The President's Office has revealed that the Chinese government has deferred the repayments of certain loans scheduled for the year 2021.

Chief Communications Strategist at the President's Office, Ibrahim Hood revealed to "One" that the deferment was finalised under the Group of Twenty (G20) Debt Service Suspension Initiative (DSSI). Under the World Bank's initiative, G-20 countries made commitments to the DSSI in April, pledging to suspend debt service for low-income countries on official bilateral credits.

The initiative also applies to other loans taken from European countries as well, hence no repayments are mandatory for the first six months for any loans taken from a European country either.

The Finance Ministry also highlighted the six month deferment period in the 2021 budget and noted that MVR 809.1 million could be spared from loan repayments from the 2021 budget due to the initiative.

While China had deferred some loan repayments, Speaker of Parliament Mohamed Nasheed had described a major country such as China strictly insisting on loan repayments from a small nation, according to pre-COVID terms, as 'unfair'.

According to the Ministry of Finance, national debt is projected to reach MVR 70.3 billion by the end of 2020 while this figure would rise to MVR 82.8 billion by the end of 2021.