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Pakistan’s Existential Economic Crisis

There is a real danger that Pakistan could default on its debt, which could lead to intensifying political turmoil amid already surging terrorism.

Thursday, April 6, 2023

/ READ TIME: 9 minutes

By: Shahbaz Rana

Pakistan’s stability increasingly depends on the outcome of an ever-worsening economic crisis. Amid skyrocketing inflation, political conflict between Prime Minister Shehbaz Sharif’s government and former Prime Minister Imran Khan, and surging terrorism , the country is facing the risk of a default due to its massive external debt obligations. This burden has been exacerbated by the derailment of the $6.5 billion International Monetary Fund (IMF) program Pakistan entered in 2019, as the international lender is unsatisfied with Pakistan’s commitment to reform and ability to arrange for funds to meet external financing requirements. Troublingly, Pakistan’s official foreign exchange reserves are hovering around $4 billion, which is insufficient to finance even a one-month of the country’s import bill.

Can Pakistan recover from the economic abyss? To determine, it is important to consider: (1) the composition of Pakistan’s overall external debt; (2) repayment pressure on the debt in both the short- and medium-term; (3) potential inflows that can offset the debt outflows; and (4) Pakistan’s external debt management strategy.

1. Pakistan’s Debt Composition — and the Terms on the Debt

As of December 2022, Pakistan holds external debt and liabilities of $126.3 billion. Nearly 77% of this debt, amounting to $97.5 billion is directly owed by the government of Pakistan to various creditors; an additional $7.9 billion is owed by government-controlled public sector enterprises to multilateral creditors.

Who are these creditors? Pakistan’s creditors fall in four broad categories: multilateral debt, Paris Club debt, private and commercial loans, and Chinese debt.

Multilateral Debt

A major share of Pakistan’s debt is owed to multilateral institutions, amounting to roughly $45 billion. Islamabad’s main multilateral creditors include the World Bank ($18 billion), the Asian Development Bank ($15 billion) and the IMF ($7.6 billion). Pakistan owes smaller amounts to the Islamic Development Bank and the Asian Infrastructure Investment Bank as well.

While a significant amount of Pakistan’s total debt, multilateral debt doesn’t present major short-term risks for Pakistan. The terms of most loans are largely concessional with a repayment timeline spanning 18 to 30 years; most repayments are spread in many small transactions. In 2022-23, Pakistan repaid a total $4.5 billion debt to multilateral creditors, which is a fifth of the total debt repayment for the year.

Paris Club Debt

Pakistan owes $8.5 billion to the Paris Club, a group of 22 major-creditor countries. This debt is scheduled to be repaid over 40 years with less than 1% interest rate, and is mostly owed to Japan, Germany, France and the United States.

Private Debt and Commercial Loans

Pakistan holds a large amount of private debt; much of this is in the form of private bonds, such as Eurobonds and global Sukuk bonds, amounting to $7.8 billion. Some of this debt is recent: In the last fiscal year, Pakistan raised $2 billion by floating Eurobonds of 5, 10, and 30 years at an interest rate ranging from 6 percent for five years and 8.87 percent for 30 years.

Pakistan holds foreign commercial loans to the tune of nearly $7 billion, which is likely to increase to nearly $9 billion by the end of the current fiscal year. Much of Pakistan’s commercial loan stock is owed to Chinese financial institutions, as Pakistan has repaid major non-Chinese commercial loans of institutions.

Most commercial loans come with steep terms; they have to be repaid to the lenders between one to three years. The rates on the loans are high as well. Some are benchmarked against the London Interbank Offered Rate (also known as LIBOR). Others, like Chinese commercial loans, are pegged against the Shanghai Interbank Offered Rate (SHIBOR). For example, Pakistan recently obtained a $2.2 billion commercial loan from the China Development Bank at six-month SHIBOR rate plus 1.5 percent; this loan is to be repaid over a three-year period.

Chinese Bilateral Debt

Pakistan holds around $27 billion of Chinese debt. This includes around $10 billion of bilateral debt and $6.2 billion in debt provided by the Chinese government to Pakistani public sector enterprises, and Chinese commercial loans of around $7 billion. In addition, China’s State Administration of Foreign Exchange (SAFE) has placed $4 billion worth of foreign deposits with Pakistan’s central bank. The bilateral debt is on concessional terms with a maturity period of 20 years. In addition to the $27 billion in debt, Pakistan also has a currency swap facility with the Chinese.

