The viral Pakistani PM speech — in which the Prime Minister warned that “loans over loans, your back will break” and repeatedly called the situation “not acceptable” — captured public attention not just for its emotional delivery but for the core problem it spotlighted: a long-running cycle of external borrowing and limited domestic investment.
Below we unpack where Pakistan’s loans have come from, how the economy looks today, what happened with FATA, and why critics argue too much is spent on defence instead of growth-producing sectors.
Pakistan’s Prime Minister just dropped a loan reality bomb! In this viral clip, he passionately declares that “loans over loans will break your back!”
Who has lent to Pakistan — a short history of creditors
Pakistan’s external debt and financing come from a range of sources: multilateral lenders (notably the IMF and World Bank), bilateral partners (China, Saudi Arabia, UAE and others), commercial banks and bondholders, and project-specific financiers (e.g., CPEC-related commercial and state-backed financing).
Pakistan has a long record of IMF programs and bailouts; the IMF approved a large loan program in 2024 as the country sought to stabilise reserves and restore market confidence.
The World Bank and other multilateral lenders also show Pakistan’s external debt stock rising over the last decade — driven by long-term project loans and budget support — with external debt levels moving markedly higher after periods of repeated financing needs.
Recent World Bank international debt statistics show a notable rise in external debt stocks over the last ten years.
China is a major bilateral creditor, especially for infrastructure projects under the China-Pakistan Economic Corridor (CPEC). Estimates in various reports have placed China as one of the larger bilateral creditors in Pakistan’s external liabilities.
Other bilateral lenders and short-term commercial credit lines (including deposits and loans from Gulf banks) have played significant roles in recent years.
The economy today: reserves, debt ratios and financing risk
Pakistan’s macro picture in recent years has been shaped by low foreign exchange reserves, high debt-servicing needs, and periodic reliance on external financing to avoid default.
Rating agencies and international monitors warn that Pakistan faces concentrated external financing risks — large repayments coming due in short windows — even while the government seeks to rebuild foreign exchange buffers.
For example, analysts have flagged the need to raise several billions of dollars in external financing to meet near-term obligations.
Indicators such as debt-to-GDP, public debt stock, and current account pressures show why the Pakistani PM speech struck a chord: repeated rescue loans without parallel structural reform make the country vulnerable to both market shocks and fiscal strain. World Bank data indicate a steady increase in long-term external liabilities over the last decade.
Why the FATA story matters for development
The Federally Administered Tribal Areas (FATA) were a semi-autonomous region until a 2018 constitutional change merged FATA into Khyber Pakhtunkhwa (KP).
The merger promised better governance, integration, and development — but also created fiscal and administrative transition costs.
Development indicators in the former FATA area historically lagged the rest of the country, with low human development scores and infrastructure deficits.
Post-merger progress has been uneven: while formal legal integration occurred, the task of rebuilding infrastructure, schooling, health services, and local economies in the former FATA districts remains substantial and expensive.
The Pakistani PM speech implicitly touches this reality: persistent borrowing without directed investment leaves regions like former FATA behind.
Defence spending vs. investment in growth
One of the most politically sensitive tradeoffs in Pakistan’s budget is defence spending versus social and economic investment.
Pakistan has historically allocated a large share of government resources to defence and security needs — a factor critics say crowds out spending on education, health, climate resilience, agricultural development, and infrastructure that could boost long-term growth and revenues.
Recent budget moves have included increases to defence allocations even while the overall fiscal envelope is under pressure; these choices raise tough questions about priorities when the country must also service heavy external debt. SIPRI and budget reporting highlight Pakistan’s significant military expenditure relative to its GDP and regional context.
Opponents of heavy defence spending argue that redirecting even a portion of those funds into productivity-enhancing investments (schools, roads, irrigation, industry subsidies, and digital infrastructure) would create more sustainable growth, broaden the tax base, and reduce the need for recurrent borrowing.
Proponents of defence spending point to real security imperatives in the region — a complicated policy choice, but one which the Pakistani PM speech implicitly criticises by emphasising the human cost of debt.
Structural reforms that could blunt the “loans over loans” cycle
The Prime Minister’s outcry — the emotional core of the Pakistani PM speech — is in many ways a call for alternatives to cyclical borrowing.
Economists and policy analysts typically recommend a combination of measures to break debt cycles:
- Fiscal consolidation with priority switches: spending more on growth-enhancing sectors, and trimming recurrent wasteful expenditures where feasible.
- Revenue mobilisation: improve tax administration and broaden the tax base so domestic revenues can support development without defaulting to external borrowing.
- Debt management and restructuring: renegotiating tenor, reducing expensive short-term commercial exposures, and smoothing repayment profiles with bilateral and multilateral creditors.
- Targeted investment in lagging regions (ex-FATA): prioritise human capital and connectivity projects that raise household incomes and local tax potential.
These are not easy or fast fixes — which is the point the PM was stressing: piling debt on top of debt without creating the productive base to repay it is unsustainable.
The social angle: who pays for “back-breaking” debt?
When a country leans on repeated external loans, the fiscal burden often falls on ordinary citizens in the form of austerity measures, inflation, reduced subsidies, and weaker public services.
Regions like former FATA, already disadvantaged, risk being last in the queue for resources unless policy choices change.
The viral Pakistani PM speech resonated because many citizens feel the squeeze — the PM’s blunt language translated economic jargon into a visceral image everyone understood: if you keep adding weight to a bent back, it will break.
Conclusion — what the viral clip really says
The Pakistani PM speech went viral because it fused emotion and an unmistakable economic message: a debt strategy built on repeating bailouts is damaging, and citizens everywhere can see the human consequences.
The clip’s popularity is a political moment and a policy alarm bell — it invites a serious conversation on creditors, defence priorities, regional development (including the former FATA areas), and the reforms necessary to build an economy that can stand without becoming permanently leaned on by loans.
Sources: International Monetary Fund, Observer Research Foundation
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