Pakistan has paid more than $ 3.8 billion in foreign debt service during the third quarter of the current fiscal year (Fiscal Year 25), including $ 1.263 billion of interest, according to data issued by the State Bank in Pakistan (SBP).
The total external debt service in the country in the fiscal year was presented at the beginning of $ 26 billion, which was the goal that appeared at the beginning. However, Pakistan has made great progress towards this goal, as total payments amounted to $ 11.46 billion in the first three quarters. This includes 7.47 billion dollars in interest, 3.99 billion dollars.
The highest payments for external debt service were made in the second quarter (October to December 25), with a total of $ 4.176 billion, with $ 1.39 billion of this number to benefit. The third quarter witnessed a decrease in payments to $ 3.813 billion, with $ 1.263 billion in interest.
SBP Jameel Ahmed recently expressed his confidence that Pakistan would be able to roll more than $ 12.3 billion of debt while securing the necessary financial assurances. The financial sector remains optimistic that Pakistan will summarize the goals of external debt service by the end of the fiscal year 25.
SBP also enhances foreign exchange reserves, with a $ 14 billion revised target for this year, with the help of unexpected high transfers flow. The goal of transfers was raised from 35 billion dollars to 38 billion dollars for the fiscal year 25, which will represent an increase of 26 % compared to the previous year’s flow of $ 30.2 billion.
In addition to these efforts, the recent International Monetary Fund’s approval of major financing arrangements for Pakistan – a billion dollar exchange under the Fund’s extended facility and a new facility for flexibility and sustainability of $ 1.4 billion for climate initiatives – must support SBP reserves.
Despite these positive developments, Pakistan is facing challenges on the commercial front. Imports increased, which expanded a commercial deficit. However, high transfers and financial support from the International Monetary Fund and countries such as China, Saudi Arabia and the United Arab Emirates have made a pillow against possible negative effects.
The goal of the Pakistani export of $ 60 billion is ambitious, as exports reach 26.86 billion dollars in the first ten months of the 25th fiscal year, indicating modest growth of 6.25 % from the previous year. However, the country’s imports rose to $ 48.21 billion, an increase of 7.77 % compared to the same period last year.
