War on terror: Pakistan suffered loss of Rs 2,080 billion

[pkpatriotic]

War on terror: Pakistan suffered loss of Rs 2,080 billion
AHMED MUKHTAR

ISLAMABAD (January 17 2009): Pakistan suffered loss of Rs 2080 billion in 'War on Terror' from 2004-05 to 2008-09, Pakistan's Finance Ministry said in a recently released document. 'The estimated cost of the 'War on Terror' to Pakistan was around Rs 484 billion during FY 2007/08.

This cost is projected to increase to Rs 678 billion during FY 2008/09,' Poverty Reduction Strategy Papers-II, a paper released by the Finance Ministry said. Pakistan's participation in the anti-terrorism campaign has led to massive unemployment in the affected regions.

Frequent bombings, worsening law and order situation and displacement of the local population, have taken a toll on the socio-economic fabric of the country. The paper plans to spend Rs 6341 billion in next five years to alleviate poverty (pro-poor expenditures) in the country starting with Rs 790 billion and Rs 991 billion in 2008-09 and 2009-10 to Rs 1850 billion in 2012-013.

The Ministry also envisaged a growth rate of 3.4 percent this year and going forward, it would achieve 5percent and 5.5percent in next two consecutive years ultimately reaching 7percent in 2012-13. Inflation rate would be brought at 23 percent this year and would be gradually reduced to 13 percent next year then 7 percent and touching 5 percent in 2012-13, the document estimated.

Nominal GDP would be $163 billion in 2008-09 and $171 billion in 2009-10 and will be reaching $217 billion in 2012-13. 'The macroeconomic stabilisation is, unfortunately, likely to slow down the economic growth, cause unemployment and push poverty rate up in the short run.

Therefore, the central element in the government's strategy is to protect the poor and vulnerable from the adverse effects of the adjustment by increasing the allocations for social safety nets,' the PRSP-II said. Further, the paper aimed at achieving 3.9percent of budget deficit in 2008-09 and to bring it down to 3percent next year and bringing it to 2 percent by 2012-13.

Net lending from central bank would be eliminated from the current fiscal year onwards. The country also plans to fix the trade deficit between $12-13 billion from 2008-09 to 2012-13. Current account deficit would be brought down to $8 billion from over $10 billion at present.

In addition, Forex reserves would be improved from $8.6 billion in 2008-09 to $14.5 billion in 2012-13. As per the government's estimate of power generation from various sources, country would add 7880 MW electricity in its existing capacity of 19,540 MW by 2010 and then would add 20,120 MW by 2015 making a total of 47,540 MW. The country would have 110,760 MW capacity by the end of 2025 and 162,590 MW by 2030.

'In order to meet the additional power generation requirement of 143,310 MW during 2005-2030, an investment of about $150 billion will be required,' the document stated. Furthermore, the average government investment per year is planned at $2billion, with the balance of $4billion per year financed through international development agencies and the private sector through BOT projects and public-prrivate partnership,' it added. 'The country is likely to receive $4.026 billion investment in 18 private sector projects for producing electricity,' the paper concluded.

 

[Omar1984]

Sad news. I remember in 2002-2003, Pakistan's economy was really booming.

 

[roopesh]

Sad news. I remember in 2002-2003, Pakistan's economy was really booming.

This cost is projected to increase to Rs 678 billion during FY 2008/09,

close to $10 billion. US released non military aid of $7 billion. + many other international finance institutes are coving this money.

Is this not really helping pakistan??? Hope pakistan pulls out of war soon. but US and India intersts are in engaging pakistan for another decade.

 

[ajpirzada]

Rs2080bn = $34.5bn (over the time of 5 years)

its not $10bn.

 

[ajpirzada]

Sad news. I remember in 2002-2003, Pakistan's economy was really booming.

dont worry too much about the economy bro. we are in a phase which will be over in another year. its not only our economy but whole world is suffering from the same problem

growth rate of 5.8% was not bad for last year. this year its goin to be around 3.5%. main reason being the global trend

 

[ajpirzada]

close to $10 billion. US released non military aid of $7 billion. + many other international finance institutes are coving this money.

