| Updated at: 1258 PST, Sunday, September 19, 2010|
KARACHI: The government of Pakistan has taken massive loans from State Bank of Pakistan (SBP), which may give further spur to the already soaring inflation, Geo News reported Sunday.
According to statistics issued by the central bank, the federal government took loan worth over Rs206 billion from July 1st to September 3rd, which stood at Rs76 billion in the corresponding period last fiscal year.
The economic experts said the borrowing from the central bank means that government is meeting its expenditures by just printing new currency notes without any production process, that led rapidly to mounting liquidity. And, the entire situation may contribute to hyped up inflation and price hike.
It should be mentioned here that government deal with International Monetary Fund (IMF) has it that volume of borrowings from the central bank will not be augmented so that price hike could be controlled.