Lahore, 14th December: China once again provides help to Pakistan to bail in its time of need.
According to reports, China has helped Pakistan to repay its $1 billion Saudi debt. This is the second time China has come to our rescue.
Geo News has reported that China has agreed to immediately provide $1 to $1.5 billion financing line to Pakistan, allowing Islamabad to repay $1 billion to the Kingdom of Saudi Arabia this week.
Earlier this year, Islamabad repaid $1 billion to KSA in the first quarter of the current fiscal year. With the latest repayment, Pakistan has so far repaid $2 billion out of the total $3 billion debt. Islamabad had paid mark up of over 3 per cent on SAFE deposit.
Top official sources confirmed to The News that Islamabad is all set to repay the $2 billion Saudi debt in the shape of SAFE deposit tomorrow.
The last portion of $1 billion will be repaid next month. When contacted, a Ministry of Finance official said, “these are bilateral confidential matters”.
The financing arrangement was part of the International Monetary Fund (IMF) programme and the lending body had sought written and verbal guarantees that these bilateral financing arrangements would be rolled over during package period, a top official privy to the development said.
IMF Mission Chief for Pakistan Ernesto Ramirez Rigo had flown to Beijing to get Chinese endorsement to make it a part of financing plan at the time of signing of the IMF agreement.
The money had been deposited in State Bank of Pakistan on December 15, 2018, with a three years maturity period. Islamabad is repaying the amount ahead of schedule.
Pakistan’s reliance on China increases with a new facility. The country’s financial account has already turned negative of $1.33 billion because of outflow of dollars.
According to Geo News, so far, increased remittances had helped Islamabad to avoid an eruption of a full-fledged balance of payment (BoP) crisis as remittances from abroad remained over $2 billion over the last consecutive five months.
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