ISLAMABAD - The government has almost breached the limit of annual foreign borrowing of $8 billion only in nine months mainly to sustain the foreign exchange reserves of the country.

Pakistan has borrowed $7.9 billion during nine months (July to March) of the ongoing fiscal year (FY2018). The government had set $8 billion as the foreign borrowing plan in parliament for the current fiscal year.

Keeping in view the current trend, the government is all set to break the previous year's record of borrowing around $10 billion in a single year.

Last year, the government had borrowed $10.2 billion from external sources as against the target of $8 billion.  The government has borrowed massively to maintain its reserves, which are depleting due to the widening current account deficit and repayment of previous loans.

The State Bank of Pakistan's held reserves are $11.4 billion. Pakistan had borrowed $330 million only in March taking overall foreign borrowing to $7.9 billion in nine months of the FY2018.

The PML-N government had borrowed around $41 billion during its current tenure. Pakistan had taken loans from all available options, including commercial banks and International Monetary Fund (IMF), and through issuing bonds in international market.

The Asian Development Bank (ADB) had recently expressed concerns over securing borrowing to contain the foreign exchange reserves that are depleting due to widening of current account deficit.

"Securing adequate financing to contain the drawdown in foreign exchange reserves is a concern", the ADB noted in its recent report.

According to the official data, the government of Pakistan had borrowed $7.91 billion in nine months of FY2018. The break-up of $7.91 billion borrowing during July-March of 2017-18 showed that government had raised $2.5 billion from the auction of Euro and Sukuk bonds in international market.

Pakistan in November had successfully executed $1.0 billion five years Sukuk and $1.5 billion ten years Eurobond transactions at profit rates of 5.625percent and 6.875 percent respectively.

Another major part of the borrowing of $7.91 billion was from the commercial banks that recorded at $1.72 billion during nine months of the current fiscal year. The government had projected only $1 billion borrowing from the commercial banks during the entire ongoing financial year.

However, the government had gone beyond the limit in just eight months to sustain its foreign exchange reserves. The government is in negotiations with some other foreign banks and expected to sign more agreements in coming months to procure more commercial loans for budgetary support.

According to official documents, the break-up of loans received showed that the Asian Development Bank provided $621.1 million, the International Bank for Reconstruction and Development $129.84 million, the International Development Association of the World Bank $240.09 million and the Islamic Development Bank gave $949.56 million (short-term loan for July-March period for crude oil import).

Pakistan also took $155.58 million from the United Kingdom during the period under review.

China gave a loan of $1.22 billion to Pakistan. The USA released $76.59 million in the current fiscal year 2017-18 against the estimates of $117.56 million.

The government received no assistance from Italy, Korea, Norway, and UNDP during the first nine months of the current fiscal year (2017-18).

The International Monetary Fund (IMF) had recently estimated Pakistan's external debt and liabilities could peak to $144 billion in the next five years from $93 billion in the current financial year of 2018.

The IMF has also estimated that total external debt servicing would reach $19.7 billion by 2023 against $7.739 billion in the FY 2018.