Islamabad [Pakistan], August 27 : Pakistan's external woes would continue to persist due to shrinking dollars despite agreeing to an IMF Standby Arrangement (SBA) scheme worth USD 3 billion, according to The News International.
Moreover, it is being estimated that the dollar outflows will outpace the dollar inflows till the end of December 2023.
If the Letters of Credit (L/Cs) are opened up without any hiccups, the dollar inflows will noticeably decrease in the form of loans amid growing debt servicing and import requirements.
Therefore, in the coming weeks and months, pressure to keep the SBP's foreign exchange reserves would increase. Foreign exchange reserves would be drained if additional dollar inflows were to prove impossible, The News International reported.
On the other hand, despite the fact that everything materialised within the intended stipulated timeline, the predicted dollar inflows in the form of programme loans, projected loans, and commercial loans are on the lower side.
According to The News International, Pakistan, in addition, is receiving USD 100 million in the form of an oil facility from the Kingdom of Saudi Arabia (KSA), and this SOF will likely expire in November 2023. As a result, the Saudi Fund for Development (SFD) will provide USD 400 million through November 30, 2023. Up until November 2023, it is anticipated that it will be approved and distributed.
The Pakistani government will need to rely on this extensive source of funding during the first and second halves of the current fiscal year as it also expects to raise USD 3 billion through commercial loans.
Pakistan also anticipates the conclusion of the first evaluation and the release of USD 700 million under the USD3 billion SBA initiative in December 2023.
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