Pakistan Reader# 510, 12 January 2023
Joel Jacob
On 11 January, Finance Minister Ishaq Dar revealed that almost 90 per cent of pledges made by the international community at a donors’ conference in Geneva for Pakistan were project loans that will be rolled out over the next three years. This comes after the international community committing USD 10 billion to help recover Pakistan from the floods.
During the press conference, Ishaq Dar with other cabinet ministers said that USD 8.7 billion of the pledges were loans but did not reveal what the terms of the loans were. He highlighted the project financing loan which already crossed USD eight billion from ADB, AIIB and the World Bank. He made a statement on Saudi Arabia’s pledging as according to the government it was not clear whether the USD one billion pertains to lending or as a loan. Ishaq Dar further said that these pledges will not solve the immediate dollar liquidity crisis and would further materialise the pledges in creating and designing the feasibilities. Dar asked naysayers to stop spreading panic over “default” rumours, saying such elements must consider national interest above everything.
Prime Minister Shahbaz Sharif said that the government would utilise “every penny” of the pledges made by the international community for the prosperity and rehabilitation of flood-hit people, which according to him would be materialised in the next three years. He said the amount pledged by “friendly countries” showed respect for Pakistan, adding the countries would never have committed the amount had there been reservations over financial irregularities. On tackling the climate challenges, PM Shehbaz Sharif said the government was aware of the globally changing circumstances as the reconstruction process will have to be robust and resilient through modern technology.
Foreign Minister Bilawal Bhutto Zardari termed the PM’s foreign policy as “successful”, saying the government achieved “two targets with a single shot.” He said, “When I say we achieved two targets simultaneously, it means we also dispelled a myth that Pakistan is isolated.”
What was the International Conference on Climate Resilient Pakistan in Geneva?
On 9 January, international donors committed to giving Pakistan over USD 10 billion to help it recover from last year’s devastating floods. Officials from 40 countries as well as private donors and international financial institutions gathered for the meeting, co-hosted by Islamabad and United Nations. Prime Minister Shehbaz Sharif said the country will need USD 16.3 billion over the next three years for the initial efforts to rebuild and improve its ability to withstand climate change. He said Pakistan should be able to cover half the cost but urged the international community to pay for the rest.
Who gave what?
A total amount of USD 9.7 billion was pledged and the Islamic Development Bank held a major share of USD 4.2 billion of total commitments. Saudi Arabia committed USD one billion, China USD 100 million, Qatar USD 25 million, Canada USD 18.6 million, Denmark USD 3.8 million, European Union Euro 87 million, France Euro 80 million, Germany Euro 84 million, Italy Euro 23 million and Azerbaijan USD two million.
What is the response from the opposition?
Imran Khan criticised the expenses incurred at the Geneva Conference and referred to it as merely begging. He also accused the current government’s economic policies, saying that it would further ruin the economy. He also questioned the logic behind taking a large delegation to Geneva. Fawad Chaudhry also said Prime Minister and the cabinet for spending a huge amount on the conference. He pointed out that since the entire conference was held via video link no important leader participated in it.
References:
"Almost 90pc of Geneva pledges are project loans, Dar reveals," Dawn, 11 January 2023
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