Islamabad: The International Monetary Fund (IMF) intends to ban Pakistan from borrowing more from China, according to reports. Islamabad’s plan to seek PKR 7. 9 billion from China for China Pakistan Economic Corridor (CPEC) projects is now likely to hinge upon the IMF recommendations.
Driving Pakistan’s economy with the help of external doles is unsustainable and Pakistan desperately needs structural reforms. The IMF has raised objections to Pakistan’s loans from China and arbitrarily high payments made to Chinese independent power producers (IPP), suggesting Islamabad renegotiate its energy agreements with Beijing, reported Financial Post.
Pakistan is obligated to pay over PKR 350 billion power dues to multiple Chinese IPPs operating in the country. IMF’s demand follows Beijing’s rejection of modification to the conditions of agreements for projects under CPEC. Pakistan’s budget for FY 2022-23 has not addressed key structural issues proving to be an obstacle to revival of its economy.
