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Foreign loans soar to $10.4b in Jul-Dec

Norwegian

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I don't get one thing. We are offering bonds with interest rate of 6-8% by-annual. Similarly we are taking loans on an interest rate of 4-5% . Instead why not take $100 billion loan from China for 20 years and 5 years grace period ? I am sure they will offer 3% interest rate as I think that is what they keep charging from us for different loans. Correct me if I am wrong. So why not pay everyone else and instead you pay to one country each year after that ? Like $5-7 billion ? I am sure it's way less then the current 15-20 billion $ we keep paying each year out of which majority goes to debt servicing and only $2-3 billion in principle. But for that we have already taken $20 billion more loans so our loans never decrease and keep increasing at a rate of $10 billion each year. We need to sign this strategic deal with China ASAP otherwise we will keep our country at its toes and won't be able to succeed.
China is not IMF. Also Pakistan owes billions of dollars to China in CPEC projects
 

Wood

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I don't get one thing. We are offering bonds with interest rate of 6-8% by-annual. Similarly we are taking loans on an interest rate of 4-5% . Instead why not take $100 billion loan from China for 20 years and 5 years grace period ? I am sure they will offer 3% interest rate as I think that is what they keep charging from us for different loans. Correct me if I am wrong. So why not pay everyone else and instead you pay to one country each year after that ? Like $5-7 billion ? I am sure it's way less then the current 15-20 billion $ we keep paying each year out of which majority goes to debt servicing and only $2-3 billion in principle. But for that we have already taken $20 billion more loans so our loans never decrease and keep increasing at a rate of $10 billion each year. We need to sign this strategic deal with China ASAP otherwise we will keep our country at its toes and won't be able to succeed.
Pakistan can reasonably expect China to reschedule the loan payments that are due under CPEC. Before you think that China will be ready to give a massive $100 billion loan to Pakistan, consider the following:

a) Imran Khan swore to never take a loan with IMF before being elected. Like most right leaning Pakistanis, he seems to harbor a romantic notion about the Pakistani relationship with Chinese. But later, he took loans from IMF and not from China. What does it tell you?
b) Pakistan recently took a billion dollar loan from Saudi at 4% interest rate. Why would Pakistan do that if they had a cheaper Chinese option?

China (like any other country) will be willing to loan money to Pakistan (or any allied nation) based on the assumed risk - reward ratio of individual projects that the money will be directed to. CPEC works the same way. You cannot expect the Chinese to dole out arbitrary loans at rates assumed by the borrower.
 

fisher1

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PTI is taking loan to return the previous loan taken by the ghunda league..now tell us why the ghunda league taken 45 billions dollar loan in there last 5 years ?? Socho bhai dimag use karo

Yes like I said Imran Khan loans are halal and good. Anything Imran Khan does is for our own good even though we don't that good but he will shove it down our throats and tell us how good it is.

Pakistanis should come out on streets and celebrate that Imran Khan is taking loans.
 

RealNapster

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China is not IMF. Also Pakistan owes billions of dollars to China in CPEC projects

China is more willing to offer "strategic deals" to Pakistan if we present our case. And after all, it's just a loan. Chinese banks (obviously with Chinese government go ahead and concessions) can easily pay the $100 billion billion in return for 3% per annum interest.

Pakistan can reasonably expect China to reschedule the loan payments that are due under CPEC. Before you think that China will be ready to give a massive $100 billion loan to Pakistan, consider the following:

a) Imran Khan swore to never take a loan with IMF before being elected. Like most right leaning Pakistanis, he seems to harbor a romantic notion about the Pakistani relationship with Chinese. But later, he took loans from IMF and not from China. What does it tell you?
b) Pakistan recently took a billion dollar loan from Saudi at 4% interest rate. Why would Pakistan do that if they had a cheaper Chinese option?

China (like any other country) will be willing to loan money to Pakistan (or any allied nation) based on the assumed risk - reward ratio of individual projects that the money will be directed to. CPEC works the same way. You cannot expect the Chinese to dole out arbitrary loans at rates assumed by the borrower.

The proposed Money directed to no project instead it's used to pay the existing loans and interest. If China can buy US debt for 3-4% per annum why do you think China won't do the same in our case ? But with some concessions ?
 

fisher1

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China is more willing to offer "strategic deals" to Pakistan if we present our case. And after all, it's just a loan. Chinese banks (obviously with Chinese government go ahead and concessions) can easily pay the $100 billion billion in return for 3% per annum interest.

Are you aware of what China is doing to Uighurs Muslims and the debt trap it is leaving African countries in? Including taking control of their airports because they couldn't pay. is that really the direction you want Pakistan to head in?

IMF is bad but China is 1000 times worse. Pakistan can't dare utter one word against China and we aren't in their debt like we are of IMF, imagine if we got serious loans from China, they will become de facto rulers of Pakistan

Death will be better than being ruled by CCP, just ask Uighurs who beg for death
 

RealNapster

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Are you aware of what China is doing to Uighurs Muslims and the debt trap it is leaving African countries in? Including taking control of their airports because they couldn't pay. is that really the direction you want Pakistan to head in?

IMF is bad but China is 1000 times worse. Pakistan can't dare utter one word against China and we aren't in their debt like we are of IMF, imagine if we got serious loans from China, they will become de facto rulers of Pakistan

Death will be better than being ruled by CCP, just ask Uighurs who beg for death

Are you aware what USA is doing with Iraq, Libya, Syria and other Muslim nations ? You still using GPS, internet, iPhone and other Apple products while planning to buy a Tesla ? Jsut tell me how is America 1000 times less evil then China ?

