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Finance ministry clarifies news report about debt indicators

Finance ministry clarifies news report about debt indicators

ISLAMABAD: Ministry of Finance rejected reports published in media stating that public debt increased by Rs5678 billion during 12 months from November 2018 to November, 2019.
A statement issued by the Ministry stated that federal government obtained only Rs3674 billion loan to cover account deficit from November 2018 to November 2019. During the month of November federal government’s debt was Rs26543 billion which was increased to Rs32131 billion during the month of November, 2019.
The main reason behind this increase is depreciation of Pakistani Rupee against US dollar, while during the month of November, 2018, Rs970 billion were allocated to meet any emergency situation.

It is pertinent to mention here that State Bank of Pakistan (SBP) reported that Pakistan’s current account deficit narrowed to $1.8 billion in first five months (Jul-Nov) of the year 2019-20 as compared to deficit of $ 6.7 billion in same period, a year ago, showing a massive decline of 73 percent.
The current account deficit also witnessed a huge fall of 72.64 percent to $319 million in November 2019 compared to $1.166 billion in same month of the previous year.
The details show that current account balance without official transfers shrank to $2.06 billion in the corresponding period against $7.088 billion in same period of last year, showing a decline of 70.92 percent.
Balance of trade in goods also plunged by 40.14 percent from $13.368 billion in July-November 2018-19 to $8.002 billion in July-November this year.
Similarly, balance of trade in services also narrowed by 6.63 percent to $1.62 billion compared to $1.734 billion.
Workers’ remittances in July-November 2019-20 also increased to $9.299 billion in five months as compared to remittances of $9.281 billion recorded during same period of last year.
As a percentage of gross domestic product (GDP), the current account deficit narrowed by 1.6 percent in the first five months of 2019-20 as opposed to 5.3 percent in the same period of last year.
Pakistan exported goods and services worth of $12.474 billion in July-November this year compared to exports valuing $11.953 billion in the comparable period of last year, reflecting a year-on-year increase of 4.35 percent.
The value of imported goods in the corresponding period was recorded at $18.311 billion, down 21.13 percent from $23.218 billion over corresponding period of last year.