ISLAMABAD
Pakistan is expecting to receive $500 million from the International Bank for Reconstruction and Development (IBRD), as the country has qualified for the loan after increasing its foreign exchange reserves to $15 billion in December previous year.
"Pakistan is expecting to receive $500 million from the International Bank for Reconstruction and Development (IBRD)", said a senior official of the Finance Ministry while talking to The Nation on Monday. However, he added that disbursement of aforesaid amount might take some time.
Pakistan had qualified for IBRD after enhancing its reserves to $15 billion last month (December). The country is now eligible for loans from the International Bank for Reconstruction and Development (IBRD) that would enable it to undertake major projects. The country was required to increase its foreign exchange reserves to three-month import bill (foreign exchange reserves around $15 billion level) for qualifying for IBRD (International Bank for Reconstruction and Development) funding of the World Bank.
Pakistan had enhanced its reserves to $15 billion in December last year after receiving two tranches worth of $1.1 billion from the International Monetary Fund (IMF) under extended fund facility (EFF) and holding auction of Sukuk bond, which generated #$1 billion for the national kitty.
IBRD loans are publicly guaranteed debt extended by the World Bank Group at market rates. Low-income countries usually do not qualify for IBRD loans unless they are creditworthy. The IBRD provides commercial-grade or concessional financing to sovereign states to fund projects that seek to improve transportation and infrastructure, education, domestic policy, environmental consciousness, energy investments, healthcare, access to food and potable water, and access to improved sanitation.
It is worth mentioning here that country's foreign exchange reserves fell down below the level of $8 billion in December last year wherein State Bank of Pakistan's reserves were only $2.96 billion. However, the reserves enhanced by almost $7 billion in one year due to rapid foreign inflows in the form of Eurobond, tranches of IMF, loans of World Bank, Asian Development Bank, Islamic Development Bank and auction of Sukuk bond.
According to the latest figures of the State Bank of Pakistan, the country's reserves are $14.94 billion where SBP's reserves are $10.30 billion and Commercial Banks $4.64 billion.