Pakistan: China deposits $2.3 billion to boost Pak Banks reserves

Islamabad: Chinese government has deposited $2.3 billion in the State Bank of Pakistan (SBP) to boost Pakistan’s sliding foreign exchange reserves, Finance Minister Miftah Ismail announced on Friday, Express Tribune reported.
“I am pleased to announce that Chinese consortium loan of RMB 15 billion (roughly $2.3 billion) has been credited into SBP account today, increasing our foreign exchange reserves,” he wrote on his official Twitter handle.
This development comes two days after China signed a $2.3 billion commercial loan deal with Pakistan, as the government waits for the rollover of three more maturing loans totaling $2 billion.
The official foreign exchange reserves of Pakistan stood in single digits at $8.24 billion. However, these loans will give it a boost, opening blocked financing pipelines.
Pakistan had repaid the $2.3 billion commercial loan in March in the hope to get it back in April. However, China had placed a condition that the money could not be used due to weakening of the external sector position of Pakistan.
China also wants Pakistan to remain committed to the International Monetary Fund (IMF) loan program.
On Tuesday, the finance minister had announced a deal with the IMF on budget numbers, aligning the figures with the global lender’s assessments of revenues and expenditures for the next fiscal year.
The government has also accepted some of the tough conditions for the sake of reaching a deal with the IMF.
However, finance ministry officials said that the understanding reached with the IMF on the budget would help complete the legislation process before the end of the ongoing fiscal year on next Thursday. (UNI)

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