Pakistan Economy Crisis: Pakistan has got great help after the financial relief package from the International Monetary Fund. Now its foreign exchange reserves have jumped to the highest level in nine months. Apart from the IMF, financial assistance has also come from Saudi Arabia and the United Arab Emirates, due to which Pakistan’s foreign exchange reserves have doubled by July 14. Now Pakistan’s foreign exchange reserves have reached $8.73 billion, which is the highest after $8.76 billion till October.
According to a Bloomberg report, the total financial aid received last week was about $ 4.2 billion. In addition, China’s Exim Bank has given a commercial loan of $600 million to Pakistan, which will boost the reserve and will appear in the reserve next week.
Pakistan’s central bank claims that Pakistan’s total foreign exchange reserves now stand at $14.1 billion, with fresh assistance and local commercial banks holding $5.34 billion. Significantly, the financial assistance from the IMF has saved Pakistan from default and has also helped in saving the government of Prime Minister Shehbaz Sharif. The tenure of this government will end next month.
heavy debt burden
Even though Pakistan’s foreign exchange reserves are increasing, but the debt burden on Pakistan has increased. This will be a big challenge for Pakistan in the coming times. Pakistan’s foreign debt has reached 100 billion dollars. The IMF has warned that the country’s debt could become unsustainable if it fails to meet bailout targets. The report states that the risk of loan sustainability has increased due to limited international fund options and higher fund requirements.
Pakistan still needs more funds
The IMF had earlier submitted a 120-page report, saying that Pakistan would need support from an IMF bailout fund and other international lenders beyond the current election cycle and ongoing additional arrangements. According to the report of Dawn newspaper, this report tells about the macroeconomic situation of Pakistan and emphasizes the need for more financial assistance to deal with the country’s cash crunch situation.
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