ISLAMABAD: Pakistan has secured International Islamic Trade Finance Corporation (ITFC) Murabaha Financing Facility of $761.5 million for the import of petroleum products on deferred payment, said the Ministry of Economic Affairs.

The ministry took to Twitter and also shared with the media that as a result of successful discussions between Federal Minister for Economic Affairs Omar Ayub Khan and Hani Salem Sonbol, chief executive officer (CEO) ITFC, Pakistan has secured $761.5 million Murabaha Financing for import of petroleum products on deferred payment.

The ministry stated that the ITFC financing would help to ease pressure on exchange rate and stabilise foreign exchange reserves.

It also reflects confidence of the IFIs in Pakistan’s economy.

The ITFC and the Economic Affairs Division (EAD) also agreed to continue their cooperation in future for maximum utilisation of $4.5 billion financing window.

Petroleum products: another price hike in the offing

According to the Economic Affairs Division, the ITFC Murabaha Financing Facility ($761.5 million) has been made effective and ready for utilisation by the Pakistan State Oil (PSO), Pak-Arab Refinery Company Limited (PARCO), and Pakistan LNG for the import of oil and gas.

Due to higher demand amid strong economic recovery, financing is enhanced from $300 million to $ 761.5 million, the ministry added.

The government last month signed financing agreement amounting to $386 million with the ITFC, a subsidiary of the Islamic Development Bank (IsDB) Group, for import of oil and LNG. This facility will be utilised by the Pakistan State Oil Company Limited, the PARCO, and the Pakistan LNG Limited (PLL).

The financing agreement provides trade financing amounting to $386 million for a period of one year for import of oil and LNG.

Copyright Business Recorder, 2021