ISLAMABAD: The federal government has clarified media reports that the Ministry of Economic Affairs is preparing for seeking $5 billion in loans from different countries.

A statement from the Ministry of Economic Affairs said no talks were underway with China, Kazakhstan and Russia for loans.

The media reports stated that the incumbent government plans to borrow $3 billion from China and $2 billion from Russia and Kazakhstan.

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The reports added that the finance ministry has finalised the plan for the loan and an agreement will be inked with China during Prime Minister Imran Khan’s visit to Beijing next month.

Islamabad is to spend $2 billion on the ML-1 Railways project, with $3 billion coming from China to shore up the country’s declining foreign exchange reserves. The loan arrangement with China would initially be inked for a one-year period, according to finance ministry sources.