Pakistan's forex reserves hit all-time high of $18.25 billion

[SBD-3]

The problem is that you guys are looking it all wrong. There are 2 aspects to this. Forex Liquidity and Net Forex Assets. Now Liquidity wise, Pakistan has 18 billion worth of Forex reserves, which means it has forex available to it for usage, where ever needed. The source of Forex does not matter.

The 2nd aspect i.e. the Net Forex assets is a little trickier. This is the forex reserves with the central bank less the total external debt of the country. In pakistan's case, this figure comes to about - 42 Billion USD . Basically 18 billion (forex reserves) - 60 billion (external debt). This is where the IMF debt etc come in. As a matter of fact the article is wrong when it says that 50% of Pakistan's reserves are made of debt. Actually its much more. Pakistan's external debt is almost 4 times its foreign reserves.

The article is correct in a way that the current reserves had a major boost from IMF SBA roughly 7 billion USD. Yet when you say that Actual reserves are negative, its no exception in the case of most of the countries, case in point even India has 305.9 billion of external debt against its 283 Billion USD of reserves (latest figures). So is the case everwhere else. A major comfort for Pakistan's external sector during the crisis was that Oil (a major component of our import bill) eased significantly. Secondly, the exports of Pakistan are grossly inelastic in nature, so while Pakistan is not able to benefit a significant increase when the whole world is making money, yet in the time of crisis, this vary fact has supported Pakistani export base.