Pakistan’s Primary Surplus Hits 26-Year High as Fiscal Deficit Falls to 22-Year Low

KARACHI: Pakistan’s primary surplus has reached its highest level in 26 years, while the country’s fiscal deficit has fallen to its lowest level in the past 22 years, according to data released by the Ministry of Finance.

According to the ministry’s figures, Pakistan’s fiscal deficit was contained at 2.6% of GDP during fiscal year 2025-26, marking the lowest level recorded in 22 years.

During the same period, the country’s primary surplus reached 2.9% of GDP, the highest level in 26 years. Officials said Pakistan has maintained a primary surplus for three consecutive years.

According to an official statement, total government revenue during the fiscal year stood at Rs19.8 trillion, including Rs14.8 trillion in tax revenue.

The government’s interest payment burden also declined significantly, falling to Rs6.95 trillion from Rs8.9 trillion a year earlier.

According to the Ministry of Finance, defence expenditure increased by 18% during the year to Rs2.588 trillion.

Meanwhile, spending on subsidies declined by 22%, falling from Rs1.3 trillion to approximately Rs1.001 trillion.

Development expenditure also decreased, with spending falling from Rs786 billion to Rs727 billion during the fiscal year.

The latest figures indicate an improvement in Pakistan’s fiscal position, with the government maintaining a primary surplus while keeping the overall fiscal deficit at its lowest level in more than two decades.