On Thursday May 24, 2012 Pakistani Government has managed to pay the second installment worth 258.4 million SDRs ($394 million) against the loan from International Monetary Fund under the Stand-by Arrangement program.
The State Bank of Pakistan (SBP) issued an advice in favour of IMF thru’ Federal Reserves Bank of New York for payment of USD 394 million equivalents to 258.4 million SDR (Special Drawing Rights). The actual amount will transfer to IMF account on Friday. The installment was paid out of foreign currency reserves held by SBP.
The above payment to IMF is also being confirmed by Chief spokesperson of SBP Mr. Wasim-ud-din.
Pakistan re-joined the IMF program in November 2008, in order to avoid default as the country’s reserves have declined to the lowest level of $6 billion in October, 2008 due to higher deficit in current account.
The first instalment was paid in February this year. The second installment paid comprises of principle amount; interest is already being paid by SBP on quarterly basis. The interest payments were made in the last week of April and May this year. However, third instalment of around 71 million SDRs ($110 million) is due at the end of Jun, 2012.
It is estimated that during the current fiscal year, the country would pay a cumulative $1.525 billion, including $182.2 million of interest payment to IMF. The amount in SDRs is around 987.3 million with interest of around 117.9 million.
Under the SBA with IMF, three installments worth $908.4 million (587.9 SDR) are due in the current fiscal year 2012.
Of total $11.3 billion under SBA programme, the country received about $7.6 billion and remaining $3.7 billion were not given due to suspension of the facility on account of delays in implementing fiscal reforms by the government.
As per the repayment schedule agreed between Pakistan and IMF, total $7.6 billion will be repaid to the IMF till the end of fiscal year 2014-15.
The SDR is an international reserve asset, created by the IMF in 1969 to supplement the existing official reserves of its member countries. At present, US dollar is equivalent to about 1.55 SDR, however its rate keeps on changing.