2. Short- and Medium-Term Debt Repayment Pressure

Pakistan’s large external debt comes with considerable repayment pressure. From April 2023 to June 2026, Pakistan needs to repay $77.5 billion in external debt. For a $350 billion economy, this is a hefty burden. The major repayments in the next three years are to Chinese financial institutions, private creditors and Saudi Arabia.

Pakistan faces near-term debt repayment pressure. From April to June 2023, the external debt servicing burden is $4.5 billion. The major repayments are due in June when a $1 billion Chinese SAFE deposit and a roughly $1.4 billion Chinese commercial loan would mature. Pakistani authorities hope to convince the Chinese to refinance and rollover both debts, something the Chinese government and commercial banks have done in the past.

Even if Pakistan manages to meet these obligations, the next fiscal year will be more challenging, as the debt servicing will rise to nearly $25 billion. This includes $15 billion of short-term loans and $7 billion in long-term debt, including a vital $1 billion repayment on a Eurobond in the fourth quarter. The short-term debt repayments include $4 billion Chinese SAFE deposits, $3 billion Saudi deposits and $2 billion UAE deposits; the Pakistani government assumes they will be rolled over by the creditors each year. Separately, Pakistan will need to repay another $1.1 billion of long-term commercial loans to Chinese banks.

In 2024-25, Pakistan’s debt servicing is likely to be around $24.6 billion, which includes $8.2 billion long-term debt repayments and another $14.5 billion short-term debt repayments; this includes major repayments to Chinese lenders of $3.8 billion. In 2025-26, the debt servicing burden is likely to be at least $23 billion; that year Pakistan is to pay back $8 billion in long-term debt, including repaying $1.8 billion for a Eurobond and $1.9 billion to Chinese commercial lender.

3. Exports, Investments and Remittances — and Pakistan’s Repayment Calculus

In order to repay its debt and avoid a sovereign default, Pakistan’s earnings from exports, foreign direct investment and remittance inflows from foreign workers are vital. However, all three inflows are projected to not keep pace with the import bill as well as the mounting debt repayment pressure.

For example, over the last three years, Pakistan’s export earnings and remittances were a total of $164 billion, compared to $170 billion worth of imports of goods. Over the next three years as well, imports are likely to be higher than the total dollar amount of exports and remittances, which will lead to a current account deficit requiring external financing. On the export side, the IMF had projected nearly $36 billion exports for 2022-23. That has now been revised with a new estimate of $28-29 billion, partly due to the rising cost of business and economic dislocation resulting from the uncertainty in the country.

Foreign direct investment is projected to remain subdued as well. In recent years, investment has averaged a dismal $2 billion annually due to challenging business environment and frequent policy changes; similar levels of investments are the best case for the next few years. Investor sentiment has also been impacted by the government’s recent restrictions on the movement of capital outside the country.

4. Options to Manage External Debt

Pakistan’s economic managers have only two options for addressing its external debt burden. The first is to take fresh loans and seek rollovers of debt. However, due to downgrades by international credit rating agencies, Pakistan’s ability to access sovereign financing market is limited. So Pakistani leadership will depend on Middle Eastern partners and China, not just for existing rollover but also fresh loans if it seeks to avoid a default. The specific amount Pakistan may seek will depend on negotiations with the IMF. If the derailed IMF program is revived, the amount will be smaller than the one it would seek if the program collapses. And in case the currently derailed IMF program is revived and completed over the summer, Pakistan will need a new IMF program, in addition to new loans and rollovers from its Middle Eastern and Chinese partners, due to its external debt burden over the new three years.

Another possibility is that Pakistan seeks pre-emptive restructuring of debt. Doing so will reduce the repayment pressure and spare scarce dollars in the economy to finance the country’s current account deficit. The Pakistani government has met with investment banks and advisors to explore restructuring options. However, for now, officials are reluctant as a restructuring process will be both painful and long, and also because of the political backlash of associated austerity measures.

What Does this Mean for Pakistan’s Stability?

