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ISLAMABAD: Adviser to Prime Minister on Climate Change Malik Amin Aslam Wednesday said Pakistan was going to offer debt for nature swap for innovative financing of 10 billion tree tsunami (TBTT) project to bridge its financing gap.

Ministry of Climate Change had come up with a modern financing mechanism for 10BTT project by offering debt for nature swap.

A policy meeting was chaired by the Adviser Malik Amin Aslam in order to devise a mechanism for debt swap with potential countries, a press release said.

Addressing the committee, he said that TBTT project would cost Rs 125 billion (US$ 800 million) whereas the government had allocated an amount of Rs 7.5 billion for the current financial year.

There was a financing gap of US$ 754 million over the period of four years, Amin said.

“This is the golden opportunity to bridge the financing gap for the project of utmost importance. Pakistan has already done this practice for education and rehabilitation sectors in the past with Canada, Germany, Italy, Norway and Belgium,” he added.

The adviser was also briefed by the representatives of the UNDP on the proposed mechanism.

After the finalization, strategy would be presented to the Federal Cabinet for its approval.

While chairing the meeting, Amin Aslama appreciated the idea and directed the relevant departments to immediately start working on the strategy.

The adviser was informed that many countries in the world had availed the opportunity of debt swapping for nature with Paris Club and others.

Most of these countries belonged to Latin America and Africa. It merits mention here that Pakistan’s external debt stands at USD 85 Billion while the largest component of annual budget goes for debt servicing.

Swapping of even a Billion Dollars of debt against TBTT would not only help bridging the financing gap but would also prove a respite amid current fiscal struggle and balance of payment.

Further details of the debt swap mechanism will be available once the strategy is finalized.

Copyright APP (Associated Press of Pakistan), 2019