ISLAMABAD – Pakistan’s economic engine is firing up as State Bank’s reserves moved up, while debt goes down with an optimistic future ahead.
The foreign exchange reserves held by State Bank of Pakistan (SBP) crossed $14.5 billion mark, surpassing International Monetary Fund’s (IMF) target set for June 2025 in major milestone in the country’s economic recovery.
As per latest numbers, the reserves rose to $14.51 billion by end of FY25, a sharp increase of $5.12 billion from $9.39 billion in FY24. This surge pushed Pakistan’s import cover to 2.5 months, a substantial improvement from 1.7 months last year, and less than one month in FY23.
The reserve build-up come from non-debt sources, including higher exports of goods and IT services, a notable uptick in foreign investment, and record-high remittances from overseas Pakistanis.
Pakistan’s debt-to-GDP ratio has declined from 75% in FY23 to an estimated 69% in FY25, reflecting prudent fiscal management and strong inflows.
Financial pundits call these developments signs of macroeconomic stabilization as this is most robust external position Pakistan has seen in recent times, especially encouraging that the improvement is driven by real economic activity, not new borrowing.
With reserves rising and debt levels falling, Pakistan appears to be on a firmer footing heading into FY26, showing strengthening economic stability and improved investor confidence.
