Japan, Pak. sign debt rescheduling accord

By B. Muralidhar Reddy

ISLAMABAD, OCT. 5. Japan today signed a debt rescheduling accord worth $ 550 million with the Musharraf Government. With the signing of the agreement, Pakistan has concluded debt- rescheduling pacts with 14 countries worth $ 1403.7 million including a $ 379 million loan, rescheduled by the United States.

The Pakistan Finance Minister, Mr. Shaukat Aziz, who was present on the occasion said the rescheduling of the debt by the Japanese Government had nothing to do with the events of September 11. But there is little doubt that the U.S. and its allies have been going out of their way in the last few days to help Pakistan in its economic difficulties. This is seen as a `reward' for the bold decision taken by Gen. Musharraf to side with the international community in the fight against the Saudi dissident, Osama bin Laden, and the Taliban.

Pakistan has an estimated external debt of $ 37 billion and pays nearly $ 5 billion on debt servicing alone every year. Reduction of debt burden is one of the main stated economic objectives of the Musharraf Government. The U.S. decision to lift first the nuclear-related sanctions and then the so-called democracy sanctions are all seen as part of the strategy by the West to strengthen the hands of Gen. Musharraf against the hardliners.

Besides the pact with Japan, Pakistan has so far concluded $ 853.7 million debt rescheduling accords with 13 countries. Two $ 7 million debt rescheduling agreements with non- Paris club member states - Saudi Arabia and the Czech Republic - have also been signed. Japan, Korea, Sweden, Russia, Belgium and Canada are expected to sign $ 892 million worth rescheduling treaties with Pakistan under the Paris Club agreement. Three agreements with non-Paris Club states - the UAE, Kuwait and Libya - worth $ 17 million are also to be signed with Islamabad under the agreement.

The Pakistan Foreign Office spokesperson today welcomed the U.S. to lift the democracy-related sanctions. ``With the latest decision by the U.S. all sanctions against Pakistan stand lifted,'' he said.

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Section  : International
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