Pakistan’s debt servicing soars to $4.87bn in 3QFY22

May 20, 2022 (MLN): Pakistan’s total external debt servicing (principal and interest) by the government has reached a total of $4.87bn at the end of 3QFY22, increased by a massive 11.88% compared to 2QFY22, the latest data issued by SBP showed on Thursday.

In the preceding year or FY21 principal and interest payments stood around $13.43bn while in FY20 and FY19 principal and interest payments stood around $14.57bn and $11.59bn respectively.

This indicates that in 3.9years, the PTI government has paid a whopping $44.87bn as principal and interest. Whereas, in five years tenure of PML (N) principal and interest amount stood at $33.363 bn, while in five years tenure of PPP government, principal and interest amount paid was $24.306 bn.

Going by the SBP data, principal amount payments during 3QFY22 totalled $3.94bn, a major chunk of which ($3.76bn) comes from the public debt particularly concentrated under the government debt head ($3.54bn). Interest payable on the principal of public debt totalled $573mn. While the interest paid on the principal of total debt totalled $755mn. Furthermore, during Jan-March FY22, Pakistan paid $3.76bn and $218mn principal amount on government debt and on IMF loans respectively. Whereas $428mn and $31mn were paid as interest payments on the government’s loan and on loans from IMF.

Meanwhile, it is pertinent to mention that within government external debt, the major chunk of $2.61bn was paid on commercial loans and credits followed by $433mn on Euro/Sukuk global bonds as the principal amount.

Moreover, to meet foreign exchange liabilities, the government paid zero amount as a principal while $114mn retired as interest payments.

Debt servicing of the Public Sectors Enterprises (PSEs) during 3QFY22 reached $93mn, soared by 2x QoQ.

Furthermore, the total debt servicing of the private sector (non-guaranteed debt) stood at $210mn in 3QFY22, of which $123mn was retired as principal amount while $87mn was paid as interest.

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