Vikrant Shekhawat : Oct 27, 2024, 07:40 PM
Pakistan-China News: Pakistan's economy is currently facing a serious cash crisis, and to find a solution to this challenge, the country's Finance Minister Muhammad Aurangzeb recently met China's Deputy Finance Minister Liao Min in Washington. The purpose of this meeting was to seek additional loan limits from China under the currency swap agreement. According to reports, Pakistan has requested to increase the current 30 billion yuan (about $ 4.3 billion) trade facility to 40 billion yuan (about $ 5.7 billion).Pakistan's cash crisis problem and expectation of help from ChinaPakistan has been facing a foreign exchange crisis for a long time. The burden of foreign loans and external payment obligations is constantly increasing. To reduce this crisis, Pakistan is expecting China to increase the trade facility, so that economic stability can be ensured. Pakistan's intention behind this is that with the additional economic assistance from China, it can face its increasing debts and keep the currency reserves stable.Will China accept Pakistan's request?This question is not easy to answer. Pakistan has requested to increase the loan limit several times in the past, which was rejected by China. However, this time Pakistan hopes that China will respond positively to this request. This is necessary for Pakistan, as this cooperation will increase its foreign exchange reserves.According to the Express Tribune report, if China accepts this request of Pakistan, the total facility will reach around $ 5.7 billion. This time China's decision can prove to be decisive for Pakistan's economic situation, as recently the two countries signed a new currency swap agreement during the visit of Prime Minister Li Keqiang, which has helped Pakistan to extend the loan repayment period till 2027.Slight increase in Pakistan's currency reservesPakistan's foreign exchange reserves have seen a slight increase in recent times. According to the State Bank of Pakistan, the currency reserves increased by $18 million in the week ending October 18, taking the total reserves to $11 billion.ConclusionThis new direction of economic relations between Pakistan and China can help provide relief to Pakistan's economy. China's decision will be important for Pakistan's economic stability. If this additional facility is provided, Pakistan can have a strong basis to deal with the cash crisis and face its financial challenges.