PAK stops billing US for ‘war on terror’ costs

[Devil Soul]

Pakistan stops billing US for ‘war on terror’ costs
By Shahbaz Rana
Published: December 20, 2011
ISLAMABAD:

The US Navy Seals raid on May 2, when Osama bin Laden was found and killed on Pakistani soil, cost Pakistan in terms of pride and reputation. It has also proved costly in terms of finance.
Since the operation in Abbottabad, the Pakistani military has stopped sending reimbursement claims to Washington for expenses incurred in the ‘war on terror’.

The decision is likely to put additional burden on the resource-strained budget. Pakistan used to claim between $100 million and $140 million per month from the US. This brings the unclaimed amount to at least $600 million over the past six months, provided activities are going on at the same pace.

After becoming a front-line state, Pakistan had claimed expenses under the Coalition Support Fund (CSF) from Washington.

As ties deteriorated, the US started using the CSF as a negotiating tool, either delaying or rejecting some of the claims to put more pressure on the economically-beleaguered Pakistani government.
The US had started rejecting 35-40% of the claimed amount prior to the raid, officials told The Express Tribune. In the initial years of the war, the US would disburse the entire amount, though this had gradually crept up to 5-10% over the past few years.

Till December 2010 the US had disbursed $8.6 billion to Pakistan, against $12 billion in claims, said a government functionary. The last tranche of the CSF was released in December 2010, that cleared up to June 2010 claims, he added.

The government will have to take a decision on whether to reflect the rejected amount as outstanding – or write it off. It seems that the authorities have compromised on $900 million worth of claims, as they put the outstanding figure at $2.5 billion. (Bearing in mind the $12 billion billed amount, the outstanding amount comes to $3.4 billion.)

The federal government had initially estimated it would receive $1.4 billion this year, but now the figure has been revised to $800 million, officials added. “It is not aid. Rather, these are the expenditures that we have already incurred and it is our own money,” a source said.

Pakistan has also raised the issue of mark-up costs on the withheld amount with US authorities, they added. The officials said that Pakistan has added $800 million in balance of payments calculations and any shortfall will increase the deficit on external payments and receipts.

They added that the US has processed half of this amount, but is waiting for the final nod from the deputy secretary of defence. After he gives clearance, the Department of Defence will notify the cleared amount to Congress, which has 15 days to either clear or block the amount. It earlier blocked $800 million from the CSF after the killing of Osama bin Laden.

The officials said that during the first five months of the current fiscal year the military has spent Rs187 billion, which is 38% of the allocated annual defence budget of Rs495.2 billion.
Published in The Express Tribune, December 20th, 2011.

 

[regular]

Excellent News We don't need to get any HARAAM Money from these evilz US/NATO , Killers of the innocent pplz around the world......

 

[jahangeer yousaf]

thanks to ALLAH ....... in the end our army understood ........ we cannot have money by killing our own people by ourselves ................ we do not need your money you moron americans keep it with you and strenght up your economy leave afghanistan and get lost bastard

 

[OrionHunter]

Excellent News We don't need to get any HARAAM Money from these evilz US/NATO , Killers of the innocent pplz around the world......

But just you wait and see....The Pak Government will soon go back to its old ways, 'haraam money' or not! The color of money is too tempting to be cast aside. This sabre rattling is only for public consumption. It will soon be back to business as usual. There are too many vested interests at work and they wouldn't like to forfeit their millions as gratis from the billions being handed out by the US of A.

 

[Chinese-Dragon]

Does this mean that Pakistan is going to pull out of the WoT?

 

[shuntmaster]

Why Pakistan still needs U.S. assistance


U.S. aid cut to Pakistan could hurt economy

By Chris Allbritton and Zeeshan Haider
ISLAMABAD | Mon Jul 11, 2011 2:21pm EDT
(Reuters) - A U.S. decision to suspend $800 million in military aid will not affect Pakistani army operations, a Pakistani military spokesman said on Monday. But analysts say the move is likely to fray ties and could harm the country's economy.

White House Chief of Staff William Daley confirmed on Sunday a New York Times report that the Obama administration had held off a third of $2 billion in security aid in a show of displeasure over Pakistan's cutback of U.S. military trainers, limits on visa for U.S. personnel and other bilateral irritants.

The United States provides hundreds of millions of dollars a year to reimburse Pakistan for deploying more than 100,000 troops along the Afghan border to combat militant groups. Other funding covers training and military hardware. The White House announcement puts $300 million in reimbursement and another $500 million in aid in question.

"The tribal operations won't be affected" by the loss of U.S. assistance, said Pakistan's military spokesman, Major-General Athar Abbas. "We can conduct our operations without external support."

Some of the assistance, he said, was reimbursement for money already spent on several operations on the Afghan border rather than money for future operations.

