ISLAMABAD: Pakistan and China are reported to have reach and agreement for a $700 million commercial loan in what appears to be a move to temporarily stabilise the extremely thin foreign currency reserves.
Finance Minister Ishaq Dar confirmed the deal, saying that the amount is expected to be received this week by State Bank of Pakistan.
Formalities completed and Board of China Development Bank has approved the facility of US $ 700 million for Pakistan. This amount is expected to be received this week by State Bank of Pakistan which will shore up its forex reserves!
— Ishaq Dar (@MIshaqDar50) February 22, 2023
Earlier, there were media report saying that the agreement for the $700 million loan between Pakistan and the China Development Bank was reached at the weekend, and the money is expected to be transferred this week.
Without clarifying the origin of the money and the amount of the loan, Finance Secretary Hamed Yaqoob Sheikh has been quoted as saying that “one loan will be rolled over in a day or two.”
The finance secretary further said another rollover was expected within this week — in a veiled reference to the loans being given by the Industrial and Commercial Bank of China (ICBC).
The latest agreement with China is expected to reviving prospects for a total of $2 billion injection from the friendly country, and it is now expected that the Industrial and Commercial Bank of China (ICBC) would reimburse one loan this month and the second one in March.
