As the country attempts to acquire external finance and stay afloat, the State Bank of Pakistan’s (SBP) foreign exchange reserves increased just a little.
In its weekly bulletin, the SBP stated that its reserves had increased by $30 million to $4.46 billion as of April 20, providing an import cover of less than a month – a stance that has been consistent for several months.
Commercial banks hold $5.56 billion in net foreign reserves, $1.1 billion higher than the SBP, bringing the total liquid foreign reserves to $10.02 billion.
Although the central bank did not disclose the reason for the increase, reserves increased by $300 million last week due to a loan from the Industrial and Commercial Bank of China.
The $350 billion economy is in disarray due to financial difficulties and a delay in reaching an agreement with the International Monetary Fund (IMF) that would release much-needed cash critical to avoiding default.
Since the end of January, the government has been in talks with the Washington-based lender about resuming the $1.1 billion loan tranche that has been on hold since November as part of a $6.5 billion Extended Fund Facility (EFF) agreed upon in 2019.
Finance Minister Ishaq Dar stated earlier this week that Pakistan has “fulfilled all of the IMF’s conditions” and hoped that the Fund would sign the staff-level agreement shortly.
Dar told News that Saudi Arabia and the United Arab Emirates (UAE) had informed the IMF of their plans to donate $3 billion to Pakistan.
Dar claimed Riyadh will provide $2 billion, while Abu Dhabi has offered $1 billion to Pakistan, and that the Washington-based lender has been informed.
Dar claimed Riyadh will provide $2 billion, while Abu Dhabi has offered $1 billion to Pakistan, and that the Washington-based lender has been informed.
According to the finance minister, all of the prerequisites for the Pakistan-IMF staff-level agreement have been met.
“Pakistan is hopeful that the IMF will soon sign the SLA and get it approved by its Executive Board,” Ishaq Dar remarked.
