Punjab’s Loan Skyrockets by Rs. 405 Billion in 38 Days Under CM Maryam

The Province of Punjab has emerged as the biggest borrower among all provinces, securing a staggering Rs. 405 billion loan from the State Bank in just the first 38 days (July 1 to August 8, 2025) of the current fiscal year (2025-26).

While the federal government is restricted by IMF conditions from borrowing directly from the State Bank, provincial governments continue to rely heavily on central bank financing.

Punjab leads the pack, with its borrowing almost 25 times higher than Balochistan and more than 20 times higher than Sindh during the same period.

According to the State Bank of Pakistan (SBP), Punjab borrowed Rs. 405 billion, Sindh Rs. 16 billion, Khyber Pakhtunkhwa Rs. 21 billion, and Balochistan Rs. 13 billion during the first 38 days of FY2025-26.

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Amid this heavy borrowing, the Punjab government announced that it had cleared its long-standing bank debt of Rs. 675 billion after more than three decades. Officials said the debt was largely linked to wheat procurement and subsidy programmes. Its repayment, which ends daily interest payments of Rs. 250 million, was hailed as a “historic step” that will free up resources for public welfare.

The final instalment of Rs. 13.8 billion was paid to the National Bank of Pakistan, with the provincial government turning down all requests from banks to roll over the loans. Officials said that without this timely repayment, Punjab would have been burdened with monthly interest costs of Rs. 500 million.

Meanwhile, State-Owned Enterprises (SOEs) continued to bleed financially, forcing them to borrow an additional Rs. 65 billion from commercial banks just to stay afloat. The total outstanding debt of these loss-making SOEs has now soared beyond Rs. 2,166 billion.

At the same time, the federal government, despite its limitations, managed to repay Rs. 55 billion to the State Bank, reducing its outstanding debt to Rs. 5,269 billion as of June 30, 2025.