Govt not to keep nation hostage to foreign debts: Musharraf

ISLAMABAD: President General Pervez Musharraf has issued directives to obtain foreign loans only under immense urgency and for the uplift projects asserting that government does not want to keep nation hostage to foreign debts.

He issued these directives during a briefing given by advisor to Prime Minister for finance, Dr Salman Shah and advisor to finance ministry and chairman loan committee Dr Ishfaq on overall economic situation of the country and foreign debts.

President reiterated the standard of life of common man has been upgraded owing to the successful and prudent economic policies being pursued by the government. The need is there that these are sustained in future. Un-necessary loans should be avoided as it was done in the past that even the country was kept under mortgage.

He went on to say that the whole nation was sagged under the load of foreign debts. " We are repaying these loans under extremely stressful situation. However, it is good omen that foreign debts graph is declining, he added.

He directed that a special policy be evolved with reference to repayment of foreign loans in next five years. Government should also take steps to maintain the momentum of economic growth.

"Foreign loans should be secured to minimum level. International donor agencies should not be approached to obtain loans to meet the non development expenses, he urged adding the loans be secured on soft terms to meet the targets with reference to development projects and macro-economic framework," he underlined.

Prime Minister Shaukat Aziz while speaking on the occasion informed that government had got approved a law from the parliament to prevent the foreign debts from crossing a specific limit. Under this law no government will be able to obtain loans beyond a set limit. It will have to move the matter to parliament if it goes beyond the limitations.

Prime Minster reiterated that GDP growth rate would be maintained and endeavors would go on to change the quality of life of people.

Immediate steps were initiated to contain inflation and keep rupee price stable and due to these measures inflation rate is on decrease.

Dr Ishfaq told after the session that Pakistan owed $35.8 billion foreign debts. These stayed intact for the last three to four years. We are repaying foreign loans as per schedule, he underlined. Foreign debt increased by 6.6 percent in 1990. Had the situation remained unchanged, the foreign debt would have soared to $97 billion, he feared.

The government soon after coming into office took prompt steps for curtailment in foreign loans. This loan stood at $39 billion in 1998-99 and we had scaled down it to $35 billion, he claimed.

He underlined country economy was robust and government will sustain the growth rate in future under comprehensive strategy. Implementation process on second generation reforms is under way, he noted.