Pakistan knocks US’ doors for $10 billion loan:Sharif-govt intends to increase amount of foreign currencies with borrowed money

Pakistan has sought a $10 billion facility (loan or financial assistance or line of credit) from the US to strengthen its foreign exchange position (to increase amount of foreign currencies kept with it) and reassure international investors, Finance Minister Muhammad Aurangzeb said, according to PTI. The cash-strapped country seeks to reduce its dependence on repeated emergency financing from friendly countries. Aurangzeb said the request had been made to the US Treasury Department and negotiations were under way, but no agreement had been reached so far, according to an interview with Business Recorder newspaper published on Thursday. Pak intends to stabilise currency He said the initiative is aimed at strengthening foreign exchange stability and sending a positive signal to international capital markets rather than securing a conventional loan or credit line. Pakistan came close to default in 2023 Pakistan has been facing pressure on its external payments for several years and came close to default in 2023 before avoiding it with timely support from the International Monetary Fund (IMF) and bilateral partners. How much loan Sharif govt took from IMF? It is currently implementing the $7 billion IMF assistance programme agreed in 2024, while the government is trying to improve its creditworthiness and regain regular access to international capital markets. The proposed $10 billion Exchange Stabilisation Support Facility from the US comes as Pakistan seeks to move away from a financing model that has relied heavily on loans, deposits and repeated rollovers from friendly countries to meet its external financing needs. Aurangzeb said Pakistan s complete effort was to shift towards market-based financing. Pakistan grateful to its partners for loans The minister said Pakistan remained grateful to its bilateral partners for the support extended over the past decade, particularly during the last three years, but its financing strategy was now being recalibrated.