The country spent some $7.5 billion on external debt servicing during the last fiscal year (FY18). The State Bank of Pakistan (SBP) Wednesday reported that external debt servicing posted some 8 percent decline during last fiscal year followed by lower public debt servicing.
Pakistan's total external debt servicing (principal and interest) amounted to $7.48 billion in FY18 compared to $8.15 billion in FY17, depicting a decline of $668 million. The debt servicing is excluding principal repayments of short-term borrowings by scheduled banks from banks abroad.
Out of total external debt servicing, major amount (almost 70 percent) were paid on account of principal debt, while the remaining amount was paid as interest payment. The country paid $5.186 billion as principal amount and $2.293 billion as interest in last fiscal year.
The impact of rising debt higher debt servicing has already witnessed in the shape of depleting foreign reserves. The country's liquid foreign exchange reserves (comprising SBP and banks) fell by 23 percent to $ 16.386 billion during last fiscal year.
Over $2 billion were spent on external debt servicing during the first quarter of FY18. During the second quarter of FY18, an amount of $1.523 billion was paid as debt servicing. In addition, in the third and fourth quarters of FY18, debt servicing payments stood at $1.354 billion and $2.3 billion, respectively.
The detailed analysis reveals that some $5.97 billion were paid as government debt servicing, $410 million Public Sector Enterprises' debt servicing and some $1.029 billion were spent as private sector debt servicing during last fiscal year.
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