Pakistan to get Rs 519 billion foreign loans, grants

Tuesday June 23, 2009

KARACHI: Pakistan will acquire over Rs 519 billion foreign assistance in the shape of loans and grants for the next fiscal year from international finance institutions and different countries to run its development and non-development program smoothly, sources . They said that every year the government seeks huge foreign assistance to run its development and non-development program without financial hurdles.

"However, for the next fiscal year (2009-10) the federal government is relying more on foreign assistance due to high expenditure and less revenue," they added. They said that the government would be compelled to cut the ever highest Rs 646 billion Public Sector Development Program (PSDP) for next fiscal year if it failed to meet the target of estimated foreign assistance for development and non-development programs.

"Increase in budget deficit would be another option," they added. Sources said that delay in foreign inflows would also raise the pressure on the rupee against dollar. They said that Finance Division has estimated overall Rs 519.704 billion loans and grants (about $6.4 billion at Rs 80 per dollar exchange rate) from external sources, which is Rs 219.313 billion higher than the budget estimates of current fiscal year 2008-09. They said that estimated loans and grants by Finance Ministry for fiscal year 2009-10 are about 73 percent higher than current fiscal year.

For the current fiscal year the ministry had estimated Rs 300.319 billion inflows, while the estimated loans and grants were 39 percent higher than the revised estimates of Rs 374.497 billion for current fiscal year. Planned and non-plan assistance through external resources for development and non-development programs comprise Rs 444 billion loans and Rs 67 billion grants. External loan estimates for development and non-development expenditures stand at Rs 452.450 billion for next fiscal year against Rs 283.776 billion for the current fiscal year, depicting an increase of 59 percent.

Revenue estimates through external grants depict an increase of 310 percent to Rs 67.254 billion in fiscal year 2010 against Rs 16.393 billion in fiscal year 2009. Overall foreign assistance for the next fiscal year comprises by planned resources Rs 510.413 billion and non-planned resources Rs 9.291 billion. Project aid for federal departments is Rs 85.86 billion; Rs 26.923 billion for provinces; Rs 150.645 billion for commodity; Rs 16.385 billion for Wapda; and Rs 10 billion for National Highway Authority.

Under plan resources Asian Development Bank would provide Rs 140.954 billion grants and loans; Australia Rs 1.79 billion; China Rs 12.293 billion; European Union Rs 1.092 billion; European Commission Rs 8.027 billion; Eurobond Rs 41.250 billion; Germany Rs 5.66 billion; France Rs 8.9 billion; International Bank for Reconstruction and Development (World Bank) Rs 2.9 billion; International Development Association Rs 49.96 billion; Islamic Development Bank Rs 59.28 billion; and Iran Rs 10.89 billion.

Italy would provide Rs 4.71 billion as loans and grants under plan resources; International Fund for Agriculture Development Rs 950 million; Japan Rs 41.307 billion; Korea Rs 7.93 billion; Kuwait Rs 3.831 billion; Norway Rs 50 million; Netherlands Rs 2.64 billion; New Zealand Rs 18.9 million; Saudi Arabia Rs 34.88 billion; Spain Rs 872 million; Sweden Rs 165 million; Turkey Rs 3.3 billion; UAE Rs 10.39 billion; UK Rs 11.289 billion; United Nation Development Programme Rs 637 million; Uncief Rs 157 million; USA Rs 33.474 billion; World Bank Rs 9.9 billion; World Food Programme Rs 580 million; and Opec would provide Rs 219 million loan in the next fiscal year.


(BRecorder)