AGL 24.40 Increased By ▲ 1.46 (6.36%)
AIRLINK 109.29 Decreased By ▼ -2.00 (-1.8%)
BOP 5.29 Increased By ▲ 0.04 (0.76%)
CNERGY 3.67 Decreased By ▼ -0.05 (-1.34%)
DCL 8.00 Increased By ▲ 0.01 (0.13%)
DFML 44.30 Increased By ▲ 4.03 (10.01%)
DGKC 88.80 Increased By ▲ 0.80 (0.91%)
FCCL 21.99 No Change ▼ 0.00 (0%)
FFBL 42.28 Increased By ▲ 0.08 (0.19%)
FFL 8.90 Increased By ▲ 0.35 (4.09%)
HUBC 151.70 Decreased By ▼ -1.59 (-1.04%)
HUMNL 10.35 Decreased By ▼ -0.10 (-0.96%)
KEL 4.45 Decreased By ▼ -0.05 (-1.11%)
KOSM 3.95 Increased By ▲ 0.10 (2.6%)
MLCF 36.60 Decreased By ▼ -0.20 (-0.54%)
NBP 49.16 Increased By ▲ 1.17 (2.44%)
OGDC 131.70 Decreased By ▼ -0.10 (-0.08%)
PAEL 26.31 Increased By ▲ 0.16 (0.61%)
PIBTL 6.07 Increased By ▲ 0.04 (0.66%)
PPL 115.45 Decreased By ▼ -0.05 (-0.04%)
PRL 22.67 Increased By ▲ 0.07 (0.31%)
PTC 12.50 Decreased By ▼ -0.08 (-0.64%)
SEARL 56.19 Increased By ▲ 0.50 (0.9%)
TELE 7.40 Increased By ▲ 0.20 (2.78%)
TOMCL 37.69 Increased By ▲ 0.69 (1.86%)
TPLP 8.34 Increased By ▲ 0.49 (6.24%)
TREET 15.33 Increased By ▲ 0.03 (0.2%)
TRG 59.96 Increased By ▲ 5.41 (9.92%)
UNITY 32.34 Increased By ▲ 0.48 (1.51%)
WTL 1.18 Increased By ▲ 0.01 (0.85%)
BR100 8,406 Increased By 61.8 (0.74%)
BR30 26,453 Increased By 106 (0.4%)
KSE100 79,397 Increased By 409.9 (0.52%)
KSE30 25,518 Increased By 153.1 (0.6%)

ISLAMABAD: The federal government mainly relied on domestic borrowing (debt market) to finance the fiscal deficit during the last fiscal year and Rs 2,983 billion or 64 percent fiscal deficit was financed through domestic debt.

According to Public Debt Bulletin & Annual Debt Review 2020-21, total public debt at the end of June 2021 rose to Rs 39,859 billion from Rs 36,399 billion in June 2020 following an increase of Rs 3,461 billion.

A few annual targets set for 2020-21 with respect to debt risk indicators were slightly missed mainly due to: (i) higher than envisaged federal fiscal deficit; (ii) lower than planned issuance of Sukuks due to unavailability of assets; (iii) net retirement in NSS stock mainly due to encashment of prize bonds; (iv) non-materialization of envisaged privatization proceeds; (v) running-off of existing external public debt portfolio and slightly higher mobilization from commercial sources (foreign commercial banks/Eurobonds); and (vi) the need to build the cash-buffer in anticipation of upcoming maturities.

Target missed, fiscal year budget deficit closes at 7.1%

Within domestic sources, major portion of additional funding was mobilised through long-term government securities. Within external sources, multilateral and commercial sources mainly contributed towards financing of federal fiscal deficit.

The reason behind the increase in the debt during the last fiscal year compared to a year before was federal primary deficit (Surplus) Rs 967 billion, interest on debt Rs 2,750 billion and others Rs 409 billion.

Around 73 percent of the net borrowing from domestic sources was through medium-to-long-term domestic debt and profile of domestic debt has improved significantly in the last few years. Short-term debt as percentage of total domestic debt has decreased to around 25 percent at end-June 2021 compared with 54 percent at end-June 2018.

Copyright Business Recorder, 2021

Comments

Comments are closed.