ISLAMABAD: The country received $2.248 billion total external inflows from multiple financing sources in the first two months (July-August) of fiscal year 2020-21 including $149 million from foreign commercial banks, which is 18 percent of budget estimates of $12.233 billion for the entire fiscal year.
According to the official data of Economic Affairs Division (EAD) the external inflows during the corresponding period of fiscal year 2019-20 were $1.659 billion which were around 13 percent of the annual budgeted amount of $12.958 billion.
In the aftermath of Covid-19 and its persistence in the country the disbursements of project financing from development partners dried up during the last quarter of the outgoing fiscal year 2019-20. The pandemic has closed down most of the economic activities across the country including development project activities. However, after the ease in the lockdown by the government the economic activity is reviving which may lead to a rise in project financing in the current fiscal year 2020-21, the EAD added.
The government budgeted foreign assistance of $12.233 billion for the fiscal year 2020-21 including $3.922 billion from foreign commercial banks. The government has budgeted $1 billion under the head of Saudi oil facility, however nothing has been received in the first two months of current fiscal year under this head,
According to the EAD the total receipt of $2.248 billion constitutes $961 million or 44 percent as programme/budgetary support assistance; $149 million (7 percent) as foreign commercial borrowing; and $138 million (6 percent) as project assistance to finance its development projects activities and $1 billion received in terms of time safe deposits.
The country received $445.9 million from multilateral and bilateral donors during August 2020. The data reveals that government procured $149 million from foreign commercial banks in July-August 2020-21 against $321.5 million during the same period of last fiscal year.
The country received $34.62 million from Ajman Bank in August, while $14.71 million from Standard Chartered Bank (London) and $100 million were received from the consortium-led by Suisse AG, UBL and ABL during in July 2020. The data also reflects the $1 billion of safe China deposit.
The bilateral and multilateral development partners have disbursed $1.099 billion of foreign economic assistance during July-August of ongoing fiscal year fiscal year 2020-21 against the budgetary allocation of $5.811 billion for fiscal year 2020-21.
Amongst the multilateral development partners, Asian Development Bank provided $259 million. And World Bank disbursed $531 million against the budgetary allocation of $2,257 million. While from bilateral sources, France, USA and UK provided $23.7 million, $23.9 million and $7 million respectively.
The EAD data further reveals that during July, 2020 total servicing of external public debt was $484 million against the repayment estimates of $10.363 billion for the entire fiscal year, which Pakistan has requested for deferment due to Covid-19.
In July 2020 the government paid $51 million of interest on foreign commercial loans. Further the government has also paid interest of $331 million to multilaterals and $102 million to bilateral development partners on loans as actual repayment has been deferred by western countries till December. For the period July, 2020-21, net transfers to the government were $829 million.
Copyright Business Recorder, 2020