China to deposit 2 billion dollars in Pakistan’s reserves to help the economy
Another step towards the development of Pakistan’s economy is on its way by none other than China, likely to deposit 2 billion dollars in Pakistan’s reserves.
China will not deposit the amount in installments, but in one go. It is expected to provide the relief in December, this year. However, China doesn’t want to highlight its assistance of 2 billion dollar for strengthening the reserves.
In the latest statement, the Finance Minister, Asad Umar said that Pakistan is not in a hurry for the International Monetary Fund (IMF) package. It indicates that Pakistan is hoping for the relief from China to support the foreign reserves.
Pakistan to finalize the purchase of 15billion RMB:
Pakistan authorities, at the commercial rate, are also trying to finalize the purchase of 15billion RMB (Yuan) at the cost of $2billion for local currency trade with China that would help Pakistan come out of US dollar’s pressure.
Beijing offered Pakistan to double the exports:
According to earlier news, Beijing offered Pakistan to double its exports to China from $1.2 to $2.2 billion by the end of current fiscal year. In case, Pakistan succeeds to do that, China will encourage Pakistan to increase its exports by one billion dollars more.
Beijing also indicated to extend a special quota for export of sugar and rice and Pakistan, which will help Pakistan to have a massive surge in exports to China.
These steps, if followed, would help Pakistan to reduce trade deficit with China which stands at $14 billion. By sending one million tons of sugar and rice to the Chinese market, Pakistan can increase its exports by just $500 million.
China’s imports stand at $2 trillion but there is a lack in the ability of Pakistan businesspersons to harness even one percent share in China’s total imports.
However, authorities in Pakistan are still in touch with IMF for a bailout package of about $6-7 billion. Pakistan is direly in need of comfort letter for the fund to move financial ties with International Financial Institutions.
China will keep supporting Pakistan:
China will continue to provide economic aid to Pakistan. Foreign reserves in Pakistan have plunged 42% since the start of the year and now stand at $8billion. China will provide all the necessary support and assistance to Pakistan, helping to overcome the economic difficulties.
As far as specific measures are concerned, relevant authorities of both countries will have detailed talks.
Pakistan has also looked to improve China Pakistan Economic Corridor to put greater emphasis on projects focusing on social development. But the Chinese officials said that there will be no change in the number of projects under CPEC. However, he said that the project will increase in favor of people’s livelihoods.
Source: The News