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Pakistan gets $500 million from China’s ICBC bank.

Pakistan gets loan

KARACHI: Pakistan has received a $500 million loan tranche from China, which will assist the country in replenishing its diminishing foreign exchange reserves as the government confronts an ongoing economic crisis.

In a tweet on Friday evening, Finance Minister Ishaq Dar stated that the State Bank of Pakistan has received $500 million from the Chinese Industrial and Commercial Bank of China Ltd (ICBC).

“State Bank of Pakistan has received today in its account from Chinese Bank ICBC US $ 500 million. “That will help Pakistan’s FX reserves,” stated the finance minister.

The latest transfer is the second disbursement of US$500m for Pakistan as part of a US$1.3b rollover facility from China’s ICBC, documentation for which was completed earlier this week.

“Out of #Chinese ICBC’s approved rollover facility of US$1.3 billion (which was earlier repaid by Pakistan to ICBC in recent months), documentation for second disbursement of US$500 million has been completed by Finance Ministry for release of funds to the State Bank of Pakistan,” the finance minister had said in a tweet on Thursday.

The central bank received the first $500 million instalment from the ICBC earlier this month as part of the friendly country’s attempts to assist Pakistan in avoiding a foreign debt default as it battled the current financial crisis.

China had extended the tranche after Islamabad met nearly all of the stringent conditions for reviving the IMF loan programme, with the government stating that it would soon reach a staff-level agreement with the global lending agency.

Dar announced earlier this month the approval of the $1.3 billion rollover facility, which he claimed will be paid out in three installments.

Almost all multilateral and bilateral creditors have been waiting for the restart of Pakistan’s IMF loan programme in order to implement financial commitments totaling more than $9 billion to assist the flood-ravaged nation.

Nevertheless, Beijing stopped its wait for IMF approval earlier this month and stepped in to save Islamabad from a possible default.

Also Read: Chinese bank to refinance $500m loan.