In 2080-81, the government paid the principal and interest on a loan of Rs.3 trillion five billion

In the last fiscal year 2080-81, the government has paid the principal and interest of Rs. Which is the highest ever. Compared to the previous year, it is more than 83 billion rupees.

Main Points:

1. High Payment Amount:

   • In the fiscal year 2080-81, the government repaid principal and interest on loans amounting to NPR 305 billion.

   • This amount is the highest so far and is about NPR 83 billion more than the previous fiscal year.

2. Income and Expenditure Imbalance:

   • The government's income has not increased in line with its expenditures, necessitating the raising of public debt, which in turn increases the repayment obligations.

   • About six percent of the total budget had to be allocated for repayment in a single fiscal year.

3. Principal and Interest Details:

   • According to the Public Debt Management Office, the government repaid NPR 223.34 billion in principal and NPR 82 billion in interest in the last fiscal year.

4. Priority on Domestic Debt:

   • For domestic loans, the government repaid NPR 255.39 billion, which includes NPR 182.62 billion in principal and NPR 72.76 billion in interest.

   • Domestic loans are given higher priority over foreign loans due to their higher interest rates and shorter terms.

5. Foreign Loan Repayment:

   • In terms of foreign loans, the government repaid a total of NPR 49.98 billion, including NPR 40.72 billion in principal and NPR 9.26 billion in interest.

   • Foreign loans generally have an average interest rate of 1.5 percent and longer terms, thus creating less pressure on the government.

6. Overall Debt Situation:

   • Despite repaying NPR 305 billion in debt, the total public debt reached NPR 2,434 billion by the end of the last fiscal year.

   • An additional NPR 358 billion in debt was added in the last fiscal year alone.

   • Of the total debt, domestic debt amounts to NPR 1,180 billion, while foreign debt is NPR 1,253 billion.

Conclusion:

The government repaid NPR 305 billion in principal and interest on loans in the last fiscal year, the highest amount so far. The necessity to raise public debt due to the imbalance between income and expenditure has resulted in significant repayment obligations, posing a substantial financial challenge for the government. While domestic loans are given higher priority, the government also continues to regularly repay foreign loans.