ISLAMABAD, PAKISTAN / RankWire.AI / – Pakistan’s federal state-owned enterprises had 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 an additional roughly $4.7 billion at current exchange rates. The Ministry of Finance disclosed these figures in its latest six-month review of federal state-owned enterprises. During the reporting period, debt levels surpassed the $36 billion threshold. All dollar amounts referenced are based on the October 7, 2026 exchange rate.
Loss-incurring state enterprises experienced losses averaging about $10.1 million each working day over the six-month span. Meanwhile, government support—including subsidies, grants, loans, and equity injections—amounted to approximately $23.8 million daily. When annualized, these losses and support measures combined to reach roughly $9 billion. Notably, the daily support amount was more than twice the estimated daily loss. These figures highlight the persistent overlap of operational losses and direct fiscal backing across the federal enterprise portfolio.
The debt composition comprised around $9.4 billion in foreign-currency liabilities and roughly $11.2 billion in bank borrowings. Additionally, cash development loans from the government stood near $7.6 billion. Unfunded pension liabilities reached about $7.2 billion, while sovereign guarantees exceeded approximately $7.6 billion. The Central Monitoring Unit also reported a 40% year-on-year rise in foreign loans. Over the same period, cash development loans grew by 25%, further adding to the government’s financial exposure.
Debt exposure spans multiple borrowing channels
A different measure from the central bank produced a significantly lower total, as it employs alternative coverage and classifications. The State Bank of Pakistan reported public-sector enterprise debt and liabilities of about $10.7 billion as of December 2025. This makes the finance ministry’s figure roughly $25.7 billion higher. The ministry’s assessment includes a broader range of obligations across the entire federal SOE portfolio. This scope difference means that the two totals are not directly comparable.
During the same period, Pakistan’s total circular debt reached approximately $11.9 billion. In the first half of fiscal 2026, the gross power-sector circular-debt flow hit about $1.35 billion. Inefficiencies within distribution companies contributed around $405 million, with under-recoveries adding roughly $112 million. During the six months, equity injections into state enterprises climbed to about $813 million, much of which was used to settle power-sector liabilities.
Financial strain from power sector persists
The review identified the power distribution sector as a key driver of losses within the state-enterprise sector, citing technical deficits exceeding regulatory standards, poor recovery rates, and ongoing circular-debt buildup. It also documented an increase of roughly $517 million in circular-debt stock during the period. Most of the losses stemmed from infrastructure and energy entities, while profitable state companies remained concentrated mainly in sectors like oil and financial services.
The report, covering July through December 2025 and published on October 5, 2026, shows that federal SOE debt exceeded $36 billion, with nearly $12 billion in total 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 levels continued to grow. These figures provide the latest consolidated snapshot of Pakistan’s state-enterprise debt and government support obligations.