Foreign exchange reserves surge for the third consecutive week
ISLAMABAD: For the third consecutive week, the foreign exchange reserves of Pakistan edged up in the week ending March 10.
The liquid reserves with the State Bank of Pakistan (SBP) increased to $4.319 billion on March 10. The central bank said on Thursday in its latest update about the reserves of Pakistan.
The total forex reserves of Pakistan amounted to $9.846 billion by March 10 as the commercial banks held $5.527 billion in reserves. Thus, the foreign exchange reserves with the commercial banks are higher by $1.208 billion in comparison with $4.319 billion reserves of the central bank.
The foreign exchange reserves of Pakistan started surging soon after the country received two tranches of loans from the Chinese Bank in recent days.
On Thursday, Finance Minister Senator Muhammad Ishaq Dar said that the country is set to receive another $500 million loan from China.
He said, “The documentation for the disbursement of $500 million by the Industrial and Commercial Bank of China (ICBC) is approved today. He said the ICBC has approved $1.3bn for Pakistan.
In a message through Twitter, Dar said, “Out of Chinese ICBC’s approved rollover facility of US$1.3 billion (which was earlier repaid by Pakistan to ICBC in recent months), documentation for the release of US$500 million has been completed. He said that the Finance Ministry and the State Bank of Pakistan completed the documentation.”
Meanwhile, China will roll over $2 billion in SAFE deposits for Pakistan in the ongoing fiscal year.
The economic team of Pakistan informed the IMF that China will roll over $2 billion in deposits in the State Administration of Foreign Exchange (SAFE) in Pakistan. Pakistan shared this information with the IMF team during virtual talks this week.
“Pakistan requested China for granting rollover of $2 billion SAFE deposits, which is going to mature by end of this month,” an official said.
Meanwhile, in spite of the fact that Pakistan has completed all upfront conditions of the IMF, the fund officials were delaying the signing of the staff-level agreement. Now the IMF has asked Pakistan to submit in writing guarantees of foreign financing from friendly countries just to further delay loans.
On the other hand, the Industrial and Commercial Bank of China has given more than one billion dollars to Pakistan to boost falling reserves without any conditions.