Islamabad:
The Ministry of Finance has signed a long -term financing center of five years per $ 1 billion, the government announced on Wednesday in a statement.
The Dubai Islamic Bank (DIB) was the only Islamic world coordinator, while DIB and Standard Charterd Bank acted as organists of responsibility and book.
“The Ministry of Finance has signed a syndicated term funding of $ 1,000 million partly guaranteed by a guarantee based on the BAD program” improved the mobilization of resources and the “” press release reform.
“Installation is a historic transaction for the Government of Pakistan which demonstrates solid support from the region’s leading financiers. This is a five-year multi-trame installation, including Islamic and conventional tranches,” he said.
The Ministry of Finance said that the Islamic installation was structured to fully comply with AAOIFI standards and represents 89% of the total funding amount, and that the remaining 11% came from conventional financing.
He added: “The transaction was also the first installation supported by the guarantee based on ADB policies linked to the reform measures of the policies undertaken by a member country of the AfDB, that is to say Pakistan.”
“The BAD program is designed to help Pakistan build long-term budgetary resilience and stability and supported Pakistan back to international business markets, with a significant interest in the banks of the Middle East,” the press release said.
Meanwhile, the ministry announced that it had managed to raise more than RS1,2 Billions thanks to a major auction of public bonds held on Wednesday.
This includes the launch of a new zero coupon obligation at 15, the first of its kind in Pakistan, which received high demand from investors and increased more than 47 billion rupees.
This new obligation does not pay interest each year. Instead, investors receive a lump sum after 15 years. This helps the government to reduce short -term reimbursements and better plan finance. The strong response shows that investors have confidence in the economy and Pakistan reforms.
This decision is part of the wider government’s strategy aimed at reducing the risk of loan, extending the period of debt repayment and promoting Islamic and long -term financial products. Yields on other state obligations have also dropped, indicating the optimism of the financial markets as to the drop in inflation and the drop in interest rates in the future.
Pakistan debt now becomes more stable. The average reimbursement period of the interior debt increased from 2.7 years last year to 3.75 years, which quickly reduces the pressure to reimburse loans. In addition, more retirement funds and insurance companies – rather than simple banks – are now investing in state bonds. This allows you to distribute financial risks and deepen the local investor base.
The Minister of Finance, Senator Muhammad Aurangzeb, said: “This is a major step in the fact of making the financial system of Pakistan stronger and more resilient. We introduce new intelligent ways to borrow that reduce risks and give investors more options. Our goal is to manage public debt, to promote Islamic finance and long -term investments to support the country’s economic growth. “
The Ministry of Finance also works on more products to allow ordinary citizens to invest in state bonds, in particular Islamic obligations, to encourage savings and financial inclusion.
Despite global uncertainties, today’s auction shows that Pakistan’s economy is gaining the confidence of investors and evolving in the right direction.
With an additional contribution from Irshad Ansari
