ISLAMABAD: Pakistan’s new government plans to tap Middle Eastern commercial banks for financing after securing a new and long-term bailout loan from the International Monetary Fund (IMF) in the coming months, the new finance chief said on Wednesday.
The first order of business for new finance minister Muhammad Aurangzeb will be to seek a fresh Extended Fund Facility (EFF) from the IMF after a current standby arrangement expires on April 11. Pakistan bagged the last-gasp rescue package last summer to avert a sovereign default. The final review this week, if successful, will release a last tranche of around $1.1 billion.
“Once we conclude the [new] Extended Fund Facility, we should be able to approach Middle Eastern banks, which have ended their whole business and appetite, for commercial borrowing and we will be able to get funding and support from them primarily to help us with our trade business, etc.,” Aurangzeb said during an interview with Pakistan’s Geo TV on Wednesday night.
Pakistan has been financially assisted by countries like Saudi Arabia and the United Arab Emirates in the past, with deposits of billions of dollars in its central bank, followed by rollovers.
Gulf states have also regularly provided Pakistan oil on deferred payment facilities and offered direct financial support to help stabilize its economy and shore up its foreign exchange reserves.
Pakistan’s newly appointed finance minister has said he wants to ensure macroeconomic stability and reduce spending and tax system leakages as an IMF team arrived in Islamabad to hold a second and last review of the nation’s $3 billion stand-by arrangement starting today, Thursday.
A set of critical challenges face Aurangzeb, including stabilizing the economy amid soaring inflation and dwindling foreign reserves, managing substantial external debts and navigating negotiations with global lenders. Pakistan also needs fiscal reforms to boost revenue and attract investments, vital for sustainable economic growth and job creation.
The debt-ridden economy, which shrank 0.2 percent last year and is expected to grow around 2 percent this year, has been under extreme stress with low reserves, a balance of payment crisis, inflation at 23 percent, policy interest rates at 22 percent and record local currency depreciation.
“The GDP is better, we have macroeconomic stability and the exchange rate is getting better,” Aurangzeb told Geo. “So we need to bring this macro stability to permanence. If this stability comes toward permeance, we can lead it toward growth.”
The minister said Pakistan had a narrow tax base and needed to reduce revenue leakages, for which it was important to digitize the tax system and make it more transparent.
“This is something we have already started working on,” said the minister, who made his first official visit to the Federal Bureau of Revenue, the national tax collection body, on Wednesday.
On foreign borrowing, the minister said Pakistan needed to improve its economic management to break out of the practice of asking friendly countries to deposit money in its central bank and then seeking rollovers.
“Now even these friendly countries have given us a clear hint that they want to help us but not through aid but through investments,” the finance minister added. “And I think it is the right thing to do for the country.”
Aurangzeb said the government would tap the China bond market in the next fiscal year.
“The one [bond] market that we haven’t tapped is in China,” he said.
“See, our G2G [government-to-government] relationships are good. Their banks are still rolling over and giving aid to us. Chinese government is also helping us.”
“So, the panda market there, the bond market, it’s the second or third most liquid market in the world,” he added. “So I think from the ministry of finance we should go toward inaugural panda bonds during the next fiscal year.”
In February, China rolled over a $2 billion loan to Pakistan due in March.
The lender has said it will formulate a medium-term program if Islamabad applies for one.
Ahead of the current stand-by arrangement, Pakistan had to meet IMF conditions including revising its budget, and raising interest rates and the price of electricity and gas. The IMF also got Pakistan to raise $1.34 billion in new taxes. The measures fueled all-time high inflation of 38 percent year-on-year in May.
The government has not officially stated the size of the additional funding it is seeking through a successor program, but Bloomberg reported in February that Pakistan planned to seek a new loan of at least $6 billion from the lender.
Pakistan says will seek financing from Middle Eastern banks after securing new IMF bailout
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Pakistan says will seek financing from Middle Eastern banks after securing new IMF bailout
- New finance chief hopes better credit ratings post-bailout will make tapping bond markets easier
- Pakistan aims to secure new IMF loan after successful completion of last review under $3 billion facility
UAE to build 20-bed hospital in Sindh under agreement with provincial government
- The hospital will be constructed in Qambar in the northwestern part of the province
- UAE has also built similar health care facilities in places like Sukkur and Larkana
KARACHI: The United Arab Emirates and Pakistan’s provincial government of Sindh signed a memorandum of understanding (MoU) on Thursday to establish a modern 20-bed hospital in Qambar, located in the northwestern part of the province, according to an official statement.
