The country’s total public debt has reached Nu 306.3bn as of March this year, according to the Financial Year 2026–27 Budget Report presented by the finance minister in today’s National Assembly session. This is an increase from Nu 302.7bn in September last year and is equivalent to 90.6 per cent of the country’s estimated Gross Domestic Product.
Of the total debt, external debt accounted for Nu 285.23bn, while domestic debt stood at Nu 21.10bn.
According to the report, hydropower projects made up the largest share of external debt.
Finance Minister Lekey Dorji said, “The highest composition of external debt is related to hydropower projects, which accounts for 58.3 per cent, while non-hydropower project debt makes up 41.7 per cent of total external debt.”
Central government debt, which refers to non-hydro budgetary debt, represented 38.2 per cent of the total public debt. “This remains within the limit set under the Public Debt Management Policy 2023, which requires Central Government debt to stay below 55 per cent of GDP annually,” added the minister.
Meanwhile, debt servicing, cash required to repay interest and principal on loans, for the 2026–27 fiscal year is projected at Nu 27.76bn. This includes Nu 11.08bn in interest payments and Nu 16.68bn in principal repayments.
External debt servicing accounts for the bulk of the total at Nu 23.16bn. Of this, Nu 13.69bn is for principal repayment and Nu 9.47bn for interest payments.
Kinley Bidha
Edited by Phub Gyem
