Reliance on external borrowing was a whopping $ 3.8 billion September-December 2017 - a month after Shahid Khaqan Abbasi took over as the country's chief executive. External debt and liabilities rose from $83.092 billion by end June 2017 to $85.087 billion by end-September 2017 to $88.891 billion by end December 2017.
Around $2 billion external borrowing was incurred during the first quarter of the current year and over $5 billion during the first six months of the current fiscal year. The PML-N administration's reliance on external borrowing, particularly borrowing from foreign banks at high rates of return with a small amortization period, is likely to increase during the remaining 3 months and one week and a half of its tenure to meet repayments of over $3 billion till the end of the current fiscal year. This was publicly acknowledged by Minister of State for Finance Rana Muhammad Afzal a few weeks.
Data from the Economic Affairs Division (EAD) reveals that after Prime Minister Abbasi took over as the country's chief executive the government borrowed $1.163 billion from foreign commercial banks (August-January 2017-18) and an additional $2.5 billion was raised through issuing Eurobonds and Sukuk, debt equity, in the international capital market.
Data from EAD further reveals that Asian Development Bank (ADB) disbursed $427.50 million, China $504 million, IDB(S-Term) $619.50 million, International Bank for Reconstruction and Development (IBRD) $86.66 million, International
Development Association (IDA) $84.81 million, UK $105.51million, Japan $67.7 million and USA $21.07 million. The government has signed short-term commercial loan agreements of $1.417 billion in the current fiscal year 2017-18 so far with different foreign banks of which $1.163 billion has been disbursed.
The government signed an agreement for procuring $200 million commercial loans from Standard Chartered Bank (SCB)-London on October 31, 2017 and $141.97 million had been disbursed by December. The government procured $500 million commercial loans from Industrial and Commercial Bank of China Limited (ICBC) in October. Further $50 million was procured from the Credit Suisse-led consortium of banks, bringing the total to $255 million from the consortium. The consortium consists of Credit Suisse AG, United Bank Limited and Allied Bank Limited. The country procured $267 million commercial loans from Citibank during the current fiscal year 2017-18 for budgetary support.
The budgeted foreign assistance was projected at $8.094 billion for 2017-18 which included $7.692 billion loans and $401.78 million grants. Finance Division debt policy statement 2017-18 presented to Parliament Monday last revealed that gross public debt increased by around Rs 652 billion during first quarter of 2017-18 with domestic debt accounting for Rs 521 billion while government borrowing from savings schemes and other domestic sources amounted to Rs 433 billion. Debt equity - issuance of Eurbonds ($1.5 billion) and sukuk ($ 1 billion) - were not included in these figures. During first quarter of 2017-18, the government issued fresh/rollover guarantees aggregating to Rs 60 billion while outstanding stock of government guarantees end September 2017 amounted to Rs 999 billion.
Comments
Comments are closed.