Public Debt Management Office (PDMO) is the dedicated government agency responsible for public debt management. The PDMO is under the Ministry of Finance and is headed by gazetted first class officer of Government of Nepal. To make the public debt management function more effective and systematic, the Government of Nepal established a separate office on Ashad 20, 2075 (June 20, 2018). It was formally inaugurated on Poush 11, 2075 (December 26,2018) and started to perform the preliminary functions.
Public Debt Management Act, 2022 has come into effect from Kartik 22, 2079 (Nov 8, 2022). The act has provided the legal basis to the PDMO for the operation of debt management functions. Debt management objective is enshrined in the preamble of the act. The main objective of raising the public debt is to accelerate the rapid economic development and maintain the economic stability. While doing so, emphasis is given to the management of internal and external loan and amendment of the legal provisions of issuing government guarantees ensuring the coordination and harmonization between fiscal and monetary policy.
Front office functions, middle office functions and back office functions are the main responsibilities of the PDMO. Currently, Nepal Rastra Bank (NRB) is responsible for the front office functions (managing internal borrowing for the government), PDMO for middle office functions and back office functions (debt servicing) and Ministry of Finance for middle office functions as well as front office functions (managing external borrowing). However, all these functions are yet to be integrated and conducted by the PDMO.