ISLAMABAD – Pakistan on Sunday urged the US administration to expedite the payment of the Coalition Support Fund, saying the delay was impacting the country’s efforts against extremism and terrorism. The demand was made during a meeting between Finance Minister Dr Abdul Hafeez Shaikh and the new US Special Envoy for Pakistan and Afghanistan Marc Grossman here.
“The finance minister told the US envoy that suspension of aid to Pakistan owing to a row between Islamabad and Washington over the fate of Raymond Davis, an American arrested for killing two Pakistanis, would be an unwise decision and would only help the extremists who are against the friendly ties between the two nations,” an official privy to the meeting, who wished to remain unnamed, said.
In a brief chat with reporters after the meeting, Grossman said Pakistan’s finance minister had raised the issue of the slow disbursement of funds by Washington. “We will make certain that the provision of coalition support funds comes through,” he said.
A statement issued by the Finance Ministry said the minister gave a detailed account in the meeting of the number of economic reforms the government had been implementing to improve the economic condition of the country. He highlighted the budget priorities, which were resource mobilisation, expenditure cuts, tax measures and inflation control, the statement said. Earlier, Shaikh gave an overview of the state of the economy when the government had assumed office.
He said economic growth was lost because development was not reconciled with reforms, because of which the whole macro-economic framework was affected. According to the statement, Grossman appreciated the government’s economic measures and hoped that they would benefit the people of Pakistan in the future.
DELAYING REFORMS: In a related development, the government’s economic managers began policy talks with an International Monetary Fund (IMF) delegation. They told the IMF team that the war on terror was not allowing the government to meet the environmental pre-requisites necessary to implement reforms it had committed to in the Stand-By Arrangement (SBA) loan.
A visiting review mission of the IMF and the government’s team of economy managers headed by Dr Abdul Hafeez Sheikh entered policy negotiations following the conclusion of five-day technical talks. The session, aimed at a favourable review of the economy, which would enable the release of the next installment of a $11.3 billion loan, would continue for the next few days.
“[The] war on terror was not only a constant pressure on current expenditures, eventually resulting in increased fiscal deficit, but also impacted the economy negatively in terms of loss of economic opportunities,” the managers told the IMF team led by Pakistan Mission Chief Adnan Mazarei. The officials therefore asked the IMF to take into account the impact of the war on the Pakistani economy.
