Beijing, July 26 – Pakistan’s Finance Minister Muhammad Aurangzeb has arrived in Beijing to discuss debt relief and structural reforms with Chinese officials, alongside Power Minister Awais Leghari.
The delegation is seeking to reprofile nearly $15 billion in energy sector debt, as part of efforts to address the country’s economic challenges. The meeting comes after the International Monetary Fund (IMF) agreed to a $7 billion bailout for Pakistan, but raised concerns over high rates of power theft and distribution losses.
“Pakistan is committed to implementing structural reforms to reduce ‘circular debt’ and strengthen tax revenue generation,” Aurangzeb said in a statement. “We believe that China, as a longtime ally, can play a crucial role in supporting our efforts.”
The Pakistani government is aiming to reduce “circular debt” by 100 billion Pakistani rupees ($360 million) annually, through measures such as increasing power tariffs and improving distribution efficiency.
China has invested over $20 billion in planned energy projects in Pakistan, and has helped the country meet its external financing needs in the past. The two countries share a border and have a long history of cooperation.
The meeting between Aurangzeb and Chinese Finance Minister Lan Fo’an is seen as a crucial step in securing debt relief and support for Pakistan’s economic reform agenda.