The UAE has undertaken several health care and development projects in Sindh in recent years, including the expansion of Sheikh Zayed Hospital for Women in Larkana and a pledged women and children’s hospital in Sukkur.
The new facility in Qambar adds to a growing portfolio of UAE-backed efforts aimed at improving public services and infrastructure in underserved areas of the province.
“The United Arab Emirates will establish a 20-bed hospital equipped with modern medical facilities in Qambar,” the Chief Minister’s spokesperson said.
“The facility will be named Sheikh Zayed Hospital,” the statement added.
Chief Minister Murad Ali Shah, who attended the signing ceremony held at his official residence, thanked the UAE authorities for the initiative and said it would help improve health care access in an underserved part of the province.
Pakistan and the UAE have longstanding ties, with the Gulf country supporting multiple infrastructure and humanitarian projects across Pakistan in recent years.
The UAE is also home to a large Pakistani community, which is one of the biggest sources of remittances to the South Asian country
Pakistan PM reaffirms India ceasefire commitment, says Kashmir resolution key to regional peace
- Shehbaz Sharif expresses concern over ‘provocative statements’ by Indian leaders following the ceasefire
- He tells Azerbaijani president Pakistan remains prepared to defend its sovereignty against any attack
ISLAMABAD: Prime Minister Shehbaz Sharif on Thursday reaffirmed Pakistan’s commitment to a recently agreed ceasefire with India but stressed that lasting peace in South Asia would only be possible through the resolution of the Kashmir dispute in line with UN Security Council resolutions.
Sharif made the statement during a phone call with Azerbaijani President Ilham Aliyev, days after cross-border hostilities between India and Pakistan were halted under a ceasefire announced by US President Donald Trump.
According to an official statement, Sharif said his country had accepted ceasefire in the interest of regional peace but warned that it remained prepared to defend its sovereignty and territorial integrity in the face of another attack.
“The Jammu and Kashmir dispute is the root cause of instability in South Asia, which should be resolved in accordance with the UN Security Council’s resolutions,” he said, according to the Prime Minister’s Office.
He also expressed concern over recent “provocative statements” by Indian leaders following the agreement.
Sharif thanked Azerbaijan for its stance on Kashmir and reiterated Pakistan’s appreciation for the solidarity shown by its leadership and people during the recent standoff.
The two leaders also discussed bilateral ties, with the Pakistani prime minister welcoming progress on proposals for up to $2 billion in Azerbaijani investments in Pakistan across multiple sectors.
He said Islamabad was committed to transforming its relations with Baku into a mutually beneficial economic partnership.
President Aliyev congratulated Sharif on Pakistan’s handling of the recent crisis and expressed support for the ceasefire agreement.
He reaffirmed Azerbaijan’s commitment to strengthening bilateral cooperation.
The Pakistani premier extended an invitation to Aliyev to undertake an official visit to Pakistan, which the Azerbaijani leader accepted.
Pakistan blames ‘state patronage’ from Afghanistan as separatist insurgency intensifies in southwest
Pakistan blames ‘state patronage’ from Afghanistan as separatist insurgency intensifies in southwest
- Afghan government has dismissed accusations it allows its territory to be used by militants or supports them
- Balochistan, Pakistan’s most resource-rich but poorest province, has for decades battled a separatist insurgency
ISLAMABAD: Chief Minister Sardar Sarfraz Bugti said on Thursday an intensifying separatist insurgency in the southwestern Pakistani province of Balochistan was being bolstered by “state patronage” from Afghanistan, rejecting that the movement was a “struggle for rights.”
Balochistan, Pakistan’s largest and most resource-rich but poorest province, has for decades battled a separatist insurgency, with rebel groups accusing Islamabad of exploiting the province’s natural wealth and failing to provide jobs, health care and education to locals. Pakistani authorities reject these claims, saying they are investing billions of dollars in infrastructure, health and development initiatives in the province.
