February 23, 2023
ISLAMABAD – Finance Minister Ishaq Dar announced on Wednesday that the board of the China Development Bank (CDB) has approved a loan facility of $700 million for Pakistan and formalities in this regard have been completed.
The State Bank of Pakistan (SBP) was expected to receive the money this week, which would help shore up the country’s dwindling foreign exchange reserves, Dar wrote on Twitter.
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
Pakistan is in dire need of funds as it battles a worsening economic crisis with the country’s foreign exchange reserves dropping to around $3 billion, barely enough to cover three weeks of controlled imports.
The government is currently holding virtual talks with the International Monetary Fund (IMF) for an economic bailout that would lead not only to a disbursement of $1.2bn but is also expected to unlock inflows from friendly countries and other multilateral institutions.
Dar had said earlier this year that the country’s foreign reserves situation would be “much better than you can think” by end-June.
China and Saudi Arabi would enhance their support, government-to-government (G2G) disinvestments would be completed, and the current account deficit would be about $3bn less than earlier projections, he had said.