KARACHI: The foreign exchange reserve of the State Bank of Pakistan (SBP) decreased further by 16% to $3.90 million in the week ending January 27, due to the repayment of external loans. This amount is only sufficient to cover imports for less than three weeks.
According to local investment firm Arif Habib Limited (AHL), the foreign exchange reserves of the State Bank of Pakistan (SBP) have reached their lowest level since February 2014, with a coverage of only 18 days of import payments, the shortest period since 1998.
The report stated that the reserves held by commercial banks remained at $5.065 billion, bringing the total foreign exchange reserves of the country to $8.074 billion.
According to Reuters, Tahir Abbas, the head of research at Arif Habib Limited, reported that the country is in dire need of fresh funds and to avoid a crisis, the International Monetary Fund (IMF) program needs to be restarted as soon as possible.
Pakistan’s talks with the IMF to restart its program are currently at a stalemate. Once these talks are successful, other platforms will be able to assist in obtaining funds.
The government held talks with the IMF on Tuesday to secure a $7 billion bailout package to alleviate the economic crisis.
The talks will last until February 9 and aim to extend the IMF’s Extended Fund Facility. The ninth review of the program is designed to assist countries experiencing balance of payments difficulties.
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