How the debt trap deepened Pakistan’s debt crisis is no longer just an economic problem buried in government reports and IMF documents. It is now shaping nearly every major policy decision the state makes. As of December 31, 2025, Pakistan’s total public debt, domestic and external combined, stood at PKR 81 trillion (USD 292 billion), equivalent to 70.7pc of GDP. Nearly 47pc of the federal budget for FY26 is expected to be consumed by debt servicing and interest payments alone (Finance Division, 2025). In practical terms, almost every second rupee collected by the government is being used to repay loans…
Author: Syed Muhammad Mehdi
A Trade Policy Challenge in the Making 1-Introduction The European Union’s regulatory landscape is undergoing a quiet but consequential shift. Driven by its broader sustainability agenda, the EU is moving to embed environmental and supply chain transparency requirements directly into the conditions of market access. At the center of this shift is the Digital Product Passport (DPP), a key implementation tool under the Ecodesign for Sustainable Products Regulation, scheduled for gradual rollout from February 2027 across multiple product categories, with textiles among the first in line (Cefic, 2025). In practical terms, the DPP requires that products entering the EU market…
Examining the effects of growing public debt, currency depreciation, and reduced government spending on the working class Pakistan’s total public debt, including domestic and external, as per the figures published by State Bank of Pakistan (SBP) stood at staggering PKR 71 trillion as on June 30, 2024, equivalent to 67% of its GDP. Alarmingly, 50% of the fiscal budget for the ongoing FY25 will be spent on the debt servicing/interest payments (Finance Ministry-2024), leaving less than 50% of resources available for health, education, defence, energy, agriculture, and public sector development programmes. On top of it, the country has recently entered…