ISLAMABAD: Pakistan’s Finance minister Ishaq Dar said Friday that China had rolled over a 2 billion dollar loan that matured last week, providing relief during Pakistan’s acute balance of payment crisis.
Pakistan’s reserves have shrunk to just 4 weeks’ worth of imports, and talks over an International Monetary Fund bailout tranche of 1.1 billion dollars have hit a stalemate.
The minister informed the Senate that he was happy to confirm that this had been rolled over on 23 March, referring to the maturity date.
Ishaq Dar avoids giving new date
His comments are the first official announcement of the rollover after the loan matured. Dar did not give the new date of the loan maturity or other terms of the arrangement.
Islamabad has been talking with the lending agency since early February for the release of 1.1 billion dollars from a 6.5 billion dollars bailout package agreed upon in 2019. One of the Fund’s conditions for releasing the tranche is the assurance of external financing to fund the country’s balance of payments.
Pakistan is facing a deep economic crisis, and foreign exchange reserves held by the State Bank of Pakistan (SBP) have shrunk to 4.2 billion dollars.
Total liquid foreign reserves held by Pakistan are 9.8 billion dollars, as net foreign reserves held by commercial banks stood at 5.6 billion dollars.
Earlier in March, Pakistan received the second disbursement of 500 million dollars from the Industrial and Commercial Bank of China.
Pakistan has received 1.7 billion dollars from Chinese institutions so far.
