Pakistan Aims to Generate USD 4.5 Billion in FY23-24 from Non-IMF Sources, Says Finance Minister Akhtar

In a recent interview with the official ICMA International Journal, Pakistan's Finance Minister, Dr. Shamshad Akhtar, unveiled the nation's ambitious plan to raise approximately USD 4.5 billion from both multilateral and bilateral sources, excluding the IMF, as reported on December 13.

Dr. Akhtar outlined that the government expects to receive over USD 1.6 billion from various sources in the second quarter (Q2). Major contributors include the Asian Development Bank, the World Bank, and the Asian Infrastructure Investment Bank, with funds encompassing both project-based and program-based allocations.

Regarding the IMF program, Dr. Akhtar highlighted the successful conclusion of the first review of the Standby Agreement and the achievement of a Staff Level Agreement (SLA). Pending approval by the IMF’s Executive Board, Pakistan could gain access to SDR 525 million, equivalent to around USD 700 million.

Fitch Ratings, in a recent note, emphasized the recovery of Pakistan’s forex reserves, driven by new funding inflows and limited current account deficits, projecting further increases. Although official gross reserves, including gold, reached USD 12.7 billion in October, up from USD 8 billion at the beginning of 2023, they remain below the peak of USD 23 billion at the end of 2021.

Additionally, the Central Bank’s net liquid forex reserves, maintaining a level just over USD 7 billion since October, have shown improvement from a low of about USD 3 billion in January. This improvement is attributed to a contraction in imports, positively impacting reserve coverage ratios.

Dr. Akhtar acknowledged the conclusion of negotiations for certain program loans, with imminent disbursements. She reassured that the country is meeting its debt obligations promptly and intends to continue doing so in the future.

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