In the past fiscal year, Pakistan paid nearly Rs26 billion in interest to China for using a $4.5 billion Chinese trade finance facility to service maturing debt, a cost borne by the country as a result of successive governments’ failure to put the economy on a sustainable basis.
SBP (The State Bank of Pakistan) has published its annual financial statement for the fiscal year 2020-21, which concluded on June 30. The central bank used up all of the $4.5 billion (or 30 billion yuan) trade finance facility available under the China-Pakistan currency swap agreement, according to the article.
“During the year, the total ceiling of 20 billion yuan against the rupee was further increased to 30 billion yuan for a term of three years with maturity buckets ranging from three months to one year,” according to the financial statement. “As of June 30, 2021, these acquisitions had been fully utilized.”
