Islamabad: Pakistan has successfully raised over Rs1.2 trillion through a large-scale government bond auction, marking a major step in the country’s debt management and financial reform strategy. A significant portion of this amount—Rs47 billion—was collected through the launch of the country’s first-ever 15-year zero-coupon bond, which attracted strong demand from investors.
Unlike traditional bonds, zero-coupon bonds do not pay yearly interest. Instead, investors receive a lump sum at the end of 15 years. This helps the government reduce pressure from short-term repayments and ensures greater stability in public finances. It also offers a reliable, long-term investment option for institutional and individual investors.
In a detailed statement, Finance Minister Senator Muhammad Aurangzeb praised the success of the new bond scheme, calling it a “historic milestone” for Pakistan’s financial market. He said the initiative is part of a broader government strategy to shift towards smarter, more sustainable borrowing methods that reduce risk and diversify investor choices.
The minister emphasized the government’s commitment to managing public debt responsibly, expanding Islamic finance options, and attracting long-term domestic capital to boost economic development. He added that falling returns on other government bonds suggest improved inflation expectations and a possible drop in interest rates, which could benefit the broader economy.
Aurangzeb also shared encouraging data: the average maturity of Pakistan’s local debt has increased from 2.7 years to 3.75 years, giving the government more breathing space. He noted a shift in the investor landscape, with not just banks, but now pension funds, insurance companies, and other institutional investors showing growing interest in government bonds. This broader participation reduces financial risks and builds a more stable, homegrown financial base for the country.