Karachi, November 10, 2023 – Pakistan has experienced a significant uptick of 26 percent in its total debt during the first quarter (July – September) of the current fiscal year 2023-24, as revealed by official data released on Friday.
According to figures provided by the State Bank of Pakistan (SBP), the total debt of the country surged to Rs 74.87 trillion in the first quarter of the current fiscal year, a substantial increase from Rs 59.47 trillion in the corresponding quarter of the previous fiscal year.
Simultaneously, total debt and liabilities witnessed a noteworthy rise of 25.8 percent, reaching Rs 61.94 trillion during the first quarter of 2023-24 compared to Rs 77.94 trillion in the same quarter of the preceding fiscal year.
Breaking down the components, domestic debt of the country saw an increase to Rs 39.70 trillion during the quarter under review, up from Rs 31.45 trillion. External debt also surged to Rs 33.47 trillion, compared to Rs 26.56 trillion, with debt from the International Monetary Fund (IMF) rising to Rs 2.26 trillion from Rs 1.73 trillion.
Total liabilities of the country marked a substantial 31.7 percent increase, reaching Rs 4.70 trillion during the first quarter of the current fiscal year, compared to Rs 3.57 trillion in the corresponding quarter of the previous fiscal year.
During this period, Pakistan recorded a massive 41.5 percent increase in debt and liabilities servicing, with the payment on total debt and services climbing to Rs 2.16 trillion. This is a significant rise from Rs 1.53 trillion in the same quarter of the last fiscal year.
Breaking down the servicing costs, Pakistan’s repayment on the principal amount of external debt and liabilities stood at Rs 553.7 billion during July – September 2023-24, compared to Rs 503 billion in the corresponding period of the previous fiscal year. On the other hand, interest payments on debt sharply increased to Rs 1.56 trillion during the first quarter of the current fiscal year, compared to Rs 989 billion in the same quarter of the last fiscal year.
The notable increase in total debt and liabilities raises concerns about the country’s fiscal sustainability and underscores the need for prudent financial management to ensure long-term economic stability. Analysts anticipate a close scrutiny of these figures and a focus on strategies to manage and alleviate the growing debt burden in the coming quarters.
