ISLAMABAD – The Embassy of China in Pakistan has responded over the mediareports of $40 billions CPEC loan repayments.
Chinese embassy in Saturday contradicted a news item appeared in a sectionof press which had claimed that Pakistan would repay $40 billion debt toChina under the China-Pakistan Economic Corridor (CPEC).
“This number of $ 40 billion is wrong and misleading. The CPEC is a majorand important economic cooperation project between China and Pakistan. AllCPEC projects are based on consensus of the two countries, and fully complywith relevant laws and regulations,” said a statement issued by the Chineseembassy.
According to the embassy, currently, 22 early harvest projects under theCPEC had been completed or were under construction, with a total investmentof $18.9 billion. These projects aim at resolving two major bottleneckshindering economic development of Pakistan, namely lack of transportationinfrastructure and energy shortage.View image on Twitterlink[image: View image on Twitter]link
linkBelt and Road & Beyond@BeltandRoadDesklinklink
Clarification on CPEC:“To date, 22 projects are progressing in various stages of implementation.Govt of Pakistan financial liability is only to the tune of US$6 billioncomprising of low interest loans & grants in infrastructure projects spreadover 20-25 years payback period.”4:58 PM – Dec 27, 2018link
– 59 link – 32 people are talking about this link
Twitter Ads info and privacy link
Explaining the financing details of 22 projects, the embassy said theChinese government provided concessional loans of $5.874 billion forPakistan Government’s major transportation infrastructure projects, with acomposite interest rate of around 2% in repayment period of 20-25 years.
Read Top Stories
The Pakistani government provides sovereign guarantee for the above loansand would start the repayment from 2021.
Secondly, the Chinese companies and their partners invested $ 12.8 billionin energy projects in Pakistan. Among them, Chinese companies provide $3billion from their own equity. The rest $9.8 billion is raised fromcommercial banks with interest rate of about 5%. The repayment period is12-18 years.
“All the CPEC energy projects are investment in nature, which is purelyindependent business behavior of these companies. The companies areresponsible for their own profits and losses and repayment of loans. ThePakistani government does not repay these loans under CPEC,” the statementsaid.
The business cooperation between the two sides is in full compliance withinternationally accepted business practice, it added.
Thirdly, the Chinese government provided interest-free loans for ExpresswayEast Bay in Gwadar. Fourthly, the Chinese government provided grant forsome livelihood projects.
Moreover, the Pakistan Government provided funding for the feasibilitystudy of ML-1 upgradation.
“Therefore, Pakistan will repay only $6.017 billion (Category I $5.874billion and Category III $0.143 billion) and their interests to China.China and Pakistan are discussing how to use Chinese grant to implement newprojects such as new Gwadar international airport, Gwadar vocationaltraining center and friendship hospital, etc.,” it said.
