Extensive borrowing: central govt debt surges by 12.77 per cent

WEB DESK: The total debt of Pakistan’s central government surged by 12.77 per cent year-on-year, reaching Rs66.08 trillion in April 2024, compared to Rs58.6 trillion in April 2023, according to data released by the State Bank of Pakistan (SBP).

On a monthly basis, the debt increased by 1.09 per cent from Rs65.37 trillion in March 2024.

The significant year-on-year rise in debt is primarily due to extensive borrowing from domestic and foreign sources to bridge the fiscal deficit.

The SBP’s detailed report reveals that the majority of the debt is domestic, amounting to Rs44.48 trillion. This includes Rs35.22 trillion in long-term debt, Rs9.17 trillion in short-term debt, and Rs92.75 billion via Naya Pakistan Certificates.

Domestic debt saw a substantial year-on-year growth of 21.7 per cent, with a month-on-month increase of 2.42 per cent.

By the end of April 2024, the government’s long-term domestic debt had risen by 20.63 per cent year-on-year to Rs35.22 trillion from Rs29.2 trillion in the previous year, marking a 1.08 per cent increase from March 2024.

Short-term domestic debt also experienced significant growth, surging by 27.04 per cent year-on-year to Rs9.17 trillion in April 2024.

Within the long-term debt category, Pakistan Investment Bonds (PIBs) constituted the largest share, standing at Rs26.54 trillion. This represents a 20.04 per cent year-on-year increase and a 1.4 per cent rise on a monthly basis.

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