Islamabad, 12 July, 2023 (GNP): Finance Minister Ishaq Dar announced on Wednesday that the United Arab Emirates (UAE) has deposited $1 billion into the State Bank of Pakistan, bolstering the country’s declining foreign exchange reserves. The timely financial support from the UAE came shortly after Saudi Arabia’s deposit of $2 billion, further reinforcing Pakistan’s economic stability.
During a televised media address, Dar expressed his gratitude to the UAE for their generous support. He highlighted the confirmation from the Federal Reserve’s Bank that the amount had been credited into the State Bank’s account.
The UAE had previously reaffirmed its commitment to the International Monetary Fund (IMF) to provide Pakistan with $1 billion in bilateral aid. The funds were pledged in April after an IMF bailout programme expired, leaving $2.5 billion pending.
However, the disbursement of these funds was dependent upon the approval of a new standby arrangement between the IMF and Pakistan.
Furthermore, Dar highlighted that the combined deposits from Saudi Arabia and the UAE have increased Pakistan’s reserves by $3 billion in just two days. He further explained that this deposit would be reflected in the forex reserves position for the week ending on 14 July, 2023, bolstering Pakistan’s economic stability.
The finance minister has expressed his heartfelt gratitude to the UAE leadership on behalf of Prime Minister Shehbaz Sharif, Chief of Army Staff Gen Asim Munir, and the Pakistani nation for their unwavering support during challenging times.
In a tweet, the premier also thanked UAE President H.H. Mohamed Bin Zayed for the $1 billion deposit. He acknowledged the UAE’s consistent support to Pakistan as a time-tested friend and brotherly country.
Grateful to my dear brother, H.H. Mohamed Bin Zayed, President of the UAE, for the deposit of $1 billion with the State Bank of Pakistan. As a time-tested friend & brotherly country, the UAE has always come forward to support Pakistan. We deeply acknowledge this kind gesture &…
— Shehbaz Sharif (@CMShehbaz) July 12, 2023
The financial support from Saudi Arabia and the UAE plays a crucial role in bolstering Pakistan’s depleting foreign exchange reserves, which had dropped to cover a month of controlled imports.
Moreover, the increment in reserves raises hopes for the approval of the new nine-month standby arrangement by the IMF’s executive board. If approved, this arrangement would bring in $3 billion, equivalent to 111% of Pakistan’s IMF quota.