KARACHI: The country’s total liquid foreign exchange reserves further fell by $449 million during last week due to external debt servicing.

According to the State Bank of Pakistan (SBP), the total liquid foreign exchange reserves held by the country stood at $ 17.03 billion as of April 8, 2022 down from $17.48 billion on April 1, 2022.

During the week under review, the SBP’s reserves decreased by $ 470 million, ie, from $11.319 billion to $ 10.849 billion, mainly due to external debt repayments. The current level of foreign exchange reserves is lowest since June 2020 and the current level can cover imports of almost two months.

Net forex reserves held by commercial banks increased by $ 21 million to $6.178 billion.

Pakistan’s external account is under pressure due to massive external debt payments and the foreign exchange reserves are gradually depleting.

The first task of the newly-appointed finance minister will be to make efforts for revival of talks with the International Monetary Fund (IMF) to ensure the timely release of the remaining amount under the Extended Fund Facility (EFF) programme.

Previously, the IMF released $ 1.053 billion loan tranche of the EFF program in the first week of February 2022. With this tranche, total disbursement under the EFF has reached $3 billion. The release of the remaining $3 billion is subject to completion of the remaining programme reviews. Analysts said that revival of talks with the IMF is crucial for Pakistan to build the depleting foreign exchange reserves.

Copyright Business Recorder, 2022