Public debt Rs. 55.37B higher in four months

By A Staff Reporter,Kathmandu, Dec. 12: Nepal’s total outstanding public debt has reached Rs. 2,729.41 billion as of mid-November 2025, increasing by Rs. 55.37 billion in the first four months of the current fiscal year 2025/26.

According to a report by the Public Debt Management Office under the Ministry of Finance, the government’s domestic debt rose by Rs. 7.74 billion, while external debt increased by Rs. 47.63 billion during the review period. 

The country’s public debt stood at Rs. 2,674.04 billion at the end of fiscal year 2024/25. Out of total debt, external debt comprises Rs. 1,453.55 billion and domestic debt comprises Rs. 1,275.96 billion.

During the first four months of the current fiscal year 2025/26, the total outstanding debt has increased by 2.07 per cent consisting of an increase in external debt and domestic debt by 3.38 per cent and 0.61 per cent, respectively.

External public debt represents more than half of total outstanding public debt as of mid-November of the current fiscal year. 

Share of external public debt to the total outstanding debt is 53.25 per cent while the share of domestic debt is 46.75 per cent.

The total debt to GDP ratio is 42.65 per cent as of mid-July, 2024. The external debt to GDP ratio is 23.80 per cent and domestic debt to GDP ratio is 20.89 per cent.

According to the statistics, International Development Association (IDA) is responsible for the largest share of outstanding external debt (48.93 per cent) followed by the Asian Development Bank (33.54 per cent). These multilateral agencies hold nearly 90.43 per cent while bilateral agencies hold 9.57 of the government's outstanding external debt. 

The government has mobilised an additional loan of Rs. 138.75 billion during the first four months of the current fiscal year out of the annual target of Rs. 595.66 billion. 

Out of additional public debt, the government has mobilised a loan of Rs. 120 billion under the domestic debt and Rs. 18.75 billion under the external debt.

The government has set a target of collecting an additional Rs. 595.66 billion of loan to meet the budget deficit for the last fiscal year. Out of this, Rs. 362 billion is aimed to be collected through domestic borrowing and Rs. 233.66 billion through external loans.  

According to the report, this debt mobilisation during the review period is only 23.29 per cent of the annual target. Of the total, the share of internal and external debt is 33.15 per cent and 8.03 per cent respectively. 

Rs. 150.88 billion spent on debt servicing 

The government has spent about Rs. 150.88 billion for the payment of principal and interest payment during the first four months of the current fiscal year. 

The data also shows that the government has paid only Rs. 127.61 billion as principal payments and Rs. 23.27 billion as interest of such loans. 

The government has paid Rs. 112.26 billion for principal payment and Rs. 19.39 billion for interest of domestic loans. Likewise, the government has paid Rs. 15.35 billion for principal payment and Rs. 3.88 billion for interest of external debt.

The government has spent 36.71 per cent of the total budget allocation for principal and interest payment during the review period of the current fiscal year.

The government has allocated budget of Rs. 411.01 billion for financial management for the current fiscal year.