Pakistan Has to Make Net Debt Repayments of $8 Billion in Remainder of FY24: SBP Governor

State Bank of Pakistan (SBP) Governor Jameel Ahmad on Thursday said that the country’s total external financing requirement for the current fiscal year (FY24) stands at $24.6 billion, which includes interest payments of $3.4 billion and $21 billion in principal repayments. However, the governor said that out of this amount $2.8 billion has already been paid ($2.2 principal and $0.6 interest) and the central bank has received commitments for rollovers worth $8 billion, with an additional expectation of $3 billion to be rolled over. This leaves the net payable amount at $8 billion for the remainder of FY24. The governor said that the current account deficit (CAD) target is 0.5-1.5 percent of GDP for FY24. He also pointed out that the CAD for August will be $160 million, much better than earlier estimates. Ahmad highlighted that all quantitative targets set by the International Monetary Fund (IMF) which includes NDA, swaps, and net international reserves have been met. He added that now all depends on how the government performs on remaining performance criteria like primary budget deficit, government guarantees, and targeted cash transfers. The SBP attributed the recent T-bill auction, where cutoff rates surpassed the policy rate, to a backdrop of economic uncertainty, depreciation of the Pakistani rupee, and market expectations of a potential policy rate hike. Earlier, contrary to market expectations, the central bank decided to keep the policy rate unchanged at 22 percent.