Pakistan on Wednesday received $1 billion loans to prop up its struggling economy that has taken a hit from global coronavirus restrictions, the central bank announced.
The Asian Development Bank (ADB), and the World Bank each have lent $500 million to cash-strapped Pakistan.
"SBP [State Bank of Pakistan] has received USD 1 bn [$1 billion] today with USD 500 mn [$500 million] each from ADB and WB," the SBP said in a Twitter post, without providing more details.
The ADB had signed an agreement for a $500 million loan with Pakistan on June 19 following the World Bank and Asian Infrastructure Investment Bank each sign loan agreements with the government for the same amount, totaling $1.5 billion, in May.
The ADB’s loan was first approved on June 10 and is financed under the bank’s COVID-19 Active Response and Expenditure Support program, according to an ADB statement last week.
The fresh loans will help Islamabad deliver social protection programs to the poor and vulnerable, expand health sector capabilities, and deliver a pro-poor fiscal stimulus to boost growth and create jobs as the country fights COVID-19.
COVID-19 hit Pakistan’s growth at a critical juncture in its macroeconomic recovery process. The pandemic is expected to lead to a sharp decline in growth, revenue collection, and significant job losses in Pakistan, the statement said.
The South Asian nuclear country's already ailing economy is projected to contract 0.4% in the ongoing fiscal year.
On 19 May, the ADB approved a separate $300 million emergency assistance loan to strengthen Pakistan’s public health response to COVID-19 and help meet the basic needs of vulnerable and poor segments of the society.
In April this year, the ADB had also reallocated $30 million from the National Disaster Risk Management Project to support the country's pandemic response.
Pakistan reported 188,926 infections so far, with a death toll of 3,755, and 77,754 recoveries.
Since originating in Wuhan, China last December, the pandemic has claimed nearly 478,000 lives in 188 countries and regions.
More than 9.27 million cases have been reported worldwide, while over 4.65 million patients have recovered, according to figures compiled by the US’ Johns Hopkins University.