For the first time, Nepal’s outstanding public debt crossed Rs 3 trillion. By mid-October 2026 (first quarter of FY 2026/27, i.e. 2083/84), the total reached about Rs 3,009 billion, according to the Public Debt Management Office (PDMO). Debt servicing in the quarter was higher than capital spending.
Key figures (mid-October 2026)
| Item | Amount |
|---|---|
| Total public debt | Rs 3,009.11 billion (45.59% of GDP) |
| External (foreign) debt | Rs 1,598.80 billion – 53.13% |
| Domestic debt | Rs 1,410.31 billion – 46.87% |
| Debt at end of FY 2025/26 (mid-July 2026) | Rs 2,981 billion |
| New borrowing in Q1 | Rs 123.32 billion (Rs 100 bn domestic + Rs 23.32 bn external) |
| Annual borrowing target 2026/27 | Rs 658.28 billion (Rs 410 bn domestic, Rs 248.28 bn external) |
| Debt servicing in Q1 | Rs 98.87 billion (principal Rs 77.74 bn + interest Rs 21.12 bn) |
| Capital expenditure by mid-October | Rs 28.42 billion |
Why it matters
- Debt per person is now over Rs 1 lakh.
- Debt has more than doubled since FY 2019/20 (Rs 1,433 billion, 38% of GDP).
- More money for repayment leaves less for development (capital) spending.
- The National Natural Resources and Fiscal Commission recommends keeping federal domestic borrowing within 5.5% of GDP.
Practice MCQs
1. Which office manages and reports Nepal’s public debt?
a) Nepal Rastra Bank b) Public Debt Management Office c) Office of the Auditor General d) National Planning Commission
Answer: b) Public Debt Management Office
2. By mid-October 2026, the share of external debt in Nepal’s total public debt was about:
a) 33% b) 46% c) 53% d) 65%
Answer: c) 53%
3. Nepal’s public debt as a share of GDP (mid-Oct 2026) was about:
a) 25% b) 35% c) 45.6% d) 60%
Answer: c) 45.6%
4. Which body recommends the domestic borrowing limit for governments in Nepal?
a) Ministry of Finance b) National Natural Resources and Fiscal Commission c) Nepal Rastra Bank d) Public Procurement Monitoring Office
Answer: b) National Natural Resources and Fiscal Commission
Related
Sources: Onlinekhabar English and Nepal News (30 Oct 2026), based on Public Debt Management Office data; Himal Press.