Pakistan's forex reserves hit to new low after debt payment to Emirati banks

KARACHI – The foreign exchange reserves of the country shrunk further after Pakistan made repayments of borrowings to the two banks of the United Arab Emirates (UAE).

Reports said the forex reserves dipped $1.2 billion to $4.5 billion after making payments to the Emirates NBD Bank and the Dubai Islamic Bank.

Pakistan paid $600 million to the Emirates bank and $420 million to the other bank. Now, the import cover of the country has dropped below one month.

Prime Minister Shehbaz Sharif is set to leave for Geneva where he will co-host, along with the United Nations, the International Conference on Climate Resilient Pakistan. The South Asian country is expected to secure lending from the moot. 

With depleting reserves, Pakistan is scrambling to revive the loan programme of the International Monetary Fund (IMF) and expecting assistance from friendly states, including China and Saudi Arabia.

A day earlier, Prime Minister Shehbaz Sharif held a telephonic conversation with IMF Managing Director Kristalina Georgieva and assured her of Pakistan’s commitment to successfully completing the ongoing loan programme.

Georgieva reiterated her commitment to help Pakistan in the difficult period. She also expressed her deep sympathy and concern on the human and material losses due to the recent floods.

The premier thanked the IMF managing director for her concern on the fallout of the floods and extended invitation to her to participate in the Climate Resilient Pakistan Conference at Geneva.

Earlier this month, the State Bank of Pakistan’s (SBP) data showed that the central bank’s forex reserves plunged by $245 million to reach $5.58 billion – the lowest since April 2014.