A $1.5 billion programme loan for Pakistan is slated to be approved by the Asian Development Bank (ADB) on Friday (today) as part of the BRACE (Building Resilience with Active Countercyclical Expenditure) programme.
According to Geo, the Board of the ADB will meet in Manila to discuss whether to approve a $1.5 billion programme loan for Pakistan. It is anticipated that this loan will be disbursed after receiving permission next week, assisting Islamabad in replenishing its depleting foreign exchange reserves.
Additionally, it is anticipated that the Asian Infrastructure Investment Bank (AIIB) will approve $500 million in co-financing, bringing the total distribution to $2 billion for the current month.
With a projected current account deficit of $10 to $12 billion and an external debt servicing obligation of $22.9 billion, Pakistan needs $34 billion for the current fiscal year. On the flip side, the terrible floods made the already bad situation with the economy even worse.
Pakistan suffered losses of $32.4 billion, according to the group of international donors, which also included the World Bank, ADB, UNDP, and EU. Pakistan also needed $16.2 billion for building expenditures.
An official document states that the $1.5 billion BRACE programme loan will assist Pakistan in responding to the deepening macroeconomic crisis exacerbated by the Russian invasion of Ukraine and the catastrophic floods that have affected close to 33 million people. Prior to the latest floods, Pakistani officials had already begun work on this programme loan.
The amount of countercyclical actions taken by the government to lessen the negative effects of cumulative external shocks, particularly on the poor and vulnerable, comes to around $2.4 billion.
