ISLAMABAD – The government is paying huge price of past borrowing asthe country repaid $7.3 billion as principal amount as well as interestpayment during nine months of the current fiscal year.
The debt servicing of the country is rapidly increasing with the passage ofthe time, which is pushing pressure on the country’s external sector.
The break-up of Rs7.3 billion showed that Pakistan had repaid $5.184billion as principal amount and $2.05 billion as interest payment duringnine months (July to March) of the ongoing fiscal year. The massiverepayment of loans is eroding the country’s foreign exchange reserves andforcing the government to take new loans.
According to the data of State Bank of Pakistan (SBP), the country hadrepaid $2.45 during first quarter (July to September), $2.43 billion insecond quarter (October to December) and $2.35 billion in third quarter(January to March) of the current fiscal year, making total payment at $7.3billion in nine months.
Keeping in view the current trend, the amount could surge to $10 billion bythe end of ongoing financial year.
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The massive repayment is continuously declining the reserves. The foreignexchange reserves of the country held by the SBP have tumbled to $8 billiondue to the massive repayment last week.
“During the week ending 17 May, SBP’s reserves decreased by $788 million to$8,057.6 million, due to external debt servicing and other officialpayments,” the SBP stated on Thursday. The overall foreign exchangereserves including of commercial banks have recorded at $15.13 billion.
