The State Bank of Pakistan (SBP) confirmed the receipt of $1 billion from China; however, details surrounding the nature of this transaction were not provided.
Last Monday, Pakistan was reported to have paid $1 billion to China against a due amount of $1.3 billion. Finance Minister Ishaq Dar expressed hope for the return of the $1 billion.
With dwindling foreign exchange reserves and objections from the IMF regarding budgetary measures, the finance minister finds himself in a difficult situation. Dar recently suggested that the IMF seems to be anticipating a default situation in Pakistan, similar to what Sri Lanka is currently experiencing.
Despite such challenges, Pakistan remains optimistic about securing the remaining $2.2 billion from the $7 billion bailout program, which concludes on June 30.
Separately, Dar informed the National Assembly Committee about a $300 million loan from China Development Bank that matures on June 26. He said it would be refinanced before the end of the month.
Pakistan hopes to extend $4 billion of bilateral Chinese loans and is also interested in extending the term of these loan maturities.
In addition to its obligations to China, Pakistan owes $3 billion to Saudi Arabia and $2 billion to the UAE. Experts suggest that successful negotiations with these countries could potentially lead to a rollover of $9 billion in bilateral loans.
