KARACHI, Nov 29: Foreign exchange reserves of the country fell substantially, after payment of $394 million IMF installment, to $13.575 billion while the reserves of the State Bank slipped below the alarming $9 billion mark.

The State Bank reported on Thursday that the reserves of the State Bank fell to $8.860 billion till week ended Nov 23, which is just about three months of import cover.

The falling foreign exchange reserves of the State Bank is alarming since its fast approaching the level of 2008 when the then government had to turn to the IMF for emergency support to avoid default as it would have been unable to meet its debt obligations.

Commercial banks reserves stood at $4.71 billion.

However, the situation is slightly different from 2008 since the private sector is now solely responsible for the import of fuel oil. The total import in 2012 for the oil was about $14.3 billion.