Pakistan

Pakistan is getting a promising response from China over its request to lengthen maturities for Belt and Road Initiative loans, according to its finance minister, signaling potentially more breathing room for the nation that has been squeezed by costly borrowing in the past, Bloomberg News reported. The South Asian nation is looking to increase the maturities for debt taken to build power plants and “create enough space” to lower electricity prices, Muhammad Aurangzeb said in an interview in Washington.

Pakistan cut its benchmark interest rate for a third consecutive meeting as slowing inflation gave policymakers space to revive economic growth, Bloomberg News reported. The State Bank of Pakistan lowered the target rate by 200 basis points to 17.5%, according to a statement. “The MPC assessed the real interest rate to still be adequately positive to bring inflation down to the medium-term target of 5%–7% and help ensure macroeconomic stability,” the central bank said.

Pakistan's Prime Minister Shehbaz Sharif said Thursday that his country has met all the conditions set by the International Monetary Fund to qualify for a new $7 billion loan to help prop up its economy, the Associated Press reported. During a Cabinet meeting in the capital, Islamabad, Sharif praised his finance team and other advisers for complying with the requirements set by the IMF, which is expected to sign a formal approval to the loan on Sept. 25, when the global lender's board of executive directors is scheduled to meet.

The State Bank of Pakistan (SBP), on Friday, annulled banking license of Industrial Development Bank Limited (IDBL) and directed its de-scheduling as it has gone into liquidation, the Associated Press of Pakistan reported. A notification issued by Banking Policy and Regulations Department of the central bank, reads “In exercise of powers conferred upon State Bank of Pakistan by Section 27 (4) of Banking Companies Ordinance, 1962 the banking license issued to Industrial Development Bank Limited (license No.

Pakistan has secured commitments from China, Saudi Arabia and the United Arab Emirates to rollover debt for a year, a boost for the nation as it awaits a final approval for its new $7 billion loan program with the International Monetary Fund, Bloomberg News reported. The amount of rollovers will be the same as last year, Pakistan’s Finance Minister Muhammad Aurangzeb told reporters in Islamabad after a parliamentary committee meeting. Pakistan has $12 billion in bilateral loans that have been extended for the past few years.

Pakistan cut its benchmark interest rate for a second consecutive meeting as slowing price gains give policymakers room to focus on shoring up growth in the cash-strapped South Asian nation, Bloomberg News reported. The State Bank of Pakistan reduced the target policy rate by 100 basis points to 19.50%, according to central bank governor Jameel Ahmad. The move was predicted by 31 out of 51 analysts in a Bloomberg survey.

Pakistan’s central bank lowered its benchmark rate by a bigger margin than expected, the first reduction in four years, after consumer prices eased in the South Asian nation, Bloomberg News reported. The State Bank of Pakistan reduced the target rate by 150 basis points to 20.50%, compared to a median estimate for a 100 basis point cut. Only two economists predicted the decision. “The committee, on balance, viewed that it is now an appropriate time to reduce the policy rate,” the central bank said in a statement.

Pakistan’s new government is hoping to inject some fresh momentum into projects that fall under China’s Belt and Road Initiative, as it tries to boost the country’s troubled economy, Bloomberg News reported. The South Asian nation is looking at joint ventures for renewable energy projects, agriculture collaboration and possibly enticing some Chinese companies to relocate to Pakistan, said Ahsan Iqbal, Pakistan’s federal minister for Planning, Development and Special Initiatives, who also co-heads the committee responsible for the China-Pakistan Economic Corridor, in an interview.

An International Monetary Fund (IMF) mission has opened discussions with Islamabad on a new loan programme, a Pakistan finance ministry statement said on Monday, Reuters reported. The mission chief, Nathan Porter, met Pakistan's Finance Minister Muhammad Aurangzeb to "kick-start the discussions on further engagement with the fund." Aurangzeb informed the team of improvements in the macro-economic indicators over the course of the standby arrangement and underscored the government's commitment to continue and expand the reform agenda, the ministry said.