Rehman Malik asks govt to seek debt relief

Islamabad: Chairman Senate Standing Committee on Interior Senator A. Rehman Malik today on Wednesday released the letter he has written to the Prime Minister Imran Khan proposing him to invoke the Force-Majeure Law for the write-off of debts of IMF, World Bank, USAID and other international financial institutions.

He has urged that international financial institutions should be requested under Force Majeure for deferment of repayments and loans in wake of adverse effects of coronavirus on Pakistan’s economy. In his letter, he has elaborated with arguments the multiple aspects of Pakistan economy and finds Majeure Law the suitable toll to get the foreign loans write-off.

While addressing a press conference through video link, Senator A. Rehman Malik said that he has done a detailed study as to how this Coronavirus Pandemic is going to affect our economy and what measures we should take to survive in the coming months. He said that therefore he sent a letter to Prime Minister to take extraordinary measures and actions before the coronavirus abrupt the Pakistan’s economy totally as because of Coronavirus our production units, services industries, airlines and exports are closed. He said that all revenue generating sources are drying up rapidly and Pakistan will be having major adverse effects of the global economic meltdown which will be far worse than post 9/11. He said “I felt it my national duty to point out in time to my nation and Prime Minister and his financial team that we are being pushed to the precipice of world recession by COVID-19.”

Senator A. Rehman Malik in his letter to PM Imran Khan writes “I, while recapping the situation, write to suggest to you some timely and effective measures that can be taken to mitigate the worsening situation. The alarm bells are warning of a sinking global economy which have already been sounded by the world bodies including UN, WHO, IMF etc., as the supply chains world over have been disrupted. It is evident that it shall take a heavy economical toll on our country, which shall be forced on us for many years to come.”

He added that due to the pandemic, the government has been forced to announce economic package for the needy and helpless common man at the cost of our mutually agreed reforms process already committed to our creditors to ensure the debt servicing and monetary reforms. He expresses that as we are being pushed to the precipice of world recession by COVID-19, he, while recapping the situation, writes to suggest some measures that can be taken to mitigate the situation.

In his letter, Senator A. Rehman Malik urges the Prime Minister Imran Khan that as this pandemic has brought wheel of our economy to stand still hence we need to seek deferment, and possible writing-off of repayments, by establishing prevalence of Force-Majeure circumstances.

He writes “in my view, by establishing Force-Majeure, IMF, World Bank, USAID etc. would be lawfully obliged to grant deferment for these repayments and possibly written off our loans”. He explains that Force-Majeure clause typically applies in cases of a natural disaster, an ‘act of God’ such as an earthquake or pandemic, war or terrorist attacks, or government policy or law changes, or a third party who fails in provision of goods or services, a force-majeure is put into place in order to protect parties from external variables out of their control.

He adds that as such, it is mandatory to include this Force-Majeure clause in the contracts and in case the creditors decline to our genuine and legal force-majeure claim as per the prevailing law as discussed in preceding para then we should activate the Force-Majeure clause before the competent International Court through an accredited lawyer of repute and prove its plausibility to the judge and a jury. However, he says that it is essential that such a claim to be framed after thorough pre-vetting and evaluating our case and we need to draft well-prepared estimates that if the pandemic continues for a longer period, economic recovery would take much longer, hence we should seek a relief of making repayments after 10 years with the request to condone the interest rate or asking for the entire loan to be written off. He further suggests that in support of our arguments, we will need immaculate, verifiable record of the measures we have taken to mitigate the COVID-19 pandemic, and the financial burdens that have been piled up due this pandemic. He explains that our sincere effort to fulfil the commitments made in the past to IMF despite increasingly adverse economic circumstances, State Bank of Pakistan’s policy decisions reflect our good intentions by not defaulting at the cost of suffering of our common man by forcing the suggested reforms of IMF and others. He adds that the balance of loan statement should be prepared and duly certified by the state bank be enclosed with the letter and we must first try to mutually agree on the Force-Majeure situation with our creditors before opting for legal battle.

Senator A. Rehman Malik expresses his hope that we have a strong case and he is confident that Pakistan can even fight it out in the International Court of Justice (ICJ) for this relief on genuine grounds, even if we don’t have a Force-Majeure clause in our contract. As a last resort, we may opt to discharge the performance obligations under the Doctrine of Frustration as it purpose is to provide relief to the disadvantaged party; that we are, since the impact of the Coronavirus Pandemic has left a multitude of inescapable consequences for us leading to the breach of contract due to events which are beyond the reasonable control of Government of Pakistan, his letter reads.

He says that this matter of foreign debts have been deliberated many times in the Senate Standing Committee on Interior as Pakistan is not in the position to repay back these heavy loans due to multiple issues including effects of coronavirus as explained above. (Letter in original is attached with the press release)

CONDEMNATION OF INDIAN BRUTALITIES IN KASHMIR: While addressing the press conference, Senator A. Rehman Malik strongly condemned the Indian Forces unprecedented brutalities against innocent people of Kashmir and Indian Muslims. He said that earlier PM Narednra Modi entry to US was banned for his involvement in terrorist activities and Muslim massacre in Gujrat and now again sane voices from US Senate are raising to ban Modi’s entry. He said that he hopes that soon Modi will be banned from travelling any country of the world for his crimes against humanity. He said that the international community must take notice of PM Narendra Modi crimes against oppressed Kashmiris and Indian Muslims. He said that by introducing new Domicile Law, Modi has violated international laws.

BRIEFING ON TRANSGENDERS ISSUES: Senator A. Rehman Malik told the media that he has sought a report on the medical facilities, financial assistance being provided to the transgenders community during the outbreak of COVID-19. He said that it has been reported in the media and in others reports that Transgenders are not being provided relief packages, financial aid and they are also being deprived of their medical facilities during COVID-19. He expressed that transgenders are the most vulnerable section of our society as they are not only homeless but also have no source of livelihood. Transgenders deserve our full attentions and support and they should be properly taken care of. He has directed that relief packages, financial assistance and ration should be provided immediately to the transgenders with proper medical facilities and the testing and screening of the transgenders for coronavirus should be conducted. The notice issued by his office stated that Chairman Committee has sought report from the Ministry of Interior, each Provincial Government and also from the Chief Commissioner, ICT on the above matter. However, NADRA has also been asked to provide full statistical data of transgenders province wise. The Senate Standing Committee on Interior shall review the government measures taken for transgenders in its next meeting.