China has emerged as Pakistan’s biggest creditor with its “iron brother” accounting for nearly 22 per cent of the country’s external debt, totalling approximately $28.8 billion. The next two biggest lenders are the World Bank with $23.55 billion credit and the Asian Development Bank at $19.63 billion. Critics argue that Pakistan could soon be merely the ‘supplicant in principal bilateral relations.’
Pakistan’s interest payments alone are equivalent to 43 per cent of its export revenues, one of the highest ratios in the world. The country is also among the top three loan recipients from the International Monetary Fund (IMF) this year.
Former finance minister Miftah Ismail told ThePrint that China is Pakistan’s largest creditor because many Chinese companies have built power plants and motorways in Pakistan on credit, which has been good for the Pakistani people and the economy.
“China is one of the few countries in the world on whom Pakistan has already relied and who have always helped Pakistan. That doesn’t mean we shouldn’t have friendly relations with other countries, including those in the region and in the West. However, as friendly as China is, dependency on any external power is never good. Pakistan can and must adopt policies that take it toward self-reliance,” he said.
