Minister for Planning Asad Umar says economic growth will improve with the paying off loans.
Talking to media in Karachi on Saturday, he said assertion of US Acting Assistant Secretary for South and Central Asian Affairs Alice Wells regarding CPEC related loans is not based on facts.
The Minister said it is true that the foreign debt of the country has reached a level that is impeding the growth of the economy. He said the loans were taken in the past as imports exceeded exports of the country and trade deficit was increasing.
He said a total public debt of the country stands at 74 billion dollars. Of this, the debt from China is 18 billion dollars, less than one fourth. He said CPEC related debt out of 18 billion dollars is 4.9 billion dollars. He said CPEC loan is 7 percent of the total external debt.
Asad Umar said three fourth of the debt is from other countries or multilateral institutions. He said Chinese institutions funded Pakistan at a difficult economic time due to deep friendship bonds between the two countries.
The Minister expressed satisfaction that commercial bilateral debt with China will start reducing at a faster pace in the coming years and will be replaced by multilateral debt.
Asad Umar said the public debt taken from China has a maturity of 20 years with an average interest rate of 2.34 percent. He said the first phase of CPEC focused on road infrastructure and energy-related projects.
