The Ministry of Economic Affairs reported on Tuesday that during July, the government estimated receiving foreign loans worth $1.6 billion while $800 million were borrowed in the same month of the previous year.
Approximately, $1.2bn were borrowed on account of budgetary support and $176m were taken to pay for crude oil imports.
A $1.04bn worth loan was obtained through Eurobonds at an interest rate that ranged between 5.875 per cent and 8.5pc. While $149m was obtained through commercial loans from Ajman Bank and Standard Chartered Bank, London. Islamic Development Bank for crude oil imports, the Asian Infrastructure Investment Bank and Asian Development Bank (ADB) granted a loan worth $176m, $28m and $31m respectively. Lastly, China gave $67.4m to finance the Multan-Sukkur motorway.
The cost of external debt servicing has gone up significantly due to increasing reliance on foreign loans to manage the foreign exchange reserves and repay the loans.
According to the State Bank of Pakistan (SBP), the current has increased the public debt by 60pc since June 2018 by adding Rs14.9 trillion.