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Pakistan receives USD 500 million from Qatar as first part of promised USD 3 billion

Business Finance

Press Trust of India  |  Islamabad 

Pakistan on Saturday received the first tranche of USD 500 million from Qatar under the USD 3 billion package consisting of a foreign currency deposit and direct investment to help boost the country's dwindling foreign-exchange reserves, according to a media report on Sunday.

The first tranche deposited with the State Bank of Pakistan (SBP) will help boost Pakistan's dwindling foreign-exchange reserves.

The gas-rich nation last week announced that it would invest USD 3 billion in the form of deposits and direct investments after Qatar's Emir Sheikh Tamim Bin Hamad Al Thani visited Islamabad.

State Bank of Pakistan's chief spokesman Abid Qamar told Dawn that a deposit of USD 500 million had been received from Qatar.

The Qatari foreign ministry said that with the new USD 3 billion investment package the size of the Qatari-Pakistani economic partnership will amount to USD 9 billion.

Qatar has not given the details of the USD 3 billion aid, but it signed three memoranda of understanding (MoUs) with Pakistan during the two-day visit of the Qatari Emir to Islamabad last week.

Qatar has emerged as the fourth country to having extended a financial assistance package at times when Islamabad is facing an acute shortage of dollars.

China, Saudi Arabia and United Arab Emirates deposited a total of USD 9.2 billion in cash with the SBP's foreign currency reserves during the outgoing fiscal year ending on June 30, 2019.

However, heavy import payments and debt repayments did not let the foreign currency reserves stabilise mainly due to sluggish exports.

The foreign reserves have depleted to six-month low at USD 7.28 billion in the week ended June 21, 2019, as per SBP latest updates on Thursday, which are just USD 700 million higher than almost five-year low at USD 6.63 billion recorded in the week ended on January 18, 2019.

Pakistan also reached an agreement with the International Monetary Fund in May for a bailout of about USD 6 billion.

Pakistan's foreign-exchange reserves have dropped by about 25 per cent to USD 7.3 billion, less than two months of import cover, according to central bank data.

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

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First Published: Sun, June 30 2019. 16:50 IST