SBP’s Performance Since 2018 The overall unit value index of imports in US$ fell by as much as 28.8 percent in 2019-20. The balance of payments position improved substantially. Imports fell by 16 percent in 2019-20 and the current account deficit declined by as much as 68 percent from$13.4 billion in 2018-19 to$4.4 billion in 2019-20. This was significantly better than the IMF Program target of$6.7 billion. Reserves also rose by$4.6 billion, close to the Program target. However, the inflow into the financial account was smaller than in 2018-19. This was due to the flight of‘hot money’ of $3 billion which had come into Pakistan when interest rates were at their peak, with the policy rate at 13.25 percent. Following COVID-19, the precipitous drop-in interest rates led to the exit of this money. The IMF program was suspended because of the economic dislocation caused by COVID-19. A special loan was given to Pakistan in June 2020 by the IMF under the Rapid Finance Facility of$1.4 billion. The program was restored in late 2021 and the sixth review was successfully completed in February 2022. Pakistan also received a special SDR allocation of $2.8 billion in August 2021. 2.4 SBPs Role after Covid-19 There is need to fully recognize the extraordinary supporting role played by the SBP in the process of revival of economic activity after the COVID-19 attack. The first step taken, as shown in Table 2.5, was a quantum reduction in the policy rate from 13.25 percent, which was set on 17 th July 2019, to 7 percent by 26 th of June 2020. A scheme for facilitating new investment was introduced called the Temporary Economic Finance Facility(TERF ) . This was a concessionary refinance facility. The maximum limit was Rs 5 billion per project, with a 5 percent interest rate, payable in 10 years with a grace period up to 2 years, Between April 20 and March 21, Rs 436 billion was advanced as loans for 628 projects. The second scheme was the loan extension and restructuring package, which was essentially a debt relief scheme. The objective of the scheme was to preserve the solvency of borrowers at a difficult time. Accordingly, payment of the loan principal amount could be deferred for up to twelve months, while continuing servicing of the markup. Over 1.8 million borrowers have benefited from this scheme and the total loan amount deferred is Rs 910 billion, with Rs 121 billion to micro finance borrowers. The third scheme was the SBP-Rozgar Scheme . The objective was to prevent lay-off of workers by financing wages and salaries of employees of private sector units. The scheme was to cover the wage bill for 6 months, with the maximum loan limit of Rs 2 billion. Repayment was to be made in 8 equal quarterly installments. The amount disbursed under this facility is Rs 212 billion. 31