The Finance Division on Wednesday rejected as “inaccurate and misleading” news report appearing in a section of media contending that the government’s public debt had soared by Rs18 trillion during last three and half years. “The article… is misleading and the author’s comparison of the 2008 to 2022 period fails to take into account the significant changes in the size of the economy,” said a finance ministry press release. The ministry spokesperson said the economy’s capacity to take loans today was higher than compared to previous years due to the significant increase in the size of the GDP. A better analysis would have focused on the public debt as a percentage of GDP, the standard indicator used by all international publications. The public debt as a percentage of GDP decreased to 72pc in fiscal year 2021, from 76.6pc in FY2020. Pakistan was one of the few countries that managed to reduce its debt despite the significant impact of COVID on public finances. He said according to the latest published data, public debt to GDP was estimated to have declined further to 67pc of GDP as of December 2021. In real terms, the increase in public debt during the period 2018-2022 is around 3.3pc of GDP, which is less than the debt accumulated during 2013 to 2018 period of 8.2pc of GDP. Secondly, he said the author needed to understand that the increase in outstanding public debt did not necessarily mean new borrowing by the government. “The change in stock of outstanding public debt is primarily on account of interest payments on debt accumulated over the last 10 years, exchange rate revaluation of external debt, and cash balances maintained by the government with the central bank. These do not represent new borrowings as the author suggests in the published article,” the spokesperson remarked. He said new borrowing by the government during July 2018 to Feb 2022 was only Rs 5 trillion – which was equivalent to the primary deficits run during this period. The article wrongly attributes new borrowing at Rs 18 trillion. The interest payments on debt accumulated over the last 10 years is estimated to be Rs 9 trillion during the last three and a half years. The impact of the exchange rate and the revaluation of the external debt is estimated around Rs 4.4 trillion whereas the government currently maintains cash balances of around Rs 0.6 trillion with the central bank to meet emergency cash requirements. He said that new borrowing undertaken by the PTI led government of Rs 5 trillion over the last three and a half years has been used primarily for scaling up spending on the poorest households and welfare of the masses. During the COVID crisis, the government launched a record fiscal and monetary stimulus package of Rs 2.5 trillion (6pc of GDP or $ 16bn). The stimulus package focused on emergency cash assistance to 15mn families through the Prime Minister’s EHSAAS program, the largest ever social welfare transfers in Pakistan’s history covering nearly 45pc of the total population. On top of this the government has provided free of cost vaccination to over 127mn citizens against COVID. PTI government has taken unprecedented relief measures to shield the most vulnerable households during the current crisis with record high international commodity prices. The government has reduced taxes on all petroleum products to 0pc and frozen prices at the pump to shield consumers. As a result, the domestic consumers are paying Rs 150 / litre on petrol compared to Rs 187/ litre in Bangladesh and Rs 244/ litre in India. Similarly, the low and middle-income households have been provided relief on their power consumption by a Rs 5 per unit reduction in their monthly bills. An estimated Rs 300bn relief has been provided to the masses to shield them from the rising international energy prices. Prime Minister Imran Khan launched the Ehsaas ration scheme in March 2022 to provide relief to over 20mn households (54pc of total population) on purchase of essential food items including flour, pulses and cooking oil. These 20mn households will receive these essential commodities at a discount of 30pc from the market prices. On top of these measures, the landmark universal healthcare program Sehat Insaf card has been launched in Punjab and certain districts in Sindh and Balochistan in 2022. More than 60pc of all households in Pakistan will now get free hospitalization and healthcare, providing savings of Rs 10 lakh to each citizen.