Pakistan would receive $1 billion as IMF’s installment and money generated from the auction of Eurobond in next few days that would build the country’s foreign exchange reserves.

The International Monetary Fund (IMF) on Monday approved to release ninth tranche worth of around $500 million for Pakistan. The executive board of the IMF in its meeting held in Washington gave approval for releasing next loan installment under the extended fund facility.

The IMF’s executive board discussed its staff mission report that visited Dubai during July 29-August 7, 2015 and conducted discussions on the eighth review of Pakistan’s economic programme supported by a three-year IMF Extended Fund Facility (EFF) arrangement. Pakistan had so far received $4.05 billion from the IMF in eight installments since September 2013.

“Pakistan will receive the amount $502 million within next few days, which will help in building country’s foreign exchange reserves,” said an official of the Ministry of Finance while talking to The Nation. He further said that Pakistan had already raised $500 million from auctioning Eurobond in international market last week.

Pakistan has successfully issued a new Bond of $500 million with a maturity of 10 year in the international Eurobond market. The coupon rate was 8.25pc equal to the rate at which it issued such bonds last year in April. Under the circumstances, the Finance Minister with the approval of the Prime Minister decided that it would be prudent to restrict the issue to the intended and announced level of $500 million in order to cover the forthcoming maturity in March 2016 of a bond issued in 2006.

The inflows of dollars in the shape of IMF tranche and Eurobond would help in increasing the country’s foreign exchange reserves. Pakistan’s current foreign exchange reserves are at historic height of $18.5 billion. The reserves would around $19-$20 billion by the end of this month or start of October. Reserves could increase to $19-$20 billion, which would cover 4-5 months import bill of the country.