If all the lenders write off Pakistan's $90 billion debt today, Pakistan will successfully get $90 billion worth of loans the very next day
So instead of building Foriegn reserves($20 billion), why dont we pay our debt with that?
I will explain this simplistically in as few lines as possible. Banks give loans to people who can return them not to those who need them. Same with loans given to countries. If people have no-confidence that you will return them, they will demand more interest from you.
The $20bil reserves of Pakistan is a dynamic number. Everyday imports reduce this number, exports increase it. Old loans are paid off with this reserves(because they reach maturity date). New loans are taken.
Now if the reserves are low, new loans will have higher interest rate. So the reserves keep depleting as the interest increases every year.
Let us say Pakistan paid $20 bil of its loans today. Then in one year, the economy will collapse unless government cuts back on essential expenditure or borrow again, because Pakistan is a trade deficit country. And this borrowing cost/interest would be much higher than the interest the country would pay with $20bil reserve.
And that is why Faiez's quote above is true though funny. Pakistan will get cheaper loans if current loans are written off.
Another funny thought:
If you are a Pakistani American, then it is a good business opportunity. You take a million dollar loan in US(there interest rates are now around 1%), then buy Pakistani government issued dollar bonds with it. The bonds will give you 8.5% interest. That way you are helping Pakistan by giving it dollars. If you use the profit to finally invest in Pakistan(buying land or something), then even better for Pakistan.
While population figures are important
But in general population figures are red hearing
Just see what Chinese just realized. and repealed the one child policy.
FYI they have finally realized the folly of concentrating on population control.
Chinese situation is totally different. They repealed one child policy because, they ended up in a situation where there are too few working people to bear too many senior citizens.
The lesson for us, which India has taken is that, do not drastically try to reduce your child births. The one-child generation will bear the burden of twice their population of senior citizens.
The lesson is not to 'don't control population at all'. More population is an asset only if all of it is productively employed and educated. Otherwise they are troublemakers/anarchists in the waiting with no jobs and livelihood. Pakistan needs to seriously control population now. Already the percentage of kids going to school is dropping. Which means unemployed/employed ratio is increasing, an impending law and order nightmare.