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Kathmandu, November 26: The Government of Nepal’s debt liability has reached 2.729 trillion rupees. According to data published today by the Public Debt Management Office, this figure is based on records up to the end of Kartik.

By the end of Ashad, the government’s total debt stood at 2.674 trillion rupees. Within the first four months of the current fiscal year, it increased further to 2.729 trillion rupees.

The government borrowed 138.75 billion rupees in these four months. During the same period, it repaid 127.61 billion rupees in principal. Meanwhile, due to the increase in foreign exchange rates, an additional 44.22 billion rupees was added to the debt burden. As a result, the total debt obligation has now reached 2.729 trillion rupees.

Of this amount, 1.275 trillion rupees is internal debt, and 1.453 trillion rupees is external debt. These figures represent only the principal amount and do not include interest.

During the review period, the government raised 138.75 billion rupees, which is 23.29% of the annual target. The government aims to raise 595.66 billion rupees in debt this fiscal year. Based on this target, 456.9 billion rupees still remains to be raised.

Out of this, the government has raised 120 billion rupees in internal loans, which is 33.15% of the target. The yearly target for internal borrowing is 362 billion rupees, and 242 billion rupees still remains to be raised.

However, the government’s performance in mobilizing external debt has been weak. The annual target for external borrowing is 233.66 billion rupees, but so far, only 18.75 billion rupees has been acquired — just 8.03% of the target. This means 214.9 billion rupees in external loans still remains to be obtained.

External loans are generally cheaper, and their repayment schedules are longer. This helps the government manage its budget more easily. However, all governments have been weak in mobilizing such loans. Both past elected governments and the current interim government have shown weak performance in utilizing foreign loans.

During the review period, the government repaid 150.88 billion rupees in debt, including interest. Of this amount:

127.61 billion rupees was principal, and 23.27 billion rupees was interest.

According to the data:

Internal debt repayment amounted to 131.65 billion rupees, including 112.26 billion rupees in principal and 19.39 billion rupees in interest.

External debt repayment amounted to 19.23 billion rupees, including 15.35 billion rupees in principal and 3.88 billion rupees in interest.

The data shows that internal debt required substantial repayment within a short period, along with higher interest costs. The government, however, has not faced significant pressure on external debt repayment.

The government aims to repay 411.01 billion rupees in debt (including interest) this year. Of this, the target is: 302.47 billion rupees in principal, and 108.53 billion rupees in interest.

This year, the government must repay:

67.45 billion rupees in external debt, and 343.55 billion rupees in internal debt (principal plus interest).

The government’s internal revenue is unable to meet the target of the set expenditure, therefore, it needed to borrow external as well as internal debts to manage the expenditure set by the budget.  

People’s News Monitoring Service.