August 01, 2023 (MLN): Pakistan expects about half of its maturing debt in fiscal year 2024 to be rolled over, according to central bank Governor Jameel Ahmad, as Bloomberg reported.
About $11.3 billion out of the $24.5bn of debt due this fiscal year will be rolled over, Ahmad said in an analyst briefing on Monday.
He further highlighted that officials expect inflows to cover more than the rest of the financing requirement.
“We are in a very comfortable position to meet our debt obligation as compared to a few weeks back,” Ahmad said in Karachi.
He further added that the government paid $1.5bn of debt in July and the pressure on Pakistan’s finances is easing after the nation secured a $3bn bailout from the International Monetary Fund (IMF) in July.
That paved the way for billions of dollars of financing from creditor nations such as Saudi Arabia and the United Arab Emirates.
The Gulf nations and China also agreed recently to extend debt payments on previous loans.
Pakistan’s foreign exchange reserves have almost doubled to $8.19bn since the IMF loan.
Moreover, Pakistan is in talks for possible commercial borrowing and expects a sale of dollar bonds and sukuk debt at the end of the fiscal year.
The central bank expects dollar bond yields to fall further, and foreign-exchange reserves to increase to more than $10bn by June 2024, enough to cover two months of imports.
IMF aid gave Pakistan 10 months of breathing room and as a result, the country was able to unlock another $5.6bn in funding.
However, IMF warns that Pakistan may have to restructure its debt if goals are not met.
