Central government debt swells to Rs49tr in September 2022

November 17, 2022 (MLN): The total debt of the central government surged to Rs49.4 trillion in September 2022, compared to Rs47.8tr in June 2022, witnessing an increase of Rs2.1tr or 4.2% in 3MFY23, the data released by the State Bank of Pakistan (SBP) showed on Thursday.

On a sequential basis, the central government debt has decreased by around Rs118.2 billion, compared to Rs49.5tr recorded in August 2022 while on yearly basis, it posted a surge of Rs9.1tr or 18.5% against Rs40.26tr in September 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 domestic that clocked in at Rs31.4tr, signifying a growth of 16% YoY, comprising Rs24.63tr long-term debt and Rs6.72tr short-term debt while the remaining was external.

By the end of September 2022, the government’s long-term debt increased by 20.9% YoY when compared to Rs19.5tr recorded in the same period a year ago.

Similarly, the short-term debt inched down by around 3.1% YoY as opposed to Rs6.9tr in September 2021.

Within the long-term domestic debt, the Pakistan Investment Bonds (PIBs) accounted for Rs18.2tr. Meanwhile, in the short-term domestic debt, Market Treasury Bills (MTBs) amounted to Rs6.7tr, down by 3.8% YoY.

Borrowing through Naya Pakistan Schemes witnessed an increase of around Rs51.9bn as of September 2022, compared to Rs45bn in the same month last year.

A breakup of the central government's external debt shows that nearly Rs17.8tr came from long-term loans while Rs288.1bn came from short-term loans.

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