Prime Minister (PM) Imran Khan-led Pakistan government is said to be planning to ask for relief on the payments for the power projects which have been debt-financed by China over the past eight years, reports Times of India.
Struggling to repay the debt under President Xi Jinping’s Belt and Road Initiative (BRI), Pakistan is said to have engaged with China in informal talks to ease the terms of repayment of debt taken for about a dozen power plants.
Bracing with power shortage, Pakistan had embarked on a large scale build-up of Chinese financed power projects which have now resulted in a surplus. This has created trouble for the Pakistani government who is the sole buyer and pays the producers even when they don’t generate power. As a result, the government is also engaging with the power producers to lower the power rates.
It should be noted that several infrastructure projects funded by China in nations like Sri Lanka and Malasia under BRI have suffered from issues ranging from heavy debt loads to corruption. It should also be noted that the US has called the BRI an initiative which leads to debt traps, a claim which has been denied by China.
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