Foreign inflows clock in at $6.67bn in 8MFY24, down by 10pc

ISLAMABAD: Pakistan has received $6.67 billion in the shape of total foreign loans during the first eight months (July-Feb) period of the current fiscal year against $7.76 billion in the same period of the last financial year.

The government has sought $17.6 billion in the whole financial year 2023-24 through foreign loans and grants.

The Kingdom of Saudi Arabia has so far remained the largest bilateral partner providing $595 million in shape of Saudi Oil Facility (SOF) in the first six months. Although, the last SOF got exhausted and Pakistan made a fresh request for additional $1 billion SOF but this deal could not be struck in February 2024. So the SOF facility in February 2024 remained zero.

This drop in foreign inflows occurred in the current fiscal year despite the fact that the IMF sponsored programme remained on track while it remained suspended in the most period of the last financial year. The scarcity in foreign inflows and increased debt repayments proved as major risks to the economy amid foreign exchange reserves held by the State Bank of Pakistan standing at just around $8 billion mark.

According to Economic Affairs Division (EAD) data, Pakistan has received $2.6 billion from multilateral creditors during the first eight months of the current fiscal year as the World Bank disbursed the major chunk of IDA loans to the tune of $1.221 billion. The Asian Development Bank disbursed $643.6 million, Asian Infrastructure Investment Bank $299 million and Islamic Development Bank $200 million.

The bilateral creditors have disbursed $848 million during the first eight months of the current fiscal year as Saudi Arabia provided $595 million in the shape of the SOF. China has provided $67.39 million, France $36.4 million, Saudi Arabia $59.1 million for other projects and USA $34.7 million.

Saudi Arabia also provided $2 billion as time deposit during the current fiscal year. In the shape of Naya Pakistan Certificate, Pakistan has received $686 million so far. Islamabad remained unable to secure commercial financing or launching of any international bonds during the current fiscal year. The EAD data does not incorporate the IMF funding to the tune of $1.9 billion so far received by Pakistan under two tranches of Standby Arrangement (SBA) programme.