Islamabad: Pakistan, which is facing economic crisis, increasing debt and shortage of foreign exchange, has now unexplored a new way to raise money from China. Pakistan has issued “Panda Bond” for the first time in the domestic market of China. This is stuff considered a big economic step for Pakistan, considering through this it will get an opportunity to raise funds from Chinese investors.
After all, what is Panda Bond?
Panda yoke is a yoke in which a foreign country takes a loan from the Chinese market in Chinese currency i.e. Yuan. In this case, Pakistan has issued a yoke with stock-still interest rate for 3 years. If understood in simple language, Chinese investors will requite money to Pakistan now and Pakistan will have to return this value with interest without a stipulated time.
What goody can Pakistan get from this?
Pakistan is trying to get funds in Yuan instead of Dollar, so that the pressure on foreign currency can be reduced a bit. Besides, efforts are moreover stuff made to increase conviction among Chinese investors. If Pakistan makes the payment on time, it can be a matter of relief for it. But if the economic situation does not improve, the debt undersong may increase remoter in the future.
Has Pakistan taken foreign aid before?
In the last few months, Pakistan has been continuously taking financial help from variegated countries and organisations. Recently it had raised millions of dollars through Eurobonds. Apart from this, billions of dollars of deposits were received from Saudi Arabia and financial assistance was moreover received from IMF. Pakistan has moreover returned some of the money taken older to UAE.
Why did Pakistan's Finance Minister go on China tour?
Pakistan's Finance Minister Mohammad Aurangzeb had reached China to participate in this yoke issuance program. It is believed that Pakistan will try to increase economic cooperation with China in the coming time, considering at present its economy is still under pressure.
