KARACHI: The government of Pakistan has secured a $300 million short-term loan from United Bank Limited (UBL) to meet its external debt repayment obligations.
UBL Facilitates Loan through International Branches
In a press release issued on Monday, UBL confirmed that its UAE and Bahrain branches arranged and financed the loan. The transaction underscores UBL’s capacity to execute high-value international deals, with the bank’s overseas assets exceeding $2.4 billion.
Debt Financing Struggles Persist
Despite securing this loan, the government faces challenges rolling over debt from China and other countries. Pakistan requires $14 billion to meet external debt repayment obligations for the fiscal year 2024-25.
State Bank Reserves Under Pressure
The State Bank of Pakistan (SBP) reported reserves at $11.853 billion as of December 26, reflecting a $228 million outflow during the week. While remittances and exports have increased, the SBP continues purchasing dollars from the domestic market to maintain reserves in line with IMF requirements under the $7 billion Extended Fund Facility.
Read Also: Federal Government Faces Rs80-90 Billion Tax Target Shortfall for December
UBL’s Role in Supporting Pakistan’s Financing Needs
“This transaction supports Pakistan’s external financing needs, in line with commitments to the IMF,” UBL stated, highlighting its role in offering seamless financial solutions both domestically and internationally.
HBL Partners to Empower Farmers
In related news, HBL Microfinance Bank (HBL MfB) and HBL Zarai Services Ltd (HZSL) have entered into a strategic partnership to provide farmers with enhanced financial and agricultural support services.
Focus on Sustainable Agriculture
The collaboration aims to foster sustainable agricultural development and improve rural livelihoods. HBL MfB will leverage its expertise to offer tailored microfinance solutions to smallholder farmers through HBL Zarai’s Deras.
This partnership reflects HBL’s commitment to empowering farmers and supporting Pakistan’s agriculture sector.
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