Mon, 04 July 2022
The Daily Ittefaq

Pakistan eyes $3 billion loan from Beijing during Imran Khan’s upcoming visit to China

Update : 01 Feb 2022, 11:52

Pakistan is attempting to acquire a $3 billion loan from China, despite the country's economic turmoil.
This news comes ahead of Pakistani Prime Minister Imran Khan's trip to Beijing this week.

Islamabad has set its sights on a USD 3 billion loan from China to help stabilize its decreasing foreign exchange reserves, as well as an investment bonanza in a half-dozen sectors during Prime Minister Imran Khan's visit to Beijing next week, said The Express Tribune.

On February 3, Imran Khan will travel to Beijing to attend the opening ceremony of the Beijing Winter Olympics 2022. During his visit, Pakistan's Prime Minister will hold crucial meetings and will meet with  the Chinese President Xi Jinping and top Chinese officials on the sidelines for bilateral talks. 

Pakistan's Ministry of Economic Affairs has planned a borrowing strategy in anticipation of PM Khan's visit to China, when a $3 billion loan arrangement with China will be completed. The initial loan agreement with China will be for a year.

Around USD 11 billion has already been invested in Islamabad through commercial loans and foreign exchange reserve assistance schemes, including USD 4 billion in SAFE deposits.

According to the Express Tribune, the Chinese money is part of Pakistan's existing official foreign exchange reserves, which are valued at USD 16.1 billion.

Pakistan paid more than Pkr 26 billion in interest to Beijing in the previous fiscal year. Notably, Pakistan paid the hefty sum just to cover the maturing debt with a USD 4.5 billion Chinese trade finance facility.

It comes after Saudi Arabia handed Pakistan a USD 3 billion loan last month.  The loan has been devoured by the country, and the country's foreign exchange reserves, which were USD 15.9 billion before the Saudi injection, have already decreased to USD 16 billion by January 21, said The Express Tribune. 

Meanwhile, Prime Minister Khan will leave for China on Thursday for a three-day visit, accompanied by several federal ministers.

 

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