Pakistan has managed to secure approximately $20 billion in external financial assistance during the first 11 months of fiscal year (FY) 2024-25, exceeding its annual target of $19.2 billion. According to reports, this figure includes approximately $6.89 billion in fresh loans and grants, while the majority of the assistance was in the form of legacy rollovers.

 

China and Saudi Arabia granted rollovers of $3 billion each, while the United Arab Emirates granted Pakistan a rollover of $2 billion.

 

Despite Pakistan exceeding the annual target, the Economic Affairs Division’s (EAD) latest report outlined that inflows of foreign economic assistance dropped by 8.7 percent during the first 11 months of FY 2024-25 compared to the same period last year, when inflows stood at a respectable $7.55 billion.

 

It merits a mention that the $6.89 billion figure does not count the $2 billion received from the International Monetary Fund (IMF) under the ongoing $7 billion Extended Fund Facility program. The reason behind this is that these IMF disbursements are recorded separately by the State Bank of Pakistan (SBP). 

 

Reports have highlighted how including IMF disbursements and the rollovers results in total foreign assistance reaching $20 billion in the 11-month period. As per the data, Pakistan’s overall rollover portfolio from Saudi Arabia, China, and the UAE is estimated to sit at $12.7 billion, comprising loans and safe deposits.

 

Reports suggest that delays in the IMF program deterred many commercial lenders, contributing to the 8.7 percent drop in foreign economic assistance. Last year, inflows were higher due to timely IMF tranches.

 

Commercial financing from UAE-based lenders showed some recovery, reportedly reaching $903 million, but it remained far below the $3.8 billion annual target. Aside from delays from the IMF’s side, credit rating concerns and tough economic conditions have played their role in the fall in foreign economic assistance. 

 

As per reports, multilateral creditors disbursed $3.37 billion during the first 11 months of FY 2024-25, recording an uptick from $3.14 billion the previous year. Reports suggest that bilateral disbursements witnessed a significant drop on a year-on-year (YoY) basis as well, falling by 45 percent, causing aid to fall to a measly $487 million from its previous value of $889 million.

 

Islamabad also intended to generate $1 billion through international bonds and expected $9 billion in inflows from China and Saudi Arabia. Reports reveal that the breakdown would be $5 billion in time deposits, while the $4 billion would be SAFE deposits.

 

Meanwhile, inflows through the Naya Pakistan Certificates rose to $1.77 billion from $1.05 billion last year. The ADB and World Bank contributed $1.39 billion and $1.23 billion, respectively, showing YoY growth.