Central govt debt swells to 51tr in December 2022

February 16, 2022 (MLN): The total debt of the central government surged to Rs51 trillion in December 2022, compared to Rs47.8tr in June 2022, witnessing an increase of Rs3.2tr or 6.7% YoY in 6MFY23, the data released by the State Bank of Pakistan (SBP) showed on Thursday.

On a sequential basis, the central government debt remained almost flat compared to Rs50.9tr recorded in November 2022 while on yearly basis, it posted a surge of 22.75% against Rs41.54tr in December 2021.

The 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 domestically clocked in at Rs33.11tr, signifying a growth of 24% YoY, comprising Rs26.91tr long-term debt and Rs6.15tr short-term debt while the remaining was external.

By the end of December 2022, the government’s long-term debt increased by 27.76% YoY when compared to Rs21tr recorded in the same period a year ago.

Similarly, the short-term debt inched up by around 9% YoY as opposed to Rs5.64tr in December 2021.

Within the long-term domestic debt, the Pakistan Investment Bonds (PIBs) accounted for Rs20.3tr, jumped by 33.78% YoY. Meanwhile, in the short-term domestic debt, Market Treasury Bills (MTBs) amounted to Rs6tr, up by 8.9% YoY.

On the other hand, borrowing through Naya Pakistan Certificates has decreased by 3.36% MoM to 47.5bn as of December 2022, while on yearly basis, the same has increased by 21.33% YoY compared to Rs39.2bn in December 2021.

A breakup of the central government's external debt shows that nearly Rs17.72tr came from long-term loans while Rs155.7bn came from short-term loans.

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