National debt falls Rs227.38bn in January; surges 1.51pc in 7 months

Author: News Desk

Pakistan has paid back Rs227.38 billion debt in the month of January, as total outstanding debts as of January 31, 2021 stand at Rs23.33 trillion against Rs23.56 trillion at the end of December last.

However, the outstanding debt has broadened by 1.51 percent during this fiscal year.

As compared to the same period of the last year when outstanding credit was Rs20.41 trillion, the current debt position is Rs2.92 trillion higher this time around, marking a year-on-year expansion of 14.3 percent.

The country’s total credit accumulation during the 7 month period (June-January), has widened by Rs347.55 billion as the total outstanding debt at the beginning of ongoing fiscal year June 30, 2020, stood at Rs22.98 trillion. This means that Pakistan’s outstanding debts have broadened by 1.51 percent this fiscal year.

The total outstanding credit is branched into the amount accumulated by the government sector and that accumulated by the non-government sector. Out of the total outstanding loan, credit given to the government sector accounts for Rs14.96 trillion while credit to non-government sectors account for Rs8.37 trillion.

The State Bank of Pakistan’s net credit to the government sector amounts to Rs5.92 trillion which includes investments in government securities and government deposits, and other direct loans. During these 7 months, the central bank has been retired a sum of Rs629.32 billion or 9.61 percent.

Meanwhile, the second largest source of financing for the sector, the Scheduled Bank’s net credit adds up to Rs9.05 trillion which is Rs668.82 billion higher than the outstanding credit at the beginning of the fiscal year thus indicating that the sector accumulated additional loan during the period.

The State Bank’s claim to outstanding credit of this particular sector is comparatively negligible (only Rs26.83 billion), while on the b-side, scheduled banks have a claim of up to Rs8.34 trillion as of the end of this month.

At the end of the previous month (December 2020), the outstanding amount owed to these banks was Rs8.35 trillion indicating that Rs11.66 billion were retired during the month whereas during the ongoing fiscal year, Rs306.88 billion were further accumulated.