KARACHI: The government will borrow Rs3.5 trillion during the next three months to meet the increasing liquidity requirement.

The State Bank’s calendar shows that the government will raise Rs3.475tr from Sept 4 to Nov 27 through treasury bills. However, this amount is less than the maturing amount of Rs4.594tr during the same period.

Over the past several years, the government’s substantial borrowing from the banking sector has significantly strained the economy to the extent that the entire tax revenue is now being utilised for debt servicing.

The interest rate was at an unprecedented 22 per cent in FY24, and the government borrowed a record around Rs8.4tr the same year.

Published in Dawn, September 11th, 2024