Lenders extend just $5.9bn in first half

Pakistani authorities were able to materialise about $5.97 billion in foreign loans in the first half of 2023-24, almost one-third of the annual budget estimate amid limited borrowing avenues in the wake of poor credit rating and adverse conditions in the global financial markets despite the support of the International Monetary Fund. In its monthly report on Foreign Economic Assistance (FEA), the Economic Affairs Division (EAD) on Thursday said the country received $5.968bn in the July-December period of FY24 against its annual target of $17.6bn. This meant foreign inflows were just above $5.595bn in the same period last year which was a tough period given the challenging relationship with the IMF. The low inflows were mainly because of the adverse international environment and the country’s poor credit rating, making international capital markets a no-go area for Pakistan. Therefore, Pakistan has deferred its plan to launch a $1.5bn Eurobond because of higher interest rates in the international capital markets and the country’s low credit rating.