Re: US creating problems for $4.5 billion gas project, trying to be a bullying ass
may I remind you pak gdp is $110 billion and is growing at a rate of 7-8% every year.
the $700 million us aid is not even 1% of our economy.
Re: US creating problems for $4.5 billion gas project, trying to be a bullying ass
The law allows gives the President the power to override it, which Bush will do as a good puppy. Anyhow Iran, Pakistan and India have each given the middle finger to America on this matter, and China and Russia are with them as well, so pipeline will go ahead as planned.
P.S. A Q Khan Zindabad. :k:
Re: US creating problems for $4.5 billion gas project, trying to be a bullying ass
The real fact is that it is a 4.5 Billion dollar project. That means that the parties will have to borrow the 4.5 Billion from somewhere. The Asia Development Bank is up to it’s gills in Pakistani debt. India will not fuund it if there is fear of a backlash on business and outsourcing from the US, and Irans highly disliked regime has a hard time getting any type of debt written anyway.
Please realize that Paksitan has huge external debt, going back to the Zia days. In addition to US Aid, the US has agreed to Debt relief ala Africa in the amount of $1.5 Billion. But there is still nearly 40 Billion in high risk/ high interest debt. Now, there is a lot more debt that can be written off, but the economic growth of Pakistan would not have been possible without unloading some of the burden of Paksitans’ borrowing. Obviously if Paksitna borrows more moeny to build a pipline, debt relief stops, aid stops, support at the World Bank stops (hello Mr Wofowitz?), and support with the Asian development bank stops. Never mind the sanctions.
National pride aside, as of 2001, the Paksitani economy was on the same list of impoverished nations as Africa. 9/11 was a windfall for Pakistan, but essentially nothing has really changed structurally to Paksitans economy.
The Pakistani economy was in the toilet in 2001, Who got you out?
US aid not enough: Pakistan
Pakistan says the economic aid to the country promised by the United States - $673 million bilaterally immediately and billions of dollars eventually, including from the International Monetary Fund and the World Bank, is not enough.
Despite the lifting of US sanctions and the announcement this week of economic aid, Pakistan stands to lose $1.5 billion this year as American and Japanese importers cancelled contracts for textiles because of the ongoing war in neighbouring Afghanistan, Foreign Minister Abdul Sattar said in Islamabad.
“As a result of the crisis in the neighbourhood, exports are affected,” he told The Washington Times in a telephone interview.
Sattar urged the Congress to quickly approve a state department request for dropping US quotas and duties on Pakistani textile exports.
He said US had agreed to support a $2 billion IMF loan package, adding that Pakistan would seek further aid from the Paris Club of donor nations, which will be asked to ease the terms on payment of its $38 billion foreign debt.
A large debt relief package to Pakistan being worked out would cut interest rates on its debt to one per cent or less and spread payments over many years, a Pakistani-American source told the paper.
US President George W Bush, the paper said, is expected to announce the package when he meets his Pakistani counterpart Gen Pervez Musharraf in New York on November 10.
Sattar said Pakistan’s economy had suffered from corruption and fiscal mismanagement under civilian governments ‘for the last several years until 1999’ when Musharraf seized power in a military coup.
Re: US creating problems for $4.5 billion gas project, trying to be a bullying ass
LOL!! Rediff? Man you have sunk low. First rediff is a pathetic source. They are the indian version of the National Enq.
Re: US creating problems for $4.5 billion gas project, trying to be a bullying ass
China a sugar daddy? China’s last batch of food aid was in April 2005.
Re: US creating problems for $4.5 billion gas project, trying to be a bullying ass
Don’t like that? Let’s go straight to the State Bank of Pakistan. Notice the big decrease in Military debt and Special US bond accounts. Additional debt was added in the Multilateral Accounts. Without US aid and US debt restructuring this would not have been possible.
http://www.sbp.org.pk/Ecodata/pakdebt.htm
Or, better stated in October of 2001, Pakistan was a basket case:
30th October, 2001.
Briefing on Pakistan’s debt sustainability
Pakistan is eligible for HIPC
Whatever we may think of her government, Pakistan’s debt - accumulated largely when foreign governments made large loans to President Zia’s regime - is not sustainable.
Pakistan’s external debt is at $31.7bn, or more than 53% of GDP, while her domestic debt at current exchange rates is a further $30bn, or 50% of GDP, meaning that total domestic and external debt exceeds GDP. Domestic debt as a proportion of GDP has been steadily increasing, from 43.5% in 1996/7 to 50% today.
Debt service in Pakistan amounts to 47% of total budgetary expenditures, and 63% of domestic revenues. In total, almost 10% of GDP goes into servicing domestic and foreign debt. This makes it the single largest item of government expenditure. Expenditures on debt servicing exceed social and poverty related expenditures by a factor of four.
In 1999, the latest date for which data is available, Pakistan owed $12.2bn to bilateral creditors, $14.2bn to multilateral creditors and the remainder to commercial creditors.
