China Extends $2.4 Billion Loan Repayment for Pakistan Amid Economic Challenges
China has extended the repayment period of a $2.4 billion loan to Pakistan by two years, providing crucial financial relief to the country amid its ongoing economic challenges.
This extension is part of a series of financial support measures from China to Pakistan. In March 2023, China approved a rollover of a $1.3 billion loan, which helped bolster Pakistan’s depleting foreign exchange reserves.
Pakistan’s economic crisis, which began in 2022, has been characterized by high inflation, a depreciating currency, and dwindling foreign exchange reserves. The country has been seeking financial assistance from various sources, including the International Monetary Fund (IMF) and friendly nations like China, to stabilize its economy.
China’s financial support is seen as a testament to the strong bilateral relations between the two countries, often referred to as an “all-weather friendship.” This relationship has been further solidified through initiatives like the China-Pakistan Economic Corridor (CPEC), which aims to enhance infrastructure and economic connectivity between the two nations.
The loan extension is expected to provide Pakistan with much-needed fiscal space to manage its economic challenges and implement necessary reforms to achieve sustainable growth.
