The foreign exchange reserves held by the State Bank reached $12,807 million on September 4.
This is the highest level of dollar reserves recorded since February 2018. A loan of $121 million by the Asian Development Bank last week helped the SBP’s dollar reserves increase by $95 million.
Pakistan’s depleting dollar reserves were one of the main challenges for the PTI when it came into power in August 2018. Within its first six months, the PTI government saw dollar reserves down to a level that was barely enough to pay for two months of imports.
To tackle this challenge, Prime Minister Imran Khan’s government signed a $6 billion bailout with the International Monetary Fund (IMF).
The increase in dollar reserves in fiscal year 2019-20 can be attributed to dollar inflows caused by the signing of the IMF programme, which opened more doors for Pakistan as the World Bank, ADB and AIIB also pledged support.
According to the IMF, the programme was supposed to unlock funding of $38 billion from multilateral donors.