Pakistan eyes $12b debt rollover next fiscal

Country will need $23b worth of external financing for 2024-25

ISLAMABAD:

Making a preliminary estimate of $23 billion worth of external financing to meet its monetary requirements for 2024-25, the federal government has decided to have debts of around $12 billion from friendly countries rolled over in the next fiscal year.

According to finance ministry insiders, $5 billion from Saudi Arabia, $3 billion from the UAE and $4 billion from China will be rolled over. They added that the estimate of further new financing from China would also be included in the next financial year’s budget.

Pakistan will receive more than $1 billion from the International Monetary Fund (IMF) under the fresh loan programme, while new financing from the World Bank and Asian Development Bank has also included in the estimated budget.

According to the finance ministry sources, new loan programme agreements will be made with financial institutions.

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The federal government aims to achieve budget targets before the anticipated arrival of the IMF review mission in Pakistan. Negotiations for a new loan program are expected to commence in mid-May.

The finance ministry sources said the ministries had been instructed to complete the targets before the negotiations on the new loan programme.

They added that the details would be given to the IMF delegation when all the important targets were met. It has also been decided to have the budget strategy paper approved by the federal cabinet before the IMF review mission’s arrival in the country.

According to the sources, the finance ministry has started preparing the budget. The targets for debt repayment, defence budget and tax collections will be set. Besides, the development and ongoing budget targets will also be determined.