Public debt reaches Rs. 2,518 billion

By A Staff Reporter,Kathmandu, Dec. 7: The total outstanding debt of the government of Nepal reached Rs. 2,518 billion by mid-November 2024.

Out of total debt, external debt amounts to Rs. 1,265.89 billion and domestic debt comprises Rs. 1,252.16 billion, according to the latest report of the Public Debt Management Office under the Ministry of Finance.

During the first four months of the current fiscal year 2024/25, the total outstanding debt has increased by 3.45 per cent with an increase of 1.01 per cent in external debt and 6.03 per cent in internal debt.

External public debt is more than half of the total outstanding public debt as of mid-November of the current fiscal year. The share of external public debt to the total outstanding debts is 50.27 per cent while the share of domestic debts is 49.73 per cent.

Around Rs. 83.96 billion has been added to public debt in the first four months of the current fiscal year.  Out of additional public debt, Rs. 71.26 billion was added under the domestic public debt and Rs. 12.7 billion under the external public debt.

The ratio of domestic public debt has been increasing over the years. The government has set a target of collecting an additional Rs. 547 billion of loans to meet the budget deficit for the current fiscal year. 

Out of this, Rs. 330 billion is aimed to be collected through domestic borrowing and Rs. 217.67 billion through external loans. 

Of the annual target of debt mobilisation, the government has mobilised Rs. 165.71 billion in public debt, including domestic debt of Rs. 144 billion and external debt of Rs. 21.71 billion during the review period.

The government was able to mobilise about 43.64 per cent of the annual domestic debt mobilisation target while only 10 per cent of the external debt mobilisation target was met during the review period.

The data also shows that the government has paid Rs. 108.14 billion as principal and interest of the public debt. Of them, the government has paid Rs. 91.73 billion for principal and interest of the domestic loans and Rs. 16.41 billion for external loans.

According to the statistics, the International Development Association (IDA) is responsible for the largest share of outstanding external debt (48 per cent) followed by the ADB (32.81 per cent).

These multilateral agencies hold nearly 89.16 per cent while bilateral agencies hold 10.84 of the government's outstanding external debt. 

Domestic debt comprises mainly short-term and long-term securities issued at the domestic market and loans borrowed from the central bank.

The total debt to GDP ratio is 44.14 per cent as of mid-November 2024. The external debt to GDP ratio is 22.19 per cent and the domestic debt to GDP ratio is 21.95 per cent.

At the end of fiscal year 2023/24, the debt to GDP ratio was 42.73 per cent consisting of 21.75 per cent on external debt and 20.98 per cent on domestic debt.  

The total public debt was Rs. 2,434.09 billion by the end of last fiscal year 2023/24.