By Staff Reporter
ISLAMABAD: Pakistan’s inflows of foreign loans and grants rose 14% in the first five months of the fiscal year, driven mainly by support from the International Monetary Fund, as the cash-strapped South Asian nation works to shore up its external finances amid ongoing economic pressures.
The inflows totalled $3.032 billion in July through November, up from $2.667 billion in the same period a year earlier, according to data released by the Ministry of Economic Affairs. That marks a modest rebound, though inflows in November alone came in at $511 million, up from $471 million in October but down almost 46% from $944 million a year ago.
The figures exclude a $1.2 billion disbursement from the IMF earlier this month, which will be reflected in later accounts. Foreign loan inflows jumped 46.22% to $2.521 billion over the five months, compared with $1.724 billion last year, while grants dropped 43% to $54 million from $94 million.
Pakistan has set a target of $19.9 billion in total foreign inflows for the current fiscal year, slightly higher than the $19.4 billion achieved last year. The government is leaning on multilateral and bilateral lenders, as well as deposits from allies, to meet its goals and stabilise reserves that have hovered precariously low in recent years.
In the comparable period of 2023, inflows exceeded $4.3 billion, bolstered by the signing of a nine-month Stand-By Arrangement with the IMF. That deal unlocked a $2 billion time deposit from Saudi Arabia, pushing July 2023 inflows alone to $5.1 billion, including $1.2 billion from the IMF and $1 billion from the United Arab Emirates.
The Ministry of Economic Affairs said that of the total inflows in the first five months, $1.157 billion was for project financing, while non-project inflows reached $1.875 billion. Budget support loans amounted to $966 million during the period, even as the annual target for such financing was trimmed to $13.5 billion from $15 billion last year.
Pakistan also drew $500 million from the Saudi Oil Facility in the five months, at a pace of $100 million per month, against a full-year target of $1 billion. From multilateral lenders excluding the IMF, inflows totaled $1.258 billion, down from $1.46 billion a year ago, when the annual target was $4.5 billion. This year’s full-year goal from multilaterals stands at $5 billion.
Bilateral lenders, excluding three key allies, provided $808 million, more than triple the $269 million from the same period last year and against an annual target of $1.36 billion. Last year’s full-year bilateral target was $523 million.
Combined inflows from bilateral and multilateral lenders hit $2.066 billion in the five months, versus a yearly target of $6.4 billion. In the prior year, such inflows were $1.73 billion against a $5.05 billion goal.
Overseas Pakistanis contributed $966 million through Naya Pakistan Certificates, up from $735 million a year earlier and already surpassing the full-year target of $609 million by a wide margin. The government’s $19.9 billion inflow target for the fiscal year includes $6.4 billion from multilateral and bilateral lenders—broken down as $5.05 billion from multilaterals and $1.36 billion from bilaterals—plus $400 million in international bonds, $3.1 billion in foreign commercial loans, $5 billion in time deposits from Saudi Arabia, and $4 billion in SAFE deposits from China.
Copyright © 2021 Independent Pakistan | All rights reserved
