According to the World Bank (WB), by the year 2023, the stock of external debt debts in Pakistan will reach $130.847 billion compared to $127.708 billion last year, whereby China lent slightly below $29 billion to the end of 2023.
The most striking feature from the World Bank “International Debt Report, 2024”, was the far broader rise in interest payments on public and publicly guaranteed (PPG) debt within the South Asia region, with increases of 62% to $12.5 billion in 2023, with the most dramatic increases appearing in Bangladesh and India, whose interest payments jumped by more than 90%. Pakistan, according to the report, was second in the region for interest payments.
For countries that are eligible for International Development Association (IDA) assistance, interest payments on the total debt stock hit a new high of a record around $34.6 billion in 2023. The interest payment-export earnings ratio increased by 1.6 percentage points to 5.8%. that is the most elevated level for the estimate since 2005. However, countries such as Mozambique, Senegal, Pakistan, Kenya, and Dominica have been reported to witness the highest ratios, thus weakening their fiscal positions.
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New IMF repurchases for LMICs, excluding Argentina, more than doubled to about $12.2 billion in 2023, with Egypt, Ukraine, and Pakistan heading the repurchasers’ count. Lending from the IMF increased by 12.9 percent to $14.8 billion in 2023, marking its return to pre-COVID normal levels of provisioning.
According to personal remittances to low and middle-income countries as classified by the World Bank, India ranked first, followed by Mexico, the Philippines, China, and Pakistan, which gets $26.6 billion in 2023.
It further indicated that the external debt stock of Pakistan included IMF credit and SDR allocations amounting to $11.532 billion; this was in addition to $110.437 billion in long-term external debt. Public and publicly guaranteed debt consisted of 46% multilateral loans, 45% bilateral loans (including 22% from China and 7% from Saudi Arabia), and 9% private loans.
Short-term external debt was $8.878 billion for the year 2023, showing a slight increase compared to $8.768 billion in 2022. External debt stocks over export values measured in 2023 are at 352.4 percent compared to 322.1 percent in 2022. Debt servicing to export percentages was 43.1 percent in 2023, compared with 42 percent back in 2022.