Pakistan receives $797m external financing in May

June 20, 2025 (MLN): Pakistan secured external financing worth $797.31 million in May 2025 from multiple financing sources, 54% higher than last month and 97.9% higher than the same month last year.

Cumulatively, in 11MFY25, the country only managed to secure $6.53 billion external financing against the annual budget estimates of $19.39bn for FY25, the latest monthly report by the Economic Affairs Division (EAD) showed.

Last year, the government had budgeted $17.62bn foreign assistance but could only materialise $9.81 throughout the fiscal year. 

The total amount comprised $792.33m in loans and the remaining $4.98m in grants from various sources.

The full-year $19.39bn target for the current fiscal year includes $5.05bn from multilateral and bilateral lenders, $1bn in international bonds, $3.78bn foreign commercial loans, $5bn time deposit from Saudi Arabia, and $4bn safe deposit from China.

Going into details made available by EAD, the disbursement from bilateral and multilateral development partners totaled $495.19m in May and $3.85bn during 11MFY25.

Although these inflows helped to improve foreign exchange reserves, they fell significantly short of the government's budget estimates.

Foreign assistance obtained through multilateral sources totaled nearly $388m in May and $3.37bn in 11MFY25. While financing through bilateral development partners stood at $107.19m in May and $486.73m in 11MFY25.

The foreign commercial borrowing amounted to $159.29m in May 2025 and $1.77bn in 11MFY25. This was obtained through Naya Pakistan Certificate.

Meanwhile the government did not manage to secure any amount through foreign commercial banks in 11MFY25 against the government's budget estimates of $3.78bn for fiscal year 2024-25.

To note, out of the total financing amount in May, the government obtained a $459.7m loan for non-project aid, which was in the form of program/budgetary support assistance to restructure Pakistan's economy. Cumulatively in 11MFY25, loans for non-project aid amounted to $3.91bn.

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