Pakistan had borrowed $13.033 billion dollars from various sources in July-April period of current fiscal year

ISLAMABAD  -  Owing to the political and economic uncertainty in the country as well as stalled IMF’s loan programme, the multilateral and bilateral sources have adopted tight cash release for Pakistan by giving only $262.14 million foreign loan to the country in April.

Pakistan was receiving foreign loans at rapid pace before no confidence motion against previous government in March as the country had received $12.178 billion in eight months (July to February) of current fiscal year. However, the foreign borrowing has considerably reduced to $851.11 million in last two months (March and April). The officials in Ministry of Economic Affairs informed that volume of foreign borrowing has shrunk mainly due to the political and economic uncertainty in the country as well as stalled loan programme of International Monetary Fund (IMF).

“The international lenders including World Bank, ADB (Asian Development Bank) and others will give loan once Pakistan satisfies the IMF on its economic situation,” said an official of the ministry while talking to The Nation on Monday. He further said that the multilateral and bilateral sources are waiting for the conclusion of the talks with the IMF, which are underway in Doha, Qatar for the seventh review under extended fund facility. The IMF would release around one billion dollars to Pakistan in case the talks remain successful. Talks are expected to complete tomorrow (Wednesday).

The incumbent government is in desperate need to receive dollars from the international sources to build the country’s foreign exchange reserves held by the State Bank of Pakistan, which have fallen to slightly above $10 billion. The reserves have declined mainly due to the repayment against previous loans as well as financing of current account deficit in ten months (July to April) of the ongoing financial year.

The latest data of the Ministry of Economic Affairs has shown that Pakistan had borrowed $13.033 billion dollars from various sources in July- April period of the current fiscal year. According to the latest data, the government has budgeted estimates of foreign assistance of $14.088 billion for the current financial year, including $13.871 billion loans and $217.44 million grants from multilateral and bilateral sources. However, the government has received $13.033 billion in just ten months of the current fiscal year. The government has borrowed more in current fiscal year as against the same period of the previous year. In corresponding period of last year, the government had borrowed $10.195 billion from international lenders. The total receipt of $13.033 billion constitutes $4.050 billion from multilateral, $485.97 million from bilateral, $2.623 billion from foreign commercial banks, and $2.041 billion from issuance of bonds and $3 billion dollars time deposit from Saudi Arabia. The non-project aid was $10.263 billion including $9.024 billion for budgetary support and project aid was $1.937 billion. Guaranteed loans were $832.53 million during the first ten months of 2021-22.

The government borrowed $2.623 billion from foreign commercial banks during the first nine months of the current fiscal year including $1.140 billion from Dubai Bank, $487.26 million from SCB (London), $61 million from Ajman Bank PJSC, $343.50 million from Suisse AG, UBL and ABL and $591.25 million from Emirates NBD.

Among multilateral development partners, mainly the Asian Development Bank provided $ 1.436 billion, the World Bank disbursed $ 1.122 billion, the AIIB $38.87 million, IDB $68.16 million and IDB (S-Term) $ 1.207 billion. China disbursed $102.05 million in the first nine months (July-March) of the current fiscal year, USA $60.85 million, Korea $4.06 million, UK $14.54 million, and Germany $12.36 million during first ten months of the current fiscal year, according to the official data.