STAFF REPORTER
ISLAMABAD Pakistan has been included in the group of countries eligible for debt relief on all principal and interest payments to official bilateral creditors announced by the G20 countries in their Riyadh meeting. The G20 grouping had been urged by the World Bank and the International Monetary Fund (IMF) to extend debt relief to the poorest countries to free up their resources for the Covid-19 related challenge instead. The G20 made the decision to include all countries grouped under the World Bank’s International Development Association (IDA) to be eligible for debt relief under the proposed plan. The IDA group contains 76 countries of which Pakistan is one. The G20 worked with a grouping of African countries as well as the multilateral lenders IMF and WB to decide on the terms of the debt relief. The suspension period for debt relief will start from May 1 and continue till Dec 1, 2020. All debt service falling due in this period will be packaged into a new loan on which the payments will not start until June 2022. Then it will be paid over the subsequent three years. A standardized term sheet has been made for all the payments clubbed under the relief plan. Prime Minister Imran Khan appreciated on Thursday the debt relief measures by G-20 countries, the International Monetary Fund (IMF) and the World Bank for developing countries, including Pakistan. The premier lauded the debt relief measures after Finance Advisor Dr Abdul Hafeez Sheikh called on PM Imran and informed him about the planned approval of an additional $1.4 billion concessionary financing from IMF to deal with the economic impact of coronavirus. In the meeting, the finance advisor also updated the premier about the progress on various components of the Economic Stimulus Package announced by the government. The meeting between the prime minister and his advisor was in connection with a meeting of the IMF’s executive board scheduled to be held on April 16, to consider an extra loan of $1.4 billion for Pakistan to boost the country’s foreign exchange reserves and extend budgetary support in the wake of the economic slowdown due to the coronavirus pandemic. Meanwhile, Foreign Minister Shah Mahmood Qureshi has said the G-20 countries decision to suspend the developing countries’ debt payments for one year will provide fiscal space to these countries including Pakistan to cope with the situation arising out of coronavirus. Addressing a news conference in Islamabad on Thursday he termed the decision as historic and timely. He said seventy-six countries including Pakistan will simultaneously benefit from this debt relief and its application will start from the 1st of May. Shah Mahmood Qureshi said the relief is on both interest payment and the principal amount. The Foreign Minister said it will have substantial impact and provide much needed fiscal space to Pakistan which will be used for the wellbeing and welfare of the Pakistani people especially the poor and disadvantaged segments of society. He said it is also step forward to give impetus to government’s relief oriented programs such as Ehsaas Cash Emergency program under which 144 billion rupees have been earmarked for disbursement amongst 12 million deserving families. The Foreign Minister pointed out it was the fourth major global initiative of Pakistan over the last two years led by Prime Minister Imran Khan. He said other three global initiatives included those of climate change, Islamophobia and illicit financial flows. Shah Mahmood Qureshi reminded that Prime Minister Imran Khan launched the global initiative for debt relief on the 12th of this month, appealing the global leaders and financial institutions as well as the UN Secretary General to restructure debt of the developing countries to enable them to effectively handle the situation. He pointed out that the coronavirus had affected developing countries the most because of contraction of their exports and remittances. He said this appeal of the Prime Minister was appreciated by the UN Secretary General and the IMF.. The Foreign Minister said coronavirus is a global phenomenon and larger consensus is required to deal with it. He said it was with the same spirit that Pakistan took part in the SAARC video conference on Covid-19 hosted by India regardless of the fact that New Delhi always tried to undermine the regional peace process. Responding to a question, the Foreign Minister said the process of bringing back stranded Pakistan from abroad will pick up momentum in the days ahead as all the necessary arrangements have been made. He said our missions abroad are providing all possible assistance to these Pakistanis.
