ISLAMABAD ; March 4, 2023; China has made a big move to avert Pakistan’s imminent default as Islamabad has received the first tranche of $ 500 million of $ 1.3 billion loan from Industrial and Commercial Bank of China (ICBC) .
Finance minister , Ishaq Dar, confirmed in his tweet on late Friday that the State Bank of Pakistan (SBP) has received $ 500 million from ICBC.
China had provided Pakistan $ 700 million just three days ago and urged other countries to help Pakistan to come out of its financial crisis.
The Finance minister in his tweet added that the amount received from ICBC is a part of a total amount of $ 1.3 billion rolled over loan and it will help Pakistan build -up forex reserves.
Pakistan had paid back $ 1.3 billion loan to ICBC last year to meet the conditionalities attached with it and the same amount has been rolled over again by the Chinese bank on Pakistan’s request.
Pakistan is going through the worst economic crisis of its history and its total forex reserves as of today stand at $ 3.5 billion which can cater to its imports of less than a month.
Cash- strapped Pakistan has been struggling to get lifeline from the International Monetary Fund (IMF), but its efforts for securing a bailout packing of $ 1.2 billion from it are yet to be materialised.
Meanwhile , Pakistan had requested China to rollover the loan of $ 1.3 billion that it paid back to ICBC last year.
Finance minister, Ishaq Dar , announced in his tweet that Pakistan is going to get two other installments of $ 800 million in next few weeks from the Chinese bank.
Chinese financial support may reduced Pakistan’s reliance on IMF and help it negotiate a better deal if after all it materialises at any later stage.
