ISLAMABAD: $1.4b of loans were obtained by Pakistan during the first quarter of financial year 2017-18 to shore-up foreign exchange reserves and to fill budget deficit gap.
Foreign commercial banks provided the bulk of loans, touching $458m or contributing one-third of the total amount reported a local newspaper. China provided $239.8m and Islamic Development Bank gave $392m for budgetary support purposes as per Ministry of Finance and Economic Affairs.
Total foreign assistance during first quarter of FY 2017-18 touched $1.5b out of which $130.5m were grants provided by UK to the tune of $81.6m and US provided $21m.
Last week, Profit had reported Pakistan had borrowed $450m on a short-term facility from a Credit Suisse led consortium of commercial banks for shoring up its dwindling foreign exchange reserves. Out of the $450m loan, $205m had already been released according to official data.
$923m of these $1.5b loans from foreign commercial banks were obtained to help Pakistan in meeting its foreign currency requirements. Also on Tuesday, the finance ministry completed the process of hiring financial advisors for the issue of Eurobond and Sukuk to raise further loans.
During the four-years of this incumbent govt, external debts and liabilities have ballooned to over $83b. Project loans according to official data stood at a mere 38.7pc or $583m compared to 61pc budgetary loans acquired in the same period.
Asian Development Bank only released $117.3m during the first quarter (July-September) of FY 2017-18 and World Bank disbursed $118.8m out of the annual allotted amount of $1.03b.
Project loans disbursement has been a headache for the govt due to systematic issues and bureaucratic hurdles. By the end of July 2017, total project loans stood at $29.7b out of which only $13.1b had been released by multilateral and bilateral donors, leaving a balance of $16.6b
