Pakistan confirms rollover of $ 2 billion Chinese loan

Islamabad: Pakistan has received a rollover loan of USD 2 billion that matured last week from its “all-weather ally” China, finance minister Ishaq Dar confirmed, a move that will help Islamabad secure the much-required bailout from the International Monetary Fund (IMF).

The rollover is one of the key requirements for Pakistan meeting its external financing needed for it to ink the staff-level agreement with the IMF.

“I am happy to confirm that this has been rolled over on March 23,” Dar told parliament, adding that all formalities were completed.

Pakistan, currently in the throes of a major economic crisis, is grappling with high external debt and dwindling foreign exchange reserves.

Pakistan is working to increase its forex reserves which are estimated to be at USD 4.8 billion after China refinanced USD 500 million a fortnight ago.

Pakistan has been negotiating with the IMF for the release of a USD 1.1 billion bailout package since February but has so far met with little success due to the stringent conditions imposed by the Washington-based lender.

The funds are part of a USD 6.5 billion bailout package the IMF approved in 2019, which analysts say is critical if Pakistan is to avoid defaulting on external debt obligations.