SBP to receive $500mn from AIIB in November: Ishaq Dar

Finance Minister Ishaq Dar announced Wednesday that the State Bank of Pakistan (SBP) will receive $500 million from the Asian Infrastructure Investment Bank (AIIB) within this month.

In a tweet, the finance minister shared that the AIIB board approved the funding as "co-financing of the Asian Development Bank (ADB) funded BRACE program for Pakistan."

"These Funds will be received by State Bank of Pakistan within November 2022," he said.

The SBP had earlier received $1.5 billion from ADB on October 26, 2022, as a disbursement of loan for the government of Pakistan, giving its foreign exchange reserves a much-needed boost.

In September, SBP's reserves had increased as the central bank received the $1.2-billion tranche from the International Monetary Fund (IMF).

SBP-held foreign exchange reserves increase $1.47bn, stand at $8.91bn

The Saudi Development Fund also rolled over a $3-billion deposit with the SBP, an amount that was due to mature in December 2022. However, this development was not meant to increase foreign exchange as the amount was already part of SBP's reserves.

The reserves’ position is critical for Pakistan which has been desperately seeking dollar inflows to meet its balance-of-payments needs.

On October 26, the ADB released $1.5 billion for Pakistan to support the economy and rehabilitate the affected people in the wake of recent floods. The development was shared by Federal Minister for Finance and Revenue Ishaq Dar on his Twitter handle.

Forex boost: SBP receives $1.5bn from ADB, says Dar

“ADB has released funds $1.5 billion to Pakistan under BRACE program for the credit of Government of Pakistan’s account with State Bank of Pakistan (SBP),” said Dar back then.

The funding boosted Pakistan’s foreign exchange reserves position, which had worsened in recent months, leaving the country with just a few weeks of import cover and putting the currency under pressure.

In recent days, the rupee has, however, remained largely stable against the US dollar even as the greenback strengthened against other currencies.