Responding to a report: "Government
takes $450m loan to prop up sliding forex reserves ", carried by a section of the press, spokesman of the
Ministry of Finance clarified that commercial financing is a normal
activity and part of overall financing plan for the current fiscal year.
Commercial financing has been planned in terms of budgetary outlay for 2017-18
to bridge resource gap and supplement external buffers, the spokesman added.
The spokesman further said that in absolute terms there has
been no increase in external debt liability of the country. In 2013, external
debt to GDP ratio was 21.4%. In 2017, this ratio has decreased to 20.6%
showing a net decline of 80 basis points in the external indebtedness of the country.
Indeed external debt of the country is at a sustainable level and much lower
than many comparable economies like India, Sri Lanka, Egypt etc. Similarly,
external debt servicing liability for this fiscal is $5.8 billion as against
last year' s liability of $6.44 billion showing a decrease of 10% over the
previous year.
The spokesman went on to say that Pakistan's FX reserves
continue to maintain a healthy level. This increase in reserves is driven by
strong improvements achieved in the first quarter of current fiscal year on
account of exports, remittances, FDI, official inflows and other private
inflows. Exports have increased by 17.7%, remittances by 13.2%, during
July-August 2017 as against corresponding period last year. FDI during
July-August 2017 stood at $458 million as compared to $180 million showing an
increase of 154.9% compared to corresponding period of last year. With these
positive trends strengthening in coming months, the foreign exchange reserves
of the country will continue to be at a healthy level.
*-*-*-*-*
