Pakistan plans to borrow more than $4bn from the Saudi-backed Islamic Development Bank

Pakistan plans $4 Billion from the Islamic Development Bank in its attempts to restore dangerously low stocks of foreign currency.

Two officials have told the Financial Times that the Jeddah-based bank has agreed to make a formal offer to lend Islamabad the money when Imran Khan takes over as prime minister.

They added that they expect Asad Umar, Mr Khan’s proposed finance minister, to accept.

“The paperwork is all in place,” said one senior adviser in Islamabad. “

The IDB is waiting for the elected government to take charge before giving their approval.”

The person added that the loan would not cover Pakistan’s expected financing gap of at least $25bn during this financial year but was “an important contribution”.

One of his first jobs will be to repair the country’s balance of payments problem, with high imports and stagnant exports having bled the country of much of its foreign exchange reserves.

One official at the Pakistani central bank who has been involved in negotiations with the IDB said the loan had the backing of the Saudi government.

Posted on: 2018-08-09T20:50:00+05:00

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