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Pakistan receives first UAE installment of $1 billion

January 24, 2019
Pakistan receives first UAE installment of $1 billion

Two days ago, Pakistan and the UAE signed an agreement for a $3b loan

Photo: AFP

The State Bank of Pakistan has received $1 billion of the $3 billion loan promised to the country by the UAE.

Two days ago, the Pakistan and UAE signed an agreement for a $3 billion loan to Islamabad. The rate of return for the loan is 3%.

The agreement was signed by State Bank of Pakistan Governor Tariq Bajwa and the Abu Dhabi Development Fund chairperson.

The funds were to be transferred to Pakistan in three instalments. The first instalment has been transferred, taking Pakistan’s foreign reserves to $14 billion from the previous $13 billion.

Related: Pakistan, Abu Dhabi sign agreement on $3b aid package

In December, the UAE announced a $3 billion bailout package for Pakistan to overcome its balance of payment issue under the Abu Dhabi Fund for Development.

The uncertainty around the International Monetary Fund package, which is very critical to take the economy out of crisis, kept investors away from the market in the second half of 2018. Foreign investors continued to offload their shares in the market throughout last year.

Given the delay in the IMF loan programme, the news of the UAE aid package sent a positive message to the investors, analysts had said.

So far, Pakistan has received $2 billion from Saudi Arabia and $1 billion from the UAE.

 
 
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