June 25, 2021 (MLN): Pakistan has received $12.135 billion total external inflows during July- May FY21 from bilateral and multilateral development partners, foreign commercial borrowing, and time deposits to restructure its economy and finance its development projects.
This foreign aid provides a wide range of support in the areas of capital formation, employment, health, education, public transport, water reservoir, and more, driving economic growth and helping to promote socio-economic and human development in Pakistan.
According to the data released by the Policy Analysis & Development Wing of EAD, these external inflows from multiple sources are around 99% of the annual budget estimates of $12.23 billion for the entire fiscal year FY21.
The country also relied on foreign commercial borrowing as it was recorded at $3.61 billion in 11MFY21 out of $12.135 billion (30%) owing to the repayment of maturing foreign commercial loans.
Going into details made available by EAD, the disbursement from bilateral and multilateral development partners also maintained a strong trend as it totaled $3.787 billion of foreign economic assistance during 11MFY21. These healthy inflows also helped to improve foreign exchange reserves and exchange rate stability.
Foreign assistance obtained by Pakistan through multilateral sources during July-May FY21 totaled $3.37 billion. Amongst the multilateral development partners, Asian Development Bank provided $1.283 billion while International Development Association-World Bank gave $850 million against the budgetary allocation of $2.257 billion.
The monthly bulletin revealed that the collective disbursement from bilateral donors amounted to $417 million during 11MFY21 wherein Pakistan received $178 million from China, followed by the United States with $102 million, the United Kingdom with $49 million while France gave $39 million.
Increased level of external inflows from multilateral and bilateral development partners is indicative of their confidence in development priorities and policies of the government including implementation of reforms in the priority areas of fiscal and debt management, energy sector, and ease of doing business.
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