Pakistan witnessed a sharp drop in foreign funding in July 2025, as inflows declined by $4.55 billion compared to the previous month. According to the Ministry of Economic Affairs, the country received $694.5 million in July, down from $5.25 billion in June. The report cited fewer disbursements from multilateral lenders and delays in planned external loans as major reasons for the decline.
Despite the steep monthly fall, the data showed an increase in annual comparison. In July 2024, Pakistan had received $436.4 million in foreign funding. This means external inflows in July 2025 were higher by $260 million. However, economic experts argue that the yearly growth remains modest given the country’s rising financing needs and debt obligations.
During July 2025, Pakistan secured $675.7 million in foreign loans from various bilateral and multilateral sources. The government also received $18.9 million in grants, mostly from development partners. The figures suggest that Pakistan is relying heavily on loans rather than aid, which adds pressure on debt servicing and fiscal management.
Looking ahead, the government has estimated that Pakistan will require $19.77 billion in external financing during the fiscal year 2025–26. This includes projected deposits of $9 billion—$5 billion from Saudi Arabia and $4 billion from China. These deposits are expected to support foreign exchange reserves and meet external debt repayments.
Analysts warn that the sharp monthly decline could signal problems in the government’s foreign funding strategy. Without consistent inflows, Pakistan may struggle to stabilize reserves, manage currency pressure, or meet IMF performance benchmarks. The report underscores the need for improved fiscal discipline, timely disbursements, and stronger diplomatic engagement with donor nations.