Omar Noman of the UNDP argues that: “the rapid accumulation of debt is not a result of populist civilian governments, as some allege. Since the rapid growth in debt servicing coincided with the return to democratic rule, it is sometimes mistakenly believed that civilian populism is the root cause of the profligacy. While some of the civilian leaders are far from blameless, while others were more prudent, the principal rise in debt obligations occurred under the previous military ruler, General Zia-ul-Haq. Much of the domestic debt, that has become such an onerous burden, was accumulated during the 1980s”.
Clearly Pakistan needs radical debt reduction if there is to be any hope of a return to economic stability and sustainability and social development in the country and region.
The urgent need for debt relief for Pakistan
Pakistan is not an IDA only country and therefore is not eligible for assistance under the HIPC initiative. She is formally classified as a middle income country by the World Bank, with a GDP per capita (in PPP terms) is at $1,860.
However, human development indicators in Pakistan place her at a lower level than many of the HIPCs. Adult Literacy is at only 44%, compared to 84.4% for Bolivia, and 76% of Zambia, while combined primary, secondary and tertiary enrolment is at only 43%, compared to 58% in Honduras (1998.)
There has been a sharp rise in poverty and inequality. The percentage of households under poverty nearly doubled between 1987 and 1999, rising from 17.3 % to 32.6 %. The growth in poverty was not confined to rural areas. The nerve centres of the political system – the urban areas – saw poverty rise from 14.9 % of households to over a quarter, who are unable to meet their minimum nutritional requirements.
The number of people below the official poverty line, defined by a basic minimum level of nutrition, have risen exponentially, from nearly 18 million in 1987 to 43.9 million by 1999. Just the increase in the number of the people unable to meet minimum calorie requirements (26 million) is greater than the entire population of the Nordic countries - Sweden, Denmark, Norway, Iceland and Finland. Pakistan has the sharpest rate of population increase in Asia This fact has been conceded by the IMF in a recent (October 2001) report, where they write that: its “long-term external outlook (is) unsustainable, with most debt indicators worse than for many countries supported under the HIPC initiative”.
In January 2001, Pakistan visited the Paris Club, and was offered an insignificant re-scheduling of her arrears and of ODA credits. The repayment period on ODA debt was lengthened beyond 15 years, to 20 years. $1.8 bn of the total bilateral debt of $12.2 bn was re-scheduled.
Pakistan is now seeking a further Paris Club deal, which would closely mimic ‘Naples Terms.’ This would involve cancellation of between 50% and 67% of non-ODA debt, and a rescheduling of ODA debt with a concessional interest rate at least as favourable as the rate under which the loan was originally contracted.
However, this level of relief will only be on bilateral debt; given Pakistan’s exclusion from the HIPC initiative, the Multilaterals will not be offering any relief on their debt.
We regard this as discriminatory; creditors are being treated unequally and the taxpayers of the Paris Club will take the “haircut”. Other, equally unwise multilateral and commercial creditors are not expected to share in the losses.
Inconsistency in Paris Club treatment of ‘friendly debtors’
In 1991 Egypt was rewarded for her support for western governments during the Gulf War. $21bn of her bilateral debt (i.e. about half) was treated under the Paris Club’s “Classic Terms”. According to the World Bank $10.5bn of interest was “forgiven” and $2.4bn of stock was written off.
According to the WB’s 1993 Debt Tables, Egypt’s total debt in 1991 was $41bn. In their 2001 (Global Development Finance) tables, the debt in 1991 was only $32bn; and had fallen to $30bn by 1993. So, depending on which of the WB’s own figures one believes, Egypt either got $10.5bn and $2.4bn in debt relief on the one hand; or her debt only fell after the negotiation by $2bn. The $12.9bn figure is however repeated every year (in a separate table) in all the Bank’s Debt Tables data.
All the indications are that the Paris Club is not consistent in its treatment of “friendly” debtors and that Pakistan will not be granted such generous treatment.
(Another inconsistency is creditor insistence that 11 HIPC countries should be denied debt relief, because they are engaged in conflict. These countries include Sierra Leone, Somalia, Burundi, Ethiopia etc. Pakistan is engaged in conflict on two fronts: Kashmir - and now in supporting the war in Afghanistan).
Conclusion: Pakistan needs debt relief urgently, with strong conditionalities and civil society monitoring.
There are strong indicators that the IMF will soon provide Pakistan with an additional $2bn in new loans. But new loans are not the answer. Pakistan needs debt relief on terms at least comparable to those of the HIPC countries, if there is to be any hope of a return to economic stability and sustainability in the country and region.
But, under current informal arrangements, creditors cannot write off debts in amounts sufficient to return Pakistan to sustainability. Furthermore one group of creditors (the bilaterals) cannot round up other groups (commercial and multilateral) and insist on equal treatment of all creditors - a fundamental rule in bankruptcy negotiations.
