ISLAMABAD, PAKISTAN / RankWire.AI / – Pakistan’s federal state-owned enterprises accumulated liabilities totaling approximately $36.5 billion by the end of December 2025. This figure represents a 14.3% increase from the previous year, equating to roughly $4.7 billion at current exchange rates. The Ministry of Finance disclosed these numbers in its latest six-month assessment of federal SOEs. During the reporting period, total debt crossed the $36 billion mark, with all dollar amounts based on the October 7, 2026 exchange rate.
Loss-incurring state entities reported losses averaging about $10.1 million each working day over the six months. Meanwhile, government interventions—covering subsidies, grants, loans, and equity infusions—amounted to approximately $23.8 million daily. When annualized, these losses and support measures combined to roughly $9 billion. The daily government support was more than twice the daily loss estimate, illustrating the ongoing overlap of operating deficits and direct fiscal backing across the federal portfolio.
The debt composition included around $9.4 billion in foreign currency liabilities and about $11.2 billion in bank borrowings. Additionally, cash development loans from the government approached $7.6 billion. Unfunded pension liabilities stood at about $7.2 billion, with sovereign guarantees exceeding roughly $7.6 billion. The Central Monitoring Unit also reported a 40% year-over-year rise in foreign loans. Over the same period, cash development loans grew by 25%, further expanding the government’s financial commitments.
Debt exposure spans multiple borrowing channels
A separate measure from the central bank indicated a significantly lower total, due to differing coverage and classification standards. The State Bank of Pakistan reported public-sector enterprise debt and liabilities of about $10.7 billion for December 2025. Consequently, the Ministry of Finance’s figure was approximately $25.7 billion higher, reflecting a broader scope of obligations across the federal SOE sector. Since these totals cover different sets of liabilities, they are not directly comparable.
During the same period, Pakistan’s overall circular debt reached approximately $11.9 billion. The gross power-sector circular-debt flow in the first half of fiscal 2026 was around $1.35 billion, with distribution-company inefficiencies contributing roughly $405 million and under-recoveries adding about $112 million. In the six months, equity injections into state enterprises increased to approximately $813 million, much of which was allocated toward settling power-sector debts.
Power sector continues to strain public finances
The report identified power distribution as a significant driver of losses within the state-enterprise portfolio, citing technical shortcomings exceeding regulatory standards, poor revenue recoveries, and persistent circular debt accumulation. It also noted a roughly $517 million rise in the circular debt stock over the six months. Infrastructure and energy-related entities comprised most of the loss profile, while profitable state companies remained concentrated in sectors such as oil and financial services.
The six-month review, covering July to December 2025, was published on October 5, 2026. It highlights that federal SOE debt exceeds $36 billion, with nearly $12 billion in combined circular debt. Major components of the liabilities include foreign-currency obligations, bank loans, government lending, guarantees, and pension commitments. Despite significant fiscal transfers during this period, debt growth persisted. The figures offer the most recent consolidated overview of Pakistan’s state-enterprise debt load and the government’s ongoing financial support efforts.