Aug-Oct auction calendar: Govt plans to borrow Rs11.09trn from banks

KARACHI: The federal government has planned to borrow Rs 11.09 trillion from the domestic banking system during the next three months (August-October) of FY24.

The federal government will raise this amount through the auction for security papers including long-term Pakistan Investment Bonds (PIBs) Fixed Rate, PIBs Floating Rate, GoP Ijara Sukuk Fixed Rental Rate (FRR) and short-term Government of Pakistan Market Treasury Bills (MTBs).

According to auction calendar, issued by the State Bank of Pakistan (SBP) most of the amount will be borrowed through sale of short-term government papers. The federal government is to raise some Rs 8.25 trillion through auction of MTBs during Aug-Oct of 2024 as against the maturing amount of Rs 8.905 trillion.

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Cumulatively, some six auctions of MTBs have been planned in the next three months by the SBP to meet the financing target. An amount of Rs 2.7 trillion will be raised in August, Rs 4.2 trillion in Sep and Rs 1.35 trillion in Oct 2023 through sale of short term government papers.

In addition, the federal government would borrow Rs 2 trillion against sale of long term security papers during the next three months. This include Rs 480 billion through sale of PIBs Fixed Rate, Rs 640 billion PIBs Floating Rate Semi-Annual Auction and an amount of Rs 880 billion through sale of 2-year and 3-year PIB (Floating Rate) Quarterly Auction.

Similarly, according to auction calendar the federal government will raised Rs 510 billion against sale of Government of Pakistan Ijara Sukuk Variable Rental Rate (VRR) and auction target for the sale of GOP Ijara Sukuk Fixed Rental Rate (FRR) is Rs 330 billion.

Copyright Business Recorder, 2023