Beyond means: While in power, PPP secured loans worth Rs 10.3 trillion
(Shahzad Shameem, Abbottabad)
The Pakistan Peoples Party-led
government obtained domestic and foreign loans worth Rs 10.3 trillion over the
past five years, highlighting the precarious state of the country’s economy, the
Senate was told on Tuesday.
These loans have propelled the country’s debt and liabilities to an
unprecedented Rs 15.2 trillion, equal to 68% of gross domestic product (GDP).
According to the Fiscal Responsibility and Debt Limitation Act of 2005, the
total debt should not exceed 60% of GDP. In response to a written question by
Balochistan National Party (Awami) Senator Naseema Ehsan, the Ministry of
Finance revealed that the PPP-led government secured loans worth Rs 8.6 trillion
domestically between 2008 and 2013 from the State Bank of Pakistan, National
Savings Schemes, commercial banks and other local institutions.
In addition, eight countries and international financial institutions also lent
Pakistan Rs 843 billion during this period. The government was also forced to
obtain a further Rs 754 billion from the International Monetary Fund to pump
into the ailing economy. Revealing more details on the foreign debt, the
ministry said that Pakistan secured maximum loans worth $4.39 billion from the
Asian Development Bank from 2008 to 2013. The International Development
Association – World Bank’s fund for the poorest – loaned $3.21 billion. China
remained the third largest lender, giving loans worth $2.91 billion.
The previous government borrowed $1.58 billion from the Islamic Development Bank
during its tenure. Kuwait chipped in with $94.2 million, Germany $67 million,
Italy $39.3 million and France $38.8 million. The International Bank for
Reconstruction and Development gave $350.7 million and the International Fund
for Agricultural Development provided $81 million. Additionally, the
Organisation of Petroleum Exporting Countries Fund for International Development
lent $32.2 million and $1 million was lent by ECO TD Bank.
The ministry of finance also stated that the domestic debt contains instruments
offered to retail investors as well as market debt (treasury bills, Pakistan
Investment Bonds, Ijara Sukuk) which are tradable instruments with an active
secondary market. It also informed the Senate that the Federal Board of Revenue
collected Rs 6.8 trillion in the form of various taxes and duties from 2008 to
2012. Meanwhile, the ministry of finance did not comment on the issue of missing
Nato containers as the matter was sub judice in the Supreme Court. However, it
informed the Senate that the National Accountability Bureau was investigating
the case.
By Zahid Gishkori Published:
ISLAMABAD: April 17, 2013
Published in The Express Tribune