Public debt exceeds 45 percent of country’s GDP

KATHMANDU: The public debt obligation has crossed 45 percent of the gross domestic product of the country.

As per the report published by the Public Debt Management Office, the government loan stood at Rs 2.611 trillion till February 12 of the current fiscal year 2024/25.

“The public debt was Rs 2.434 trillion in the beginning of the current fiscal year and it was added by Rs 176 billion till February 12. The total public debt till February 12 stood at 45.77 per cent of the country’s GDP,” according to the report.

Of the total public debt, 50.87 percent is external loan and 49.13 per cent internal loan.  The internal loan reached Rs 1.282 trillion while the external loan was Rs 1.328 trillion.

The country faced an additional loan burden of Rs 36.59 billion till the period due to plummeting value of Nepali currency against the US dollar.

The government had set the target of mobilizing Rs 547 billion public debts for the current fiscal year. The Office said it has raised Rs 290.57 billion public loans so far. The total public debt raised so far is 53.12 per cent of the annual target.

The government has the target of raising Rs 330 billion in domestic loans and Rs 217 billion in external loans in the current fiscal year.

The Office said that Rs 229.15 billion towards internal and Rs 61.42 billion towards external public debt has been raised until February 12 of the current fiscal year 2024/25 starting July16, 2024. The loan raised so far towards domestic comprises 69 percent and towards external 28.31 percent of the annual target.

Similarly, the government has allocated Rs 402.85 billion for paying the principal and the interest of the public debt. The Office stated that Rs 178.75 billion has been paid as principal and interest in the last seven months. The debt servicing expenditure until February 12 is 3.31 percent of the GDP.