Pakistan’s finance ministry is preparing to request a bigger currency swap line from China as the current 30 billion‑yuan facility reaches its 2027 expiry. Finance Minister Muhammad Aurangzeb told Reuters the existing line has been fully drawn and that the government will formally apply for an expansion when renewal talks begin.
China partnership and U.S. financing hopes
“They were open to it, but there is a process which has to be followed,” Aurangzeb said, referring to recent meetings with his Chinese counterpart and the country’s central bank governor. He added that Pakistan also expects a decision from Washington within two months on a proposed $10 billion exchange‑stabilisation facility.
The U.S. side of the discussion involves the Export‑Import Bank (EXIM) and the International Development Finance Corporation (DFC). EXIM financing could help Pakistan International Airlines purchase Boeing aircraft now that the carrier has been privatized, while DFC funding may support a $5 billion programme to upgrade the nation’s oil refineries.
Balancing support from both superpowers
When asked whether seeking aid from both China and the United States could create conflict, Aurangzeb described the situation as an “and‑and” discussion. “China has been a long‑standing strategic partner for us… and we have a very good relationship with the Trump administration,” he said, emphasizing Pakistan’s fortunate position of having strong ties to both economic powers.
Oil price volatility and growth outlook
Regarding the recent surge in crude oil prices following the Middle‑East conflict that began in February, Aurangzeb said Pakistan managed the initial spike relatively well after U.S. and Israeli strikes on Iran. However, he warned that a prolonged conflict into November or December could threaten the government’s 4 % fiscal‑year growth target.
Pakistan has secured enough oil stocks to meet demand through September and is preparing supplies for October, with daily monitoring of the situation. Planning for November deliveries is already under way.
No further IMF assistance planned
Despite ongoing talks with the United States, the finance minister said Pakistan has no intention of seeking additional International Monetary Fund (IMF) financing or emergency support at this time. “As of now, our considered view is that it’s manageable,” he asserted.
An IMF mission is scheduled for next week to conduct the fourth review of Pakistan’s $7 billion programme and the third review of its Resilience and Sustainability Facility. Aurangzeb expressed confidence that the country remains largely compliant with quantitative and structural benchmarks.
Looking ahead
Pakistan’s leadership hopes that the combined support from China and the United States will reinforce foreign‑exchange reserves, sustain debt‑service capacity, and preserve investor confidence as the nation navigates a challenging global economic environment.
Original reporting: Appleton, WI News Feed (HLL/CB) — read the source article.
