The government may borrow from international market through issuance of bonds for repayment of already foreign borrowing of US $6.5 billion, including commercial loans of $858 million, becoming due from February 2017 to June 2018. Secretary Finance Tariq Bajwa stated this during a meeting of Senate Standing Committee on Finance chaired by Saleem Mandviwalla in response to an agenda items on repayment of foreign debt from June 2013 to January 2017 and the amount the debt that has to be paid till June 2018.
In response to a question whether the government would issue bonds to finance the repayment, the secretary finance stated, "We might be deliberating on this and when something will mature, we will share it with the committee." The committee was further informed that foreign debt repayment obligations projected $6.491 billion in the next seventeen months are on account of commercial borrowing of $858 million, issuance of bonds $750 million, as well as $2.9 billion multilateral, $1.8 billion bilateral and $82 million of International Monetary Fund (IMF).
The Finance Ministry added that actual repayment of foreign debt of $14.627 billion was made from June 2013 to January 2017. Bajwa said that as there are sufficient foreign exchange reserves supported by projected inflows in the coming months, therefore, there would be no issue of repayment.
The committee also inquired from the State Bank of Pakistan (SBP) how it sees the country''s debt repayment position. The representative of the SBP said it agrees to the views of the Finance Ministry. There would be no issue in repayment of debt, he said, adding that the decline in exports and deceleration in remittances have widened the current account deficit, however, finance account is positive owing to the China-Pakistan Economic Corridor (CPEC).
When the committee sought information about equity in the financial account, the SBP official stated he does not have information because a survey is being conducted to ascertain the equity and loan as some transactions are being settled offshore. The committee considered and approved the Public Private Partnership Authority Bill, 2016 with some amendments after the Finance Division agreed to drop the name of finance minister from chairmanship, however, veto power in decision making would rest with the Finance Division.
The officials of Finance Ministry stated that authority was designed to forge public-private partnership for undertaking mega projects. The law would provide enabling environment for private participation in provision of public infrastructure and related services through fair and transparent procurement. The committee deferred further consideration on "The Limited Liability Partnership Bill, 2017" as it sought a detailed viewpoint of the Securities and Exchange Commission of Pakistan (SECP) on the bill in its next meeting.
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