§ Mr. Clark Hutchison
asked the Secretary of State for Commonwealth Relations and the Colonies whether he will continue to provide loans to India and Pakistan on the easier terms which he announced in the House on 17th July, 1963.
§ Mr. Sandys
Yes. At recent meetings of the aid Consortia held under the aegis of the World Bank we undertook to make available additional aid amounting to £30 million to India and £8 million to Pakistan for the year 1964–65. This aid will be in the form of loans under434W Section 3 of the Export Guarantees Act, 1949. The repayment of these loans, as of the loans to which I referred last July, will be over a period of 25 years including a grace period of seven years in which no repayments of principal will be required. As last year, we have agreed also to waive interest during the first seven years of the loans.
The cost of the waiver of interest will be borne on the Commonwealth Grants and Loans Vote. Payments will be made from that Vote to the Acquisition of Guaranteed Securities Fund—which is administered by the Export Credits Guarantee Department—in order to recompense the Fund for the interest waived. Parliament will be asked in due course to approve a Supplementary Estimate in respect of the current financial year. Meanwhile, if necessary, advances will be obtained from the Civil Contingencies Fund.