The increase in the exchange rate of foreign currencies, including the US dollar, against the Nepali currency in recent months has put an additional burden on Nepal's public debt. As of mid-January, the increase in the exchange rate of foreign currencies, including the US dollar, has added an additional burden of Rs 92.96 billion to Nepal's outstanding public debt, according to the Public Debt Management Office.

Nepal's debt must be repaid in foreign currencies (mainly US dollars). In the past, when borrowing was done, the exchange rates of foreign currencies were low. The increase in the exchange rates of foreign currencies, including the dollar, in recent months has added an additional burden to the public debt to be repaid, said Gopi Prasad Koirala, head of the Public Debt Management Office. 'We calculate foreign currencies of all countries by converting them into US dollars. Even when the exchange rates of foreign currencies other than the dollar increase, we have to pay more amount accordingly,' he said, 'Nepal benefits when the exchange rate of foreign currencies decreases.' 

Nepal benefits when the dollar exchange rate decreases, while it loses when it increases. Due to exchange rate changes, there has been a loss in 4 out of the last 7 fiscal years, while it has been profitable in the remaining years. This year too, Nepal has had to bear losses in most months.

Compared to Asad 2082, the Nepali rupee has depreciated by 4.9 percent against the US dollar until last Magh. The Nepali rupee had depreciated by 2.8 percent during the same period last year. In mid-December 2082, the purchasing exchange rate of one US dollar reached 144.01 rupees. In mid-June 2082, the exchange rate was 137 rupees.

In the seven months of the current fiscal year (Shrawan to Magh), about 2.5 trillion rupees have been added to public debt. Accordingly, the Public Debt Management Office's Magh report shows that public debt in Nepal has reached 2858 billion 970 million rupees. This is 184 billion 930 million rupees more than the public debt of last Ashar. The outstanding government debt in last Ashar was 2674 billion 400 million rupees. The total government debt outstanding by the government as of Magh is equivalent to 46.81 percent of the gross domestic product (GDP). 

The National Statistics Office has projected that GDP will reach 6107 billion rupees in the current fiscal year. Of the total public debt, 47.19 percent or 1349 billion rupees is domestic and 52.81 percent or 1509 billion rupees is foreign. 

In the last seven months, the government has collected Rs 255.48 billion in debt. This is 42.89 percent of the annual target. Of this, domestic debt is 60.13 percent and foreign debt is 16.18 percent. In this way, domestic debt is 85.20 percent and foreign debt is 14.80 percent of the total public debt collected. Based on this, Rs 340.17 billion should be collected to achieve the total debt collection target set for this year. This includes domestic debt of Rs 144.33 billion and foreign debt of Rs 195.84 billion.

Till last Magh, the government has spent Rs 233.65 billion on repayment of principal and interest on the debt. This is 49.55 percent of the annual target. This year, the government has allocated Rs 411.1 billion for repayment of principal and interest on the debt. Of the total amount paid by the government till last Magh, Rs 163.52 billion has been spent on principal and the remaining Rs 40.13 billion has been spent on interest. The amount used to pay interest on public debt is included in current expenditure. Therefore, the Rs 255.48 billion raised during the period is reduced by Rs 163.52 billion spent on principal repayment. In the amount received in this way, Rs 92.96 billion due to changes in foreign exchange rates has been added to the public debt of Rs 184.93 billion in the last two months. Due to changes in exchange rates, there has been a loss in 4 of the last 7 fiscal years and a profit in the remaining years. This year too, Nepal has had to bear losses in most months.

The Nepali rupee has depreciated by 4.9 percent against the US dollar as of last Magh compared to Asad 2082. The Nepali rupee had depreciated by 2.8 percent during the same period last year. In mid-2082 Poush, the purchasing exchange rate of one US dollar reached Rs 144.01. In mid-2082 Asad, the exchange rate was Rs 137.

Looking at the public debt outstanding by the government as of the end of the last fiscal year, every Nepali now has about Rs 94,000. According to the National Census 2078 of the National Statistics Office, the population of Nepal is 29.164,578. This figure was derived by dividing the outstanding public debt as of last Ashar by this population.

Economists say that the continuously increasing public debt poses a risk. In the fiscal year 2080/81 and in the last fiscal year, the allocation under the heading of financial management exceeded the size of capital expenditure. But this is not the case in the current fiscal year. However, experts say that this situation is the result of the continuous increase in internal and external debt.