Loan agreement worth $2.3 billion with Chinese consortium reached, says Ismail

Finance minister says inflows expected within days

Picture source - APP (May 2022)

Finance Minister Miftah Ismail has said that a Chinese consortium of banks had signed a $2.3 billion loan facility agreement with Pakistan, with the money expected to start arriving in a couple of days.

In a statement on Twitter, the finance minister said that the agreement was signed on Tuesday and thanked the Chinese government for facilitating this transaction.

In a statement by Foreign Minister Bilawal Bhutto Zardari on Twitter, he thanked the Chinese president, the foreign minister and the people, adding that the Chinese consortium of banks had signed the loan facility agreement.

Bilawal said that the Pakistani people were grateful for the support of their “all-weather friends”.

Earlier in June, the finance minister had said that the terms and conditions for refinancing of the $2.3 billion deposit by Chinese banks had been agreed.

He also stated in a press conference on June 2 that China had withdrawn the loan on March 25 and tough conditions had been set under which Pakistan was unable to utilise the funds.

The finance minister stated that following a visit by the Pakistani foreign minister and discussions between Prime Minister Shehbaz Sharif and his Chinese counterpart, China agreed to give the amount while also reducing the interest rate from 2.5 percent to 1.5.

The development comes amid reports that an understanding between the Pakistani government and the International Monetary Fund had been reached on the budget for fiscal year 2022-23.