There is a real danger that nuclear-armed Pakistan with a population of nearly 230 million people may be unable to meet its external debt obligations — which will trigger a sovereign default. To avert this scenario, Pakistan needs IMF’s continued support as well as help from Chinese and Middle Eastern partners. Pakistani leadership has been asking the United States to intercede with the IMF, but that effort hasn’t borne fruit in the way they hoped for. Pakistani leadership is also making frantic efforts for bailouts from foreign partners, but it is unclear if they will make the difficult reform choices necessary to win the trust of the IMF. If Pakistan ultimately defaults, there will be a cascade of disruptive effects. Crucially, Pakistan’s imports could be disrupted, which could lead to a shortage of some essential goods and commodities. In Sri Lanka , the disruption of oil imports stoked public discontent, protests and a change in government. Pakistan, which is already seeing intense political conflict between Sharif’s government and opposition leader Khan, may also see the economic crisis creating more political turmoil. And given Pakistan’s demographic profile and surging terrorism threats, the resulting crisis could go in unexpected directions.

Shahbaz Rana is an economic correspondent with Pakistan’s daily English newspaper The Express Tribune and the host of a primetime TV show, The Review, at Express News.

The views expressed in this publication are those of the author(s).

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International Edition

Pakistan’s economic crisis

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The 2022 year saw political turmoil, an economic crisis, and catastrophic flooding in Pakistan. On the economic front, the country has been dealing with backbreaking inflation, a depreciating currency, and precariously low foreign reserves. As Pakistan looks to address these challenges in a turbulent moment, important questions arise as to the long-term roots of these problems, how political instability shapes them, and what economic policy Pakistan should adopt to address its difficulties.

On February 1, the Center for Middle East Policy at Brookings hosted an event to discuss the deep roots of Pakistan’s economic challenges and the future of its economy.

Viewers submitted questions by emailing [email protected]  or by joining the conversation on Twitter with  #PakistanEconomy .

Introduction

Panel discussion.

Foreign Policy

Center for Middle East Policy

Madiha Afzal

April 3, 2024

February 29, 2024

Pakistan's Economic Crisis - Explained

Kinnary Nensee , Apoorva Bajj

The Islamic Republic of Pakistan was formed in 1947 after the partition of the British Indian Empire. The country was, initially, a dominion of the British Commonwealth until 1956, when it drafted and framed its own constitution. Ranked among the emerging and growth-leading economies through its rapidly growing middle class, the country’s political history since independence is characterized by periods of significant economic and military growth as well as economic and political instability.

Pakistan is geographically, ethnically, and linguistically diverse and is a member of the United Nations, the Shanghai Cooperation Organisation, the Organisation of Islamic Cooperation, the Commonwealth of Nations, the South Asian Association for Regional Cooperation, and the Islamic Military Counter-Terrorism Coalition.

Current Economic Crisis Bail-Out Loans & History Talks With IMF For Loans Conclusion

Current Economic Crisis

It was Pakistan’s rising economic crisis that led to a political stand-off between the then Prime Minister Imran Khan and the current Prime Minister Shahbaz Sharif, who took office in April 2022.  However, the country’s economy has been steadily dwindling as its forex reserves fell to a 9-year low reaching below USD 3 billion in early February 2023. The country’s currency , the Pakistani Rupee, has seen a steep fall to reach Rs. 271.50 against one US dollar. Inflation within the country is at a 48-year high with just enough foreign reserves to cover imports for less than a month. The country’s consumer price index in January 2023 had increased by 27.6% and the wholesale price index increased by 28.5%.

Unsurprisingly, the rising inflation has led to an exponential price increase in essential commodities like wheat, onions, gas cylinders, etc. To add to its woes, the oil companies of the country are on the verge of collapse due to the ongoing economic crises and its currency devaluation . This has also led to a lot of petrol pumps running out of fuel disrupting everyday life. The breakdown of the national electricity grid of the country also led to nationwide power outages , specifically affecting Karachi, Islamabad, Lahore, and Peshawar.

Pakistan’s rising expenses are adding to its troubles as the country’s high borrowing led to total debt and liability of Pakistani Rupees 59,697.7 billion in FY ’22. This amount was approximately 89% of the country’s total GDP. Unemployment and poverty are proving huge hindrances to food, healthcare, and wages for the citizens of the country.

Bail-Out Loans & History

By the year 2008, Pakistan’s external debt was Pakistani Rs. 6435 billion. Being an election year, Pakistan People’s Party came to power in that year and during its five-year tenure, increased the country’s debt by 135% to reach Pakistani Rupees 15096 billion by the year 2013. This amounted to 64% of the country’s GDP. A large increase in this debt was domestic with external debt increasing by 22%. Hence the external debt which was at USD 42.8 billion in 2008 reached USD 52.4 billion in 2013.

