Govt borrows Rs6tn in 10 months, breaks all records

Islamabad: The federal government broke all records by borrowing Rs6 trillion from banks in 10 months.

According to data released by the State Bank of Pakistan (SBP), the government has borrowed 5.96 trillion rupees (on cash basis) from the local banking sector in the first 10 months, i.e. from July 1, 2023 to 26th April 2024, which is 124% more than the loan of 2.66 trillion rupees during the same period last year.

The government repaid a net loan of Rs735 billion to the State Bank during this period. It is pertinent to mention that the government cannot borrow directly from the central bank under the International Monetary Fund (IMF) mandate.

The loans taken from scheduled banks in the current financial year have already exceeded the Rs3.7 trillion loan taken in the entire financial year 2023.

Overall, the net debt of the public sector for budget support in the 10 months of FY2020-24 was Rs5 trillion, which was Rs.3.74 trillion in FY23.