The government of Punjab has cancelled six aid agreements with the United States in protest over the US raid that killed Osama bin Laden, Law Minister Rana Sanaullah said on Friday. Pakistan hailed Osama bin Laden’s death as a big step against militancy, but was incensed by the raid in Abbottabad, saying it was a violation of sovereignty.
“We have cancelled six MOUs (memorandums of understanding) with the US in the fields of health, education and solid waste management,” Sanaullah said. “We have told their concerned departments about our decision. This is our protest against the Abbottabad incident.” The PML-N, which rules Punjab, called for a review of the country’s ties with Washington, urging the central government to reduce reliance on foreign aid.
A PML-N spokesman said Punjab had been expected to get Rs 20 billion for welfare projects in the next three years from the US. “This will not have much effect as the amount is quite small and it (the decision) has not been taken by the federal government but by the provincial government,” said Asif Qureshi, analyst at Invisor Securities, a brokerage firm based in Karachi.
Osama’s presence in Pakistan has led to calls by some US congressmen to cut aid to the country. Pakistan is struggling to revive its economy, which depends heavily on an $11 billion International Monetary fund loan to stay afloat. To get the remaining tranches of the loan, which was secured in 2008, Pakistan must implement politically unpopular reforms such as broadening its tax base and reforming the energy sector.
One of the lowest tax-to-GDP ratio in the world of around 10 percent has increased Pakistan’s reliance on foreign funds and loans, even for development projects. Pakistan received $20 billion in US military and economic aid in the past 20 years. US special forces killed Osama bin Laden on May 2.