The elections of 2013 brought Nawaz Sharif to power under whose rule, the external debt increased by 226.8% from USD 52.4 billion to USD 75.3 billion. The primary reason for this debt increase was the China-Pakistan Economic Corridor through which Pakistan procured loans from China and, in return, awarded contracts to only Chinese companies. This also resulted in high imports from China. Imran Khan came to power in 2018 and subsequently added to the increasing external debt to USD 110.6 billion during his rule.

As per IMF data , it has disbursed 21 loans to Pakistan over the years, the first request emerging from the country as early as 1958. Since then, IMF had agreed to disburse a total loan amount of USD 31.73 billion of which USD 20 billion has been disbursed through different transactions like Stand by Arrangements (SBA), Extended Fund Facility (EFF), Extended Credit Facility (ECF) and Structural Adjustment Facility Commitment (SAFC). An IMF loan is released in these different installments based on certain norms that are set by the lender.

Talks With IMF For Loans

Nathan Porter, leading the IMF mission began talks with the Pakistan government represented by their finance minister, Ishaq Dar, on January 31 st , 2023. The talks failed to reach a satisfactory conclusion for Pakistan regarding its immediate requirement of USD 1.1 billion loan amount to prevent the country’s bankruptcy. The country is on the verge of defaulting on its external liabilities and is heavily dependent on the IMF’s loan. The loan amount is a part of the USD 6.5 billion loan program. IMF said – “Virtual discussions will continue in the coming days to finalize the implementation details of these policies.”

As inflation mounts and poverty rules the country, Pakistan is in dire need of monetary help from the IMF. However, this loan is also feared to increase inflation and price hikes for the common citizens of the country, further increasing their burdens. The ongoing Russia-Ukraine hostilities are adding to rising inflation around the globe as well. It remains to be seen, how the current government of Pakistan handles the ongoing economic crisis.

Why is Pakistan in an economic crisis?

Pakistan's economic crisis is caused by economic mismanagement, political uncertainty, high inflation and energy prices, and urgent foreign debt payments.

What role can international organizations, such as the IMF, play in helping Pakistan navigate its economic crisis?

IMF and other international organizations can help Pakistan by providing financial assistance, technical expertise, policy advice, and coordination to support economic growth, but such assistance may come with conditions that could be politically and socially difficult to implement.

What impact has the economic crisis had on the daily lives of Pakistani citizens, particularly those living in poverty?

The economic crisis in Pakistan has made it harder for people, particularly those in poverty, to afford basic necessities like food and healthcare due to rising inflation, unemployment, and expensive imported goods.

What is the impact of the economic crisis on Pakistan's job market?

The economic crisis in Pakistan has led to rising unemployment rates, limited job opportunities, and job losses in the manufacturing, construction, and public sectors.

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World Bank: Pakistan’s Economy Slows Down While Inflation Rises Amid Catastrophic Floods

ISLAMABAD, October 6, 2022 - Pakistan’s economy is expected to grow by only 2 percent in the current fiscal year ending June 2023. According to the World Bank’s October 2022 Pakistan Development Update: Inflation and the Poor , the slower growth will reflect damages and disruptions caused by catastrophic floods, a tight monetary stance, high inflation, and a less conducive global environment. Recovery will be gradual, with real GDP growth projected to reach 3.2 percent in fiscal year 2024.

Poverty in the hardest-hit regions will likely worsen in the context of the recent flooding. Preliminary estimates suggest that – without decisive relief and recovery efforts to help the poor – the national poverty rate may increase by 2.5 to 4 percentage points, pushing between 5.8 and 9 million people into poverty. Macroeconomic risks also remain high as Pakistan faces challenges associated with a large current account deficit, high public debt, and lower demand from its traditional export markets amid subdued global growth.

“ The recent floods are expected to have a substantial negative impact on Pakistan’s economy and on the poor, mostly through the disruption of agricultural production,” said Najy Benhassine, the World Bank’s Country Director for Pakistan . “The Government must strike a balance in meeting extensive relief and recovery needs, while staying on track with overdue macroeconomic reforms. It will be more important than ever to carefully target relief to the poor, constrain the fiscal deficit within sustainable limits, maintain a tight monetary policy stance, ensure continued exchange rate flexibility, and make progress on critical structural reforms, especially those in the energy sector.”

