The Financial Times reported Wednesday that Pakistan might seek billions of dollars in loans from foreign lenders after severe floods aggravated the South Asian country’s economic difficulties.
Shehbaz Sharif, the country’s prime minister, says, “We are not asking for any form of action, [such as] a postponement or a moratorium.” “We are requesting more money.”
According to Sharif, who was reported by the Financial Times, the nation needs “vast quantities of money” for “giant enterprises” like reconstructing roads, bridges, and other infrastructure that has been damaged or destroyed.
According to the BBC, Sharif reiterated an estimate of $30 billion in flood damages but did not specify the amount Pakistan is asking for.
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After the record floods, the United Nations increased its humanitarian relief request for Pakistan by five times, from $160 million to $816 million.
This is because rising water-borne infections and concern about increasing hunger pose additional threats.
Additionally, the European Union increased its disaster aid to 30 million euros ($29.57 million).
The cost of imports, borrowing, and debt payments are all rising due to Pakistan’s currency fall, making inflation, which is already at a multi-decade high of 27.3%, worse.
The situation has worsened due to the floods’ projected $30 billion economic damage and growing worries about Islamabad’s capacity to collect money to fulfill external financial commitments.