Islamabad: The federal government recently announced its decision to raise USD 1.5 billion via floating Eurobonds during (Fiscal Year) FY2020-21, a news source reported. This decision was prompted by the government’s realisation that its prioritisation for hot foreign money over bonds during the previous financial year had ultimately proved to be ‘costly’.
According to the details available, the floating of the Eurobonds would be part of the external inflows of FY2020-21. The government would use these to meet its external debt obligations, and establish foreign exchange reserves.
On the other hand, both the State Bank of Pakistan (SBP) and Ministry of Finance have opined that floating Eurobonds in FY2020-21 would discourage foreign money inflows. Sources have revealed that the money raised via the sovereign bonds was payable either in five, seven, or ten years. They added that the plan for floating the Eurobonds had already been shared with Prime Minister (PM) Imran Khan before the Eid holidays.