This Update also outlines potential strategies to manage the impacts of high inflation. Inflation in Pakistan is expected to reach around 23 percent in FY23, reflecting flood-related disruptions to the supply of food and other goods, higher energy prices, and difficult external conditions, including tighter global monetary conditions. The Update shows that the high inflation will disproportionately impact the poor.

“While relief measures are needed to cushion the impacts of flooding, it will be critical to ensure that these are targeted towards those most in need,” said Derek H. C. Chen, author of the report . “Pakistan has previously resorted to energy subsidies, but our analysis shows that such measures disproportionately benefit better-off households, while imposing unsustainable fiscal costs. Going forward, the priority should be to tame inflation through sound macroeconomic policies. These should be accompanied by measures to provide targeted relief to those hit hardest by rising prices, including through expanded social protection programs, and to address the distortions that discourage trade and productivity.”

The Pakistan Development Update is a companion piece to the South Asia Economic Focus, a twice-a-year World Bank report that examines economic developments and prospects in the South Asia region and analyzes policy challenges faced by countries. The Fall 2022 edition titled Coping with Shocks: Migration and the Road to Resilience, launched on October 6, 2022, shows that growth in South Asia is dampening due to recent major global and regional shocks including rising inflation; the impacts of the global food, fertilizer and fuel shortages; the economic crisis in Sri Lanka; and the catastrophic floods in Pakistan. It also analyzes the impacts of COVID-19 on migration and the role labor mobility and migration can play in facilitating economic development.

This site uses cookies to optimize functionality and give you the best possible experience. If you continue to navigate this website beyond this page, cookies will be placed on your browser. To learn more about cookies, click here .

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Baba’s Explainer – Pakistan’s Economic Crisis

• January 12, 2023

Economics , International Relations

• GS-2: India and its neighbourhood
• GS-3: Economy & challenges

Context : Currently, Pakistan sits on the verge of economic collapse with its hopes pinned on getting concessions from the IMF on the Extended Fund Facility (EFF) established in 2019, as well as getting help from friendly nations in the form of long-term loans or donations.

• At the International Conference on Climate Resilient Pakistan (ICCRP) that began in Geneva Pakistan’s Prime Minister, Shehbaz Sharif, made a desperate plea for help.
• very high inflation
• very low foreign exchange reserves
• high indebtedness and a weak external position.
• rising unemployment
• Deemed to be a consequence of climate change, the floods inflicted an estimated loss of $3 billion on the country, caused over 1,700 deaths, and displaced 8 million people.
• In 2019, Pakistan had come to an agreement with the IMF about an EFF worth $6 billion, which was later increased to $7 billion.
• increasing energy rates,
• imposing more taxes, and
• artificial control over the exchange rate.
• Currently, the country is in the midst of a severe cash crunch with its foreign exchange reserves in the State Bank of Pakistan (SBP) depleting to $5.576 billion during the week ended on Dec 30, 2022.
• According to data released by Pakistan’s central bank, the reserves are less than half of what they were a year ago and at an 8-year low.
• Along with another $5.8 billion held by commercial banks, the forex reserves are just about adequate to pay for 3 weeks of imports to the country.
• As Pakistan still reels from the effect of the 2022 floods, servicing foreign debt and paying for crucial commodities such as medicine, food, and energy are among its chief concerns.
• However, Pakistan is scheduled to pay $8.3 billion to external lenders over the first three months of 2023. Without any relief, the country is set to default on these payments.
• As its leaders try to rally global support, ordinary citizens have been suffering.
• With massive spikes in prices of food products and other essentials, Pakistan recorded an inflation rate of around 24.5% in December. This number was even higher in rural Pakistan, close to 29%
• Prices of perishable food items have soared by nearly 56%.
• Wheat, a staple in the Pakistani diet, has seen prices increase by 57%.
• Ordering shopping centres to close at 8 pm local time, and marriage halls and restaurants by 10 pm.
• 20% of government employees have been asked to work from home.
• Pakistan Prime Minister stated that the people of Pakistan were “doubly victimised” by climate disasters and “morally bankrupt” global financial systems. “This system routinely denies middle-income countries of debt relief and concessional relief needed to invest in resilience against natural disasters”
• Currently, Pakistan has its hopes pinned on getting concessions from the IMF on the Extended Fund Facility (EFF) established in 2019, and getting help from friendly nations in the form of long-term loans or donations.
• Pakistan has also received funding pledges from US, France, Saudi Arabia, China, and Japan, with the Asian Development Bank and Asian Infrastructure Investment Bank also promising help.
• Help could potentially come from China, Pakistan’s “all-weather friend”.

