Tuesday, April 20, 2021

Govt will borrow Rs 4.82 trillion in Just three months

Each template in our ever growing studio library can be added and moved around within any page effortlessly with one click. Combine them, rearrange them and customize them further as much as you desire. Welcome to the future of building with WordPress.

Each template in our ever growing studio library can be added and moved around within any page effortlessly with one click. Combine them, rearrange them and customize them further as much as you desire. Welcome to the future of building with WordPress.

Each template in our ever growing studio library can be added and moved around within any page effortlessly with one click. Combine them, rearrange them and customize them further as much as you desire. Welcome to the future of building with WordPress.

The govt plans to borrow Rs 4.82 trillion from local commercial banks over the next three months (March to May) to repay part of the previous loan and partly finance budget expenditures in the current fiscal year 2021.

However, The government generally finances budgetary expenditures through tax collection, profit from state entities, and sell-off of loss-making companies.

Although revenues under such bonds increased during the first eight months (July-February) of the current fiscal year, budget expenditures remained even higher, forcing the government to increase debt to finance the budget deficiency.

The government is also expecting to increase the debt by RS 840 billion in the domestic economy over the next three months.

Furthermore, Details indicate that It will add Rs 4.82 trillion to its debt by selling its debt securities to a commercial bank.

Where to use 4.82 trillion:

Rs3.98 trillion would be used to repay previous loans to banks, while the remaining Rs840 billion would be used to finance the budget deficit in FY21, according to the auction schedule of the State Bank of Pakistan (SBP ) released on Friday.

The increase in new debt would also force the government to raise multi-headed taxes and toughen the challenge of increasing taxpayers for economic managers in an attempt to pay off the growing debt.

Prime Minister Imran Khan also approved the withdrawal of RS 80 billion income tax exemptions on Friday, which was one of several conditions set by the International Monetary Fund (IMF) for the resumption of the program US $ 6 billion in loans.

However, The government has devised a strategy to reduce the cost of borrowing, which, in turn, will lessen part of the debt burden on the economy.

Moreover, The government plans to raise Rs4 trillion through short-term MTBs (month market treasury bills) auctions during March-May 2021. Of these, around Rs3.7 trillion also would be used to repay previous loans raised through MTBs.

More From Latest News

Top Trending