ISLAMABAD: The PTI government has obtained $49.23 billion foreign loans in its 45 months tenure. Thus, on an average, the previous government borrowed more than one billion dollars every month.
The previous government’s borrowing had been increasing over the last three and half years from $10.59 billion in 2018-19 to $10.662 billion in 2019-20 and then reaching $14.28 billion in 2020-21 followed by $12.70 billion in first nine months.
In its last nine months, July-March 2021-22, the PTI government received $12.7 billion worth foreign loans, 70pc higher than the foreign loans it received in the comparable period in the previous financial year.
This does not include more than $1.6 billion of foreign debt in Naya Pakistan Certificates from overseas Pakistanis which are not reported by the MEA. This also does not include more than $1 billion secured from the International Monetary Fund which flowed in February — both these loans are reported separately by the State Bank of Pakistan.
With this, the total foreign debt from external sources (other than Pakistanis) reached $49.29 billion in about 45 months of the PTI government.
This showed the government’s heavy reliance on foreign loans to finance the rising current account deficit and maintain foreign exchange reserves needed to finance higher imports and earlier loans.
This was evident from the fact that the annual budget target for foreign debt was set at $14.088 billion in the federal budget 2021-22 and the government borrowed $12.77 billion in the first nine months. The government had borrowed a total of $14.3 billion in the full 2020-21.
There were four major sources of foreign inflows including $3.95 billion of multilateral lenders followed by $3 billion of time deposits from Saudi Arabia, about $2.62 billion of commercial loans from private banks and $2.04 billion worth of international bonds. There were four major sources of foreign inflows including $3.95 billion of multilateral lenders followed by $3 billion of time deposits from Saudi Arabia, about $2.62 billion of commercial loans from private banks and $2.04 billion worth of international bonds.
The report said the government received $8.88bn worth of inflows for budgetary support which also included $1.2bn of short-term credit. This put the total non-productive (non-project) assistance at $10.114bn in nine months against the full-year target of $12.16bn, which meant that more than 80pc of the total loans were acquired for oil imports, budget financing and foreign exchange reserve build-up.
