Increase in Federal Government borrowing for budgetary support

Engineering Post Report

The borrowing by the Federal Government for budgetary support has registered substantial increase over the past many months.

The Government sector , according to the available information, had increased to as much as Rs 1586.8 billion for budgetary support  during  the period July 01 to April 29,FY2022 as compared to Rs 642.6 billion  during the same period in the previous year.

Domestic borrowing for budgetary support, however, remained higher than last year due to pressure on the external front for high payments.

Within the budgetary support, the federal government had borrowed Rs 133.5 billion from the State Bank of Pakistan as compared to retirement of Rs 1164.3 billion in the same period last year.

On the other hand, the federal government had borrowed Rs 1453.3 billion from the scheduled banks as compared to borrowing of Rs 1807.9 billion in the previous year. As result, net government sector borrowing amounted to Rs 1795.6 billion against the borrowing of Rs 619.7 billion during the same period last year.

During first nine months of FY2022, the federal government has financed around 62 per cent of fiscal deficit from domestic sources. Within the domestic sources, banks and non-banks financing share stood at 66 and 34 per cent respectively.