Money-strapped Pakistan secures $800 million in debt reduction from G20 nations: Report

ISLAMABAD: Money-strapped Pakistan has secured $800 million value of debt freeze offers from 14 members of the G20 whereas it was nonetheless awaiting ratification by the remaining six international locations of the grouping, together with Saudi Arabia and Japan, in line with a media report on Sunday.
Pakistan owes $25.four billion to the Group of 20 wealthy nations as of August this yr. On April 15, the G-20 nations introduced a freeze on debt repayments from 76 international locations, together with Pakistan, throughout Could to December 2020 interval, topic to the situation that every nation would make a proper request.
Pakistan together with 76 different poor African international locations had certified for the G-20 debt reduction initiative, introduced in April this yr for Could-December 2020 interval, to fight the adversarial impacts of the Covid-19 pandemic.
Throughout the previous seven months, 14 international locations ratified their agreements with Pakistan, which has supplied fiscal area of $800 million to Islamabad in the interim, The Categorical Tribune reported, quoting authorities sources as saying.
Along with these 14 nations, two different international locations had additionally approached to increase debt reduction to Pakistan.
In response to official paperwork, Pakistan has not but finalised the debt rescheduling modalities with Japan, Russia, Saudi Arabia, United Arab Emirates and the UK.
Though these six international locations haven’t but ratified the debt reduction associated agreements, these G-20 members are anticipated to conclude the deal earlier than finish of subsequent month, stated a senior official of the Ministry of Financial Affairs.
He stated that Pakistan was not making repayments to those six international locations too, on the understanding that these members would finally sign-off the offers.
Pakistan was anticipating a complete $1.eight billion short-term debt reduction from the members of G-20 nations for Could-December 2020 interval, in line with the Ministry of Financial Affairs. This included $1.47 billion principal loans repayments and $323 million curiosity on the loans.
The financial affairs ministry’s estimates had proven that Pakistan can get $613 million value of short-term reduction from Saudi Arabia, $309 million from China, $23 million from Canada, $183 million from France, $99 million from Germany, $6 million from Italy, $373 million from Japan, $47 million from South Korea, $14 million from Russia, $1 million from the UK and $128 million from the US.
Thus far, Pakistani authorities have entered into 27 debt rescheduling agreements with about 16 international locations, the report stated.
The utmost reduction was anticipated from Saudi Arabia to the tune of $613 million for Could-December interval, it stated. Japan was additionally anticipated to supply $373 million reduction. Nonetheless, agreements with these nations have been nonetheless pending the ultimate nod.
Russia can also be anticipated to ratify the revised phrases by finish of subsequent month, which as soon as ratified may present short-term reduction of $14 million, the report stated.
Saudi Arabia has additionally not prolonged the $three billion monetary help package deal and has already prematurely withdrawn $1 billion that Pakistan paid again by arranging one other mortgage from China. Pakistan might also payback $1 billion subsequent month to the oil-rich kingdom, a yr forward of Pakistan’s expectations.
In the meantime, the Financial Coordination Committee of the Cupboard on Friday accepted to make one other formal request to the G-20 nations for extension in debt reduction initiative for one more six months, the report stated.
This time, the Ministry of Financial Affairs has estimated that Pakistan can doubtlessly get reduction of $915 million, together with $273 million in curiosity funds throughout January-June 2021 interval.
The utmost reduction of $385 million is predicted from China, adopted by $211 million from Japan, $104 million from France, $53.6 million from Germany, $65 million from the US, $12 million from Saudi Arabia, $7 million from Russia and half one million greenback from the UAE.
In case, Japan and Saudi Arabia additionally delay the reduction below the second section, the web advantages might come right down to $685 million within the second section, stated the sources.

Leave a Reply

%d bloggers like this: