Federal government’s plan to repay over 71 trillion rupees in debt

The federal government has unveiled a plan to repay over 71 trillion rupees in debt.

To reduce the national debt, the federal government has prepared a Debt Management Plan aimed at repaying more than 71 trillion rupees, with a focus on reducing reliance on additional borrowing.

According to sources in the Ministry of Finance, the government will enhance its capacity to repay loans while activating maximum concessional external financing.

Ongoing multilateral projects funded by international loans will be completed swiftly, and improvements will be made to national savings schemes to increase savings.

Under the government’s Debt Management Plan, the issuance of bonds will enhance presence in international markets.

Panda bonds, Eurobonds, and international Sukuk will be issued in global markets. Measures will also be taken to mitigate refinancing and interest rate risks.

The federal government has decided to implement structural reforms within institutions and expand the tax net. Reducing fiscal deficits is also part of the debt repayment plan.

A decrease in fiscal deficits is expected to lead to economic stability, subsequently reducing reliance on additional borrowing.

The plan includes expanding investments and activating the domestic debt capital market. Engagements with local and foreign investors will be increased.

In the coming years, the establishment of a non-bank sector will be initiated, including pension funds, insurance, and asset management companies.

Sources indicate that efforts will be made to promote the establishment of a Sharia-compliant debt market in the next few years.

The maturity profile of local and foreign loan portfolios will be enhanced, with actions taken according to a medium-term debt management strategy.