Pakistan asked China to roll over its $6.3 billion debt that is due to mature in the following eight months.
On Saturday, Pakistan asked China as part of its overall strategy to raise $34 billion in the current fiscal year to cover its debt and foreign trade-related commitments.
It has also been discussed that Pakistan apply for a new Chinese loan to pay off the maturing bilateral debt for the fiscal year 2022–23, which ends on June 30.
Chinese ambassador Nong Rong discussed the problem in a meeting with Pakistan’s Finance Minister Ishaq Dar of rolling over and refinancing nearly $6.3 billion in commercial loans.
According to officials from the Ministry of Finance, the $3.3 billion Chinese commercial loans and three $3 billion SAFE deposits loans will mature between now and June of the following year.
The International Monetary Fund and the Ministry of Finance without taking into account the effects of the most recent terrible floods have assessed Pakistan’s gross external finance requirements for the current fiscal year to be in the range of $32 billion to $34 billion.
Saudi Arabia has also announced to refinance $3 billion of debt due in December of this year; Pakistan has already received $2.2 billion in loans during the quarter of July to September.
The country still has to raise $29 billion, and in addition to any new loans, it is hoping for rollovers from China of at least $6.3 billion to $7.2 billion.
Prime Minister Shehbaz Sharif will travel to Beijing on November 1 with an extensive list of new projects and requests for debt rollovers, as well as the possibility of authorizing additional loans and preferential trade status for specific exportable items.