According to the State Bank of Pakistan (SBP) and the Ministry of Finance, the ongoing International Monetary Fund (IMF) programme will more than adequately cover Pakistan’s gross financing needs for the current fiscal year while also providing an additional $4 billion buffer.
According to a joint statement released on Sunday, the nation’s finance requirements are due to a $10 billion current account deficit and approximately $24 billion in foreign debt repayments.”
It is vital for Pakistan to be somewhat overfinanced compared to these needs,” it stated. “This will strengthen Pakistan’s foreign exchange reserves position.”
As a result, aside from the $1.2 billion tranche that the IMF is anticipated to issue in the upcoming weeks, finance commitments totaling $4 billion were being secured through a variety of channels, including friendly nations.
According to the statement, Pakistan’s issues are being vigorously addressed and are only temporary. The SBP and finance ministry highlighted these issues by pointing out that since February.
On the other hand, the statement noted that the exchange rate had been significantly under pressure, particularly since mid-June, as a result of general USD tightening, an increase in the current account deficit, a decline in reserves, and worsening sentiment as a result of the delay in the IMF agreement and internal affairs.