The United Kingdom (UK) has announced to provide 1 billion pounds for projects in Pakistan. It has encouraged its firms to set up facilities in Pakistan.
UK’s Her Majesty’s Regional Trade Commissioner for the Middle East, Afghanistan, and Pakistan (MEAP) region, Simon Penny, said that the Kingdom is increasing its funding to Pakistan from 400 million pounds to one billion pounds.
The country will offer funds for projects like roads, infrastructure, schools, and hospitals. “I think this is a very good example of how the UK is having confidence over Pakistan. It is a very important market for us,” he said.
Penny told that the UK used to provide funding to its firms for doing business in other countries through export credit agency, UK Export Finance (UKEF). However, now the funding will be made available for Pakistani companies as well.
“For making that money available, we look for borrowers of that money to a source of a minimum of 20 percent of the project from the UK, which is very favorable. It also provided a very safe return [of money] in terms of the law of the land which is…10 years or longer,” said the dignitary.
The main goal of this funding is to ensure finances for the projects that would not transpire just because the private sector is lacking funds. It is not meant to compete with the private sector or commercial banks. For instance, banks are reluctant to provide funding for a long period like 10 years.
Apart from the funding, the Kingdom is also planning to introduce a project for encouraging more companies to invest in Pakistan.
“We are very much focused on it [encouraging more companies to enter into Pakistan]. How do we sell Pakistan’s investment stories internationally… there are many opportunities for international businesses in the UK to do business here,” he said.
Penny further acknowledged that Pakistan has improved on the World Bank’s (WB) ease of doing business index because of which the UK is very encouraged to invest in Pakistan.