Karachi: The G20 countries on Wednesday announced their decision to include Pakistan in the group of countries to be offered debt relief on all interest and principal payments to official bilateral creditors, according to news sources.
The decision was made after a meeting
of G20 countries in Riyadh. The session was held as a result of the
International Monetary Fund (IMF) and the World Bank (WB)’s appeal to extend
debt relief to economically disadvantaged countries — to enable them to free up
their resources amid the global coronavirus crises.
The G20 approved of all the countries categorized under the WB’s International Development Association (IDA) to be included in the proposed plan for debt relief. Pakistan in one of 76 countries included in this IDA group.
The debt relief suspension period
starts from May 1 and will continue till December 1. The due debts during this
period will be packaged into a new loan for which the payments will start in
June 2022 — to be paid over three subsequent years. The group has prepared a
standardized term sheet for the payment added in this relief plan.
The G20 countries, the IMF and the
WB are still mulling whether to extend the suspension period to June 2021,
depending on the evolving situation. The definition of ‘official bilateral
creditors’ hasn’t yet been finalised either.
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