G-20 debt relief to provide vast fiscal space: Qureshi

Foreign Minister Shah Mahmood Qureshi Thursday said Pakistan would get a substantial relief following the G-20 countries decision to suspend the developing countries' debt payments for one year to provide fiscal space to these countries including Pakistan to cope with the situation arising out of the Covid-19 pandemic.

Speaking at a news conference, the foreign minister said that 76 countries including Pakistan would simultaneously benefit from the debt relief and its application would start from May 1, 2020.

Responding to a question, he said that initially it was debated that the relief would be for 25 Least Developed Countries (LDCs) in which Pakistan did not fall.

However, he insisted that after Pakistan's efforts the scope of the relief was broadened to 76 countries, adding that Pakistan succeeded in its efforts in broadening the scope of the relief to the International Development Association (IDA).

The foreign minister also referred to the International Monetary Fund (IMF) meeting on Thursday, adding that the fund was expected to approve $1.4 billion fiscal liquidity for Pakistan.

He said that that the amount would also be used in the relief efforts.

To another query about the overall impact of the debt relief, he said that it would be a substantial relief for Pakistan, as the country roughly repay about $10 to $12 billion annually to multilateral and bilateral lenders.

He said that the relief included, from all the multilateral and bilateral lenders, financial institutions including the IMF and World Bank.

However, he said that Adviser to the Prime Minister on Finance Dr Abdul Hafeez Sheikh has said that in order to assess the overall impact of the debt relief, we need to wait for coming of more details.

"But I can say this that the impact will be substantial," he added.

Qureshi termed the decision as historic and timely, adding that the relief was on both interest payment and the principal amount.

He said that it would provide much-needed fiscal space to Pakistan, which would be used for the well being and welfare of the Pakistani people especially the poor and disadvantaged segments of the society.

He said it was also a step forward to give impetus to government's relief-oriented programmes such as Ehsaas Cash Emergency programme under which Rs144 billion had been earmarked for disbursement among 12 million deserving families.

He pointed out that it was the fourth major global initiative of Pakistan over the last two years led by Prime Minister Imran Khan, adding that other three global initiatives included those of climate change, Islamophobia and illicit financial flows.

The foreign minister, while giving credit to Prime Minister Imran Khan for the G-20 forum's decision, pointed out that the prime minister launched the Global Initiative for Debt Relief on April 12, 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 asserted that the coronavirus had affected developing countries the most because of contraction of their exports and remittances, adding that the prime minister's appeal was appreciated by the UN secretary general and the IMF.

The foreign minister said that the coronavirus was a global phenomenon and larger consensus was required to deal with it, adding that it was with the same spirit that Pakistan took part in the SAARC video conference on the Covid-19 hosted by India regardless of the fact that New Delhi always tried to undermine the regional peace process.

To another query, Qureshi said the process of bringing back stranded Pakistanis from abroad would pick up momentum in the days ahead as all the necessary arrangements had been made.

He said that the provinces had now agreed to reopen the airports and accept the returnees from abroad by taking all necessary arrangements in order to prevent the pandemic.

He said that in the first week roughly 2,000 nationals were being brought back and now from April 20, the capacity would be increased to 7,000.

Commenting on the US President, Donald Trump's decision to halt funding to the World Health Organization (WHO), the foreign minister said the US should review its decision saying it was time for cooperation.

He said that cutting the assistance of the WHO would only add to the difficulties of the world body at this critical time.

Responding to another query about the lack of coordination between the federal and the Sindh governments, Qureshi tried to dispel the impression by saying "Chief Minister Sindh Murad Ali Shah is the first person the prime minister listened to during meetings of the National Coordination Committee (NCC)."

He pointed out that 18th amendment allowed flexibility to the provinces, adding that he believed that the Sindh government was working with good intentions and the federal government would not disappoint the provincial government.