As of June 30, 2025, Pakistan’s total external debt had reached approximately USD 126 billion.
The Economic Affairs Division (EAD) has admitted that there is currently no transparent mechanism to ensure that loans obtained from the International Monetary Fund (IMF) are actually being used for budgetary support or to maintain balance of payments stability.
An EAD official made this statement during a meeting of the Senate Standing Committee on Economic Affairs, chaired by Senator Saifullah Abro.
The committee reviewed the implementation of its previous recommendations concerning IMF funds, including details of received amounts, disbursements, repayments, annual interest payments, and comprehensive loan data.
The committee chairman expressed concern that although aggregate figures were available, there was no clear audit trail or transparent accounting system in place. He emphasized that successive governments’ promises to reduce dependence on IMF programs had failed to provide transparent figures regarding debt repayments and interest obligations.
Senator Hidayatullah Khan inquired whether IMF funds classified as grants or balance-of-payments support had been effectively utilized for structural reforms, while Senator Syed Waqar Mehdi asked whether the intended usage targets had been achieved. Officials responded that while targets existed, systemic transparency and data accessibility remained limited.
In response to a question from the committee chairman, it was revealed that budgetary support funds were received in 2010, 2019, and 2020. The chairman also sought details of the SDR 3.334 billion Extended Fund Facility, but representatives of the Finance Division were unable to provide satisfactory answers.
According to the report, as of June 30, 2025, Pakistan’s total external debt stood at around USD 126 billion, including USD 82.5 billion in external public debt and USD 43.5 billion in government-guaranteed debt.
Senator Hidayatullah Khan reiterated the need to provide complete annual data on external debt and IMF obligations for the years 2008, 2013, 2018, 2022, and 2024. The chairman endorsed the proposal, stressing that accurate and verified data are essential for parliamentary oversight. He directed the Economic Affairs Division to furnish the committee with a comprehensive breakdown of public external debt since 2008, including project-wise allocations, creditor categories, and agreement years.
Committee members also expressed concern over the absence of Minister for Economic Affairs Ahsan Cheema from the session.
The Senate committee also discussed the issue of releasing unused funds allocated for the restoration and rehabilitation of Multan’s historic center. The committee was informed that the total approved project cost was approximately PKR 850 million, divided into two phases. However, the chairman expressed serious concern over the unutilized balance of PKR 679 million, which had reportedly been diverted by the management committee to other projects without proper reporting or accountability.
It was further revealed that PKR 170 million had been spent on preparing the project’s feasibility report. The EAD informed the committee that the project had since been transferred from the federal to the provincial government.
The committee expressed surprise that funds allocated for various project components had not been utilized properly and stressed that any reallocation of funds must follow a transparent and fully documented procedure.
The committee also reviewed ongoing projects in the energy sector, including the Power Distribution Strengthening Project being implemented through LESCO with support from the Asian Development Bank. An USD 80 million loan was allocated for the STG component, with procurement progressing in eight phases and third-party technical evaluations underway. Senator Abro voiced concern over procedural inconsistencies.
Following a briefing from the Managing Director of the Public Procurement Regulatory Authority (PPRA), the committee observed that LESCO had violated PPRA regulations. The Joint Secretary of the Power Division also acknowledged these violations. The committee was alarmed to learn that most lowest bidders were disqualified without adherence to PPRA rules, and that bidders deemed responsive in one project segment were declared non-responsive in another.
Additionally, Senator Falak Naz expressed concern over poor road accessibility in Chitral, which has been affecting local communities and tourism.
The National Highway Authority (NHA) reported that 85% of restoration work had been completed, with the remaining work expected to finish by November 2025.
The committee chairman decided that the next meeting would be held in Chitral to review project progress. Representatives of the provincial government would also be invited to participate in order to coordinate with NHA on resolving the issue.
