In quest of IMF loan...: Pakistan seeks $1bn commercial loan from foreign bank

ISLAMABAD: Pakistan has made a formal request to the Standard Chartered Bank (SCB) to resume its commercial foreign loan of around $800 million to $1 billion to fulfil the financing gap for getting approval from the IMF’s executive board.

“Yes, Pakistan has made a formal request to SCB for securing commercial loans and the bank agreed in principle for resuming credit line for the country,” top official sources confirmed while talking to The News on Wednesday. Pakistan has also made a request to the Kingdom of Saudi Arabia for provision of $1.2 billion in the shape of a Saudi Oil Facility (SOF), and soon after getting confirmation from the brotherly country, Pakistani authorities are expected to sign a Letter of Intent (LoI) for dispatching formal request to the IMF’s executive board for getting approval of $7 billion Extended Fund Facility (EFF) programme.

Pakistan and the IMF struck a staff level agreement on July 12, 2024; but so far, the IMF’s executive board has not included Islamabad in its calendar issued up to Sept 13, 2024. According to a press announcement, made by finance ministry on Wednesday, Federal Minister for Finance and Revenue Senator Muhammad Aurangzeb held a virtual meeting with Sunil Kaushal, global head of Corporate & Investment Banking at Standard Chartered Bank, to discuss expanding investment opportunities in Pakistan.

The meeting was attended by Rehan Shaikh, CEO of Standard Chartered Pakistan, the finance secretary, and other senior officers of the Finance Division.

During the discussion, the finance minister underscored the positive trajectory of Pakistan’s macro-economic indicators and expressed the government’s commitment to maintaining economic stability through various reforms. “Our government is dedicated to creating a conducive environment for foreign investments, ensuring that Pakistan remains a competitive and attractive destination for global investors,” Aurangzeb remarked.

The dialogue focused on exploring potential collaborations between the Government of Pakistan and Standard Chartered Bank, particularly in sectors such as infrastructure development, digital banking, and sustainable finance.

Kaushal expressed his confidence in Pakistan’s economic outlook and reiterated Standard Chartered’s long-term commitment to the country. “Standard Chartered views Pakistan as a key market with vast opportunities and we are committed to deepening our engagement with the country by extending all kinds of investment and financial support needed to fulfilling the country’s economic ambitions, in the present as well as the years to come,” he stated. The meeting concluded with both parties agreeing to explore specific investment projects in the coming months. The finance minister assured the delegation of the government’s full support in facilitating their initiatives and expressed his optimism about further strengthening the partnership with Standard Chartered Bank.