According to sources, the federal government will seek $5 billion in loans from Kazakhstan, Russia and China to stabilise its forex reserves.
As per the details from Geo News, Pakistan will seek a $3 billion loan from China while $2 billion from Kazakhstan and China. The details suggested that the finance ministry had finalised the framework to acquire a loan from China and the agreement would be signed during the prime minister’s visit to China, Beijing.
The Economic Affairs Division, Government of Pakistan, has however denied any such news. It stated that “no such proposal is under process in EAD”.
This is in response to the news in media that EAD has prepared a plan for obtaining US$ 5 billion new loans from China, Russia & Kazakhstan.
This is to clarify that no such proposal is under process in EAD for obtaining $3bn loan from China and $2bn loan from Russia & Kazakhstan.— Economic Affairs Division, Government of Pakistan (@eadgop) January 31, 2022
The $3 billion loan from China will strengthen the forex reserves, while the $2 billion loans from Russia and Kazakhstan will be utilised in the ML-1 Railways project.
The steps to acquire more loans came after all the conditions for International Monetary Fund’s loan have been fulfilled. The IMF board meeting will be held on February 2.