ISLAMABAD: Defending the controversial $500 million Eurobond launch as a success, Finance Minister Ishaq Dar said on Wednesday that the United States was expected to reimburse in a few days about $375m to Pakistan under the Coalition Support Fund (CSF).

“Positive news on the CSF is that reimbursements for the Sept 2014 quarter would be available to us over the next 3-4 days,” he said at a news conference after returning from the US to report approval by IMF of $504m tranche, launch of the expensive $500m Eurobond and other meetings.

He said the process for the launch of Eurobond was started when international capital markets were normal and before the slowdown in China. He said the decision to launch the bond was taken to cover for the repayment of $500m bond launched in 2006, due early next year, instead of draining foreign exchange reserves.

Also read: IMF announces immediate disbursement of $504m to Pakistan

The minister said based on positive awareness about the country’s “economic achievements”, it was decided to hold four road shows in the international market instead of eight in all past transactions. In all, 80 leading international investors had subscribed to the Pakistani paper that was double the asking size of $500m.

He said 38pc subscription went to the UK and US each, followed by 12pc investors of Europe and 12pc to Asian and Middle Eastern investors. It was important to remain in the international capital market through bonds, sukuk and equity products as predicted by Jetro of Japan to ensure Pakistan became second choicest place for international investors in a few years, he added.

He said many other countries had cancelled their bond offerings and Pakistan’s financial advisers had also proposed so, but with the approval of the prime minister it was decided to test the country’s worth in the worst of situations and global market turmoil.

Mr Dar did not agree with critics that the bond was expensive or it would add to the country’s total public debt. He said the 10-year Pakistan Investment Bond carried 9.33pc cost that would be retired by the State Bank of Pakistan with induction of fresh Eurobond and as such expensive domestic debt would come down.

He said it was not a good option to cancel the transaction at the eleventh hour. “It was a prudent decision. We have no regrets because it is in the interest of Pakistan.”

The finance minister said he had held discussions with the US treasury secretary on CSF disbursements.

He said the reimbursements of two quarters until Dec 31, 2014, were still outstanding while allocations for 2015-16 were estimated at $900m to $1 billion. It would be reimbursed in due course.

He denied that he was contemplating reshuffle in the officialdom of five divisions under his ministry for some recent failures, including taxes and bond launch. “I am impressed by the performance, but some routine changes should not be seen in this context.”

In reply to a question about another IMF programme, the minister said it was too premature to comment because the current programme still had a year to run and expressed the hope that economic indicators would improve to an extent that the country should not require another programme.

Responding to a question on partial suspension of the recent agriculture package by the Election Commission of Pakistan, Mr Dar said 70pc of the farming community had suffered after fall in commodity process.

He said if the benefits announced in the package were denied for two-three months to farmers, the government would respect the ECP decision, but farmers should hold opponents accountable.

Published in Dawn October 1st, 2015

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