Islamabad, 27 Jan 2024 (WAI): Caretaker Prime Minister Anwaarul Haq Kakar has asked Chinese Prime Minister Li Qiang to give Pakistan more time to repay a $2 billion loan. He thanked China for helping out during Pakistan’s financial difficulties. The deadline to pay back this loan is March 23. Talks are happening between Pakistan’s Finance Ministry and China about this. Pakistan has gotten $4 billion in loans from China, which has helped ease the pressure of paying back debts.
In a recent development, Caretaker Prime Minister Anwaarul Haq Kakar has taken a step towards stabilizing Pakistan’s financial situation. In a letter addressed to Chinese Prime Minister Li Qiang, Kakar has formally requested the rollover of a $2 billion debt for one year.
Sources from the finance ministry have indicated that China is likely to extend the repayment period for the loan, providing some relief to Pakistan’s financial obligations. The deadline for the repayment of the $2 billion loan from China is approaching, and it is set for completion on March 23.
Efforts have been underway between officials from the finance ministry and Chinese authorities to negotiate the terms of the debt rollover. In his letter, Kakar has expressed gratitude to China for its ongoing financial support during Pakistan’s economic challenges.
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This request for debt rollover comes in the wake of similar arrangements with other countries. Earlier, the UAE extended a $2 billion loan repayment deadline for Pakistan, while Saudi Arabia provided a $5 billion deposit to the State Bank of Pakistan.
The interim government’s actions aim to alleviate the mounting pressure on external debt payments and stabilize foreign exchange reserves. The recent developments have prompted the government to engage with the International Monetary Fund (IMF) for further assistance. In its latest report, the IMF has adjusted projections for Pakistan’s financing needs, indicating minor revisions in deficit projections and external financing requirements.
The IMF’s continued involvement is crucial for Pakistan’s economic stability, and discussions for a new long-term program are expected to commence soon. These developments underscore Pakistan’s commitment to managing its economic challenges effectively.
Political Analyst | M.Phil. Scholar