I know that everyone is 1000 times worse when it come to their policies. No country is angle nor is anyone complete Satan. How you use a country for your benefit is what matters the most.

Pakistan can't dare utter one word against China and we aren't in their debt like we are of IMF, imagine if we got serious loans from China, they will become de facto rulers of Pakistan

We keep taking loans from IMF and American influence is so much in Pakistan that retired ranks kept saying that even ay chief selection is not possible without USA go ahead. Only that person make it through who USA okay.

And the worst past is, you don't have to imagine that because its already happened and still happening to some extent.
 

Wood

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The proposed Money directed to no project instead it's used to pay the existing loans and interest. If China can buy US debt for 3-4% per annum why do you think China won't do the same in our case ? But with some concessions ?
The American debt is seen as an asset because of the default status of USD. China helps US maintain its default currency status by buying Federal debt. US can never default on its loans that are in USD.

Pakistan's debt on the other hand is high risk to the point that the buyer is likely to see it as more of a liability than an asset. You'll need to realize that interest rates are determined based on the perception of risk of the borrower's default. Pakistan does not have the same credit rating as US.
 

RealNapster

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The American debt is seen as an asset because of the default status of USD. China helps US maintain its default currency status by buying Federal debt. US can never default on its loans that are in USD.

Pakistan's debt on the other hand is high risk to the point that the buyer is likely to see it as more of a liability than an asset. You'll need to realize that interest rates are determined based on the perception of risk of the borrower's default. Pakistan does not have the same credit rating as US.

In the start I proposed this scheme and used the word "Strategic deal" for it because of the above mentioned reasons. China won't take such a initiative on a purely business minded way but more on a strategic way. They still get 2-2.5% interest rate but really help out Pakistan in getting it out of the jaws of piranhas.
 

Wood

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In the start I proposed this scheme and used the word "Strategic deal" for it because of the above mentioned reasons. China won't take such a initiative on a purely business minded way but more on a strategic way. They still get 2-2.5% interest rate but really help out Pakistan in getting it out of the jaws of piranhas.
I was misled because you phrase this 'deal' as an option that is on the table for Pakistan to take. It is rather a wish from you - that China would shoulder Pakistan's economic stability. In reality, the Chinese state may or may not choose to shoulder Pakistan. That is the Chinese prerogative and Pakistan cannot force their hand in the matter. The evidence so far indicates that Pakistani gov. has not been able extract such special external debt consolidation loans from China.
 

RealNapster

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I was misled because you phrase this 'deal' as an option that is on the table for Pakistan to take. It is rather a wish from you - that China would shoulder Pakistan's economic stability. In reality, the Chinese state may or may not choose to shoulder Pakistan. That is the Chinese prerogative and Pakistan cannot force their hand in the matter. The evidence so far indicates that Pakistani gov. has not been able extract such special external debt consolidation loans from China.

Yes it is my wish and actually if you have read my posts from past I am proposing such a deal since a year.

1. Pakistan failed to get such a consideration from China because we never asked for it. All we keep asking them is for 2-3 billion $ now and then which they always deposit without any problem.

2. Its always a no till you don't ask for it. Only then you know the exact answer.

3. China can not afford a destabilised Pakistan. It is the only Chinese ally which is doing fine (relatively. Everyone else is pretty much fcuked up). The reasons China keep arming Pakistan on concession rate weapons is to keep it able to counter India otherwise Indian major focus shift from Pakistan towards China.

4. It is a friend and pochna to banta hy
 

Wood

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1. Pakistan failed to get such a consideration from China because we never asked for it. All we keep asking them is for 2-3 billion $ now and then which they always deposit without any problem.
How do you know that Pakistan has never made a proposal for such an arrangement in all the different back door discussions between both parties?

3. China can not afford a destabilised Pakistan. It is the only Chinese ally which is doing fine (relatively. Everyone else is pretty much fcuked up). The reasons China keep arming Pakistan on concession rate weapons is to keep it able to counter India otherwise Indian major focus shift from Pakistan towards China.
You underestimate the Chinese.

While Pakistan's well being is in China's strategic interest, it is not quintessential necessity for them to deal with India. China needs a big ally to be able to deal with America and its partners. Russia is today the biggest ally of China, not Pakistan.
 

RealNapster

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How do you know that Pakistan has never made a proposal for such an arrangement in all the different back door discussions between both parties?

Because in Pakistani beurecracy and political class everyone have a hole in their mouth through which they spell everything out. Trust me if there was such a thing under consideration ,you would have already heard about it.

You underestimate the Chinese.

While Pakistan's well being is in China's strategic interest, it is not quintessential necessity for them to deal with India. China needs a big ally to be able to deal with America and its partners. Russia is today the biggest ally of China, not Pakistan

Russia is biggest in that part of the world. Pakistan is the most important one in this part of the world.
 

The Accountant

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I don't get one thing. We are offering bonds with interest rate of 6-8% by-annual. Similarly we are taking loans on an interest rate of 4-5% . Instead why not take $100 billion loan from China for 20 years and 5 years grace period ? I am sure they will offer 3% interest rate as I think that is what they keep charging from us for different loans. Correct me if I am wrong. So why not pay everyone else and instead you pay to one country each year after that ? Like $5-7 billion ? I am sure it's way less then the current 15-20 billion $ we keep paying each year out of which majority goes to debt servicing and only $2-3 billion in principle. But for that we have already taken $20 billion more loans so our loans never decrease and keep increasing at a rate of $10 billion each year. We need to sign this strategic deal with China ASAP otherwise we will keep our country at its toes and won't be able to succeed.
China will not offer loan unless we agree to become a vessel state ...
 

Affan-khan

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