ISLAMABAD

Pakistan’s foreign exchange reserves would cross the benchmark of $14 billion by the end of June 2014 mainly because of foreign inflows in shape of IMF’s tranche and revenue generated through disinvesting shares of United Bank Limited. 

Pakistan would receive around $860 million in next couple of weeks including $550 million from International Monetary Fund (IMF) as fourth tracnhe under extended fund facility and $310 million of disinvesting of UBL’s share. “The IMF’s executive board meeting is likely to be held on June 28 2014 to consider its staff mission’s report on Pakistan economy before approving fourth tranche”, Rana Asad Amin, official spokesperson and advisor of the Finance Ministry told The Nation on Monday.

Similarly, the government would receive $310 million from disinvesting shares of UBL.

The government has recently divested 19.8 percent shares of UBL, which generated $387 million for the national kitty. Out of $387 million, $310 million would be as foreign exchange component while the remaining amount is the rupee component.

These two foreign inflows, IMF installment and privatisation of UBL, would take Pakistan’s reserves to beyond $14 billion by end of June 30. Pakistan’s foreign exchange reserves currently stood at $13.456 billion wherein State Bank of Pakistan’s held are $8.612 billion and $4.844 billion are of commercial banks (other than the central bank).

An International Monetary Fund (IMF) staff mission, led by Jeffrey Franks, visited Dubai during May 1-9, 2014 to conduct discussions on the third review of Pakistan’s SDR 4.393 billion (about US$6.6 billion) Extended Fund Facility (EFF), approved by the Executive Board of the IMF on September 4, 2013. Therefore, the IMF staff would present its report on the third review that, upon management approval, is tentatively scheduled for consideration by the IMF Executive Board on June 28. If approved, the conclusion of this review would make SDR 360 million (about $550 million) available to Pakistan.

Pakistan would receive $2.2 billion from IMF after getting fourth tranche worth of $550 million during outgoing financial year 2013-14. However, the government has repaid $3.2 billion to the Fund during outgoing fiscal year.