In advance of a crucial International Monetary Fund (IMF) board meeting to authorize further funds, authorities stated that Pakistan’s state bank received an additional $1 billion deposit on Wednesday.
The deposit boosts the state’s foreign reserves to $7.5 billion, more than quadruple the account balance from last week, and comes a day after Saudi Arabia deposited $2 billion to Islamabad.
As it struggles to pay off debilitating external debt, the economy is experiencing a balance of payments crisis, and months of political unrest have discouraged foreign investment.
A sharp drop in industrial production is being caused by the country’s struggle to afford imports, skyrocketing inflation, and the devaluation of the rupee.
An important need of the IMF for sanctioning a new standby contract for Pakistan for $3 billion has been securing financial backing from friendly countries.
The IMF executive board meeting taking place this week in Washington will examine whether to approve the deal.
The UAE has always offered its assistance to Pakistan as a dependable ally and fraternal nation, the prime minister Shehbaz Sharif tweeted late on Wednesday.
“We deeply appreciate this kind act and see it as essential to our efforts to stabilize the economy,” the statement reads.
Ishaq Dar, the minister of finance, said that the UAE deposit will appear on the books by Friday.
The Covid epidemic, a worldwide energy crisis, and historic floods that swamped a third of the nation last year have all contributed to Pakistan’s economy being stretched to its breaking point as a result of years of financial mismanagement.
For the first time in seven months, Pakistan’s headline inflation decreased in June. This was good news for the country’s struggling administration, which must conduct elections later this year.
