Pakistan secures $603mln loan from Islamic Development Bank

Pakistan and the Islamic Development Bank (IsDB) signed three loan agreements worth a total of $603 million on Tuesday.

The agreements were signed by the Vice President of the Islamic Development Bank and the Secretary of the Economic Affairs Division, in the presence of Federal Minister for Economic Affairs Ahsan Khan Cheema, Federal Minister Syed Imran Ahmed Shah, and other senior officials.

The Islamic Development Bank will provide $475 million in financial assistance for the M-6 Sukkur to Hyderabad Motorway project. This motorway forms a key section of the proposed Peshawar to Karachi motorway.

Additionally, Pakistan signed an agreement with the IsDB to launch a poverty alleviation programme for families affected by floods. The programme’s total cost is $134.2 million, with the IsDB contributing $118.4 million. The project will be implemented across 25 districts of the country.

For a separate initiative in Azad Kashmir aimed at out-of-school children, the Islamic Development Bank will provide $10 million in funding.

Meanwhile, the Pakistan government to seek roll over a $3 billion loan from the United Arab Emirates (UAE), official sources said.

“Prime Minister Shehbaz Sharif will write a letter to the President UAE Sheikh Mohamed bin Zayed Al Nahyan requesting to him for the rollover of three tranches amounting to US $3 billion before their maturity dates.

Sources in the Ministry of Finance has said that the ministry has completed its working and the PM will soon request to the UAE authorities for rollover of US$ 3 billion loan.

The Gulf country has deposited total US$ 3 billion in the State Bank of Pakistan being used for the balance of payment, sources said.

Officials said that a $1 billion tranche will mature on January 17, while another $1 billion to mature on January 23. The next $1 billion is expected to mature in July this year.