The Government of Pakistan entered into new agreements amounting to $2.166 billion in commitments during the period of July-March 2023-24, according to the Economic Affairs Division (EAD). The official data revealed that the World Bank committed $888 million, making up 41% of the total from multilateral partners. The Asian Development Bank (ADB) and the Asian Infrastructure Investment Bank (AIIB) followed with commitments of $706 million (33%) and $250 million (12%) respectively.
The EAD emphasized that managing external debt prudently, coupled with strong institutional arrangements, is crucial for improving the country’s repayment capacity. It was noted that external debt can be beneficial if used to create assets that generate positive returns and externalities. However, the reliance on external debt must be carefully monitored to ensure it remains productive for economic growth.
As of May 2024, Pakistan’s external debt and liabilities have surged to $130.179 billion. During the period of July-March 2023-24, the country received disbursements totaling $6.904 billion, primarily from multilateral development partners, bilateral development partners, and international financial institutions (IFIs). The World Bank, ADB, and AIIB were the largest contributors among multilateral partners, disbursing $1,482 million, $666 million, and $304 million, respectively. Saudi Arabia led bilateral contributions with $657 million, followed by China with $576 million.
The disbursements during this period were allocated to various sectors, including energy and power ($404 million), flood recovery ($234 million), construction ($200 million), agriculture ($155 million), transport and communication ($154 million), health and nutrition ($144 million), governance research and statistics ($105 million), water ($97 million), and physical planning and housing ($61 million).
As of March 31, 2024, Pakistan’s total external public debt stood at $86,683 million. The government paid $8,086 million towards debt servicing from July-March 2023-24, including $5,363 million in principal repayments and $2,723 million in interest payments. Net transfers to the government’s external public debt resulted in a positive balance of $909 million during this period.
