Finance Minister Ishaq Dar Announces China’s Approval of $2 Billion Loan to Aid Pakistan’s Financial Struggles

Pakistan’s central bank has reported a decrease of $354 million in forex reserves, bringing the country’s total to $4.2 billion. The government has been in talks with the International Monetary Fund (IMF) since February to secure the release of $1.1 billion from a $6.5 billion bailout package agreed in 2019. However, talks have stalled and the country’s reserves have dropped to just four weeks’ worth of imports. In a bid to ease the balance of payment crisis, Pakistan’s finance minister, Ishaq Dar, announced that China had agreed to roll over a $2 billion loan that had matured last week. This announcement marks the first official confirmation of the rollover, although no details about the new maturity date or other terms have been released. The IMF has made external financing a condition for releasing the tranche, and China has been Pakistan’s only source of help so far, with a refinancing of $1.8 billion credited to the central bank last month.