Pakistan in Crises to Pay Chinese Loan

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Chinese Loan

Pakistan has communicated in clear tone that third parties cannot undermine its efforts to undertake infrastructure and energy development plan with the help of China. This came in response to the warning by US Secretary of the State Mike Pompeo that urged IMF not to extend any bailout that helps China.

The Belt and Road Initiate by China have brought a loan and investment worth billions of dollar to Pakistan. Pakistan is now struggling with the balance of payment crises and has already been into Rupee devaluation and duties on import to curb the crises. Reserves have decreased to $10 billion and bailout has to be availed anytime soon.

With the new government set to approach the Washington-based lender for the second time in five years, Pompeo said the US looked forward to engagement with Pakistan’s expected new prime minister, Imran Khan, but said there was “no rationale” for a bailout that pays off Chinese Loan by Pakistan.

“Make no mistake. We will be watching what the IMF does,” Pompeo said in an interview  “There’s no rationale for IMF tax dollars, and associated with that American dollar that is part of the IMF funding, for those to go to bail out Chinese Loan or China itself,” Pompeo said.

In response, Pakistan’s Ministry of Finance decried the statement, saying that third parties cannot weaken the country’s resolve in making CPEC a success.

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