By Staff Reporter
ISLAMABAD: Pakistan’s ability to secure foreign loans has decreased by 40 percent in the first nine months (July-March) period of the current fiscal year, as it only managed to secure a total of $7.7 billion compared to $12.7 billion in the same period last year, official figures showed on Wednesday.
This inability to generate dollar inflows in the form of loans and grants can be attributed to Islamabad’s failure to complete a stalled bailout deal with the International Monetary Fund (IMF) and effectively undertake donor-funded projects.
The Kingdom of Saudi Arabia (KSA) has emerged as Pakistan’s largest bilateral partner, providing $782.82 million in the form of an oil facility during the first nine months of the current fiscal year. The KSA also disbursed $100 million in project financing during the current financial year.
Multilateral creditors contributed significantly to Pakistan’s loan portfolio, with $4.02 billion obtained from them during the first nine months of the current fiscal year. This includes $1.94 billion from the Asian Development Bank (ADB), $546.7 million from the Asian Infrastructure Investment Bank (AIIB), $1.1 billion from the World Bank’s International Development Association (IDA), $146.9 million from the World Bank’s International Bank for Reconstruction and Development (IBRD), $38.4 million from the International Fund for Agricultural Development (IFAD), $16.81 million from the Islamic Development Bank (IsDB), and $161 million also from IsDB for a short term loan.
Bilateral donors contributed $1.06 billion during the period, with the United States disbursing $24 million, Japan $34 million, France $29 million, China $54 million, and Korea $21.31 million.
The government’s ability to generate commercial loans was also compromised due to its failure to strike a deal with the IMF. It was only able to generate $900 million in commercial loans in the first nine months, compared to the official projection of over $7 billion.
The IMF disbursed $1.16 billion and the government raised $612.3 million through Naya Pakistan Certificates in the current fiscal year, but could not fetch any amount through the launch of international bonds.
The government has budgeted a total of $22.817 billion in foreign assistance for the current fiscal year, which includes a significant portion of $7.5 billion from foreign commercial banks.
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