ISLAMABAD – Finance Minister Ishaq Dar announced on Wednesday that the board of the China Development Bank (CDB) approved a loan facility of $700 million for Pakistan.
Taking to Twitter, the finance minister the State Bank of Pakistan (SBP) was expected to receive the money this week, which would help shore up the country’s dwindling foreign exchange reserves.
Formalities completed and Board of China Development Bank has approved the facility of US $ 700 million for Pakistan. This amount is expected to be received this week by State Bank of Pakistan which will shore up its forex reserves!
— Ishaq Dar (@MIshaqDar50) February 22, 2023
Pakistan is stuck in a dire balance of payment crisis and needs to secure the $1 billion tranche under the $6.5 billion Extended Fund Facility from the International Monetary Fund (IMF).
One of the demands of the global lender was that Pakistan needs to secure additional external financing avenues.
Apart from this, the IMF is also demanding slapping additional power surcharges and hiking the policy rate from Pakistan.
The government is currently holding virtual talks with the International Monetary Fund (IMF) for an economic bailout that would lead not only to a disbursement of $1.2bn but is also expected to unlock inflows from friendly countries and other multilateral institutions.
Dar had said earlier this year that the country’s foreign reserves situation would be “much better than you can think” by end-June.
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