Pakistan is expected to receive more than $2 billion from various sources within the next one and a half months.
The sources include funds from the International Monetary Fund (IMF), the new Sukuk, and Eurobonds issues.
Reliable sources from within the State Bank of Pakistan (SBP) have told ProPakistani that the central bank will soon confirm the receipt of over $2 billion in confirmed credit, including $1 billion from the IMF next tranche and the remaining payment in par through respective issues of Sukuk and Eurobonds.
While the sources couldn’t confirm the draft timeline for the placement of funds with the bank, the prospectus inflows are expected to propel forex reserves to reach $20.5 billion in the near term.
Amid a widening current account deficit, declining foreign currency reserves, and a depreciating rupee, additional fundraising to meet budgetary requirements is essential for Pakistan. Earlier, the State Bank of Pakistan witnessed huge inflows of $3 billion from Saudi Arabia, pushing reserves to 25.1 billion by the week ending 3 December 2021. External debt and other official payments were also made, and the SBP reserves reflected a net addition of $2.648 billion to stand at $18.658 billion. The foreign exchange reserves held by the commercial banks stood at $6.4 billion.
It is pertinent to note that the Islamic denominated Ijara Sukuk was launched following a staff-level agreement with the IMF in November. The bond was launched with the aim that Pakistan would be able to get a ‘favorable’ deal in the shape of getting a competitive mark-up on offered amounts from potential investors.
Government officials at the time did mention that the remaining $1-1.5 billion bonds will be launched in the second half (Jan-June) period of FY2022.
Moreover, the country’s trade deficit expanded by 162.4 percent during November, owing to an almost threefold increase in imports compared to exports. The current account deficit stood at $5.08 billion from July to October 2021 as against the current account surplus of $1.33 billion reported in the same period the last year.
Source: Pro Pakistani