ISLAMABAD: The first nine months (July-March) of this fiscal year (FY14) showed that the government has shored up the country’s dwindling reserves and improved macroeconomic indicators. However, this performance largely remains dependent on donors’ money, and not structural reforms.

Addressing a press conference on Wednesday, Finance Minister Ishaq Dar announced that the country’s reserves would reach $15 billion by end of September. He said he had made this announcement after reviewing the inflows that the country would receive, especially from the International Monetary Fund (IMF), the World Bank and the Asian Development Bank (ADB).

The country’s forex reserves reached $11.67bn. “The central bank received $2bn on Wednesday, which was raised through floating of Eurobond,” the minister said.

Dar elaborated on the government’s plans in securing loans from various quarters, but he was not willing to accept that it will enhance the country’s overall debt and its servicing liabilities.

Asked whether the government was planning to raise reserves through increasing exports and revenue base, the minister said the exports would rise by $2bn this year and notices were issued to people for bringing them on to the tax rolls. Pakistan is believed to be the worst tax-compliant country, where only 0.4 per cent of the total population pay taxes.

The minister said that during his talks with officials of the World Bank in Washington, two concessionary loans were agreed. “The bank would provide $1bn for energy and revenue development in the first week of May.”

The total credit limit for Pakistan is $1.7bn. Mr Dar said the government has already decided to construct both mega projects of Dasu dam and Diamer-Bhasha dam. Pakistan, he said, would receive $600 million for Dasu project and $100m for Sindh Irrigation System in the last week of next month.

He said the remaining requirements of Dasu dam would also be met by the World Bank, which would provide $3.2bn under the next aid programme. The country would also enter into a project partnership strategy with the World Bank under which it would get $11bn between 2015 and 2019.

Mr Dar also announced that the ADB would also provide programme loan of $400m in the first week of May. US Exim Bank, which grants concessionary loans to Pakistan’s neighbouring countries, has also been requested to the same for Pakistan, he added.

The finance minister also said the government would soon start dealing with International Bank for Reconstruction and Development (IBRD) for getting concessionary loans. He said he had received a message that the Islamic Development Bank (IDB) was also providing a $137m loan.

When asked that raising $2bn through bond would lead to increase in the debt, he explained that as much domestic debt in rupee would stand retired, there would be no increase in the national debt.

He said the domestic debt is averaged at 12.25 pc, while average of the cost of the bond would be 7.75 pc, resulting into a saving of about $90m. He claimed that the $90m will be an annual saving of the bonds.

Mr Dar also announced that Pakistan would also launch Islamic Sukuk bonds.

He said he had taken up the issue with US officials in Washington on pending payments of $1.5bn against Coalition Support Fund. “The country would receive $380m by the end of this month.”

Elaborating on the performance of the economy in the first nine months of the current fiscal year, the minister said the economy was on the upsurge and the government borrowing for budgetary support has narrowed to Rs815bn this year from Rs1,046bn in the year-ago period.

As a result, he said, the budget deficit was now at 3.1 pc in July-March of this fiscal year as against 4.6pc during the same period last year.

The overall economy grew by 4.1pc in the first half (July-December) of FY 14 as against 3.4pc over the same period of FY13.