Pakistan’s capability to pay back foreign loan can become weaker if the amount increases further, according to Moody’s Investors Service.
However, Pakistan’s foreign exchange reserves are satisfactory enough to pay back foreign loans, Moody’s stated.
About imports in the country, the investors service said that imports had gone up to fulfil the needs created due to the rise in investment in the country.
Though increase in investment in Pakistan is inevitable, Moody’s noted that the country has attracted heavy investment due to the China-Pakistan Economic Corridor (CPEC). “This rise in investment has called for the need to increase imports.”
China had also asked its state-owned companies to invest in Pakistan and transfer technology to the country under the CPEC.
This was said by Dr Li Jing Feng, director of Regional Studies and Strategic Research Centre at Sichuan Academy of Social Sciences, Beijing, China, at a roundtable on “BCIM-EC & CPEC within China’s Belt-and-Road-Initiatives”.
He also mentioned that Gwadar was more important than Chabahar port as it was a deep sea port and bigger ships could not dock at the Iranian port.
Published in Daily Times, August 25th 2018.
