ISLAMABAD: In a significant development for Pakistan’s financial markets, the government has successfully raised over Rs. 1.2 trillion through the auction of government securities, including the historic launch of a 15-year zero-coupon bond.
Finance Minister Senator Muhammad Aurangzeb called the auction a “major milestone” in strengthening Pakistan’s financial system in an official statement. He noted that the move reflects the government’s strategy to introduce better borrowing practices, reduce rollover risks, and diversify financial instruments.
“Our aim is to manage public debt responsibly, promote Islamic finance, and encourage long-term investment for economic growth,” he said.
The finance ministry further noted that the development is in line with the government’s broader economic vision, which includes reducing debt-related risks, extending repayment periods, and promoting Sharia-compliant and long-term instruments.
A key result of the bond issuance is the falling yields on other government securities, which is an indication of growing market expectations of low inflation and interest rate cuts in the near future.
Finance Minister Aurangzeb also emphasized that Pakistan’s domestic debt portfolio is becoming more resilient. The average maturity of domestic debt has increased from 2.7 years to 3.75 years, reducing short-term repayment pressures.
He added that investment is no longer limited to commercial banks. Pension funds, insurance companies, and other institutional investors are now participating in bond purchases, a sign of broader confidence and reduced systemic risk in local markets.
