Pakistan Borrowed 27% Fewer Loans in 7 Months of FY25 Than Last Year

Pakistan borrowed $4.585 billion from multiple financing sources during the first seven months (July-January) of the current fiscal year 2024-25 compared to $6.31 billion borrowed (-27. percent) during the same period of 2023-24, revealed the Economic Affairs Division (EAD) data. The $4.585 billion does not include the first tranche of $1.03 billion, received from the International Monetary Fund (IMF). If the IMF inflows are added, total inflows would reach $5.585 billion during the first seven months of the current fiscal year. The government had budgeted $9 billion in time deposits from Saudi Arabia ($5 billion) and China ($4 billion) for FY25. However, no funds were received under this head in the first seven months, and there was no reported assistance from the UAE. In the first week of December 2024, Saudi Arabia extended a $3 billion deposit placed with Pakistan for another year, however, the EAD data covering the first seven months does not reflect it. Vice President JS Global Waqas Ghani told ProPakistani, “The government has not been able to launch an international bond yet but secured a US$500 mn commercial loan. Through the Naya Pakistan Certificate, Pakistan has generated US$1.126 bn during 7MFY25. Note that including the IMF disbursement, the total disbursement was around US$ 5.6 billion. There is a significant gap from the total projected disbursements for the fiscal year of around US$19.4 billion”. Pakistan revised its external financing estimates from $19.393 billion to $14.393 billion for FY25, including $14.216 billion in loans and $176.29 million in grants, excluding IMF funding. Of the $3.779 billion budgeted from foreign commercial banks, only $500 million was received by January, with no disclosure on the lender. The country did not borrow from commercial banks in November. No funds were raised from international bond issuance, despite a $1 billion target for FY25. Raise from the “Naya Pakistan Certificate” stood at $1.126 billion in the first seven months, including $199.23 million in January. Multilateral lenders provided $2.322 billion from July to January, including $458 million in January, while bilateral sources disbursed $329.10 million in total, with $12.68 million received in January. Non-project aid amounted to $2.54 billion, with $1.312 billion for budgetary support, while project aid reached $2.045 billion. The Asian Development Bank (ADB) disbursed $1.048 billion, including $139.73 million in January, against a budgeted $1.651 billion for FY25. The International Development Association (IDA) provided $573.85 million, while the International Bank for Reconstruction and Development (IBRD) disbursed $201.50 million. The Islamic Development Bank (IsDB) released $265.7 million in short-term financing. The Asian Infrastructure Investment Bank (AIIB) disbursed $60.22 million, and the International Fund for Agricultural Development (IFAD) provided $26.12 million. China disbursed $99.17 million, Saudi Arabia provided $12.37 million, the USA released $40.05 million, and France exceeded its budgeted commitment by disbursing $102.57 million.