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Pakistan requires USD 76.19 bln to pay off debts

ISLAMABAD, Oct 19 (KUNA) -- The International Monetary Fund's (IMF) Fiscal Monitor Report estimates that Pakistan requires at least USD 76.19 billion or 30 percent of its GDP each year to pay off its maturing debt.
Pakistan at top of the 27 developing countries where 29.9 percent of GDP is required in fiscal 2013-14 to pay off debts against the 25 percent of GDP in last financial 2012-13. According to IMF, gross financing needs in advanced economies, though still large, have stabilized at about 22 per cent of GDP.
The size of Pakistan's economy stands at USD 247.62 billion where USD 76.19 billion is required for the payment of the matured debts in the current fiscal 2013-14, placing Pakistan firmly at the top of the list of indebted emerging countries. Earlier, the board of IMF has approved a USD 6.7 billion loan package for Pakistan to help the nation revive its ailing economy, filling up the reserves just in time as the central bank of Pakistan was left with USD 5 billion in foreign currency reserves.
According to the estimates by Asian Development Bank, Pakistan needs USD 6 billion to USD 9 billion to meet its requirements including about USD 5 billion in outstanding debt as it averted a balance of payments crisis in 2008 by securing USD 11 billion IMF loan. The loans by IMF generally come up with some conditions for economic reforms and Pakistani government had to cut down subsidies on electricity and send out notices to 10,000 delinquent taxpayers for the approval of the fund.
Pakistan has one of the lowest tax-to-GDP ratios in the world. The government has recently imposed an average increase of more than 35 percent after including 17 percent GST to the consumers of higher slab who use more than 300 units of electricity per month. Egypt, Jordan, Hungary, and Pakistan are among the countries whose requirement for repayment of debts exceeds 20 percent of GDP, reflecting short maturities and high deficits. (end) sbk.mt KUNA 191015 Oct 13NNNN