Islamabad, Oct 23: Finance Minister Optimistic on Securing Major Energy Debt Relief from China
Finance Minister Muhammad Aurangzeb said Pakistan’s request to extend energy sector debt payments has been met with an encouraging response from China, reported Bloomberg.
As the nation struggles with high electricity rates that have risen for some households in recent years, the extension, if authorized, will offer financial respite.
With new tax policies aimed at industries like retail and agriculture anticipated to go into force shortly, the finance minister underlined once more the necessity of increasing Pakistan’s tax-to-GDP ratio to 13.5%.
The federal government’s strategy to deal with its economic issues, such as growing inflation and interest rates, includes extending the maturities of its debt. The benchmark interest rate has already been lowered by the central bank to 17.5%, and another decrease is anticipated at the November 4 meeting.
The government sees the attempts of the finance minister to negotiate for significant Energy Debt Relief from China write-off from the Chinese as a way of restoring aggregate stability. Due to soaring energy bills and a constant loss of power, Pakistan has been unable to pay its debts.
Ensuring that energy debt relief would be the internal and external fix for energy sufficiency and predictable energy resources which is necessary for the economy. The energy sector has been identified to be one of the biggest debt creators to the external front of Pakistan.
