September 23, 2021 (MLN): Pakistan has received $2.38 billion foreign assistance during the first two months of the fiscal year 2021-22 i.e., July- August from multiple financing sources against the annual budget estimates of $14.09bn for the entire fiscal year FY22.
The Economic Affairs Division (EAD) data, released on Thursday, shows that foreign assistance obtained by Pakistan through multilateral sources during July-August 2021 totaled $879.40mn. Amongst the multilateral development partners, Islamic Development Bank (IDB) provided $413.21mn as short-term finance, Asian Development Bank (ADB) $280.73mn, International Development Association-World Bank (IDA) $142.37mn, while the country obtained $37.77mn from Asian Infrastructure Investment Bank (AIIB) during the month of July-Aug 2021.
The government also relied on foreign commercial borrowing as it was recorded at $363.26mn during July-August 2021 while it received $1.041bn from bonds issuance. All these commercial loans were arranged for budgetary support and included an $87.26mn loan from Standard Chartered Bank London, 61mn from Ajman Bank while Dubai Bank provided $215mn during 2MFY22.
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.
The collective disbursement from bilateral donors made available by EAD showed that Pakistan received $73.35mn from China, followed by the United States with a grant of $14.78mn, Germany with $2.01mn while Korea and Japan gave $1.16mn and $0.06mn, respectively during 2MFY22.
These external inflows from multilateral and bilateral development partners are 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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