Home HEADLINES Pakistan to repay $1.7 billion on account of foreign debt till December

Pakistan to repay $1.7 billion on account of foreign debt till December

Pakistan to repay $1.7 billion on account of foreign debt till December

ISLAMABAD: Pakistan must make $1.7 billion on account of foreign debt repayments till December 2018, official data revealed on Friday piling up the risk to the country already plummeting foreign exchange reserves.

Data obtained from various ministries reveals Pakistan requires to make debt servicing of over $1.7 billion in form of principal and markup on outstanding foreign loans in the present 2nd quarter, reports The News.

Overall foreign debt obligations during the current FY19 are projected at $9 billion, as per latest data and the foreign exchange reserves of the central bank continued to plummet as they touched $7.67 billion on November 2nd a decrease of $98 million due to external debt servicing.

Although Saudi Arabia had promised $3 billion to shore up the central bank’s forex reserves, however, the State Bank of Pakistan (SBP) hasn’t received any inflows yet.

As the economic managers negotiate a possible bailout package with the visiting International Monetary Fund (IMF) delegation, the issue of debt servicing has assumed great significance.

During July this year, the Chinese had extended $2 billion to shore up the country’s forex reserves.

And project financing has plunged by approximately 40% in current FY19 due to the failure of Islamabad to timely approve donors-funded projects because of political transition and enacting of a ban on development funds four months ago by the Election Commission of Pakistan (ECP).

According to finance ministry projections, Pakistan will have to repay around $700 million to multilateral creditors, $400 million to bilateral creditors, $76 million to the IMF, $298 million in shape of commercial loans and $200 million due to bond repayments in October-December period.

Moreover, the Asian Development Bank (ADB) is going to be repaid $129 million, $65 million to the International Bank for Reconstruction and Development (IBRD), $102 million to the International Development Association (IDA), $24 million to the Islamic Development Bank (IDB).

Also, $1 million each are to be paid to the Organization of the Petroleum Exporting Countries Fund and International Fund for Agriculture Development (IFAD).

During the current months, the government will repay $572 million as principal and $146 million as interest payment on loans obtained and repay $34 million to the IMF too.