Pakistan secures over $237 million in external financing in April

WEB DESK: Pakistan secured external financing amounting to $237.24 million in April 2024, according to the latest report by the Economic Affairs Division (EAD). This financing included $228.64 million in loans and $8.60 million in grants from various sources.

In the first ten months of the fiscal year 2024 (10MFY24), Pakistan managed to secure a total of $7.14 billion in external financing, far short of the annual budget estimate of $17.62 billion.

Non-project aid and commercial borrowing

In April, the government obtained a $117.39 million loan for non-project aid, specifically for programme and budgetary support to help restructure the economy. Over the 10MFY24 period, loans for non-project aid totaled $4.84 billion.

Foreign commercial borrowing remained a significant component, with $107.95 million secured in April and $889.43 million over 10MFY24 through the Naya Pakistan Certificate. However, the government did not secure any funds from foreign commercial banks during this period, against a budget estimate of $4.5 billion for the fiscal year.

Bilateral and multilateral support

Disbursements from bilateral and multilateral development partners remained strong, totaling $129.29 million in April and $3.74 billion in 10MFY24. Despite bolstering foreign exchange reserves, these inflows fell short of the government’s budget expectations.

Multilateral sources provided nearly $121.61 million in April and $2.87 billion in 10MFY24. The International Development Association-World Bank (IDA) led multilateral funding in April with $61.73 million, followed by the Asian Development Bank (ADB) with $42.78 million, the International Bank for Reconstruction and Development (IBRD) with $8.52 million, and the Asian Infrastructure Investment Bank (AIIB) with $6.33 million.

Cumulatively, the IDA has been a major contributor with $1.35 billion, followed by the ADB with $708.30 million, and the AIIB with $309.95 million over 10MFY24.

Bilateral development partners provided $7.68 million in April and $877.76 million in 10MFY24. Germany contributed $3.10 million, Korea $1.80 million, France $1.77 million, and the USA $1.01 million in April. Saudi Arabia’s oil facility was a significant source of bilateral funding, contributing $595.18 million in 10MFY24.

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