Business Desk 
Jun 19, 2025
The Ministry of Finance has raised over Rs1.2 trillion through a major auction of government bonds. This auction includes the launch of a new 15-year Zero Coupon Bond, the first of its kind in Pakistan, which received strong demand from investors and raised over Rs47 billion.
Notably, this new bond does not pay interest every year, while investors get a lump sum at the end of 15 years. This move helps the government reduce short-term repayments and plan finances better.
It is part of the government’s broader strategy to reduce borrowing risks, extend the repayment period of debt, and promote Islamic and long-term financial products.
As per the ministry, Pakistan’s debt is now becoming more stable. The average repayment period of domestic debt has increased from 2.7 years last year to 3.75 years now, reducing the pressure to repay loans quickly.
Finance Minister Muhammad Aurangzeb stated: “This is a major step forward in making Pakistan’s financial system stronger and more resilient. We are introducing new, smart ways of borrowing that reduce risk and give investors more options. Our aim is to manage public debt responsibly, promote Islamic finance, and attract more long-term investment to support the country’s economic growth.”
More pension funds and insurance companies—rather than just banks—are now investing in government bonds.
To note, the Ministry of Finance is working on more products to allow ordinary citizens to invest in government bonds, especially Islamic ones, to encourage savings and financial inclusion.
