The economy of neighboring country Pakistan is going through a critical phase. China is being held responsible for the economic crisis in Pakistan. By 2023, Pakistan has a debt of about 125 billion US dollars. One third of this loan has been taken by China alone. China has already grabbed the land of many countries on the pretext of giving them loans.
Statement of Pakistan Foreign Minister
Pakistan’s acting Finance Minister Shamshad Akhtar said that despite the reforms, Pakistan’s economy remains fragile. The country, which is facing cash crunch, will have to take more loans from the IMF for some time. Akhtar said that if the economy is to be strengthened in Pakistan, there is a need to carry out major financial reforms. The country will not survive without it. We may probably need another EFF (Extended Fund Facility). We will remain with the IMF.
china interest rates
The cost of the CPEC project being run by China in Pakistan is about 25 billion US dollars. The interest rates on loans received by Pakistan from China are more than 7 percent. Whereas IMF gives interest at 2 percent. China’s interest rates are much higher than those of lenders like the IMF.
Sri Lanka has become China’s victim
China has always been working on the policy of ‘grabbing land by giving loan’. Sri Lanka was so burdened by China’s debt that it gave Hambantota port to China on a 99-year lease.