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April 24, 2002
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Wednesday
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Safar 10, 1423
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Supplemental US aid
French voters shock
Hockey infrastructure
Supplemental US aid
IT is an indication of the continued American interest in Pakistan’s economic development that President Bush has sent a supplemental request to Congress for an additional $145 million in aid for the current financial year. This will bring the total US aid to Pakistan for the current year to $746 million. The immediate impact of this assistance will be reflected in our balance of payments position, which since 9/11 has started showing signs of significant improvement. Finance Minister Shaukat Aziz, who has been meeting the US officials, including Treasury Secretary Paul O’Neill, in connection with the setting up of a joint US-Pakistan economic forum, has said that Washington is at the moment also firming up the amount of assistance for Islamabad in the next US financial year commencing from Sept 1, 2002. This, again, is welcome news.
The bulk of the money amounting to $75 million from supplemental assistance has appropriately been allocated for border security, $40 million for infrastructure, and smaller sums for counter-narcotics and counter-terrorism. The first meeting of the joint economic forum, held last week, reviewed global and regional economic and financial developments, exchanged views on efforts to increase global economic growth, and discussed the economic reforms being implemented in Pakistan to support a more rapid, broad-based and job-creating growth. The joint forum, which will meet once a year or as circumstances warrant, has been described as an important vehicle for the exchange of ideas on important economic and financial policy matters and is considered by Pakistan as significant because it marks the first bilateral arrangement of its kind in the post-cold war era.
These are all welcome developments and augur well for Pakistan’s long-term economic interests. The US not only has the ability on its own to help its friends overcome their economic difficulties, it can influence the multilateral aid agencies significantly to be more generous with resources and less stringent with conditionalities. Pakistan could use the joint forum to put before the US the real hurdles in the way of Pakistan’s efforts to graduate from a dole-dependent country to one which can stand on its own feet.
If Pakistan could use its new found influence with Washington through the joint economic forum to get the IMF and the World Bank relax this condition so that it could spend more on social and physical infrastructure, perhaps this country could get out of its deepening recession. This would create jobs and expand the economy, boost exports and generate resources to meet the ever-increasing expenditures, both development and non-development. Though the joint forum in its first meeting did not discuss the issue of an increased market access to Pakistani goods, efforts could be made on the sidelines of this forum, when it meets next, to explain our point to
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