According to reports, a Chinese bank has granted $700 million to Pakistan. The Minister of Finance of Dar has stated that the SBP anticipates receiving the loan within the next week.
Ishaq Dar, Pakistan’s finance minister, reported on Wednesday that the board of the China Development Bank (CDB) has authorised a $700 million loan for Pakistan.
The nation’s foreign exchange reserves alarmingly fell below $3 billion earlier this month for the first time in nine years, cutting the country’s ability to import goods to little over two weeks.
Pakistan has sought assurances from Saudi Arabia and China for further funds as the government works to restart the International Monetary Fund (IMF) programme.
Ishaq Dar’s first inclination after becoming finance minister in September was to look for financial support from allies in order to evade the strict criteria of the IMF.
The minister stated in November that he had obtained a $13 billion bailout from China and Saudi Arabia with the help of $5.7 billion in new loans. Dar was certain that the money would arrive before to the IMF programme restart.
With time, it became apparent that Islamabad’s previous partners would not provide additional funding without the nation first accepting the Fund’s requirements. When it came time to negotiate the arrangement, Pakistan had to invite the IMF mission.
After working so hard to persuade the IMF, the government is now hopeful that its allies will come to its aid.
Dar said on Twitter that CDB has decided to support Pakistan.
The finance czar said, “Formalities fulfilled,” adding that $700 million was anticipated to arrive at the State Bank of Pakistan (SBP) by this week.
The loan, he insisted, will “shore up” Pakistan’s foreign exchange reserves.
Islamabad, on the other hand, has consented to adopt the Memorandum of Economic and Financial Policy (MEFP), which includes IMF-recommended policy changes.
The staff-level agreement between the fund and the government is anticipated to be finalised next week, according to sources.