But militant attacks have intensified in recent months, targeting security forces and infrastructure, including Chinese-backed projects. In one of the most brazen assaults earlier this year, the Balochistan Liberation Army hijacked a passenger train carrying over 350 people and held them hostage for about 36 hours before the military rescued them. The army said 31 soldiers, railway staff and civilians were killed.
In August last year, at least 73 people were killed when separatist militants attacked police stations, railway lines and highways in a highly-coordinated assault and security forces launched retaliatory operations. Most recently, seven Pakistan army soldiers were killed on May 6 when their vehicle was targeted by an improvised explosive device.
Bugti dismissed the claim that such violence represented a struggle for rights.
“This is not a national war, nor a struggle for rights,” he said. “It is a futile conflict, and the only ones suffering are the Baloch themselves.”
Bugti acknowledged that uneven development in Balochistan and poor governance and corruption had helped insurgents gain ground but said external backing from Pakistan’s enemies, particularly support from within Afghanistan, was bolstering separatists.
“Our insurgents are living in Afghanistan under state patronage,” the CM said.
The Taliban government in Afghanistan has repeatedly dismissed Pakistani accusations that it was allowing its territory to be used by militants or that it supported any insurgent movements. It says Pakistan’s security problems are a domestic issue.
Bugti said another factor helping militants was public sympathy and legitimacy provided by civil society groups like the Baloch Yakjehti Council. The BYC has held several protests in Balochistan and marches to the federal capital, Islamabad, in recent years, putting the spotlight on issues like human rights abuses in the province as well as extrajudicial killings and detentions, which the state denies. The Pakistan army has previously called the civil rights movement a “terrorist proxy.”
“Insurgents need mouthpieces, they need legitimate voices from society,” Bugti said, predicting that the insurgency would dissipate.
“What happened with the Kurds in Türkiye after 40 long years is also where these groups will end up too.”
The Kurdistan Workers Party (PKK) group, which has been locked in bloody conflict with the Turkish state for more than four decades, announced earlier this week it would disband and end its armed struggle.
The development followed a call from the group’s imprisoned leader, Abdullah Öcalan, who urged the PKK to cease its armed struggle and pursue Kurdish rights through democratic means.
‘Irresponsible, ignorant’: Islamabad condemns Indian calls for IAEA to take charge of Pakistan’s nukes
- India and Pakistan became nuclear powers after they conducted tit-for-tat nuclear tests in 1998
- Latest standoff with missiles, drones briefly raised fears that nuclear arsenals might come into play
ISLAMABAD: The foreign office on Thursday “strongly” condemned remarks by the Indian defense minister that the International Atomic Energy Agency should take charge of Pakistan’s nuclear weapons, calling them “irresponsible” and reflecting New Delhi’s “ignorance” about the mandate of the UN watchdog.
Deadly fighting broke out between the old enemies last week after India struck what it said were “terrorist camps” in Pakistan in retaliation for an attack in Indian-administered Kashmir last month that killed 26. New Delhi said the assault was backed by Pakistan.
Islamabad had denied the allegations and both countries sent missiles and drones into each other’s airspace in the days that followed, before they reached a truce on Saturday.
“Are nuclear weapons safe in the hands of such an irresponsible and rogue nation?” Rajnath Singh said while addressing soldiers in Indian-administered Kashmir’s summer capital of Srinagar. “I believe that Pakistan’s nuclear weapons should be taken under the supervision of IAEA.”
In response, the Pakistan foreign office said India’s “irresponsible remarks reveal his profound insecurity and frustration regarding Pakistan’s effective defense and deterrence against Indian aggression through conventional means.”
“Pakistan’s conventional capabilities are adequate to deter India, without the self-imposed ‘nuclear blackmail’ that New Delhi suffers,” the FO statement said. “The comments of India’s Defense Minister also show his sheer ignorance of the mandate and responsibilities of a specialized agency of the United Nations like the IAEA.”
The IAEA is a Vienna-based UN watchdog that monitors nuclear programs to ensure they are peaceful.
