ISLAMABAD: Pakistan has secured $3.01 billion in the shape of foreign loans during the first five months of the current fiscal year. Out of the total foreign inflows, Islamabad received $500 million in the shape of oil facility from Saudi Arabia.
According to data of the Ministry of Economic Affairs, the reliance on borrowing increased raising Rs858 billion between July and November of FY2025-26.
The figures show a sharp rise compared to the same period of the previous fiscal year, when the government had borrowed foreign loans in rupee term of Rs741 billion. This means borrowing during the first five months of the current fiscal year was Rs117 billion higher, representing an increase of around 15 per cent year on year.
A month wise breakdown reveals that the government borrowed Rs198 billion in July, followed by Rs192 billion in August. In September, borrowing stood at Rs124 billion, rising to Rs133 billion in October, while Rs144 billion was secured in November alone.
Documents indicate that in November, the government obtained external loans amounting to $515 million, around $40 million higher than the borrowing recorded in October, when approximately $475 million was secured. Of the November inflows, $314.5 million came through bilateral and multilateral agreements, while $196.9 million was raised through the issuance of Naya Pakistan Certificates.
The report further notes that $100 million was received in October under the Saudi oil facility, while a total of $1 billion is expected under this arrangement during the current fiscal year. So far, $500 million has already been received.
According to the Economic Affairs Division’s external financing report, the government received $54.1 million in grants during the first five months of the fiscal year. For the full year, the federal government has projected external financing of more than $19.92 billion.
In addition, the government plans to roll over $9 billion in safe deposits from Saudi Arabia and China during the current fiscal year, including $5 billion from Saudi Arabia and $4 billion from China. Of this amount, $3 billion from Saudi Arabia has already been rolled over.
According to the IMF projections, total external inflows of over $25 billion during FY2025-26 are expected. This includes a target of rolling over $12 billion from friendly countries, along with $2 billion under the IMF loan tranche plan. Under the IMF’s Resilience and Sustainability Facility, two tranches amounting to around $400 million are also expected during the year.
Responsibility for rolling over $9 billion from Saudi Arabia and China lies with the Ministry of Finance, while the $3 billion rollover from the United Arab Emirates will be handled by the central bank.
Project financing will continue to be sourced from major multilateral lenders, including the World Bank Group and the Asian Development Bank, along with other international financial institutions. The government has also decided to issue $250 million worth of Panda Bonds in the Chinese market in January.
According to the report, the government expects to secure $1.924 billion from the Asian Development Bank, $1.6639 billion from the World Bank Group, and $860 million from the Islamic Development Bank during the current fiscal year, including $700 million in short term financing.
The financing plan also includes the issuance of $400 million in bonds and $610 million through Naya Pakistan Certificates. Overall, the government aims to raise $6.4 billion under project financing through bilateral and multilateral arrangements during FY2025-26.
