By Staff Reporter
ISLAMABAD: Pakistan’s external borrowing fell 37 percent to $10.8 billion in the fiscal year 2022/23, the lowest level in four years, as a stalled IMF programme reduced access to foreign loans from commercial banks and friendly countries, official data showed on Friday.
The borrowing included $2.2 billion from foreign commercial banks, $5.2 billion from multilateral lenders, $1.5 billion from bilateral donors and $1.2 billion from the International Monetary Fund, according to data from the Economic Affairs Division.
The government had budgeted to borrow $22.8 billion from external sources in the fiscal year 2022-23, including $7.5 billion from foreign commercial banks.
However, it fell short of the target by $12 billion, partly because it did not include the rollover of $6 billion in deposits from China and Saudi Arabia and the refinancing of a $1.3 billion Chinese loan.
The government, however, claimed that the lower borrowing reflects Pakistan’s efforts to reduce its reliance on expensive and short-term debt and to improve its external balance of payments position.
The country’s current account deficit narrowed to $1.8 billion in the fiscal year 2022-23, compared with $4.4 billion in the previous year, according to the central bank.
The government also raised $789 million from overseas Pakistanis through the Naya Pakistan Certificate program, which offers attractive returns on dollar- and rupee-denominated bonds.
The main sources of multilateral loans were the Asian Development Bank, which disbursed $2.3 billion, and the World Bank’s International Development Association, which disbursed $1.9 billion. The main bilateral donors were Saudi Arabia, which provided $1.2 billion under an oil facility agreement, and China, which provided $128 million.
The government received $2.2 billion in external loans in June, the last month of the fiscal year, including $1.3 billion from foreign commercial banks and $429 million from the IDA. The IMF has also disbursed $1.2 billion under the new short-term program, which was signed in June.
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