Kathmandu: The federal government has reported receiving Rs 99.20 billion in external loans during the first 11 months of the current fiscal year, which accounts for less than half of its targeted Rs 217 billion.
According to National News Agency Nepal, a report from the Public Debt Management Office reveals that the foreign loans received by mid-June amount to just 45.72 percent of the target. In contrast, the internal debt mobilization is nearly on track, achieving 95.45 percent of its Rs 330 billion goal, with around Rs 315 billion already secured.
Most external loans have been directed towards capital expenditure to fund development projects. However, a slowdown in development activities has impeded the inflow of these loans, as stated by Gopi Krishna Koirala, Chief of the Public Debt Management Office. He explained that donor agencies primarily offer financial assistance through project-based loans rather than direct budgetary support, making project delays or poor implementation a significant factor in loan receipt. Weak development expenditure has thus led to a decline in external loan inflows.
According to the Office of the Auditor General, the annual capital expenditure had only reached about 42 percent of its target by Saturday evening.
The Public Debt Management Office also reported that the government’s total outstanding debt amounts to Rs 2,654 billion. From the start of the current fiscal year, when the total public debt was Rs 2,434.9 billion, an additional Rs 220.58 billion was added by the end of last May.
By the end of last May, the total public debt equaled 43.47 percent of the country’s gross domestic product. Foreign debt comprises 52.0 percent of the total debt, while domestic debt accounts for 47.94 percent. As of mid-June, internal debt stands at Rs 1,272.53 billion and external debt at Rs 1,382.12 billion. The government had aimed to mobilize Rs 5.47 billion in public debt for the fiscal year, collecting Rs 414 billion by mid-June.
As of June 14, total public debt remains 43.47 percent of the country’s GDP. The government has yet to receive 52 percent in foreign loans, while domestic debt constitutes 47.94 percent. The government had set a public debt mobilization target of Rs 547 billion through active measures. By mid-June, it had raised Rs 14.19 billion, achieving 75.72 percent of the annual target. Over the past 11 months, Rs 329.6 billion has been spent on principal and interest payments for government debt.