To avoid foreign currency crisis, Pakistan has turned to his loan-lender, China. In April, Chinese banks have loaned Pakistan $1 billion, as revealed by Pakistan’s central bank governor, Tariq Bajwa. The loan has been taken at “good, competitive rates”.
China has been helping Pakistan as part of financial, political and militaries ties. China has already invested $60 billion on the infrastructure building in Pakistan. There has also been more financial cooperation as part of CPEC, but the exact sum has not been revealed by China.
In the wake of dropping of Pakistan’s foreign exchange— $18.1 billion last year in April to $10.8 billion in May this year—Pakistan has sought the help of his all-weather friend. To avoid going to IMF, Pakistan has asked China to step in in these financial crisis times.
“The money strengthens the financial, political and military ties between the two countries,” quoted Tariq Bajwa. “Chinese commercial banks are awash with liquidity.”
Pakistan has had nine engagements with IMP since 1988, where three were doubled programmes. In total, there have been 12 IMP programmes in 28 years. However, only four have been successfully completed in the 2000s and 2010s, where others were abandoned halfway.
According to the Stockholm International Peace Research Institute, China had also loaned arms worth $514 million to Pakistan last year, where only $21 million worth arms were imported from the U.S.
(Inputs by PTI)
