SBP reserves tumble by $119m to $4.19b due to external debt repayments.

ISLAMABAD -- Pakistan's foreign exchange reserves have further declined by $119 million to $4.19 billion in the last week mainly due to the debt repayment and lesser borrowing available amid suspension of the International Monetary Fund (IMF)'s programme.

'During the week ended on 19: May: 2023, SBP reserves decreased by $119 million to $4,193.0 million due to external debt repayments,' the State Bank of Pakistan (SBP) said in its brief statement. It added that total liquid foreign reserves held by the country stood at $9.731 billion as the reserves held by the SBP are $4.19 billion and net foreign reserves held by commercial banks are $5.53 billion.

The reserves are tumbling mainly due to repayment against previous loans. The government would have to repay over three billion dollars by the end of next month (June). On the other hand, the foreign inflows have almost dried amid suspension of the International Monetary Fund (IMF)'s programme. The international financial institutions are not releasing funds for Pakistan in the absence of the IMF programme. Pakistan and IMF have yet to reach a staff levA!el agreement as both sides are continuously negotiating since January 31 this year. The government had met all prior actions of the IMF. The government has taken all tough decisions including increasing power and gas prices massively and imposA!ing new taxation measures worth Rs170 billion. Pakistan had accepted two more conditions. The government, on the IMF demand, has imposed a surcharge of up to Rs3.23 per unit on electricity consumers across the country from July 1.

The government has received foreign borrowing worth only $8.12 billion from the international lenders in 10 months (July: April) of the current fiscal year 2022: 23, which is only 35.6 percent of the annual projected borrowing. The government has budgeted foreign assistance of $22.817 billion for the current fiscal year. The breakup of the $8.12 billion...