Islamabad: The government of Pakistan is planning to take a new loan of $ 15 billion to pay its foreign debt and strengthen its foreign exchange reserves. This will be the highest loan taken by Pakistan in any one year. It was said on Sunday in local media reports.
Sources in Pakistan’s finance ministry told the newspaper ‘The Express Tribune’ that out of about $ 15 billion of foreign debt in the fiscal year 2020-21, about $ 10 billion will be used to pay off the old maturing debt. This amount is in addition to the interest payment. It has been said in the news that the remaining amount will become part of the country’s external public debt, which has increased to $ 86.4 billion by the end of March this year.
Taking of $ 15 billion loan by Pakistan in any one year reflects the challenges and the deepening debt crisis. Foreign exchange is not possible in Pakistan without debt. The gross foreign exchange reserves of $ 12 billion with the State Bank of Pakistan are mostly from the debt.
According to sources, the Finance Ministry is expected to get a total of $ 15 billion from bilateral and multilateral lenders, commercial banks, Eurobond issuers and IMF during the financial year 2020-21. Pakistan’s dependence on foreign debt is increasing. From July 2018 to June 2021, he would have taken a new loan of $ 40 billion. Of this, he will use 27 billion dollars to repay the old debt, while the remaining 13 billion dollars will be added to his external public debt.