SBP-held forex reserves surge to over $9 billion

ISLAMABAD   -  Pakistan’s foreign exchange reserves held by the State Bank of Pakistan (SBP) have increased to over $9 billion after getting last tranche from the International Monetary Fund (IMF).

The total liquid foreign reserves held by the country stood at $14,458.9 million as of 03-May-2024. The break-up of the foreign reserves position showed that foreign reserves held by the State Bank of Pakistan are $9,120.3 million and net foreign reserves held by commercial banks are $5,338.6 million. “During the week ended on 03-May-2024, SBP reserves increased by $1,114 million to $9,120.3 million mainly due to receipt of $1.1 billion from IMF as final tranche under SBA program,” the State Bank of Pakistan said on Thursday.

Pakistan has borrowed a $9.796 billion loan from international lenders in the first nine months (July to March) of the current fiscal year to build the country’s foreign exchange reserves. The country has received $6.899 billion in budget and project financing and another $2.2 billion came in State Bank of Pakistan’s account.

The government had budgeted $17.619 billion from multiple financing sources for the current fiscal year including $17.384 billion loans and $234.60 million grants. The govt received only 55.6 percent in the period from July to March in the current financial year.

The country has received tranche after completing second IMF programme. Pakistan had completed the first IMF programme in 2015-16. Now, the country has completed the IMF programme for the second time out of total more than 20 programmes.

Pakistan had recently requested the IMF for a fresh loan programme. Finance Minister Mohammad Aurangzeb stressed that apart from the IMF, no plan B could be imagined, with the new staff-level agreement expected in June or July. The IMF mission is likely to visit Pakistan in next few days to finalise the salient features of the upcoming bailout package under the $6-$8 billion Extended Fund Facility (EFF) programme. The size of the next EFF programme will be finalised during the upcoming parleys between the two sides.

Meanwhile, workers’ remittances recorded an inflow of $2.8 billion during April 2024. In terms of growth, during April 2024, remittances increased by 27.9 percent on y/y basis.

Cumulatively, with inflow of US$ 23.8 billion, workers’ remittances increased by 3.5 percent during first 10 months of FY24 compared to the same period last year.

Remittances inflows during April 2024 were mainly sourced from Saudi Arabia (US$ 712.0 million), United Arab Emirates (US$ 542.3 million), United Kingdom (US$ 403.2 million) and United States of America (US$ 329.2 million).

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