KATHMANDU, April 19: The government has raised over Rs 366 billion in public debt in the first nine months of the current Fiscal Year (FY) 2024/25, while it spent more than Rs 250 billion on loan repayments including principal and interest.
According to the Public Debt Management Office (PDMO), Nepal’s total public debt reached Rs 2.67 trillion by the end of Chaitra (mid-April). The report states that the country added Rs 233.17 billion in new loans since the start of the current FY, with total debt standing at Rs 2.43 trillion at the beginning of the current FY.
As of mid-April, public debt accounts for 46.75 percent of the Gross Domestic Product (GDP), with external loans making up 51.19 percent and domestic loans accounting for 48.81 percent.
Take prudent measures to curb public debt
Of the total debt, domestic debt stands at Rs 1.30 trillion, while external liabilities amount to Rs 1.36 trillion.
The government had aimed to raise around Rs 550 billion in public debt for the current fiscal year. By the end of the third quarter, it had achieved 66.93 percent of this target, raising Rs 366.09 billion.
Of this amount, Rs 291.14 billion was raised through domestic borrowing and Rs 74.95 billion from external sources. This represents 88.22 percent of the annual target for domestic debt and 34.54 percent for foreign debt. The annual borrowing targets are Rs 330 billion domestically and Rs 217 billion externally.
Loan repayments have also surged, with the government spending over Rs 252.48 billion on debt servicing by mid-April. Of this, Rs 212.93 billion was used to repay domestic debt (Rs 170.09 billion in principal and Rs 42.84 billion in interest). Similarly, Rs 39.43 billion was paid for external debt servicing (Rs 32.93 billion in principal and Rs 6.51 billion in interest).
The report also shows that exchange rate fluctuations added Rs 70.09 billion to the country’s external debt obligations. Nepal borrows in five major foreign currencies under the Special Drawing Rights (SDR) system: US Dollar, Euro, Pound Sterling, Chinese Yuan, and Japanese Yen. The depreciation of the Nepali currency against these currencies has increased the external debt burden, the report said.
