The federal government plans to borrow Rs 5.87 trillion through treasury bills and investment bonds in the next three months.
According to the central bank, the loan will be taken from commercial banks. A loan of Rs 5.87 trillion will be used to repay a loan of Rs 5.15 trillion already taken. The new loans will further increase the debt burden on the nation as the SBP has hiked the benchmark interest rate by 25 basis points in the last month alone.
Economist Dr. Ashfaq Hassan Khan says a one-point increase in the benchmark interest rate increases interest payments on loans by Rs 180 billion. Sami A. Tariq, head of research at Pak-Kuwait Investment Company, said the government’s aim in issuing treasury bills and investment bonds was to reduce the cost of borrowing and provide adequate time to implement economic reforms. The government plans to use نئے 720 billion of the new debt for budget spending. These include development projects.