Pakistan, which came under the guise of the Beld and Road Initiative, is now badly trapped. For the power projects, Pakistan, which has been taking heavy loans from China in the last 8 years, is no longer able to repay the installment. In such a situation, he is now preparing to seek relief from his alleged ‘evergreen friend’. However, before this, many small countries have lost a lot of their money by getting caught in this move of China.
According to a person aware of the matter, Pakistan and China have held informal discussions for relief in repayment of loan installment for about a dozen power plants. On the condition of keeping the name confidential, he said that Islamabad has not yet formally appealed.
To overcome the power shortage, Pakistan had imposed these power projects by taking loans from China, but the production started exceeding what Pakistan cannot afford. Many countries from Sri Lanka to Malaysia have suffered due to heavy debt of China. From the Ministry of Foreign Affairs and Finance of China to the Power Division of Pakistan, it has refused to say anything in this matter.
China has rejected criticism of the US that the Beld & Road Initiative has turned into a debt trap. However, he admitted that countries were facing difficulty in repaying loans due to the global slowdown caused by the epidemic. Last year, Beijing provided debt relief to 15 African countries by the end of 2020. Pakistan has signed $ 11 billion projects last year under the Beld and Road Program, most of which are to change the situation in the country’s railways.
China’s loan helped Pakistan in energy supply, but it started generating more power than needed. This has become a big problem for the government of Islamabad, because only he is the buyer of this electricity and he has to pay money even when they do not produce. For this, the government has also talked to power plants, which produce about half a billy at a lower price.