India and Pakistan became nuclear powers after they conducted tit-for-tat nuclear tests in 1998 and their decades-old animosity has made the region — the world’s most populous — one of its most dangerous nuclear flashpoints.
The latest military conflict between the South Asian neighbors spiraled alarmingly on Saturday and there were briefly fears that nuclear arsenals might come into play as Pakistan’s military said a top body overseeing its nuclear weapons would meet.
But the Pakistani defense minister said no such meeting was scheduled.
Military analysts said this may have been Pakistan’s way of hinting at its nuclear option as Islamabad has a “first-use” policy if its existence is under threat in a conflict.
Indian Prime Minister Narendra Modi said on Monday India would strike at “terrorist hideouts” across the border again if there were new attacks on India and would not be deterred by what he called Islamabad’s “nuclear blackmail.”
Pakistan rejected Modi’s statements as being “provocative and inflammatory,” saying it represented a dangerous escalation.
Hindu-majority India and Muslim-majority Pakistan have fought three wars in the past, two of them over the Himalayan region of Kashmir, which they both claim in full but rule in part.
India also blames Pakistan for supporting militants battling security forces in its part of Kashmir, but Islamabad denies the accusation.
With inputs from Reuters
UAE’s LuLuFin partners with Pakistan’s ABHI fintech for financial inclusion, remittances
- Last year, ABHI secured $15 million in debt financing to expand UAE operations
- In 2023, it was selected as one of the Future 100 companies of the UAE
KARACHI: Pakistani fintech ABHI, which expanded its operations to the UAE and Saudi Arabia last year, has partnered with leading global financial services conglomerate, LuLu Financial Holdings, to enhance financial inclusion and remittance solutions, ABHI said in a statement on Thursday.
Founded in 2021, ABHI raised $17 million in a Series A funding round led by Speedinvest. Last year, it secured a whopping $15 million in debt financing through a credit facility by Shorooq partners and Amplify Growth Partnership companies to expand its operations in the United Arab Emirate. It also operates in Saudi Arabia and Bangladesh.
The fintech company provides employees an opportunity to withdraw their earned salary any day through its Earned Wage Access facility and other products. In 2023, it was selected as one of the Future 100 companies of the UAE.
“As part of the partnership, workers in the UAE will be able to access their earned wages instantly and remit funds to their families back home through LuLu Exchange — without having to wait for payday,” the ABHI statement said on the partnership with LuLuFin.
“Through the initiative, workers in the UAE will benefit from Earned Wage Access and Send Now, Pay Later services, giving them greater financial flexibility and control over their income.”
By offering instant access to earned wages and enabling timely remittances, the partnership addresses a key financial need among expatriate workers, empowering them to support their families with greater ease and security, ABHI said.
The Pakistani fintech will provide the operational framework for LuLuFin, enabling customers to access their earned wages before their scheduled payday and allowing employees to send money internationally instantly with the flexibility to defer payment.
The service will be rolled out across all major corridors, with the launch for Pakistani customers scheduled for May.
“This partnership with ABHI represents a bold step toward redefining financial connectivity for global diasporas. By leveraging cutting-edge technology, we aim to create a seamless bridge for expatriates to support their families, setting the stage for a future where financial inclusivity knows no borders,” Thampi Sudarsanan, Chief Executive Officer, LuLu Exchange UAE, said.
Omair Ansari, the Co-Founder & CEO of Abhi Middle East Limited, said the partnership with LuLu Financial Holdings marked a “significant step in enabling expatriates to access their hard-earned wages seamlessly and support their families back home without financial strain.”
“By integrating ABHI’s technology with Lulu’s extensive market expertise, we are dedicated to promoting financial inclusion and providing underserved communities with greater flexibility and convenience in managing their finances,” Ansari added.
In January, ABHI announced it had acquired FINCA microfinance bank to improve financial inclusion for millions of Pakistanis across the country.
FINCA Pakistan, part of a global FINCA network, operates in 108 cities across Pakistan, providing state-of-the-art deposit and payment solutions, including micro-credit facilities aimed at improving livelihoods.
In February, ABHI launched the ABHI Microfinance Bank in collaboration with TPL Corp.