That is why we need a fair, independent, accountable and transparent insolvency process, perhaps based on Chapter 9 of the US legal code (which provides for the bankruptcy of municipalities) - to negotiate an orderly re-structuring of Pakistan’s debts.
And, there should of course be tough conditions for debt cancellation, but they should be based on the need for open, democratic and accountable government and on direct poverty reduction - not on IMF austerity programmes for liberalising the economy.
For poverty reduction to be meaningful, civil society must be involved in the process, and given the power to monitor and report back to creditors on how the money is spent. There is a Jubilee 2000 campaign in Pakistan, run by the Catholic Justice and Peace Commission. There are many other, active and lively civil society organisations and political parties. There is also a very lively and largely free press
http://www.jubileeplus.org/databank/Briefings/Pakistan301001.htm
Re: US creating problems for $4.5 billion gas project, trying to be a bullying ass
Pakistan will go ahead and build the pipeline. The USA will be scared of radicals taking over in Pakistan and so will continue to fork over 700 million per year to avoid the Pakistani economy going down the pan and radicals taking over in the resulting instability.
Pakistan will thus get 600 + 700 = 1300 million in revenue every year.
Pakistani will be happy that Pakistan is getting money.
Iran will be happy that Iran can sell gas to India.
The USA will be happy that Pakistan's economy will be doing well enough to stave off the threat of radicalism.
Everyone will be happy clappy.
Re: US creating problems for $4.5 billion gas project, trying to be a bullying ass
We are paying higher interest rates with the principle amount still due. The CE ****ed up big time.
Re: US creating problems for $4.5 billion gas project, trying to be a bullying ass
This is a really happy but dopey analysis. Irani Mullahs will keep their country under Matoo grip and hence Western sanctions. Pakistan should not touch this hot potatoe even with a 10 foot pole.
Re: US creating problems for $4.5 billion gas project, trying to be a bullying ass
Pakistan should do what it damn well pleases and Inshallah it will.
Re: US creating problems for $4.5 billion gas project, trying to be a bullying ass
Pakistan needs to keep Iran friendly to avoid the danger of ever getting politically sandwiched between hostile contries. It is unrealistic to expect the USA or China to risk their forces or status to defend Pakistan militarily or politically.
Besides which, a Pakistani economic collapse would be far more dangerous to the USA than a marginally stronger Iranian economy.
Re: US creating problems for $4.5 billion gas project, trying to be a bullying ass
Bravado (or Bharrak) like our good ole Mullha Umar! The same Mullah Umar who rode his 25cc motor bike into the sunset. He sure gave a damn to all his followers by pushing them to face daisy cutters while he ran like heck with his tail in his legs.
I wonder when we’ll all learn to be good citizens of Pakistan and quit bombing Pakistani-Shias, killing Pakistani-Admadis, and harassing Pakistani Christians. I wonder when we’ll learn how to be good citizens of the world and quit pedalling hate and paranoia.
Re: US creating problems for $4.5 billion gas project, trying to be a bullying ass
Nice speech. Does that include your pedalling of hate for religious conservatives? Its amazing how people can say something and not realise that they are the perps they hate.
Re: US creating problems for $4.5 billion gas project, trying to be a bullying ass
I guess some of us haven’t realized:
with friends like MAToos, who needs enemies!
Re: US creating problems for $4.5 billion gas project, trying to be a bullying ass
Remember Iran-Contra?
Or the Afghan Mujahdeen?
And still today the Wahabi kings of Arabia?
The American MAToos have no problems dealing with Muslim MAToos when it suits them, so get off your high horse and see the realities as they are, rather giving us one sided rants.
Re: US creating problems for $4.5 billion gas project, trying to be a bullying ass
:k:
Re: US creating problems for $4.5 billion gas project, trying to be a bullying ass
Yes I remember your majesty the deposed and the dead king!
I also remember modern day Khalifa (the barber) MAToo Umar and how he ran with his tail in his legs, riding his favorite 25cc motoercycle.
The day Pakistan starts spending $2500 billion a year budget, it will be OK to push around the MAToos, the Waha-Bi-Bis and you name it.
For now our meager $XX15 billion a year budget should remind the Bharrak brathree and Lota brathree to take a hike and live in Afghanistan. We in Pakistan want to survive and live in peace avoiding MAToo plague.
Re: US creating problems for $4.5 billion gas project, trying to be a bullying ass
^ LOL welcome back.
Re: US creating problems for $4.5 billion gas project, trying to be a bullying ass
Remember your own words: I wonder when we’ll learn how to be good citizens of the world and quit pedalling hate and paranoia.
If you talk the talk then walk the walk.
Re: US creating problems for $4.5 billion gas project, trying to be a bullying ass
Who on earth can trust the amerikkans they break every rule in the book pakistan would be stupid to turn a deal of the century offer like this also they can stop being a slave for the yanks at the same time.