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Pakistan

Dar confirms rollover of $2bn China loan, says issue is ‘no longer pending’

  • Denies reports that request for rollover is 'work in progress'
Published March 31, 2023
Dar confirms $2bn China loan has rolled over, issue is ‘no longer pending’

Finance Minister Ishaq Dar on Friday confirmed that a $2-billion loan from China has been rolled over and the matter is “no longer pending”, denying reports that talks were still in progress.

“I want to confirm that the $2-billion deposit from China, which was due on 23 March, is no longer pending,” said Dar, while answering a query raised by Pakistan Peoples’ Party (PPP) Senator Raza Rabbani in Parliament.

“Moreover, the documentation (of this loan) for 2023-24 is also completed” he said.

Earlier, Reuters reported that China is still working on a request by Pakistan to roll over the loan that matured last week, citing a top finance ministry official.

“It is a work in progress,” Reuters quoted the official as saying, on condition of anonymity. “Formal documentation is underway” and a formal announcement will be made, they had added.

But Dar said the report was “totally speculative”.

The rollover was critical for the South Asian nation as its foreign exchange reserves have dipped to just four weeks worth of imports at a time when it is locked in talks with the International Monetary Fund (IMF) to secure bailout funds.

On Thursday, the SBP reported that its foreign exchange reserves have decreased $354 million, clocking in at $4.2 billion as of March 24. This was the first decline after almost one-and-a-half months.

Technical-level talks with IMF are over: Ishaq Dar

Meanwhile, Dar explained that Pakistan conducts two types of business with China.

“One is the SAFE deposit, which is a business between the central bank of China and the central bank of Pakistan (State Bank of Pakistan), which is a sovereign business.”

“The second business is with the commercial banks of China including Industrial and Commercial Bank of China (ICBC), Bank of China, and China Development Bank,” he said.

As Pakistan struggles to avert a default on its obligations, the only help so far has come from longtime ally Beijing.

Earlier this month, Dar confirmed the country’s central bank had received $500 million from ICBC. This transfer was the second disbursement of $500 million for Pakistan as part of a US$1.3b rollover facility from the institution.

China Development Bank had also refinanced a $700-million loan in February, bringing the total facility from Chinese institutions to $2 billion.

Comments

Comments are closed.

Tulukan Mairandi Mar 31, 2023 02:27pm
The nation will be in default if China did not roll over. In other words we are in default if not for a loan (others' money). however the K-209 tranche bond is due on 4-Apr, and Paris Club payments on 8-Apr. There is strong indications that Pakistan WILL announce a default. Please withdraw ALL your savings from banks and sit tight.
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dr fahad Mar 31, 2023 03:11pm
@Tulukan Mairandi, comment on indian website .
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Miannawazshit Mar 31, 2023 03:45pm
He is still lying. I would rather believe Reuters than this goof.
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Tuluka lavada Mar 31, 2023 04:21pm
Can he be trusted? He said that imf agreement will be signed in 2 days - 2 months ago
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TimeToMovveOn Mar 31, 2023 05:56pm
Now Pakistan cannot raise the issue of freedom for minorities and Uighers, and Muslims in China. It will go back to barking at India for these things and no one in the international arena will take Pak seriously.
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Shanj Mar 31, 2023 07:01pm
These all loan PDM , Sharifs and Zardari will eat .
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Rogen Mar 31, 2023 07:29pm
@Tulukan Mairandi, sauce or stfu
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Pakistan meri jaan Mar 31, 2023 08:31pm
Big shame for all those pakistani making statement against pakistan by citing 2 days 2 weeks Such people live in hell Ishaq dar is not the honour of iMF he has done the things Now its IMF who has to do Why you didnt call when IK govt faild Tareen out from IMF office hopeless face down looking the earth why you didnt make such statement that time so plz wish and hope for the best for pakistan
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Tulukan Mairandi Apr 01, 2023 12:17am
There is strong indications that Pakistan WILL announce a default, due to failure to repay bonds and paris club loans. Please withdraw ALL your savings from banks, change PKR to any other currency, and sit tight to see Dar's hung face in this website.
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Ali Apr 01, 2023 12:27am
@Pakistan meri jaan, Beta bolna to seekh lo pehlay
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KhanRA Apr 01, 2023 05:04am
Why believe him? He wiped out Pakistans reserves to inflate the value of the rupee. Does he have any credibility?
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KhanRA Apr 01, 2023 05:07am
@Pakistan meri jaan, Why didn’t the economy collapse under Imran khan? Or miftah Ismail? It collapsed when the sharifs put Ishaq dar into this position. He depleted the nations reserves to foolishly inflate the value of the rupee (when other countries try to lower the value of theirs to increase exports). Remember that did this last time too to peg the ruppee value at 105 to the dollar. There was a time when we had $27 billion in reserves, but then the Dar curse wrought havoc to Pakistan. All because he’s married into the Sharif clan - and for mother reason.
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