ISLAMABAD: Pakistan has reportedly sought a USD 10 billion liquidity facility from the US Treasury’s Exchange Stabilisation Fund, although neither government has publicly disclosed its terms or approval status.
The proposed arrangement’s legal structure, pricing, maturity, conditions and permitted uses remain unclear.
The facility would differ from the US Federal Reserve’s established central-bank swap network. Instead, it would draw on the Treasury-managed Exchange Stabilisation Fund and could take the form of currency support or a short-term balance-of-payments backstop.
If approved and activated, the arrangement could allow the State Bank of Pakistan (SBP) to obtain US dollars against Pakistani rupees under agreed repayment terms. The funds could potentially support external payments, essential imports or foreign-exchange market stability, depending on the final agreement.
A USD 10 billion ceiling would not mean the full amount had entered Pakistan’s usable foreign-exchange reserves. Any amount drawn would create a liability carrying repayment obligations and potentially interest or fees.
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Pakistan already maintains a bilateral currency-swap arrangement with the People’s Bank of China. That facility mainly provides renminbi liquidity, while any US arrangement would provide dollars for dollar-denominated payments or market operations.
An International Monetary Fund study counted 91 participants and about USD 1.9 trillion in announced capacity across the global bilateral-swap network by the end of 2020. It found limited evidence that access alone automatically improves macroeconomic policy outcomes.
