Last year, the government met the domestic debt target of 100% but managed to collect only 57.79% of the external debt.
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In the last fiscal year 2081/82, while the government raised 100 percent of its internal debt, it was seen that it was able to raise only 57 percent of its external debt.
According to the Public Debt Management Office's report on government debt up to the end of last June, the target of three trillion 30 billion rupees set for domestic debt last year has been 100 percent fulfilled.
But 57.79 percent of the said to raise 2 trillion 17 billion rupees for external loans, only 1 trillion 25 billion 39 billion 99 million rupees has been raised. In other words, last year the government could not collect external debt equal to 91 billion 60 million rupees.
Head of Public Debt Management Office Gopikrishna Koirala informed that due to the low capital expenditure of the government and the development projects could not be completed within the stipulated time, the external debt could not be raised as per the target.
'All the external debt could not be collected due to insufficient capital expenditure and projects not being completed on time. The annual projects and programs of the government have to be spent first from our own resources and later from the lenders. But since the work was not completed, it was not possible to ask for its research. Due to this, the external debt has decreased,' said Koirala.
Comparatively, the interest rate of external loans is cheaper than internal loans and the repayment period is also longer. On the other hand, external debt is considered more effective because the government spends the internal debt in the current nature, but the external debt is also capital in nature and the creditor has to focus more on capital formation. Similarly, when the government itself uses the loans that should flow from banks and financial institutions to the private sector, it has an impact on the money market as well.
In the last fiscal year, the government had set a target of mobilizing a total of five trillion 47 billion rupees in public debt. Out of which 4 trillion 55 billion 39 crore rupees have been received, the office said. Compared to the annual target, the total public debt of last year is 83.25 percent. According to the
office, the total government debt has reached 26 trillion 69 billion 57 billion rupees with an addition of 2 trillion 31 billion 8 million rupees in the last year alone. Which comes to 43.71 percent of the gross domestic product. In the total public debt, the share of foreign debt is 52.49 percent and the share of domestic debt is 47.51 percent. According to the
office, the government currently owes 12 trillion 63 billion 645 million rupees in domestic debt and 14 trillion 1 billion 35 billion 28 million rupees in external debt. On the basis of gross domestic product, internal debt is 22.14 percent and external debt is 24.56 percent.
Similarly, in the last year, more than four billion rupees have been spent for the principal-interest payment of government debt In FY 2081/82, 4 billion two billion 85 million rupees have been allocated for debt service expenses, and 3 billion 62 billion 59 billion rupees have been paid by the end of June.
This is 90.01 percent based on the annual budget allocation,' said the office's monthly report. On the basis of gross domestic product, the debt service expenditure is 5.94 percent by the end of June.
In the last fiscal year, the government has spent three billion four billion 191.2 million rupees for the principal-interest payment of the internal debt, while 58.4 billion 13 million rupees has been spent for the principal-interest payment of the external debt.
