External Debt and Economic Growth: Implications for Sustainable Development in Pakistan

External debt role in Pakistan economic growth has been analyzed in this paper. Over the years Pakistan has been relying on external debt financing and the purpose of this study was to investigate if external debt has positively contributed in the economic growth or has been a hurdle in the economic growth. The time period of data used in this research study was of 44 years (1977-2021). The data for the research study was extracted for multiple Pakistan Economic Surveys, World Bank Data Bank, International Monetary Funds. ARDL model was utilized in this study to explore the short run and long run relationship. Other variables that were incorporated to this study were Exports, Imports, Inflation and External Debt Servicing. External debt has a positive and contributing relation with Economic growth in Pakistan’s economy in both short run and long run whereas Exports also has a positive contribution towards Economic growth both in short run as well as long run.