Finance Minister Ishaq Dar said on Thursday that China’s Export-Import (Exim) Bank rolled over $2.4 billion in loan payments for the next two years.
“Chinese EXIM Bank has rolled over for 2 years principal amounts of following loans totalling US$ 2.4 billion which are due in next 2 fiscal years,” he announced in a tweet.
The minister said that the roll over for this year amounts to $1.2 billion and $1.2 billion for the next year.
“Pakistan will make interest payments only in both years,” the finance minister said.
Last week, China had agreed to reschedule over $2 billion publicly guaranteed debt of Pakistan for a period of two years, providing a major relief to the government that is in the process of rebuilding foreign exchange reserves through fresh loans and rolling over maturing debt.
The Economic Coordination Committee (ECC) of the Cabinet approved the revised terms of the agreement reached between Islamabad and Beijing, according to senior Pakistani officials.
China has time and again helped Pakistan meet its debt obligations through the provision of new loans and the roll over of the existing debt. China prematurely refinanced its $1.3 billion commercial loans in June, which helped Pakistan avoid a default on its international debt obligations during the period when the International Monetary Fund programme was stalled.
After the signing of the new IMF programme, Pakistan’s gross official foreign exchange reserves have bounced back to $8.7 billion – up from the critically low level of $4.5 billion before the IMF deal.