Advisor to the Finance Minister Khurram Schehzad has clarified misconceptions regarding Pakistan’s recent zero-coupon bonds, saying these bonds are a standard financial instrument based on the principle of the time value of money.

In a post on his X handle, the Finance Advisor rejected narrative being portrayed in the media that 80 billion rupees worth of bonds will become a liability of 512 billion rupees in 15 years.

He said these bonds, issued at a discount and repaid in full at maturity, allow the government to secure long-term funding without annual interest payments or repeated market borrowing.

Khurram Schehzad explained that this approach reduces refinancing risks and provides predictability.

He said the zero-coupon bond system is also used globally by countries including the United States, the United Kingdom, Japan, and other emerging economies.

The Finance Advisor said these bonds constitute only 5 percent of Pakistan’s debt and are typically purchased by long-term investors such as pension funds and insurance companies.