Main Practice Question: Recent times have witnessed economic crisis in neighbouring countries of Sri Lanka and Pakistan. What do you think are the learnings for India from these crisis?

Note: Write answer his question in the comment section.

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• 2022 Floods , Economic Crisis , IMF , Neighbour , Pakistan

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Today's Paper | April 25, 2024

Not without reform.

FINANCE Minister Muhammad Aurangzeb says that the economy has the potential to grow 10 times its size to $3tr for Pakistan to become a high-middle-income country by 2047. That kind of growth or economic transformation is difficult to achieve but not impossible.

India accomplished this feat to become the world’s fifth-largest economy by increasing its GDP size from less than $275bn to over $3.7tr in 30 years after it began to implement reforms in earnest to overcome a severe crisis resulting from external debt. Ever since then, it has not returned to the IMF for help and is now well on its way to becoming the world’s third-largest economy after the US and China. The latter country has grown at a very high annual rate of 10pc for decades to transform itself into the world’s second-largest economy and rescue millions of its citizens from poverty.

There are also examples of countries from Southeast Asia, which were poorer and less developed than us a few decades ago but have surged far ahead now. Even if these economies have not fully overcome poverty or become high-middle-income nations, their examples show us the road to better days. But, living on borrowed money as we are, the periodic articulation of a desire to grow rich will not help.

If Pakistan is desirous of becoming a middle-income economy and halting the perennial cyclical crisis that has led Mr Aurangzeb to Washington to seek the country’s 24th bailout from the IMF, it must follow the path others have successfully taken. It has to honestly and diligently implement reforms to limit the role of government in the economy, encourage the private sector to lead growth, and integrate the economy with the region and global economy by breaking down barriers to trade and investment.

These reforms, however, will have to be based on enduring fiscal stabilisation policies. A similar message was conveyed by IMF’s Middle East and Central Asia director Jihad Azour the other day when he emphasised that giving precedence to reforms to revive the Pakistani economy was more important than the loan amount being negotiated. “What is important at this stage is to accelerate the reforms, double down on the structure of reforms in order to provide Pakistan with its full potential of growth,” he said.

The problem with us is that our ruling elite is still trying to find a way around the tough reforms that will hit their privileges. The creation of SIFC as an island of facilitation for certain foreign or local investors is one example of this attitude. But it will be difficult to carry on like this. With geopolitical rent becoming more and more difficult to draw, a debt-ridden country cannot daydream its way into becoming a middle-income economy.

Published in Dawn, April 22nd, 2024

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US warns Pakistan of 'potential risk of sanctions' over trade deal with Iran

Anyone considering a business deal with Iran needs to be aware of the potential risk of sanctions from the United States, an official said on Tuesday.

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• US warns of sanctions risk for business deals with Iran
• Deputy Spokesperson advises caution on deals with Iran
• US imposes sanctions on suppliers to Pakistan's missile programme

"Just let me say broadly, we advise anyone considering business deals with Iran to be aware of the potential risk of sanctions. But ultimately, the government of Pakistan can speak to their own foreign policy pursuits," Vedant Patel, Deputy Spokesperson of the US State Department, said while responding to a question on a recent visit of the Iranian president to Pakistan.

During the visit, Pakistan and Iran signed eight MoUs (memoranda of understanding) and also agreed to push bilateral trade to USD 10 billion.

Early this week, the US imposed sanctions on suppliers to Pakistan's ballistic missile programme, including three companies from China.

"The sanctions were made because these were entities that were proliferators of weapons of mass destruction and the means of their delivery. These were entities based in the PRC (People's Republic of China), in Belarus, and that we have witnessed to have supplied equipment and other applicable items to Pakistan's ballistic missile programme," Patel said.

"They are following our October 23 designation of three PRC entities who have worked to supply Pakistan's missile programme. We are going to continue to disrupt and take actions against proliferation networks and concerning weapons of mass destruction procurement activities, wherever they may occur," he added.

What caused Dubai floods? Experts cite climate change, not cloud seeding

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Reporting by Alexander Cornwell; editing by Maha El Dahan and Alexandra Hudson

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A coalition vessel successfully engaged one anti-ship ballistic missile (ASBM) launched from the Iranian-backed Houthi "terrorist-controlled areas" in Yemen over the Gulf of Aden, the U.S. Central Command (USCENTCOM) said on Thursday.