ISLAMABAD: Pakistan on Friday received the second installment of $500 million as part of $1.3 billion facility from the Industrial and Commercial Bank of China (ICBC), the Pakistani finance minister said, as the South Asian country scrambles to shore up its dwindling forex reserves.
Islamabad repaid the $1.3 billion loan to ICBC in the recent months and the Pakistani finance ministry completed documentation for the release of the second installment earlier this week.
“State Bank of Pakistan has received today in its account from Chinese Bank ICBC $500 million,” Finance Minister Ishaq Dar said on Twitter.
“It will shore up forex reserves of Pakistan.”
The Chinese lender approved the rollover this month, which was to be disbursed to Pakistan in three installments. Pakistan received the first installment of $500 million on March 4 that had took the country’s foreign exchange reserves to $4 billion.
The money is crucial for the cash-strapped South Asian economy, which is facing a balance of payment crisis, with its central bank foreign exchange reserves dropping to levels barely able to cover three weeks of imports.
More external financing will only be coming to Pakistan after Islamabad signs a deal with the International Monetary Fund (IMF).
The lender has been negotiating the deal with Pakistan since early last month to clear its 9th review, which if approved by its board will issue over $1 billion tranche of $6.5 billion bailout agreed in 2019.