"I don't think there will be any significant impact from this," he added.

Politically, however, it would be damaging to the relationship, said Pakistan's former ambassador to the United States, retired Major-General Mehmood Durrani said, reflecting a widespread view in Pakistan that it was fighting America's war, for which Washington must reimburse it.

"This is something that they have to pay, and if they don't then it's breach of agreement and breach of trust," he said.

In Washington, Pentagon spokesman Colonel David Lapan said the $800 million in U.S. aid had been put on hold and could be resumed if Pakistan increased the number of visas for U.S. personnel and reinstated the training missions.

"It's ... directly tied to those decisions by the Pakistani military to curtail training and to not grant visas for some of the U.S. personnel that we need to get in. So if those things change, then this aid will change as well," Lapan said.

Lapan said the aid that had been put on hold included money for training as well as equipment that ordinarily would be provided with a trainer or adviser.

Some of the aid put on hold was money from the Coalition Support Fund, which goes to reimburse U.S. allies for their assistance in counterterrorism operations, he said.

ECONOMIC IMPACT

Pakistan's economy could be hit if Washington holds back on the $300 million reimbursement from the Coalition Support Fund that Pakistan says it is owed.

Because it is reimbursements for money already spent on military operations, CSF monies go into the general treasury. So holding back these payments will not hurt the military, but would strain the country's finances further at a time when it is battling a deep downturn.

The money was expected by June 30, and its delay has already bumped Pakistan's fiscal deficit to 5.3 percent of gross domestic product for fiscal year 2010/11 (July-June), a finance ministry official said. With the CSF money, the deficit was anticipated to be 5.1 percent.

CSF money also supports Pakistan's current account. Though the July-May current account is in surplus by $205 million, it may not be able to maintain the surplus in the long term because of rising international oil prices and lower prices for cotton, its main cash crop.

Pakistan received $632 million from the CSF in its 2010/11 fiscal year. Finance ministry officials were unavailable for comment.

The cutback in assistance is part of a high-stakes stand-off between the United States and Pakistan, said Ayesha Siddiqa, an expert on the Pakistan military. Washington has given up on winning Pakistani hearts and minds and is now counting on Pakistan's precarious financial situation to bring it onside.

"America understands that Pakistan needs money," she said. "Pakistan is insolvent. It cannot disengage (from the United States), so eventually it will turn around."

DOWNWARD SPIRAL

The U.S.-Pakistan relationship has been on a downward spiral since last year, but the decline accelerated after the killing of two Pakistanis by a CIA contractor in Lahore in January and the U.S. raid to kill Osama bin Laden, which Pakistan complains it was not told about and says was a breach of its sovereignty.

Pakistan has demanded the number of U.S. military personnel in Pakistan be slashed, and the U.S. has complied. Pakistan also wants to cut the number of U.S. intelligence officials.

If ties became truly frigid, Pakistan could seek closer links with China, it's single largest arms supplier.

 

[pakistanitarzan]

The most funniest thing i have noticed in all these threads are that Indian members of this forum will try their level best just to prove that Pakistan will always need US Aid.

 

[longbrained]

Why not bill them when they are still using the air corridor for transports?

 

[T-Rex]

Does this mean that Pakistan is going to pull out of the WoT?

I think so, but the question is for how long? Now, that depends on many factors and China's role is one of the most important factors.

 

[Last Hope]

What the heck is wrong with our media?

We have stopped billing the costs since.. June I guess.
And the media channels seek the opportunity to re-publish the reports as new ones to boast their channel.
So do the politicians.

Not only since May 2, all previous costs weren't billed either.

 

[OrionHunter]

If ties became truly frigid, Pakistan could seek closer links with China, it's single largest arms supplier.

Let's get real. China is NOT going to support Pakistan financially. Period!

Pointers to this is its refusal to provide $7 billion in aid to Pakistan which then had to run to the IMF. This amount was disbursed after imposing strict conditionalities on Pakistan, only some of which have been complied with.

The promised $200 million for Pakistan's flood relief never materialized except for a measly $43 million only after considerable prodding by the US of A.

China till date has given Pakistan next to nix in terms of monetary aid or grants. Only nukes and weapon systems are pumped into Pakistan for China's own national interests which is, to counterbalance India and protect its Southern flank for which they are using Pakistan as its proxy.

 

[BATMAN]

US formulated agreements with Pakistan, according to which Pakistan will get reimbursed for all the expenses incurred in US WOT.
While today, the reimbursement claims stand as $3.2 billion.
This is not new.. in past US had taken payment of F-16's which never delivered to Pakistan.

Pakistan need to address its claims via international arbitration court.

 

[StandForInsaf]

oh comn cut the bullshit aid and run country at your own. we don't need AIDS.