PAKISTAN ACQUIRES $800M IN DEBT RELIEF FROM G20

Mon 23 November 2020:

Pakistan has secured US $ 800 million worth of debt freeze deals from 14 members of the G20 while it still awaits ratification by the remaining six countries of the grouping, including Saudi Arabia and Japan, according to a media report on Sunday.

It may be recalled that Pakistan along with 76 other poor African countries had qualified for the G-20 debt relief initiative, announced in April this year for May-December 2020 period, to combat the downturn brought on by the coronavirus pandemic.

Countries with which Pakistan has not yet finalised debt rescheduling modalities include Japan, Russia, Saudi Arabia, United Arab Emirates (UAE) and the United Kingdom (UK).

According to a report by the Express Tribune which quotes government sources, 14 countries ratified their agreements with Pakistan during the past seven months, which has provided fiscal space of $800 million to Islamabad for the time being.

In addition to these 14 nations, two other countries had also approached to extend debt relief to Pakistan.

The Express Tribune claims that although six countries have not yet ratified the debt relief related agreements, the G-20 members are expected to conclude the deal before the end of December.

Further, Pakistan was not making repayments to these six countries too, on the understanding that these members would eventually sign-off the deals.

So far, Pakistani authorities have entered into 27 debt rescheduling agreements with about 16 countries, according to the Ministry of Economic Affairs.

It may be mentioned here that the Economic Coordination Committee (ECC) of the cabinet on Friday had approved to make another formal request to the G-20 nations for extension in debt relief initiative for another six months.

It is expected that Pakistan can potentially get relief worth $915 million, including $273 million in interest payments during January-June 2021 period.

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