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In relief for Pakistan, South Korea defers loan worth millions

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The government of Pakistan signs agreement with the Republic of Korea under the G-20 Debt Service Suspension Initiative on May 15, 2023 in Islamabad. — PID

The Republic of Korea on Monday differed Pakistan’s loan worth $19.911 million on Monday, under the G-20 Debt Service Suspension Initiative (DSSI) framework as Islamabad battles a worsening economic crisis.

According to the details, the cash-strapped country inked a Debt Service Suspension Agreement with Korea today. This amount, initially had to be repaid between July and December 2021, will now be repaid over a period of six years (including one-year grace period) in semi-annual installments, said a press release issued by the Economic Affairs Division (EAD).

Due to the support extended by the development partners of Pakistan, the G-20 DSSI has provided the fiscal space which was necessary to deal with urgent health and economic needs of the country.

The total amount of debt, that is to be suspended under the DSSI framework, covering the period of repayment from May 2020 to December 2021, stands at $3,686 million.

Pakistan has already concluded and signed 104 agreements with 21 bilateral creditors for the deferment of its debt repayments under the G-20 DSSI, amounting to $3,633 million.

The signing of above-mentioned agreement brings this total to $3,653 million. Negotiations for the remaining agreements to be signed under the G-20 DSSI are on-going.





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