Sunday, January 08, 2023
ISLAMABAD: Minister for Finance and Revenue Senator Ishaq Dar said Saturday that Pakistan's foreign exchange reserves would "strengthen" in the coming days as he banks on friendly countries for inflows.
In conversation with Geo News, the finance minister said the country's reserves stood at a total of $10 billion — $4 billion of the State Bank of Pakistan and $6 billion of commercial banks.
"Pakistan is repaying its loans on time, and soon, the foreign exchange reserves will also boost," the finance minister said, as the country grapples with economic distress.
Foreign exchange reserves held by the SBP dwindled to only $4.5 billion after the repayment of loans worth $1.2 billion to the United Arab Emirates (UAE) banks, sources told Geo News Saturday.
This, according to sources, leaves the country with an import cover of only under a month, as Pakistan faces a severe economic crunch amid a greenback shortage.
A breakup shows Pakistan returned $600 million to the Emirates Bank, while it repaid $420 million to the Dubai Islamic Bank, according to sources.
The finance minister mentioned that a delegation of the International Monetary Fund (IMF) would soon visit the country and he would also meet the lender's officials at the Geneva moot.
The International Conference on Climate Resilient Pakistan will take place on January 9 in Switzerland's Geneva, where the coalition government aims to raise funds in its bid to recover from the deadly floods.
After concluding the visit to Geneva, Dar, without mentioning further, told the media outlet that he would visit the United Arab Emirates (UAE) on a three-day official visit.
"Funds from Saudi Arabia and other friendly countries will soon be received," the finance minister said, who told journalists earlier this week that he expects inflows from the Kingdom and China "in a few days".
Amid a crisis-like situation, Pakistan will have to repay approximately $8.3 billion in the shape of external debt servicing over the next three months (Jan-March) of the current fiscal year.
The government is eyeing to secure a $1.7 billion bailout package through the ninth review of the IMF, but both sides have made no substantial headway in recent days.
PM Shehbaz has said an IMF delegation was slated to visit Pakistan in 2-3 days to “take up and finalise” the ninth review of the economy to unstick a direly needed bailout tranche of $1.1 billion.
In light of the economic crisis, the National Security Committee (NSC) has also recently agreed on undertaking concrete steps — including import rationalisation as well as preventing illegal currency outflows and hawala business — in order to strengthen the economy.