Karachi: In order to enable Pakistan to meet the devastating impact of the recent countrywide flooding, the Asian Development Bank (ADB) has released USD 1.5bn to Pakistan. Pakistan is currently in dire need of USD 32 billion for debt servicing during the ongoing fiscal year. Talking about the release of loans the finance minister Ishaq Dar tweeted, “Asian Development Bank has released funds $1.5 billion to Pakistan under BRACE program for the credit of the government of Pakistan’s account with State Bank of Pakistan. AlhamdoLilah!.”
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The BRACE (Building Resilience under Active Countercyclical Expenditures) is basically meant for supporting the government's efforts to face the challenges in the aftermath of the devastating flood on the socio-economic development of the country. The Central bank after the release of the loan announced that it would significantly improve the foreign reserves of Pakistan. The SBP said, “as disbursement of policy-based loan for the government of Pakistan. These proceeds have increased the forex reserves of SBP and will be reflected in the reserves for the week ending Oct 28”.
Earlier in August this year, the IMF approved the seventh and eighth reviews of the Pakistan Bailout Program. The approval of funding by the IMF opened new horizons of inflows from other international financiers like the Word Bank, and the Asian Development Bank. It is relevant to mention here that before ADB, the WB in September announced that it would provide $2bn to Pakistan for reconstruction and rehabilitation activities in the country. This foreign inflow would help Pakistan improve its forex. Earlier the reserves of the central bank had fallen from $9bn during 10 months of the current fiscal year to $7.6bn on Oct 14.