Pakistan set to repay $1 billion against Eurobond

Islamabad: Pakistan is set to repay a foreign debt worth $1 billion against a 10-year Eurobond maturing in the middle of this month which will reduce the stock of the debt acquired through the selling of bonds in international markets to below $7 billion.

The State Bank of Pakistan (SBP) told The Express Tribune that it was ready to repay the bond anytime and was waiting to receive instructions to do so from the finance ministry.

The move will reduce the stock of the debt acquired through selling Eurobonds and Sukuks (bond-like instruments used in Islamic finance) in international markets to below $7 billion.

This has enhanced the country’s capacity to repay all the upcoming maturing foreign debt on time.

Following the repayment of $1 billion in April, Pakistan's foreign exchange reserves will experience a decline. However, the anticipated International Monetary Fund (IMF) tranche of $1.1 billion, likely to be received by the end of April, is expected to restore the reserves back to over the $8 billion mark.

Topline Securities CEO Muhammad Sohail said the recent increases in inflows from foreign portfolio investors purchasing shares at the Pakistan Stock Exchange (PSX) and treasury bills, coupled with the SBP’s gradual acquisition of US dollars from the market, were contributing to the management of regular debt repayments.