Nepal Adds Over Rs 14 Billion to Sovereign Debt in First Month of Current FY

Nepal’s sovereign debt increased by more than Rs 14 billion in the first month of the current fiscal year (FY 2025/26), according to the Public Debt Management Office.

A report published by the office shows that total public debt, which stood at Rs 2669 billion at the start of the fiscal year, reached Rs 2683 billion by mid-August, marking an addition of Rs 14.02 billion in the month of Shrawn (mid-July to mid-August). Public debt now accounts for 43.94 percent of the country’s GDP.

Of the total debt, 52.26 percent (around Rs 1.42 trillion) is external, while 47.74 percent is domestic.

The government has set a target to raise Rs 595 billion in public debt this fiscal year. By mid-August, Rs 44.57 billion, or 7.48 percent of the annual target, had been mobilized.

The government aims to raise Rs 362 billion in domestic loans during the fiscal year, of which Rs 40 billion, or 11.05 percent of the target, was mobilized in the first month. Similarly, for external loans, the target is Rs 233.66 billion, but only Rs 4.57 billion, or 1.96 percent, had been raised by mid-August.

For debt servicing, the budget has allocated Rs 411 billion for interest payments this year. Of this, Rs 36.68 billion was paid in the first month alone, representing 8.93 percent of the annual allocation, the Public Debt Management Office said. -- RSS