Economic Survey 2011-12 revealed that the public debt as a percent of GDP stood at 58.2 percent by end-March 2012 compared to 55.5 percent of GDP during the same period last year while the External Debt and Liabilities (EDL) stock was recorded at $60.3 billion as of March 2012 while from July-March 2012, just $179 million was added to the EDL stock. As a percentage of GDP in dollar terms, the EDL was down by 200 basis points from July-March 2012 compared to fiscal year 2011 and approximated to 26.5 percent.
Pakistan''s public debt position declined slightly in the current fiscal year. A host of internal and external factors contributed to the decline. Higher interest payments, large subsidies specially food and energy, growing security spending needs, narrow tax base and rising international commodity prices have resulted in large twin account (ie fiscal and current account) deficits.
Servicing of external debt and liabilities during the first nine months of fiscal year 2012 amounted to $3567 million. Out of the total, $1692 million was paid against principal while interest payments were $633 million. $1243 million was rolled over.
The government claims in the Economic Survey that it has increasingly focused on the domestic part of financing over the last few years owing to non-availability of sufficient external financing ie domestic borrowings inched up in share from 46.6 percent in fiscal year 1990 to 59.9 percent at end March,2012. As at the end of March 2012, servicing of the public debt stood at Rs 719 billion against the budget amount of Rs 1,034.2 billion.
The survey depicts that the total domestic debt was positioned at Rs 7,206.9 billion at end-March 2012, representing an increase of Rs 1,190.5 billion in the first nine months of the current fiscal year. This increase stems from net issuance of market debt namely Treasury bills (Rs 576.4 billion) and Pies (Rs 307.5 billion). In relation to GDP the domestic debt stood at 34.9 percent which is higher than end-June 2011 level of 33.4 percent. The domestic debt grew by 19.8 percent in first nine months of current fiscal year
Floating Debt share in overall public debt and domestic debt stood at 32.7 percent and 54.5 percent respectively by end-March 2012. During July-March, 2012, the floating debt grew by Rs 691.5 billion or 21.4 percent.
Unfunded Debt is made up of the various instruments available under the National Savings Scheme (NSS). The total share of unfunded debt in the government''s domestic debt stood at Rs 1,725.4 billion or 23.9 percent by end-March 2012. The stock of unfunded debt increased by Rs 69.6 billion or 4.2 percent compared with fiscal year 2011. Net receipts in Regular Income Scheme were up by 17.2 percent in July-March, 2012, as the stock increased from Rs 182.6 billion in June, 2011 to Rs 214 billion at end-March 2011.
At end March 2012, public and publicly guaranteed debt accounted for the largest share of 76 percent in EDL. Public and publicly guaranteed debt is dominated by the loans from the bilateral and multilateral donors. Multilateral debt, which is the largest component of Pakistan''s EDL witnessed a decrease of $730 million during the period under review. Debt from bilateral sources include loan contracted with Paris Club countries and other countries outside the Paris Club. It is second largest component of Pakistan'' EDL. It witnessed an increase of $137 million during the period under review.
The share of private non-guaranteed debt in total EDL stood at 6 percent at end March 2012. The stock of private non-guaranteed debt decreased by $147 million - from $3.48 billion in June 2011 to $3.34 billion by end march 2012. At end-March 2012, debt owed to IMF aggregated up to $8.1 billion. Payment amounting to $793 million has been made in the 3rd and 4th quarter of fiscal year 2012.
The Economic Survey revealed that the total amount of foreign economic assistance received in the first nine months of 2011-12 stood at $1,660 million. The commitments of foreign economic assistance were $4,580 million during 2010-11, while during July-March 2012 total commitments amounted to $1,967 million. About 76 percent of total commitments during July-March 2012 were in the shape of project aid while the remaining comprised non-project aid. Out of total non-project aid, share of BOP/budgetary support was 78 percent.
During July-March 2010-11, disbursements of $1,660 million were for different purposes like ProjectAid ($1,113 million, Programme - loans/Budgetary Support ($99 million) and relief ($448 million). Project aid accounted for 67 percent of the total disbursements.
Pakistan witnessed an increase in spreads on its 2016, 2017 and 2036 Eurobonds in the first ten months of 2010-11. The Eurobond maturing in 2016 is currently (as of May 9th, 2012) trading at a spread of UST+1098 basis points. The 2017 maturity bond, that had an issue spread of UST+200 basis points, is trading currently at a spread of UST+1157 basis points. The 2036 bond, compared to the issue spread of UST+302 basis points and a spread of 681 basis points last year, is trading currently at a spread of UST+1002 basis points.