Pakistan has to repay $10b by July

Pakistan’s central bank has reported that the country has to meet a significantly high foreign debt obligation amounting to $10 billion in June and July 2024, which is building pressure on government high-ups to look for loan rollovers as well as arrange financing to repay it on time. At present, Pakistan’s foreign exchange reserves stand at $9 billion, which are even lower than the debt obligation for the next two months. This leaves a very limited room for the government to settle debt with the current reserves and liberalise imports to give a fresh push to the economy. Talking to The Express Tribune, Optimus Capital Management Head of Research Maaz Azam recalled that Pakistan had borrowed $3 billion from friendly countries including Saudi Arabia and the United Arab Emirates (UAE) between June and July last year. It was followed by the receipt of the first $1 billion tranche of International Monetary Fund (IMF)’s loan in July 2023, which took foreign exchange reserves to around $8 billion from around $4 billion in June 2023.