Pakistan to Borrow Rs5.906 Trillion from External Sources

Pakistan is gearing up to borrow a substantial amount of Rs5.906 trillion from external sources in the upcoming fiscal year, marking a 17% increase from the previous year. This move comes as the government aims to secure funding for various projects and programs to support the country's economic development.

Despite seeking a new loan program from the International Monetary Fund (IMF), no budget allocation has been made from the IMF. The government is set to borrow Rs1.144 trillion from commercial banks, a significant jump from the current fiscal year's revised amount of Rs285 billion.

For project loans, a total of Rs323.266 billion has been earmarked for the 2024-25 fiscal year, reflecting a notable increase from the previous year. In terms of program loans, external assistance of Rs277.890 billion is projected to be acquired. Additionally, Rs1.475 trillion is expected to be borrowed from the Kingdom of Saudi Arabia's time deposit.

On the other hand, no funds have been allocated from the United Arab Emirates for the upcoming fiscal year, in contrast to the previous year's allocation of Rs290 billion. The government plans to borrow Rs1.180 trillion from safe deposit sources, while Euro bonds are anticipated to contribute Rs295 billion to the borrowing for 2024-25.

As of March 2024, Pakistan's total public debt reached Rs67,525 billion, showing a 7.3% increase from the previous year. The external public debt stood at $86.7 billion (Rs24,093 billion) by the end of March 2024, indicating a rise of approximately $2.6 billion during the first nine months of the current fiscal year. Domestic debt was recorded at Rs4 billion.

The significant increase in borrowing from external sources highlights Pakistan's efforts to secure financial resources for its development projects and programs. As the country navigates its fiscal challenges, the government's borrowing strategy plays a crucial role in shaping its economic landscape. It remains to be seen how these borrowing initiatives will impact Pakistan's financial stability and growth trajectory in the coming years.