Govt borrows seven times more from banks

The government borrowed seven times more from banks during the first five months of the current fiscal year while the budgetary borrowing is reaching close to the amount it borrowed during the entire FY23. The latest data issued by the State Bank of Pakistan (SBP) on Tuesday showed that the government borrowed Rs3.585 trillion from July 1 to Dec 8 FY24 against Rs516bn in the same period last year. Total borrowing in FY23 was Rs3.7tr. Banks are eagerly parking their maximum liquidity in risk-free papers as the government keeps borrowing aggressively despite higher revenue growth. In the last auction held on Dec 13, the government received bids worth Rs4.6tr from banks and other corporate investors. The government picked Rs2.6tr out of it.