Central Government debt increases by 7% YoY to Rs 35.6 trillion in September

November 11, 2020 (MLN): The total debt of Central Government during the month of September 2020 stood at Rs. 35.68 trillion, i.e.7% percent higher than the figures reported last year in Sep’19. Whereas, on a monthly basis, the debt figure remained static.

The data released by the State Bank of Pakistan (SBP) shows that the larger portion of the debt was domestic, whereas the remaining was external. The Central Government Domestic Debt amounted to Rs. 23.7 trillion during the month, signifying a growth of 5% YoY, while on monthly basis, it depicted a marginal increase only.

Central government’s domestic debt is divided into two broad categories i.e. long-term debt and short-term debt. Long-term debt is further divided into three broad categories namely; Market loans, Federal government bonds and Prize Bonds which collectively termed as permanent debt. By the end of September 2020, the government’s long-term debt increased by 2% MoM while on yearly basis, it surged by 15% to Rs 18.6 trillion, as it was Rs 16 trillion at the end of September 2019.

Within the long-term domestic debt, the Pakistan Investment Bonds (PIBs) accounted for Rs. 13.6 trillion, and Saving Schemes accounted for Rs. 3.53 trillion.

With regards to the government’s short-term debt which comprises of Bai Muajjal, Market Treasury Bills, MTBs for Replenishment of Cash and Outright Sale of MRTS to Banks clocked in at Rs 5.1 trillion during the month under review, depicting a decline of 22% YoY and 3% MoM.

In the short-term, the major portion of the debt was MTBs which amounted to Rs 5 trillion, portraying a reduction of 14% YoY and 3% MoM. 

Meanwhile, the Central government’s External debt which excludes IMF loans to Central Bank for BOP support and includes foreign exchange liabilities and IMF loan for budgetary support logged in at Rs 11.98 trillion, registering an upsurge of 13% YoY and a decline of  1% MoM, as it stood at Rs 10.6 trillion at the end of September 2019 and Rs 12 trillion in preceding month.

A breakup of the Central Government External Debt shows that nearly Rs.11.79 trillion came from long-term loans while Rs. 194.2 billion came from short-term loans.

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