PTI government paying $10 billion per year in loan

ISLAMABAD, Pakistan: The Federal Cabinet which met in Islamabad on Tuesday with Prime Minister Imran Khan in the Chair was informed that the Pakistan Tehreek-e-Insaf (PTI)-led incumbent government is paying US$ 10 billion per year in loan instead of US$ 5 billion as was a practice in past governments.

The Cabinet was briefed that the government inherited a debt of Rs 30 trillion hence it had to take US$ 24 billion of loans to pay off installments of these loans and to prevent the Country from bankruptcy.

It was informed that an increase of Rs 7.7 trillion was recorded in the government loans last year owing to the restoration of the original value of Pakistani currency whereas the Coronavirus pandemic caused a loss of income of Rs 1 trillion.

The Federal Cabinet was further told that the government is focusing on increasing exports and foreign exchange reserves.

It was informed that the government has taken important steps to significantly bring down the primary fiscal deficit, improve the nature and quality of domestic and foreign loans, and introduce new products regarding loans.

The meeting was apprised that the primary deficit has been reduced from Rs 1.5 trillion to Rs 1 trillion in the current year.

The Primary Surplus of Rs 0.2 trillion was recorded in March 2020 for the first time in the last 12 years.

In the meeting, the Federal Cabinet approved the proposed visa policy for Afghanistan and allowed the British airline Virgin Atlantic to start flights between Pakistan and the United Kingdom.

The meeting allowed a one-time pre-shipment to pre-shipment agencies regarding the import of wheat by the Trading Corporation of Pakistan.

Regarding steps to reduce Circular Debt in the Power Sector, the Cabinet was briefed that Circular Debt has recorded a reduction of over Rs 300 billion in total debt of Rs 853 billion due to effective measures taken by the government during the current year.

The Cabinet noted that in the wake of renegotiations with the Independent Power Producers (IPPs) and rationalizing return on equity cover, the benefit of Rs 620 billion is expected in the Circular Debt.

The meeting was told that losses in transmission and distributions are continuously decreasing.

Regarding the opening up of schools, the Cabinet was told that educational activities will be restored throughout Pakistan from tomorrow, reviving the education of 30 million schoolchildren.

The Cabinet emphasized on strictly implementing precautionary measures, including the use of masks to prevent the spread of Coronavirus.