Key Takeaways:
– The country has borrowed approximately USD 29 billion from the IMF during the past 30 years.
– In the last four years alone, Pakistan borrowed over USD 6.26 billion and repaid USD 4.52 billion.
– In 2024, Pakistan borrowed USD 1.35 billion in Special Drawing Rights (SDRs) and repaid USD 646.69 million in SDRs.
– SDRs are an international reserve asset based on major currencies.
Overview:
Pakistan’s Finance Ministry recently revealed that the country has paid more than USD 3.6 billion in interest on loans to the International Monetary Fund (IMF) over the past four decades. Here are the key details:
Interest Payments and Loan History:
Pakistan’s cash-strapped government has informed Parliament that it paid over USD 3.6 billion in interest to the IMF. The interest paid amounts to over Rs 1,000 billion in Pakistani currency. Over the past 30 years, Pakistan borrowed approximately USD 29 billion from the IMF and repaid more than USD 21.72 billion during the same period. Additionally, during this period, Pakistan paid over USD 1.10 billion in interest to the IMF.
Special Drawing Rights (SDRs):
In 2024, Pakistan borrowed USD 1.35 billion in SDRs from the IMF and repaid USD 646.69 million in SDRs. SDRs are an international reserve asset created by the IMF. They can be exchanged among governments for freely usable currencies during times of need and are based on a basket of major international currencies.
Committee Inquiry:
The Senate’s Standing Committee on Economic Affairs sought details of every IMF program. The committee emphasized the need for transparency and understanding the impact of each program.
Upcoming IMF Loan:
Pakistan is close to securing another IMF loan of about USD 7 billion, which will be provided over three years.
