Pakistan Cancels $0.5 Billion High-Interest Loan
Pakistan has turned down a $490 million commercial loan offered by the Islamic Development Bank (IsDB) Group because the lender’s … Read More The post Pakistan Cancels $0.5 Billion High-Interest Loan appeared first on ProPakistani .
Pakistan has rejected a $490 million commercial loan offered by the Islamic Development Bank (IsDB) Group due to its high interest rate, despite the country's gross financing needs remaining at around 20 percent of GDP. The Debt Management Office of the Finance Ministry had hoped for an interest cost of around 6 percent, but the International Islamic Trade Finance Corporation (ITFC)'s all-in cost of about 8 percent was higher than Pakistan's December 2027 bond, which was trading at 6.1 percent.
The government has now sought a new facility at competitive rates, either from the ITFC or another lender.
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