Amid challenging times for the economy of Pakistan, Governor SBP remarked that for the fiscal year 2023, around $33 billion were to be repaid to exterior stakeholders, including the Current Account Deficit (CAD) of $10 billion and $23 billion in loan reimbursements.
Out of the payable $23 billion external debt, Pakistan has already repaid more than $6 billion, whereas a bilateral loan of $4 billion has been rolled over with the cooperation of relevant countries.
“Another $8.3 billion maturing obligations are expected to be rolled over as discussions are underway,” he said, adding that the remaining outstanding repayment stands around $4.7 billion for the remainder of this fiscal year.
He said Pakistan had received foreign exchange inflows of $4 billion (excluding the rollovers of $4 billion mentioned above). “Pakistan will continue to make timely loan payments while inflows are expected to increase significantly in the second half of the current fiscal year,” he added.
Along with the rollover of some external obligations, Pakistan’s foreign exchange reserves are expected to increase significantly in the coming months.
He said the debt profile of Pakistan was composed of bilateral and multilateral creditors, and only a tiny percentage is owed to foreign banks. “SBP has enough reserves to repay all obligations effectively, and the inflows expected will boost forex reserves”.
He assumed that the war in Ukraine, a historic increase in international commodity prices and monetary tightening pursued by central banks were consequential challenges.
As a result, developing countries, including Pakistan, faced predicaments raising funds from international financial markets. On the domestic front, the economy is impacted by floods which created challenges for Pakistan.
Overall the situation is challenging; however, SBP and the government are carrying measures to improve it, Governor SBP counted.