The Pakistani federal government's debt rose 32 percent to Rs58.962 trillion in the year to May, as per data released by the central bank.

The debt rose to the situation as the government faced high borrowing needs, a dollar shortage, a weakening currency and costly interest payments.

Total debt reached Rs44.641 trillion as of May 31, 2022. The debt increased by 1 percent month-on-month in May 2023, reports The News International.

It stood at Rs58.599 trillion in April. The debt jumped by 23.26 percent in 11 months (July-May) of the recently concluded fiscal year. The debt came at Rs47.832 trillion by the end of June.

Debt figures were released following last week’s staff-level agreement between Pakistan and the International Monetary Fund (IMF) on a $3 billion standby arrangement. The eight-month delay in the agreement, which is awaiting IMF board approval in July, gives Pakistan some relief as it struggles with a severe balance of payments crisis and declining foreign exchange reserves. The IMF agreement has reduced the nation’s risk of a short-term default.

Domestic debt surged by 28 percent year-on-year to Rs37.1 trillion at the end of May.

It rose by 19.2 percent during 11 months of FY2023.

Foreign debt sharply increased by 40 percent to Rs21.9 trillion as of May. The external debt grew by 31 percent in July-May FY2023.