ISLAMABAD

The federal government took heavy loans from the foreign commercial banks from July 2015 to January 2016 as other multilateral and bilateral donors did not release sufficient amount due to slower pace of economic reforms.
Country borrowed $956 million from the commercial banks during seven months as against $200 million. The government took loans from commercial banks, which it had budgeted to receive in the entire fiscal year (July 2015 to June 2016), at higher interest rate.
Interestingly, Australia, EU, Italy, Norway, UNDP, Organization of the Petroleum Exporting Countries (Opec) and Turkish Exim Bank did not release a single penny for Pakistan during the period under review. Meanwhile, other multilateral and bilateral donors had not released even 50 percent of the committed amount despite passing of seven months of the year 2015-2016.
According to the latest data of Economic Affairs Division (EAD), Pakistan had received $4.28 billion, which is 46 percent of budget estimates of foreign assistance, from multilateral and bilateral donors from July to January 2016.
The government had projected to receive $9.18 billion loans to be received from multilateral and bilateral donors excluding IMF's tranches during ongoing financial year.
The Asian Development Bank (ADB) disbursed $662.78 million to Pakistan during July to January 2016, which is 65 percent of the budgeted estimates of $1020.4 million.
However, China released $561.4 million, 18 percent of the budgeted inflow of $3.05 billion. International Development Association (IDA) released $612.95 million in July-January period, which is only 35 of the budget estimates of $1729.2 million.
Another larger component of the assistance was the auction of Eurobond of $500 million.
The government has still space to auction another bond of same value before the end of June 2016, as it estimated to generate one billion dollars from the auction of bond during present financial year.
International Bank of Reconstruction and Development (IBRD) released $4.159 million and IDB $5.89 million in the month of January, bringing the total disbursement to $99.6 million, $40.35 million and $55.65 million respectively. Kuwait disbursed $37.28 million, Germany $29.45 million, and IDB (S-Term) $378.46 million in the current fiscal year.
The amount does not include releases amounting to $4.98 billion from International Monetary Fund (IMF) under the September 4, 2013 approved $6.64 billion Extended Fund Facility (EFF).
It is worth mentioning here that incumbent government is taking massive foreign loans. According to the Debt Policy Statement (DPS) 2015-2016 released by Ministry of Finance, external public debt increased by $1 billion during July-September and was recorded at $51.9 billion. The external debt increased due to $515 million commercial loans and $500 million Eurobonds. In addition, 8th tranche under IMF Extended Fund Facility (EFF) added $497 million in external public debt.