According to a report on Octocber 23rd, Pakistani Finance Minister, Mohammad IshaqDar met CCP’s ambassador to Islamabad Nong Rong before his country’s congratulations on Xi Jinping’s reelection and sought a rollover of its debt to Communist China for more than one year, preferably for three to five years. The more time, the better. He also asked for a fresh loan to repay the maturing debt during the next year and the most favorable trade treatment for certain export commodities, preferably for free. Pakistan also expected CCP to offer interest discount or debt reduction, preferable debt relief, and provided a list of projects waiting for investment from Beijing.
Dar said Islamabad sought a rollover of the $3.3 billion commercial loans from Communist China and three $3 billion worth of State Administration of Foreign Exchange (SAFE) deposit loans maturing next June. Previously, Beijing has also extended a total of $4 billion worth of SAFE deposit loans, $1 billion of which has already been rolled over this July.
At present, Pakistan had an outstanding debt of $26.7 billion to Communist China, while the country’s gross foreign exchange reserves stood as $7.5 billion. Fitch, the international credit rating agency, downgraded Pakistan to the highly risky debt category.
On November 1st, Pakistani Prime Minister Shehbaz Sharif would visit Beijing and carry a long list of new projects and requests for a rollover of the existing debt in an effort to repay maturing debts with fresh loans where possible and seek the most favorable trade treatment.
Faced with so many unreasonable requests, Rong Nong reaffirmed Beijing’s continued support for Islamabad. Chinese people had to prepare billions of dollars for Pakistan once again in exchange for their congratulations on Xi’s accession to the throne.