Central govt debt crosses Rs70tr as of Aug

October 08, 2024 (MLN): The total debt of the central government crossed the Rs70 trillion mark as of August 2024, the data released by the State Bank of Pakistan (SBP) showed.

The figure reported for August reflects a 9.99% increase compared to Rs63.97tr in August 2023.

Moreover, on a sequential basis, the central government debt rose by 1.06% compared to Rs69.62tr in July 2024.

The year-on-year increase in debt burden is primarily attributed to borrowing from domestic and foreign sources to cover the fiscal deficit.

As per details made available by SBP, the larger portion of the debt was domestic and stood at Rs48.34tr, comprising Rs37.3tr long-term debt, Rs10.96tr short-term debt and the remaining Rs80bn through Naya Pakistan Certificates.

The figure reported by the central bank for the domestic debt reflects an increase of 21.47% YoY, while on a sequential basis, it is up 1.31%.

By the end of August 2024, the government’s long-term debt increased by 24.27% to Rs37.3tr as compared to Rs30.01tr recorded in the same period a year ago, while increasing 0.83% MoM.

Similarly, the short-term debt increased by 13.75% YoY to Rs10.96tr in the review month.

Within the long-term domestic debt, the Pakistan Investment Bonds (PIBs) accounted for the majority proportion and stood at Rs28.39tr, Up by 28.5% YoY and 0.86% MoM.

Meanwhile, in the short-term domestic debt, Market Treasury Bills (MTBs) were the dominant source, as borrowing through this security amounted to Rs10.88tr, up by 13.72% YoY and 3.02% MoM.

Borrowing through Naya Pakistan Certificates has declined by 45.03% YoY to stand at Rs80bn in August 2024.

Comparison on a monthly metric shows that in August, the government borrowed 9.22% less through these certificates compared to Rs88.12bn in the previous month.

A breakup of the central government's external debt shows that nearly Rs21.81tr came from long-term loans while Rs212.4bn came from short-term loans.

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