FPCCI seeks strategy to cope with debt servicing challenge

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Staff Reporter

Karachi

As the country’s debt repayment capacity has been waning due to sole dependence on foreign loans, federation of Pakistan chambers of commerce and Industry has sought a long-term strategy to cope with the challenge of debt servicing amidst huge domestic and foreign loans, which have increased to Rs36.3 trillion or 87 percent of the Gross Domestic Production.
In a statement issued on Saturday, FPCCI President Mian Anjum Nisar opposed the excessive borrowing policy of previous governments, as the present government has also added an additional Rs11.35 trillion in the total public debt during the first two years in power, which is more than the total debt the previous government has taken in its five-year term.
Quoting the figures, he observed that over 40 percent of the additional debt in the past two years is only because of debt servicing expenditures while about 30 percent due to rupee devaluation, which was depreciated almost 47 percent during this period. He flayed the economic managers for keeping the interest rate artificially high at 13.25 percent during this period, besides devaluing the rupee more than the requirements, contributing most to lift the public debt.