Redefining Pak-USA Relations – Is USA really indispensible for Pakistan?


(Below is the first part of the proposal put forward by myself in a leading think tank to the likes of Mr. Sartaj Aziz (Ex Foreign and Finance Minister Pakistan), Mr. Khursheed M Kasoori (Ex Foreign Minister Pakistan), S M Zafar (Senior lawyer and Senator, e.t.c.), Muahid Hassan Shah (Scholar & brother of Musahid H Syed), Mr. Altaf Hassan Qureshi (Senior Journalist and Columnist) and many other dignitaries including experts on National Security issues (Retired Brigadiers and Colonels) and senior editors who were present there. It was highly appreciated and proponents of USA aid were left speechless as the myths on the Pakistan-USA relations were shattered. )

There is a popular misconception that Pakistan is about to go insolvent and only the “mighty” USA aid is keeping it afloat, hence USA can get done what it wants to by threatening to pull the plug.

Is it really so? Let us analyse and shed some light on possible redefining of the Pak-USA relations and the significance of USA aid to Pakistan.

There is a common rhetoric regarding Pak-US relations or better still the USA’s aid to Pakistan on which our foreign policy is based. It’s been based on 2 myths:

1) The economic aid to Pakistan is of paramount importance and the country cannot survive without it.

2) We need the USA for state-of-the-art weapons from the USA due to threats from India.

The word “Myth” has been used with lot of thought and research put into it, as will be proven below in analysing the merits of these myths:

1) The economic aid to Pakistan is of paramount importance and the country cannot survive without it.

This is the biggest illusion put forward to the people of Pakistan and the world audience.

  • USA promised $ 1.5 billion in economic and military assistance to Pakistan through Kerry-Lugar Bill.
  • In reality this has NEVER been paid in full.
  • Pakistan received $275 million in Fiscal Year 2009 and $676 million in Fiscal 2010 which includes $500 million spent on flood relief.
  • If we net off, Pakistan received ONLY $ 451 million in 2 years instead of the propagated and promised $ 3 billion.
  • USA aid doesn’t help the GOP (Government of Pakistan) much as hardly 12-15 per cent of the total amount is channelled for budgetary support. A lot of the funding is spent through NGO’s and indirectly.
  • BUT even if the whole of the promised $3 billion is paid in full, this accounts for less than 0.5% of the Gross National Income (GNI) of Pakistan and less than 7% of total foreign exchange earnings.
  • These facts clearly show that the Pakistani economy will NOT suffer greatly let alone collapse if the US decides to withdraw its assistance.
  • As for the coalition support fund they are mere reimbursements of the expenditure we have to incur in ADVANCE and even these have been struck by serious disagreements where USA has regularly been “rejecting” 40% plus of the bills, while our roads and infrastructures have damaged beyond repairs and business are being hampered with finances flowing out of the country.
  • Proponents of USA argue that USA gives more “aid” to Pakistan than China, forgetting that it is Trade that is needed to build economies and not the aid.
  • We hear a lot about trade nowadays but it appears that USA is more focused on ensuring Pakistan’s dependency on aid and thereof itself.
  • On the other hand China is planning to invest $ 30 billion in Pakistan in the next 5 years in several mega projects, thereby opening avenues of trade.

Proposal:

The much-propagated aid has resulted in much adversity between the two nations and it is high-time to take the corrective action.

In our next dialogue with the American administration, we can thank them for their efforts is passing the Kerry-Lugar bill and voluntarily withdraw telling them that we feel in these difficult economic times of high-unemployment the American people deserve these funds more.

It will:

  • reduce the anti-Pakistan sentiments in the USA population who wrongly feel that Billions of  $’s of their tax money is being spent on Pakistan every year which is contrary to the reality as discussed above
  • make USA take Pakistan more seriously.
  • make USA discuss partnership and proposals on merits and not think of Pakistan as a beggar.
  • reduce the friction and improve it for all as Pakistani establishment will also not feel unnecessary pressure to compromise on its’ vital interests.

As for the funds lost by this, without any new taxation and by just approving FBR’s proposal re black money scheme connected to stock exchange and some other proposals (will be discussed in a different post), GOP can raise over PKR 500 billion, more than covering the USA aid.

2) We need the USA for state-of-the-art weapons from the USA due to threats from India.

to be continued in the next blog

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5 thoughts on “Redefining Pak-USA Relations – Is USA really indispensible for Pakistan?

  1. noone tell this we all need to know this and read

    will forward to my friends

    sir my wish is to meet & to thank you

    i know i can never meet you but i thank you for all that you doing for muslims

  2. Hi Omer Hope you remember me Nice piece keep up the good work. I need a lead from you can you give your number please

  3. Asalam

    Good such people in pakistan. Mr. Omer Zaheer Meer should be made pak finance head to help pak develop economy and independence

  4. USA has imposed sanctions on Pakistan 5 times in past. Pakistan’s golden period, economically, was before 1964 when Ayub Khan started to take aids and economic pacts with USA. One European nobel prize winner economist predicted that Pakistan will be the biggest economic power in Asia in the next 30 to 40 years from then. U can find many such things like this for that period.

    Alliance with UK has a big opportunity cost with little return. Let’s take a look at some examples:

    – The exemptions given on power (electricity) is 100 million dollars more than what Kerry Lugar bill offered.
    – 40 percent of the aid given by IMF and world bank, are purposefully put into the pockets of decision making elite class of developing countries. 20 percent is the share of institutions’ consultants. (According to former US ambassador to UN). Being super-optimistic, you can expect this govt. to spend remaining 40 percent on public honestly.
    – 2/3rd of all the aid given to Pakistan after 2001 was for the security purpose (for war against terrorism, not for Pakistan’s own defence)
    – Pakistan could not buy cheap oil from Iran because US was not willing (that was not a legal restriction at all)
    – Pakistan could not start a gas pipeline and other massive and productive projects just because US did not want them to
    – US has given 28 billion dollars so far in 63 years and pak suffered a loss of 68 billion dollars in this war

    So statistically, we are in a big deficit due to this dependence. It’s more a psychological dependence rather than real. So, we just need a sincere leadership who has a will to make us independent and stop to fool people with these false perceptions, a leadership who has all the stakes in Pakistan.

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