Pakistan receives $500 million in refinancing from China’s ICBC, says Finance Minister Ishaq Dar

Finance Minister Ishaq Dar announced on Friday that Pakistan has received $500 million in refinancing from China as part of a $1.3 billion facility authorized by the Industrial and Commercial Bank of China (ICBC).

Ishaq Dar said, “Formalities completed [and] Chinese Bank, ICBC approved rollover of $1.3 billion facility which has been repaid by Pakistan to ICBC in recent months,” .

He said that the facility would be disbursed in three instalments, first one of $500 million has been received by the State Bank of Pakistan.

“It will increase forex reserves!” Dar added.

Hours before his announcement, the finance minister revealed that China has renewed a facility under which Pakistan expected an additional inflow of $500 million in the “next few days”.

Highlighting the PDM-led government’s economic achievements, Dar said that the foreign exchange reserves held by the SBP climbed to $3.8 billion from $2.8 billion — recorded last month. He maintained that the government returned $6.5 billion of foreign debt during the current fiscal year.

Pakistan has made payments of around $5.5 billion (excluding the $1 billion sukuk payment). These include $2 billion to China Development Bank and ICBC and $3.5 billion have been given to banks in other countries,” he said.

“Debt is usually rolled over but the debt stock does not reduce. We are reducing debt stock,” he said. “Formalities with ICBC were completed last night. We returned $1.3 billion to it and this facility has been renewed and we will receive the amount back in three tranches.

“We paid back $1.3 billion in three tranches — $500 million, $500 million and $300 million. We will receive it back the same way. Pakistan will get $500 million in two-three days. We might receive it on Monday. Then we will get an additional $500 million in 10 days.”