High expenditures in the past two fiscal years have attributed to the rise in public debt, which has reached a critical level of Rs9.0 trillion by end of FY-2010 compared to end-June 2009 amount of Rs7.795 trillion. Public debt has surpassed the tax-to-GDP limit of 60.0 per cent set by the Fiscal Responsibility and Debt Limitation Act (FR&DLA), to 61.0 by the end of FY-2010. There is an urgent need for a viable debt management strategy that would reduce the over reliance on external inflows and domestic borrowings, decrease cost of debt-servicing and create substantial space for growth and development. The strategy has to be comprehensive enough to address all the issues that contribute towards accumulation of national debt.