Pakistan plans to seek $2 billion in loans from World Bank, ADB

WION Web Team Islamabad, Pakistan May 20, 2020, 04.03 PM(IST)

Coronavirus in Pakistan Photograph:( Reuters )

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The loans that Pakistan is seeking to obtain from the World Bank and the Asian Development Bank (ADB) are higher than the USD 1.8-billion debt relief that Islamabad has sought from the G20 nations, The Express Tribune reported.

The cash-strapped Pakistan government plans to seek USD 2 billion in new foreign loans from the global financial bodies to respond to the coronavirus crisis.

The loans that Pakistan is seeking to obtain from the World Bank and the Asian Development Bank (ADB) are higher than the USD 1.8-billion debt relief that Islamabad has sought from the G20 nations, The Express Tribune reported.

This is also aimed at undertaking fiscal reforms amid the rapid deterioration of public debt indicators.

The new plan comes as the ADB and Pakistan have finalised a USD 305 million emergency COVID-19 loan to help the country buy medical equipment and disburse money to poor women. The Asian Development Bank will extend the loan on commercial terms.

Once the CDWP clears concept papers of these loans, the board of directors of the World Bank and ADB would approve the loans.

Pakistan's public debt is projected to increase to Rs 37.5 trillion or a whopping 90 per cent of gross domestic product (GDP) by June this year.

Pakistan also wants to take USD 300 million in loan from the ADB in the name of financial markets development programme.

The money will be utilised by the finance ministry, State Bank of Pakistan (SBP), Securities and Exchange Commission of Pakistan and Federal Board of Revenue to strengthen market stability, market facilitation, supply measures and demand measures, according to the documents.

(with inputs from PTI)