ISLAMABAD: Pakistan repaid two loans for international trade. Pakistan had less than 25 days of import coverage after loan payments.
The sources claim that 600 million AED went to NBD Emirates Bank and $420 million went to Dubai Islamic Bank. It is important to note that as a result of the decrease in foreign reserves, the nation's financial situation deteriorated and the inflation rate increased since the government stopped granting letters of credit (LC) to private businesses. Numerous auto sectors have temporarily closed their plants during the last few days.
The Ministry of Finance still expects $6.3 billion in foreign commercial loans to materialise in the current fiscal year, which likewise seems to be an extremely optimistic figure, as opposed to the projected over $7 billion in foreign commercial loans. The government is banking on China renewing its $3.5 billion in international commercial loans and non-Chinese banks not calling in their $1.3 billion in loans. According to the finance ministry, a $700 million Chinese commercial loan that Islamabad had previously returned will arrive soon.
However, because Pakistan's poor credit rating has a negative effect on both Chinese and non-Chinese commercial banks' overall balance sheets, neither have offered loans thus far.Since the International Monetary Fund (IMF) did not confirm a mission visit that was ad hoc scheduled for October 26, Pakistan's economic problems have gotten worse. The likelihood of default has increased, and former finance minister Miftah Ismail has frequently stated that the nation might default in the absence of the IMF programme.
But on Wednesday, Finance Minister Ishaq Dar fiercely asserted that Pakistan "would not fail" on its international obligations because the government has secured the $31-32 billion needed for the current fiscal year 2023.Dar's early-morning speech did not, however, soothe uneasy investors, as the stock market fell another 524 points after the finance minister's remarks. Since the dollar isn't available at this rate in the open market, the rupee continued to lose value and closed on Wednesday at more than Rs226.37 to the dollar, a number that has taken on symbolic meaning.