China refutes report claiming repayment of $40b debt by Pakistan

China refutes report claiming repayment of $40b debt by Pakistan

Islamabad (Agencies): The Chinese embassy in Pakistan rejected a news item appeared in a section of press, claiming that Pakistan would repay $40 billion debt to China under the China-Pakistan Economic Corridor (CPEC).

According to a statement issued by the embassy, the figure of forty billion US dollars is wrong and misleading.

The embassy said the Chinese government provided concessional loans of 5.874 billion dollars to Pakistan Government's major transportation infrastructure projects, with a composite interest rate of around 2% in repayment period of 20-25 years.

Currently, 22 early harvest projects under the CPEC had been completed or were under construction, with a total investment of $18.9 billion. These projects aim at resolving two major bottlenecks hindering economic development of Pakistan, namely lack of transportation infrastructure and energy shortage.

The embassy further said all the CPEC energy projects are investment in nature and the companies are responsible for their own profits and losses and repayment of loans.

The statement said the Chinese government provided interest-free loans for Expressway East Bay in Gwadar and provided grant for some livelihood projects.      

In nutshell, Pakistan will repay only 6.017 billion dollars along with interest to China.