The government has managed the precarious debt situation with discipline,aggressive control of expenses, and an increase in tax and non-tax revenues.
The finance ministry, in a statement, said that the government efforts haveyielded a primary surplus, and only payment of interest on past loans hasforced the government to borrow at all.
In the current fiscal year, the government has succeeded in keeping thestock of public debt firmly in check with virtually no increase. The StateBank of Pakistan’s data suggests a minimal increase in the stock of aboutRs. 397 billion during the July-October period.
“However, this number does not include the adjustments of revaluation ofthe IMF loan and the buildup of further cash buffers by the government,which if adjusted would make the estimates fairly similar,” said theMinistry.——————————
The statement further said the prudent debt management has includedconverting short-term into longer-term debt and reducing the cost of theborrowing.
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The combined effect of these actions will contain any addition to the debtstock to a minimum.
The finance ministry clarified that the sole reason forcing the governmentto borrow is the requirement to pay one trillion rupees in interest on pastloans in the period July to October.
This is on top of Rs. 4.7 trillion already paid before June, bringing thetotal amount of interest paid on past loans to a staggering Rs. 5.7trillion.
