Karachi: The country’s domestic debt has surged over a record level of PkR 6 trillion in FY11 on account of high fiscal deficit due to high current expenditures and lower revenue generation.
According to Alfalah Securities, the State Bank of Pakistan (SBP) has indicated that the country’s stock of domestic debts, comprising of permanent debt, floating debt, un-funded debt and foreign currency loan has increased from PkR 4.654 trn to PkR 6.143 trn ending on June 30, 2011, witnessing a cumulative growth of 29.22% in FY11.
However, domestic liabilities of the government have decreased by 12% from PkR 214.2 bn in FY11 as compared to PkR 240.6 bn in the same period last year. SBP has urged the government to reduce its exponentially rising expenditure which has strained the government borrowing due to which a tight monetary policy stance has been adopted by the SBP to curb inflation.
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