China lends Pakistan $1.6bn

China has given Pakistan a credit line worth $1.6 billion to stave off a balance of payments crisis, two Pakistani central bank sources said on Thursday, with cash earmarked for boosting fast-depleting foreign currency reserves.

Two State Bank of Pakistan (SBP) sources told Reuters the credit facility that accompanies a currency swap agreement between SBP and China’s central bank has been hiked to 20 billion yuan ($3.13 billion) from 10 billion yuan.

“This arrangement has been finalised,” said one SBP source, who spoke on condition of anonymity. A second source confirmed the agreement and the figures.

Pakistan’s National Security Advisor Nasser Khan Janjua on Wednesday met with Yang Jiechi, member of the Political Bureau of the Communist Party of China (CPC) central committee, wherein the two figures agreed to deepen all-round cooperation between the two countries.

Janjua said that Pakistan has always stood by China and is willing to work with the friendly nation to take advantage of the China-Pakistan Economic Corridor, in order to further cooperation in various fields and promote Pakistan-China relations.

Yang Jiechi, who is also director of the Office of the Foreign Affairs Commission of the CPC central committee, said that since President Xi Jinping’s visit to Pakistan in 2015, the China-Pakistan all-weather strategic cooperative partnership has made great progress, the official Xinhua news agency reported.

He further said, “In the new situation, China and Pakistan should maintain the momentum of high-level exchanges, strengthen strategic communication and coordination, deepen all-round cooperation, and advance the construction of the CPEC.”

On Wednesday, Janjua also attended a meeting of the Shanghai Cooperation Organisation NSAs, which discussed security cooperation between SCO member states.

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