ISLAMABAD: The Senate Standing Committee on Finance and Revenue has sought detailed briefing from the Finance Ministry about a release of funds of $68 million as per agreement with Export-Import (EXIM) Bank China.
This release was a part of total allocated amount of $ 124 million signed in 2011. “The Finance Ministry will elaborate the current status of the said agreement before the committee today (Monday),” a well placed source at the Finance Ministry told Customs Today here on Saturday, saying that In December 2010, during visit of then Chinese Premier Wen Jiabao, Pakistan and China inked a series of agreements and Memoranda of Understandings on expanding cooperation in economy, energy, security and technology and a year later in same month 2011, both the countries also signed six bilateral agreements worth $700 million, including a Currency Swap Agreement to further bolster their existing trade and economic cooperation.
It is worth mentioning here that established in 1994, Export-Import Bank of China (China EXIMim Bank) is one of three institutional banks in China chartered to implement the state policies in industry, foreign trade, diplomacy, economy, and provide policy financial support so as to promote the export of Chinese products and services as well as is subordinated to the State Council.
The source said that since the signing of the aforesaid agreements between Finance Ministry and EXIM Bank China, a number of developments regarding implementation of the agreements had been made.
“In April last year, on the on the sidelines of Boao Asia Forum 2014, President, EXIM Bank of China Mr. Lui Ruogu held meeting with Prime Minister Muhammad Nawaz Sharif and reiterated bank’s commitment and resolve to continue supporting in financing infrastructure and energy sector projects,” the source observed, saying that Lui Rugu assured support and agreed to gear the pace of financing process.
Similarly the source said that in October last, President, EXIM Bank of China Mr. Lui Ruogu and Finance Minister Ishaq Dar shared their views on various projects of the economic corridor, particularly the importance of project viability and early completion of the projects at a meeting in Beijing.
“In the recent past, in December 2014, Finance Minister Ishaq Dar told Director General Strategic Plans Division (SPD) Lieutenant General Zubair Mahmood Hayat that Exim Bank of China would finance 82% of the overall cost of the K2-K3 nuclear energy projects as energy projects were part of Pak-China Energy Corridor,” the source added.
It is pertinent to note here that six agreements signed in 2011 included, Supplementary Agreement on Extension of Five Year Development Programme on Trade and Economic Cooperation, Inter-Governmental Framework Agreement on Additional Financing for Improvement of KKH ($ 90 million), Concessional Loan Agreement on Additional Financing for Improvement of KKH ($ 90 million), Loan Agreement on Provision of $ 259 million Preferential Buyer’s Credit for KKH (Karakorum Highway) Realignment at Attabad and Loan Agreement on Export Credit Facility of $ 464 million for Power Plant between Guddu Power Company,
The source said that Finance Ministry would also explain before the committee about the possible loss of import duty incurred to the national kitty due to umbrella of concession offered by the government to Chinese exporters.
“Pakistan agreed to eliminate and reduce tariff rates on 5,686 tariff lines under Free Trade Agreement (FTA) which included Elimination of tariff (Three years) 2,423 35.6%, Reduction on Margin of Preference from 50%( five years), Reduction on Margin of Preference from 20%( five years)” the source said adding that Pakistan gave market access to China mainly on machinery, organic, and inorganic chemicals, fruits& vegetables, medicaments and other raw materials for various industries including engineering sector, and intermediary goods for engineering sector etc.
