Punjab has emerged as the biggest borrower among all provinces, as it secured a massive Rs. 405 billion loan in just 38 days under the leadership of Chief Minister Maryam Nawaz. The borrowing spree, covering the period from July 1 to August 8, 2025, highlights Punjab’s heavy reliance on the State Bank of Pakistan (SBP).
Punjab Tops Provincial Borrowing
According to SBP data, Punjab’s borrowing is staggering when compared with other provinces. During the same 38-day period:
- Punjab borrowed Rs. 405 billion
- Sindh borrowed Rs. 16 billion
- Khyber Pakhtunkhwa borrowed Rs. 21 billion
- Balochistan borrowed Rs. 13 billion
This shows Punjab’s loan size was 25 times higher than Balochistan and over 20 times higher than Sindh.
IMF Restrictions and Provincial Borrowing
While the federal government remains bound by IMF restrictions that prevent it from borrowing directly from the State Bank, provincial governments still rely heavily on central bank financing. This contrast underscores why Punjab’s borrowing has drawn significant attention.
Punjab Clears Long-Standing Rs. 675 Billion Debt
In the middle of this heavy borrowing, the Punjab government made headlines by announcing that it had cleared its long-standing debt of Rs. 675 billion after more than three decades.
Debt Linked to Wheat Procurement
Officials explained that the debt was primarily linked to wheat procurement and subsidy programmes. By settling this liability, Punjab stopped paying Rs. 250 million in daily interest, which had burdened the province for years.
Historic Repayment to NBP
The final instalment of Rs. 13.8 billion was paid to the National Bank of Pakistan (NBP). Despite requests from banks to roll over the loans, the provincial government refused. Without this repayment, Punjab would have continued paying Rs. 500 million in monthly debt servicing, further straining its finances.
SOEs Continue to Bleed Financially
Meanwhile, Pakistan’s State-Owned Enterprises (SOEs) remained in financial distress. To survive, they borrowed an additional Rs. 65 billion from commercial banks, pushing their total outstanding debt beyond Rs. 2,166 billion.
Federal Government Repays Debt
In contrast, the federal government managed to reduce its liabilities. It repaid Rs. 55 billion to the State Bank, cutting its outstanding debt to Rs. 5,269 billion as of June 30, 2025.
Key Takeaways
- CM Maryam Nawaz’s Punjab borrowed Rs. 405 billion in 38 days.
- Borrowing was 25 times higher than Balochistan and 20 times higher than Sindh.
- Punjab cleared Rs. 675 billion wheat procurement debt after 30+ years.
- Repayment saved Rs. 250 million daily and Rs. 500 million monthly in interest costs.
- SOEs remain a major financial burden with debt exceeding Rs. 2,166 billion.
- The federal government repaid Rs. 55 billion, lowering its overall debt.
