A seminar on “Public Debt and Fiscal Sustainability in Nepal” was successfully organized today in Nepal Administrative Staff College, Jawalakhel, Lalitpur, with first technical session on “Debt Stock and Structure in Nepal: Domestic versus External Debt.” The seminar was organized by KYE Group-I as part of the Know Your Economy module of ACMD-IV with the objective of promoting informed discussion on Nepal’s public debt dynamics and their implications for fiscal sustainability.
The program brought together senior officials from NASC, guest expert and twenty-five participants from ACMD-IV. Discussions centered on the current level and composition of Nepal’s public debt, recent trends in domestic and external borrowing, and associated fiscal risks.
The Chief Guest of the program was Executive Director of NASC Mr. Ram Sharan Pudasaini. Other guests included Dr. Raghu Bista, Mr. Yagya Prasad Dhungel, Course Coordinator Mr. Gobinda Bhandari. Mr. Babu Ram Subedi was invited as the guest expert. The group constituted of Mr. Nandkishor Yadav, Mr. Basudev Sigdel, Mr. Kamal Dev Kuswaha, Ms. Maleena Shakya, Mr. Om Prakash Mahato and Mr. Prasiddha Upreti. The program was chaired by Mr. Kamal Dev Kuswaha and Mr. Nandkishor Yadav, Mr. Basudev Sigdel, Mr. Om Prakash Mahato presented the seminar paper.
In the thematic session on debt stock and structure, Mr. Basudev Sigdel highlighted the global debt scenario, growing size of public debt in recent years, changes in the balance between domestic and external debt in the past ten years in Nepalese context. Mr. Sigdel also emphasized the fact that 3.4 billion people live in countries that spend more on interest than on health or education. Mr. Nandkishor Yadav pointed out the gaps in budgetary operation highlighting trends in debt accumulation, the composition of domestic and external debt, and relation between GDP, export, import and financial expenditure. Mr. Om Prakash Mahato stressed on the issues and challenges of public debt along with policy implications for Debt sustainability.
During the interactive question-and-answer session, participants raised key issues related to rising external debt exposure, exchange rate risks, debt servicing pressures, and the effectiveness of current debt management practices. The invited experts and participants shared reflections on the presentation and policy discussions. Feedback highlighted the need to focus on debt instruments, institutional and absorptive capacities, enhanced debt sustainability analysis for improved debt transparency. Mr. Babu Ram Subedi underscored that public debt does not become a burden when it is invested in revenue-generating activities or productive infrastructure that supports long-term economic growth and strengthens the government’s capacity to repay.
The seminar concluded with Mr. Ram Sharan Pudasaini summarizing the session and appreciated the efforts made by the participants while clearing some misunderstanding regarding public debt.
He even stressed on the importance of prudent debt management, evidence-based policymaking, and the importance of maintaining a balanced debt structure to minimize fiscal and macroeconomic vulnerabilities.
