ISLAMABAD, Sept 16: Pakistan is working on a plan to hedge its $600 million Sukuk bond, which was issued in January with a spread of 220 basis points over six-month LIBOR (London Inter-bank Offered Rate). This was stated by Ashfaque Hassan Khan, an economic adviser and director general of the Debt Management Office of the finance ministry.

Pakistan has gone to the international capital market twice in the last 20 months, to issue a eurobond and a Sukuk, a form of Islamic bond. It plans to issue another eurobond this year or at the start of 2006 as part of a plan to go to the market around once a year.

“The Sukuk that we had issued was on floating rate. We are trying to hedge it — from float to fix,” Mr Khan added.

A number of local and international banks had offered their products in this regard, but the ministry had decided to design its own and then approach interested banks, Mr Khan said.

He said the government also wanted to raise money abroad for state-owned companies by issuing global depository receipts.

“We have not yet selected any entity. Presently, we are in the process of looking for a lead manager for this,” he said, adding that the work would be done by the end of the current fiscal year on June 30, 2006.—Reuters