Pakistan to retire $9.2bn foreign loans this year, Senate told

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–Minister tells Senate govt has paid back $3,256m foreign debt and $1,295.21m interest on loans till January 31, 2019

 

ISLAMABAD: The Finance Ministry on Thursday informed the Senate that of the total $88.19 billion in foreign loans, $9.2 billion will be retired this year.

During the question hour, Minister of State for Finance and Revenue Hammad Azhar said $37bn worth of foreign loans would be retired during the next five years.

Giving details, the minister said some $3,256m under foreign debt and $1,295.21m interest on loans had been paid back during the current fiscal year till January 31, 2019.

Pakistan borrowed $6.90897bn in the Fiscal Year 2013-14, $5.40721bn in FY14-15 and $4.45020bn in FY15-16, he said, adding that Pakistan’s borrowing from foreign sources remained $6.520381bn in FY16-17, while in FY17-18 the country borrowed $6.020526bn from foreign sources.

The country has borrowed $4.550154bn in the ongoing fiscal year till now, Azhar said, adding that the present government was committed to fully discharging the debt obligations of the country to its external creditors and a multi-pronged strategy was being pursued.

“The focus is to substantially increase the country’s exports and workers remittances and reduce imports,” he said, expressing hope that this year, the country would receive $22 billion in remittances from overseas Pakistani.

The country’s export was also expected to reach $25bn during the said period, he said, adding that the government was also focusing on enhancing domestic revenues, reducing expenditure to bring down budget deficit as well as current account deficit.

To another question, the minister said the process to seek membership of Egmont Group was initiated on September 21, 2011 after the approval of the federal cabinet.

At present, Onsite Assessment Report (OAR) from FinCEN (FIU of USA) and JAFIC (FIU of Japan) was still awaited which described findings of Onsite visit to Pakistan (January 29, 2018 to February 02, 2018), he said.

He said the government was vigorously following-up to expedite the process of Egmont Group membership. “After getting membership of Egmont Group, we will also get data,” he added.

Azhar also informed the Senate that the inflation (CPI) in July-March of FY2019, remained at 6.8 per cent which was within the single digit range. The minister pointed out that the increase in the price level was due to rising international oil prices and rupee depreciation.

He said, “To anchor expected rise in inflation, State Bank has also further raised the policy rate to 10.75 per cent effective from April 1, to compress the aggregate demand in the economy.”

To another question, the minister said the preceding year witnessed a growth of 5.22 per cent but broadly it was led by consumption.