UAE lends $1 billion, transfers another $2 billion to Pakistan – Times of India

The United Arab Emirates agreed on Thursday to lend $1 billion to Pakistan and roll over an existing $2 billion loan, Pakistan’s information minister said.
Pakistan says it suffered more than $30 billion in damage as floods swept the country from July to August.
The announcement of the loan came as Pakistan’s Prime Minister Shehbaz Sharif kicked off a two-day visit to the United Arab Emirates.
He met with UAE President Sheikh Mohammed bin Zayed al-Nahyan and would discuss business and economic opportunities with other officials and business leaders, Information Minister Marriyum Aurangzeb said.
“We share the determination and understanding that continued efforts are needed to further strengthen trade, investment and economic relations,” Sharif said in a statement from his office.
As a ninth assessment by the International Monetary Fund (IMF) to approve the release of the next $1.1 billion tranche to Pakistan has been pending since September, external financing is critical to the country’s fractured economy.
Pakistan’s central bank foreign reserves fell to a critical level of $5.5 billion in the week ending Dec. 30, barely enough for three weeks of imports.
The IMF and Pakistan signed a $6 billion bailout package in 2019, which was supplemented by another $1 billion earlier this year.
The lender wants Pakistan to take fiscal measures to meet budget targets, implement reforms in the power and energy sector and review subsidies to the agriculture and export sectors.
IMF officials met Pakistan’s Finance Minister Ishaq Dar on Monday on the sidelines of a climate conference in Geneva, which saw more than $9 billion in pledges for flood recovery.
Dar said on Wednesday that Pakistan was already working on the fiscal contingency plan to get rid of energy sector debt and review subsidies.
Saudi Arabia, a longtime ally, is also considering investing $10 billion
in the South Asian nation of 220 million and increasing deposits at the country’s central bank from $3 billion to $5 billion.

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