Islamabad:
Pakistan received $ 26.7 billion loans during the financial year 2024-25, about half of which was half of the old loan extension (rollover).
According to data compiled by the Ministry of Economic Affairs, Ministry of Finance and Pakistan, these loans are slightly higher than the previous financial year. According to the report, only $ 3.4 billion (ie 13 %of the total loan) was received for development projects, while the remaining loans were taken to meet the budget deficit and increase foreign exchange reserves.
This condition is making the loan repayment more difficult because most of them do not generate debt income. In late June, State Bank’s foreign exchange reserves were $ 14.5 billion, which is mainly the result of the role and new payment of loans, which further reduce the external financial sovereignty of the country.
The government received $ 11.9 billion in direct loans, which is $ 1.2 billion more than the previous year. The IMF got $ 2.1 billion, while Saudi Arabia, China, United Arab Emirates and Kuwait have a total role over $ 12.7 billion.
Saudi Arabia paid a deposit amount of $ 5 billion at 4 percent interest rate, while China put $ 4 billion on interest rates. The UAE also reserved a $ 3 billion in State Bank.
China guaranteed $ 484 million to purchase property, while the government failed to issue $ 1 billion Eurobands and Panda bonds. The government fulfilled this deficiency by obtaining expensive trade loans including the guarantee of the Asian Development Bank.
ADB gave $ 2.1 billion, IMF 2.1 billion, World Bank 1.7 billion and Islamic Development Bank loan 716 million. Saudi Arabia also gave $ 200 million oil financing agreement at 6 percent interest. According to the Finance Ministry, Pakistan’s loan for GDP ratio and overall financial requirements is now exceeding unbearable level. The IMF has warned that during the next three financial years (2026–2028), Pakistan will require $ 70.5 billion external financial, while the loan repayment capacity is constantly being threatened.
