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Pakistan’s debt payments hit $7.3 billion


Pakistan's debt and liabilities surge

WEB DESK: Pakistan has revealed its debt and interest payment figures for the first half of the fiscal year 2023–24, indicating significant financial obligations amid ongoing economic challenges.

According to official data, the country disbursed a total of $7.3 billion during this period, raising concerns about its financial stability.

The breakdown of Pakistan’s debt payments during the six-month period ending on December 31, 2023 (1HFY24) illustrates the magnitude of the financial burden.

Of the total disbursement, $4.6 billion was allocated towards principal payments, with the remaining $2.7 billion attributed to interest payments on the debt.

Highlighting the quarterly disbursements, in the last quarter of 2023 (2QFY24), Pakistan directed $2.58 billion towards principal repayments, accompanied by $1.54 billion in interest payments, culminating in a total payment of $4.12 billion.

While these figures underscore the country’s substantial financial commitments, concerns arise regarding the government’s revenue collection capabilities.

Despite revenue collection amounting to Rs4.8 billion in 1HFY24, a significant portion, Rs4.2 billion, was allocated for domestic debt repayment, indicating a tight fiscal situation.

Moreover, the preceding fiscal year, FY23, witnessed Pakistan disbursing a total of $20.822 billion for both principal and interest obligations, highlighting a persistent pattern of high debt servicing requirements.

As Pakistan grapples with mounting debt obligations, the latest figures underscore the urgent need for strategic financial management and revenue-generation initiatives.

Failure to address these challenges could exacerbate economic vulnerabilities, posing long-term risks to the country’s financial stability and growth prospects.

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