In a recent Senate Committee on Economic Affairs session chaired by Senator Saifullah Abro, officials from the Economic Affairs Division delivered a sobering briefing. They disclosed that Pakistan’s external debt has surged past $130 billion. This figure encompasses debts accrued by the government and the private sector, highlighting the country’s significant financial obligations on the international stage.
Magnitude of Financial Commitments External Debt
The meeting underscored the sheer magnitude of Pakistan’s financial commitments, with ongoing projects totaling 298. Among these are 146 multi-sectoral initiatives and 152 projects under bilateral agreements. This extensive portfolio reflects Pakistan’s robust engagement in various sectors, financed through external loans and collaborations with international partners.
Management of Financial Instruments External Debt
Critical aspects of financial management were deliberated, emphasizing the oversight of commercial domestic loans from international financial institutions (IFIs) like the International Monetary Fund (IMF). Additionally, the Ministry of Finance oversees issues related to bonds and certificates, crucial for sustaining Pakistan’s economic stability amidst global financial dynamics.
Development Assistance and International Collaboration
The discussion also centered on external development assistance, which ior bolstering Pakistan’s infrastructure and socioeconomic sectors. The ministry collaborates closely with the central bank and international development agencies to manage short-term assistance programs effectively. Notably, from 2013 to 2022, Pakistan’s technical assistance programs have benefited significantly from training from countries such as China, Japan, Korea, and Singapore. This collaboration underscores the international community’s investment in Pakistan’s development agenda.
Ensuring Effective Utilization of Borrowed Funds External Debt
Committee members emphasized the critical importance of efficiently utilizing borrowed funds. They stressed that projects funded through loans must be completed on schedule and achieve intended developmental milestones. This scrutiny aims to maximize the impact of financial resources while maintaining fiscal discipline and transparency.
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The Senate Committee meeting highlighted Pakistan’s daunting financial landscape, characterized by substantial external debt and ambitious developmental endeavors. While external loans are crucial in funding essential infrastructure, healthcare, and education projects, prudent management and oversight are necessary to mitigate financial risks and ensure sustainable economic growth.
