Canada has decided to write off Pakistan's 392 million U.S. dollars loan against additional expenditure in education sector, particularly teacher training, to be made by the training institutes over the next five years, according to a Pakistani foreign ministry statement on Friday.

This was the highest ever debt conversion ever undertaken by the Canadian government, the statement said.

A Memorandum of Understanding (MOU) regarding Pakistan-Canada Debt Swap was signed by the Vice President of Canadian International Development Agency (DIDA) and Pakistan's Secretary of Economic Affairs Division Khlid Saeed in Canada, the statement said.

The Economic Affairs Division would establish a special account for the Pakistan Canada Debt Conversion, while a Bi-national Steering Committee would be established to oversee the implementation of debt swap agreement, the statement said.

The agreement was signed in pursuance of the Paris Club III Rescheduling Agreement signed in 2001.

The debt swap agreement was a significant step in reducing Pakistan's external debt burden over the next few years, the statement said.

Source: Xinhua