Pakistan's central government debt rose 6.6% from a year earlier to PKR 83.4 trillion in July, despite edging down 0.3% from the previous month. The data, from the State Bank of Pakistan and compiled by Topline Research, reflects the government's financing position at the start of the new fiscal year.
How much did Pakistan's central government debt rise in July?
Pakistan's central government debt reached PKR 83.4 trillion in July, up 6.6% from a year earlier, though it fell slightly, by 0.3%, from June. Domestic borrowing remained the main driver, rising 7.8% year over year to PKR 59.3 trillion and accounting for about 71% of total debt. External debt rose 3.7% annually to PKR 24.1 trillion.
What is driving the rise in domestic borrowing?
Domestic borrowing declined 0.3% from June but still rose 7.8% year over year to PKR 59.3 trillion, according to Topline Research. Short-term domestic debt recorded the fastest annual growth of any component, increasing 23.9% to PKR 10.8 trillion, growing nearly five times faster than permanent debt on an annual basis.
Permanent debt, the largest component of domestic borrowing, rose 5.3% to PKR 45 trillion. Unfunded debt increased 9% to PKR 3.3 trillion. Permanent debt remained by far the largest component of domestic liabilities despite the faster growth in short-term borrowing.
How has Pakistan's external debt changed?
The government's external debt stood at PKR 24.1 trillion in July, up 3.7% from a year earlier but down 0.4% from June. In dollar terms, external debt fell slightly to $86.8 billion from $87 billion a month earlier, according to Topline Research. The difference between the rupee and dollar movements partly reflects exchange-rate effects on foreign-currency liabilities.
The increase in the debt stock comes as Pakistan continues efforts to contain its fiscal deficit and improve debt sustainability while meeting substantial domestic and external financing needs. The figures cover the central government's outstanding domestic and external debt as it continues to implement its economic reform programme.
Key figures:
- Total central government debt: PKR 83.4tr, up 6.6% year over year
- Domestic debt: PKR 59.3tr, up 7.8%
- External debt: PKR 24.1tr, up 3.7%
- Short-term domestic debt: PKR 10.8tr, up 23.9%
- Permanent debt: PKR 45tr, up 5.3%
- Unfunded debt: PKR 3.3tr, up 9%
- External debt in dollar terms: $86.8bn, down from $87bn in June
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