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ISLAMABAD: Pakistan’s debt servicing of domestic and foreign loans has become largest single item of national expenditures compared with other major heads including the combined defence and development expenditures.
The debt servicing as single component has outpaced defence and development expenditures as it consumed Rs314 billion in the first quarter (July-Sept) of the current fiscal year, with domestic debt servicing amounting to Rs299.438 billion and foreign debt servicing to Rs13.390 billion, shows the data released by the ministry of finance on Monday. During this period, Rs191 were spent on defence and development.
Individually, defence expenditures stood at Rs117 billion and development expenditures were registered at Rs74 billion.
The economic trend is reminiscent of the decade of 90s when debt servicing emerged as the main problem out of the 3Ds i.e. debt servicing, defence and development.
Due to an unprecedented increase of 73 percent in loan repayments (Rs314 billion versus Rs181 billion in the same period last fiscal year), or Rs132 billion, overall budget deficit soared to Rs282 billion, or 1.2 percent of gross domestic product (GDP) in the first three months of FY13.
A major portion of interest repayments was redirected to domestic loans, as this amount stood at Rs299 billion compared with Rs169 billion. The interest payment on foreign loans consumed Rs13 billion as against Rs12 billion.
However, nontax revenue helped in containing budget deficit, as the government collected Rs240 billion in July-Sept FY13 compared with Rs104 billion in the comparable period, noted the data
Of the total consolidated expenditures of federal and provincial governments standing at Rs887 billion, the current expenditures accounted for Rs812 billion in this period.
Since the figures are yet to be reconciled, the statistical discrepancy went up to Rs88 billion in the first quarter of the current fiscal year compared to Rs38 billion in the same period a year ago.
The debt servicing as single component has outpaced defence and development expenditures as it consumed Rs314 billion in the first quarter (July-Sept) of the current fiscal year, with domestic debt servicing amounting to Rs299.438 billion and foreign debt servicing to Rs13.390 billion, shows the data released by the ministry of finance on Monday. During this period, Rs191 were spent on defence and development.
Individually, defence expenditures stood at Rs117 billion and development expenditures were registered at Rs74 billion.
The economic trend is reminiscent of the decade of 90s when debt servicing emerged as the main problem out of the 3Ds i.e. debt servicing, defence and development.
Due to an unprecedented increase of 73 percent in loan repayments (Rs314 billion versus Rs181 billion in the same period last fiscal year), or Rs132 billion, overall budget deficit soared to Rs282 billion, or 1.2 percent of gross domestic product (GDP) in the first three months of FY13.
A major portion of interest repayments was redirected to domestic loans, as this amount stood at Rs299 billion compared with Rs169 billion. The interest payment on foreign loans consumed Rs13 billion as against Rs12 billion.
However, nontax revenue helped in containing budget deficit, as the government collected Rs240 billion in July-Sept FY13 compared with Rs104 billion in the comparable period, noted the data
Of the total consolidated expenditures of federal and provincial governments standing at Rs887 billion, the current expenditures accounted for Rs812 billion in this period.
Since the figures are yet to be reconciled, the statistical discrepancy went up to Rs88 billion in the first quarter of the current fiscal year compared to Rs38 billion in the same period a year ago.
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