If China does not extend the facility on its expiry, the central bank will have to arrange 20 billion yuan or $3 billion to return the Chinese loan. The original agreement had been renewed in December 2014 for a period of three years with overall limit of 10 billion yuan or $1.5 billion. It was further extended in May 2018 for a period of three years, with the amount being increased to 20 billion yuan or $3 billion. The trade facility, originally meant to promote bilateral trade in respective local currencies, has been instead used for paying foreign debt. If China does not extend the facility on its expiry, the central bank will have to arrange 20 billion yuan or $3 billion to return the Chinese loan.

Source: The Express Tribune November 01, 2020 05:26 UTC