German Deputy Minister meets Finance Minister, Financing Agreements Signed

The Finance Minister Senator Mohammad Ishaq Dar received the German Deputy Minister for Economic Cooperation, Thomas Silberhorn for a meeting here on Wednesday.

Welcoming the Deputy Minister, Mr. Ishaq Dar acknowledged the increase in German development and economic assistance over the past few years. He reiterated the engagement with Germany in the sectors of energy, health, governance and education. He said Pakistan would also like to expand its cooperation with Germany in the spheres of trade, science and technology, automobile industry, manufacturing and renewable energy projects.

The German Deputy Minister on this occasion referred to the upcoming Pak-German Bilateral Negotiations to be held in Berlin from 28th – 30th October, 2015 and hoped they would further expand bilateral cooperation. He apprised the Minister about the Financing Agreements between EAD, Pakistan and KFW of Germany on economic cooperation. He said this was an example of Germany’s continued support to Pakistan for development in different sectors.

Minister Dar while appreciating German assistance for TDPs and development work in FATA underlined that all support activities to FATA is spearheaded by the Federal Government, therefore all efforts must coincide and supplement instead of  duplication or overlapping. He also called upon the German side for revisiting the Bilateral Agreement between the Government of Pakistan and Federal Republic of Germany which was signed in 1972. He said as a result of subsequent legislative and economic developments on both sides, relevant changes are required in the Agreement which may be discussed during the upcoming Bilateral Negotiations.

The German Deputy Minister for Economic Cooperation said that Bilateral development cooperation between Pakistan and Germany commenced as early as 1961.  Pakistan was the first country to avail economic assistance from Germany in that year, he said. The two sides celebrated the 50th anniversary of development cooperation in 2011. Germany is providing financial assistance through KFW and technical assistance through GIZ. 

Mr. Silberhorn appreciated Pakistan’s structural reform efforts and achievement of economic stability. He also invited Finance Minister Dar’s attention to the ADB Board of Governors meeting being held in Frankfurt in May next year and said we would be eager to see you participate in the meeting. Minister Dar said that he would attend the ADB meeting.

Both sides on this occasion agreed in principle on establishment of  the Pakistan Microfinance Investment Company  which is jointly funded by KFW Germany, DFID UK and c (Pakistan Poverty Alleviation Fund) and aims to further strengthen and develop the microfinance sector in Pakistan

An agreement signing ceremony followed the meeting in which three Financing Agreements for German development cooperation to Pakistan were signed. These include (i) Euro 10 million grant agreement for the Reintegration and Rehabilitation for Temporarily Displaced Persons in Federally Administered Tribal Areas (FATA) (ii) Euro 10 million grant agreement for the Regional Infrastructure Fund KP. (iii) Euro 40 million loan agreement for the Rehabilitation of Warsak Hydropower plant.

The Project “Reintegration and Rehabilitation for Temporarily Displaced Persons in FATA” aims to support the return of the TDPs to FATA and to contribute to the rehabilitation of the affected areas. The project “Regional Infrastructure Fund in Khyber Pakhtunkhwa” aims to strengthen the implementation capacities of District Administration and to enhance participation of the population in the decision making process at district level. The “Warsak Dam Rehabilitation Project” aims at the rehabilitation of 55 years old hydropower project for restoring its power generation capacity to 243 MW from 180 MW.

Secretary Finance, Dr. Waqar Masood Khan, Secretary EAD, Saleem Sethi and senior officials of Ministry of Finance and Economic Affairs Division attended the meeting.