Pakistan, Denmark discuss Inter-Governmental Framework Agreement

Islamabad: Ambassador of Denmark to Pakistan Lis Rosenholm called on Federal Minister for Economic Affairs Sardar Ayaz Sadiq in his office on Friday.

The Inter-Governmental Framework Agreement between Denmark and Pakistan and matters of mutual interest were discussed in the meeting, said a press release issued by EAD here.

The minister apprised the ambassador that Pakistan and Denmark enjoy a friendly and cordial relationship and a lot of potential exists to enhance the relationship between both nations. He mentioned that the efforts to revive bilateral economic and development cooperation between the two countries paid off with Denmark agreeing to provide on-budget support to Pakistan through the Inter-Governmental Framework Agreement.

He appreciated the focus on Waste Water Treatment Projects in Faisalabad and Lahore. He apprised the envoy about the projects already in the pipeline with the support of development partners including AFD, ADB, and JICA on Water Waste Management.

The ambassador highlighted that the framework agreement is a strategic agreement that would further open numerous possibilities to identify more areas of cooperation. She put special focus on collaboration in areas including climate change, water waste management, renewable energy, and green infrastructure.

This agreement offers the Danida Sustainable Infrastructure Finance (DSIF) Facility by the Danish side which would provide interest-free but tied loans up to but not limited to €100 million aimed at the transfer of technology and know-how.

The interest-free loans after signing this framework agreement will have a 35 percent concessional element covering the interest on the loan, export premium, bank margin, and an upfront grant if these expenses do not arrive at 35 percent of the contract amount. The loans would have a 10-year maturity period generally and 15 years can be accommodated in exceptional cases.

The minister appreciated the idea and further discussed the potential sectors in which collaboration is needed. He also highlighted the current flood situation in the country and expressed the need for collaboration to strengthen flood resilience.

He stressed the exchange of trade delegations that can help in promoting and enhancing economic and trade relations. Moreover, he stressed having joint ventures with Danish companies for increasing the production and export of dairy products with a special focus on cheese production.