Salahuddin
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As the full effects of the harsh winter hit Kashmir and the areas devastated by the October earthquake, millions of people who survived will be at the mercy of the cold with countless others destined to perish. In response to accusations that the government and army were slow to respond to the initial tragedy in providing adequate welfare for the survivors, the Pakistani regime is making much of it's recent donor conference where a total of $5.8 billion was pledged towards the rebuilding cost. However, what is rarely mentioned by the regime is that $3.9 billion of this money is in the form of new interest based loans, loans which will have to be repaid.
The Musharraff regime has tried to deflect criticism by citing the few debt ââ¬Ëwrite-offsââ¬â¢ that have been granted as a reward for Pakistanââ¬â¢s role in the 'War on Terror'. Yet these are mere crumbs compared to the billions in foreign debt that Pakistan has accumulated over the years. These loans will simply add to the burden of debt which will engulf Pakistan for years to come.
The loans have also come with added conditions such as reducing Pakistan's military expenditure. Moreover, there is little expectation that these monies will be used for the welfare of those most in need. Past experience shows how money lent by international institutions is often spent on foreign contracts with the associated kickbacks, resulting in wealth being taken out of the country. Added to the gross mismanagement and corruption of the elites in the Pakistani establishment, it is difficult to believe that these loans will be used to help the people of Kashmir. Already there have been reports of local politicians siphoning off desperately needed resources. At the same time, money has been found to fund two new VIP jets for the use of the Prime Minister whilst the government recently announced that gas prices are set to increase again by 15%.
The contrast with the response of other nationââ¬â¢s to loans and the pitfalls attached to them cannot be more marked. Argentina's President, Néstor Kirchner, recently announced that Argentina will pay back the $9.8 billion that it owes to the International Monetary Fund (IMF) immediately. It was originally scheduled to pay this back in instalments over the next three years.
This decision showed how Argentina had clearly learnt the lessons from its last bitter experience with the International financial system in 2001. When it defaulted on it's huge external debt of about $100 billion, the austerity measures forced upon it plunged the country into economic chaos. This had severe repercussions for ordinary Argentineans, who could not withdraw their bank savings, leaving one in four people in poverty, literally overnight. Many people struggled to purchase simple food items. This was despite having huge agricultural resources with Argentina being one of the World's largest beef exporters, so much so that it is known as the 'bread basket' of South America.
Yet it was struggling to feed it's own people during the economic meltdown. Even in recent months the IMF had been pushing for a review of utility prices which had been frozen at a third of their pre-crisis price level. This was something which was not lost on the Argentinean President as he announced the debt pay back, commenting that the IMF implemented "failed political regimes and monetary systems". He further stated "the result has been exclusion, poverty, destitution and the destruction of our production apparatus".
It is now abundantly clear to all countries of the world that lending institutions such as the IMF and World Bank do not have the best interests of poor countries at heart. In return for interest based loans, the imposition of their conditions and policies often requires the wholesale privatisation of state assets, further increasing the country's debt with little to show for. These state assets often end up in the hands of Western multinationals via quick sell offs without yielding any tangible benefits to the people. On the contrary basic prices of essential commodities such as gas, electricity, water and foodstuffs are hiked up in order to satisfy the creditors. The result is misery for millions of ordinary people.
The emergence of the Caliphate in the Muslim world will herald a new dawn in International Relations. It will expose the true nature of institutions such as the IMF and UN as the proxies of the major powers. The Caliphate will demonstrate to the Non Muslim world a new era of trade and justice, free from exploitation.
Source: KCom Journal
What do you guys have to say about this ?
The Musharraff regime has tried to deflect criticism by citing the few debt ââ¬Ëwrite-offsââ¬â¢ that have been granted as a reward for Pakistanââ¬â¢s role in the 'War on Terror'. Yet these are mere crumbs compared to the billions in foreign debt that Pakistan has accumulated over the years. These loans will simply add to the burden of debt which will engulf Pakistan for years to come.
The loans have also come with added conditions such as reducing Pakistan's military expenditure. Moreover, there is little expectation that these monies will be used for the welfare of those most in need. Past experience shows how money lent by international institutions is often spent on foreign contracts with the associated kickbacks, resulting in wealth being taken out of the country. Added to the gross mismanagement and corruption of the elites in the Pakistani establishment, it is difficult to believe that these loans will be used to help the people of Kashmir. Already there have been reports of local politicians siphoning off desperately needed resources. At the same time, money has been found to fund two new VIP jets for the use of the Prime Minister whilst the government recently announced that gas prices are set to increase again by 15%.
The contrast with the response of other nationââ¬â¢s to loans and the pitfalls attached to them cannot be more marked. Argentina's President, Néstor Kirchner, recently announced that Argentina will pay back the $9.8 billion that it owes to the International Monetary Fund (IMF) immediately. It was originally scheduled to pay this back in instalments over the next three years.
This decision showed how Argentina had clearly learnt the lessons from its last bitter experience with the International financial system in 2001. When it defaulted on it's huge external debt of about $100 billion, the austerity measures forced upon it plunged the country into economic chaos. This had severe repercussions for ordinary Argentineans, who could not withdraw their bank savings, leaving one in four people in poverty, literally overnight. Many people struggled to purchase simple food items. This was despite having huge agricultural resources with Argentina being one of the World's largest beef exporters, so much so that it is known as the 'bread basket' of South America.
Yet it was struggling to feed it's own people during the economic meltdown. Even in recent months the IMF had been pushing for a review of utility prices which had been frozen at a third of their pre-crisis price level. This was something which was not lost on the Argentinean President as he announced the debt pay back, commenting that the IMF implemented "failed political regimes and monetary systems". He further stated "the result has been exclusion, poverty, destitution and the destruction of our production apparatus".
It is now abundantly clear to all countries of the world that lending institutions such as the IMF and World Bank do not have the best interests of poor countries at heart. In return for interest based loans, the imposition of their conditions and policies often requires the wholesale privatisation of state assets, further increasing the country's debt with little to show for. These state assets often end up in the hands of Western multinationals via quick sell offs without yielding any tangible benefits to the people. On the contrary basic prices of essential commodities such as gas, electricity, water and foodstuffs are hiked up in order to satisfy the creditors. The result is misery for millions of ordinary people.
The emergence of the Caliphate in the Muslim world will herald a new dawn in International Relations. It will expose the true nature of institutions such as the IMF and UN as the proxies of the major powers. The Caliphate will demonstrate to the Non Muslim world a new era of trade and justice, free from exploitation.
Source: KCom Journal
What do you guys have to say about this ?
