Pakistan’s public debt stands at Rs.9.47 trillion

ISLAMABAD - Pakistan’s public debt stands at a whopping Rs.9.47 trillion (about $110 million), said an official statement.

Dawn reported Wednesday that due to the massive public debt, the government has violated the limits on borrowing imposed in the Fiscal Responsibility and Debt Limitation Act. The act requires the federal government to take measures to reduce total public debt and maintain it within prudent limits.

The total public debt stood at Rs.8.894 trillion as of June 30, 2010, an increase of Rs.1.265 billion or 16.6 percent higher than the debt stock at the end of last fiscal year, said a mandatory debt policy statement for 2010-11 released by the ministry of finance Tuesday.

While the government took Rs.798 billion from domestic sources, it borrowed Rs.189 billion from external sources to finance fiscal operations.

The government also borrowed Rs.271 billion from the International Monetary Fund for balance of payments support and incurred an exchange loss of Rs.200 billion on the external debt portfolio because of the rupee depreciation against the US dollar.

The statement observed that the total public debt situation worsened in the first quarter of the current fiscal year and stood at Rs.9.473 trillion at the end of the first quarter (July-September) of fiscal 2011, registering an increase of Rs.579 billion or 6.5 percent in just three months of the current fiscal year.

The media report said that the depreciation of the US dollar against other currencies has added approximately $2.4 billion to the external debt.