Pakistan Accumulates Over $10 Billion In New Debt During Covid: Report
NDTV
To manage the fiscal imbalance, the government massively stockpiled debt, which led to impacts on financial markets.
Asian Development Bank released a report which states that Pakistan has accumulated over USD10 billion in new debt during the Covid-19 pandemic.
To manage the fiscal imbalance, the government massively stockpiled debt, which led to impacts on financial markets. A high fiscal deficit affects resource allocation among the private and the public sectors. In Pakistan, the borrowing of the government from banks constitutes more than 90 per cent of total loans, the report noted.
Pakistan's debt to Gross Domestic Product ratio was the highest in the Central Asia Regional Economic Cooperation Program (CAREC) region at 86 per cent in 2019 which increased in 2020, reading at 99 per cent, as per Business Recorder citing the ADB report named as "COVID-19 and Economic Recovery Potential in the CAREC Region".
The report further states that the debt sustainability analysis for the CAREC region that the overall risk of debt distress for Pakistan is high.
