In a significant relief for Pakistan, China’s Exim Bank has granted the country a reprieve concerning a $2.1 billion loan due last week. This act of financial leniency is a huge relief to Pakistan, which is presently grappling with a severe financial crisis and finding it challenging to balance its books.
In an official letter to the Pakistani government, the Chinese bank communicated its decision to roll over the loan. This means that Pakistan won’t have to bear any interest burden for a given period, and they have been given a two-year grace period to repay the principal amount. Furthering the ease, the Chinese bank is even prepared to extend the repayment term until June 2025.
This act of financial generosity from China towards Pakistan is not unique. Earlier, the State Bank of Pakistan revealed that China had deferred a $1 billion loan, which lent much-needed fiscal respite to the struggling nation. It’s worth noting that Pakistan is indebted to numerous other countries, and the support of China has been instrumental in enabling Pakistan to handle these financial pressures and budgetary issues.
Pakistan and China share a robust economic bond and a long-standing friendship. China has continually played a significant role in bolstering Pakistan’s economic resilience in challenging times. As Pakistan navigates its way through its current economic troubles, the sustained support of China and other allies is key to ensuring the nation remains resilient and continues on its path of growth.