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Nawaz’s best foot forward

November 6, 2013 at 6:59 pm | News Desk

Mehmood ul Hasan

Mehmood Ul Hassan Khan

Prime Minister Nawaz Sharif recently completed his official visit to Washington where he met US President Barack Obama, Vice-President Joe Biden, Secretary of State John Kerry and other top officials. Economic integration and further strengthening of bilateral trade and commerce ties were the main areas of attraction of the Prime Minister’s visit to the USA.

The Energy Sector

The leaders emphasized that both sides should work together on a range of options to enable Pakistan to overcome its energy deficiencies. It was specified that both sides will hold further discussions in the working groups on Energy and Security, Strategic Stability, and Non-Proliferation. energyMoreover, President Obama noted that US assistance in the energy sector has added over 1,000 megawatts of power to Pakistan’s national grid, helping over 16 million Pakistanis.

Prime Minister Sharif expressed appreciation for US assistance toward the construction and rehabilitation of Gomal Zam, Satpara, Mangla, and Tarbela dams and the modernization of Guddu, Jamshoro, and Muzaffargarh power plants, and the leaders highlighted the recent Overseas Private Investment Corporation (OPIC) loan for private sector wind development in Sindh.

Cooperation in Science and Technology

Both leaders expressed satisfaction at the implementation of the 2003 Agreement on Science and Technology Cooperation between the United States and Pakistan. They acknowledged its significance in promoting a decade of intensified cooperation between the two countries, and decided to extend the agreement through 2018.    science and technology

During Prime the visit the US State Department announced the two countries signed a five-year extension of the US–Pakistan Science and Technology Cooperation Agreement. State Department’s Assistant Secretary for Oceans and International Environmental and Scientific Affairs (OES), Dr Kerri-Ann Jones and Pakistani Foreign Secretary, Jalil Abbas Jilani signed the agreement to expand relations between the US and Pakistan scientific and technological communities, and were joined by the White House Office of Science and Technology Policy Director, John P. Holdren.

Multiplier Effects

Since its inception in 2003, this agreement has provided a framework to strengthen scientific, technological, and engineering capabilities for both the countries, helping foster mutual prosperity and economic growth. Under the auspices of the US–Pakistan agreement, the governments have jointly funded nearly $30 million worth of collaborative research projects through the US–Pakistan Science and Technology Cooperation Program.

The United States released $1.6 billion in aid to Pakistan, boosting a flow of assistance that slowed in recent years amid a downturn in relations. The bulk of the funding is made up of $1.38 billion in military. The rest is $260.5 million in civilian aid. The $260.5 million in civilian assistance is part of the total $959.5 million in FY2012 civilian assistance to be notified, because much of the civilian assistance continued unaffected during the slowdown.       kary

During the different meetings it was decided that both countries would be engaged in a range of initiatives in the coming months to help bolster cooperation in trade, investment and energy sectors. The Pakistan-US Working Group on Energy is to meet in Houston and Washington in November to discuss ways to expand cooperation. Under another initiative, the United States would invite Pakistani businessmen and send ‘buyers mission’ to spur trade prospects. Moreover, World Bank has agreed to finance the Dasu power project in Pakistan.

Historic Context

According to an official figure Pakistan has received $25.9 billion from the US during the past decade (2002-2012) in shape of all accounts. The US has so far committed $1.164 billion for FY14 including $398 million for security-related expenditures and $766 million for the Economic Support Fund (ESF).  It also includes $10.687 billion on account of reimbursement of Coalition Support Fund (CSF) payments, which cannot be defined as financial assistance in accordance with any standard because these expenditures were incurred by the Pakistan military in its attempts to flush out supporters of Taliban and then reimbursed by Washington.

According to a document prepared by the US Congressional Research Service in collaboration with the departments of state, defence, agriculture and USAID, Pakistan received $17.226 billion for security related expenditures while total economic assistance stood at $8.686 billion since 2002.

Pakistan received $312 million in the shape of the National Defence Authorization Act (NDAA) under section 1206 to provide global training and equipment. The US also provided $265 million for a Counternarcotics Fund (CN), $2.751 billion in shape of Foreign Military Financing (FMF), $27 million for International Military Education and Training (IMET), $717 million for International Narcotics Control and Law Enforcement (INCLF), $115 million for Non-Proliferation, Anti Terrorism, Demining and Related (majority for anti terrorism assistance) and $2.352 billion for Pakistan Counterinsurgency Fund (PCF) and Counterinsurgency Capacity Fund (PCCF).

The US provided $5.687 billion out of the $10.687 billion during the Musharraf regime from 2002 to 2007. When the PPP-led government assumed power in 2008, the US reimbursed $1.019 billion in FY08, $685 million in FY09, $1.499 billion in FY10, $1.118 billion in FY11 and $688 million in FY12. The reimbursement for FY13 and FY14 is not yet fully known.

On account of total economic assistance worth $8.686 billion during the last one decade,52634cfd38767 the documents showed that USA provided $249 million for Child Survival and Health, $286 million for Development Assistance (DA), $6.610 billion for Economic Support Funds (ESF), $572 million for Food Aid, $17 million for Human Rights and Democracy Funds (HRDF), $704 million for International Disaster Assistance (IDA) and $248 million for Migration and Refugee Assistance (MRA) from 2002 to 2012.

A majority of the total economic assistance funds were received by Pakistan during the tenure of a democratically elected government. During the tenure of the Musharraf regime from 2002 to 2007, Pakistan received $2.033 billion in shape of Economic Support Fund while the country received $347 million in FY08, $1.114 billion in FY09, $1.292 billion in FY10, $919 million in FY11 and $905 million in FY12.

Concluding Remarks  1-21-2012_31809_l

Although every country has its own socio-economic, geo-politics and geo-strategic vested interests but recent visit of the Prime Minister succeeded to achieve some convergences between the two countries. Nevertheless, controversies have been minimized. Commitments to have enduring Pak-US bilateral relations are the ultimate victor.

Energy security, economic integration, regional peace and cooperation in science and technology would further strengthen the Pak-US bilateral relations. Mutual military cooperation has strategic implications which would be used for any threat associated to terrorism, extremism and misadventures.

From the Pakistan side hopes were high for greater inflows of the US foreign investments, joint ventures and trade. The US also presented its list of preferences, pledges and persuasions. However, the nitty-gritty of the present interaction and those to follow should not be mistaken.  It was a giant show of commercial diplomacy, soft image projection, conflict resolution and above all securing greater mutual economic bounties and markets.


News Desk

Economic Affairs Editor

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