The Federal Government’s debt, excluding IMF loans and other liabilities, swelled by 10 percent (Rs. 3.7 trillion) to Rs. 42.4 trillion, mainly due to external loans and currency depreciation during the first seven months (July-January) of the current fiscal year.
According to the State Bank of Pakistan, the Federal Government’s debt ballooned by Rs. 3,695 billion from Rs. 38,699 billion to Rs. 42,394 billion during the first seven months of the current fiscal year, which translates to a loan of approximately Rs. 17.6 billion on a daily basis.
The government has taken Rs. 1,146 billion fresh loans from local resources during the first seven months of the current fiscal year. During the period, the government’s domestic debt increased from Rs. 26,265 billion to Rs. 27,412 billion, especially due to GOP Ijara Sukuk three years and five years.
The long-term domestic debt of the Federal Government has increased while short-term debt has declined, which shows that the government has adopted longer-term financing instead of short-term. The long-term domestic debt increased by Rs. 2,111 billion to Rs. 21,668 billion during the first seven months of the current fiscal year.
Out of total domestic public debt, the Ijara Sukuk swelled by Rs. 818 billion from Rs. 665 billion to Rs. 1,483 billion during the period. The government has raised Rs. 1,000 billion from issuing Pakistan Investment Bonds (PIBs) in seven months of the current fiscal year. The government’s liabilities against the Pakistan Investment Bonds increased from Rs. 14,590 billion to Rs. 15,588 billion during the aforementioned period.
The government loan against the Bai-Muajjal of Sukuk narrowed by Rs. 73 billion to Rs. 128 billion during the seven months of the current fiscal year. The report shows that the government’s outstanding decreased against Prize Bonds by Rs. 72 billion from Rs. 444 billion to Rs. 372 billion during the period.
The government also raised Rs. 475 billion against the State Bank of Pakistan’s on-lending to the Government of Pakistan against the allocation of 1.95 billion SDR. The total unfunded debt slightly decreased from Rs. 3,646 billion to Rs. 3,609 billion during the seven months. Out of the total unfunded debt, the debt stocks against saving schemes decreased by Rs. 25 billion from Rs. 3,498 billion to Rs. 3,473 billion, GP Fund also decreased by Rs. 12 billion from Rs. 101 billion to Rs. 89 billion during the period.
The short-term borrowing through market treasury bills squeezed by Rs. 1,376 billion from Rs. 6,680 to Rs. 5,304 billion during the first seven months of the current fiscal year. It shows that the government has retired Rs. 976 billion loan, which was raised from T-Bills.
The PTI-led Federal Government also raised more than Rs. 12 billion through Naya Pakistan Certificates, taking the cumulative debt through NPCs to Rs. 40 billion during the first seven months of the current fiscal year.
The report shows that the external debt of the Federal Government has increased by Rs. 2,449 billion to Rs. 14,983 billion, mainly due to currency depreciation during the first seven months of the current fiscal year.
The report further shows that, on average, Pak Rupee depreciated by Rs. 20 from Rs. 157 to Rs. 177 against the US Dollar during the first seven months of the current fiscal year.
The government has availed only $5.7 billion (Rs. 970 billion) through fresh borrowing from external sources during the first seven months of the current fiscal year. The remaining Rs. 1.6 billion was mounted only due to currency variation during the seven months of the current fiscal year.
The government is also following the policy of long-term loans for external financing. It is pertinent to mention here that the IMF loan, deposits from China and Saudi Arabia to build foreign exchange reserves, and other guarantees are not included in these debt figures.