Is this not really helping pakistan??? Hope pakistan pulls out of war soon. but US and India intersts are in engaging pakistan for another decade.

this is per year. $7bn which US paid was over the time of saveral year.
wat other international institutes are covering is not actually called covering but lending.

 

[roopesh]

this is per year. $7bn which US paid was over the time of saveral year.
wat other international institutes are covering is not actually called covering but lending.

i am confused! need some pak economy expert comments.

all i was thinking these days was pak fighting in afghan is to imprve country's economical poition. If its a loss why should pak fight? no logic
something is missig here

 

[ajpirzada]

i am confused! need some pak economy expert comments.

all i was thinking these days was pak fighting in afghan is to imprve country's economical poition. If its a loss why should pak fight? no logic
something is missig here

it was never gud for our economy. u r confused coz of the media reports. they have been blamin us for not usin US money in the rit way. the question is which money are they talkin about??? so far total cost for this so called war on terror is 34.5bn dollars. US has only given us 7bn dollar (im not sure about this amount). so its simple maths. where is pak gainin anything for which we should thank US.

 

[must7]

it was never gud for our economy. u r confused coz of the media reports. they have been blamin us for not usin US money in the rit way. the question is which money are they talkin about??? so far total cost for this so called war on terror is 34.5bn dollars. US has only given us 7bn dollar (im not sure about this amount). so its simple maths. where is pak gainin anything for which we should thank US.

You are forgetting the loss in export when people have stopped buying from us due to the ongoing terrorist return activities in Pakistan + the extra amount for War insurance surcharge brings the price up of our commodity & we have been seeknig special quote as given to other countries like Bangladesh, etc. by US but none has been extended to us.

What USA gives is against it's own supplies + the other aids are in US scrapped material like the WWII helos, frigates, Block 15 F-16's, etc.

However, we have been since day one seeking special ROZ's (special zones for export, etc.).

The WOT has made us loss several deals but it seems the world is all confused to realize that !

 

[haviZsultan]

dont worry too much about the economy bro. we are in a phase which will be over in another year. its not only our economy but whole world is suffering from the same problem

growth rate of 5.8% was not bad for last year. this year its goin to be around 3.5%. main reason being the global trend

Its absolutely pathetic dude. 5.8% is lowest after musharraf left. 6.8% was the lowest we had in his period. We came second fastest grwing economy in 2005 with 8.4% growth rate.

Its a sad situation.

 

[ajpirzada]

Its absolutely pathetic dude. 5.8% is lowest after musharraf left. 6.8% was the lowest we had in his period. We came second fastest grwing economy in 2005 with 8.4% growth rate.

Its a sad situation.

ya its sad but again u have to look at the factors which are causing that to happen. those factors are now improving and im optimistic.

 

[waraich66]

ya its sad but again u have to look at the factors which are causing that to happen. those factors are now improving and im optimistic.

After peace in afghanistan pakistan can recover this amount in one year due to its strategic location and gate way to central asia.

That is reason US started this WOT to get hold of this region and get lion share ,now when they are looking after seven years there is no gain Millband is saying WOT is wrong.

India also energy hungery country need oil and gas but it pass through Pakistan and Pakistan get its share ,Allah has gifted Pakistan with lot of resources dont worry :

 

[Anwar2]

Pakistan has been fighting the American war on Terror virtually free of charge. We have been stupid enough to take the Ownership of the war, for rather paltry wages. Great swaths of our territory have been frozen out of national economic mainstream due to Army operations.
the real cost is estimated to be more like US$ 60b, not $ 34.8b.
The only beneficiaries are a select coiterie of Generals and corrupted political leaders.
The only honorable options to do is to pull our forces out from the Western Border; or for the US to pay all the arrears, followed by the right price for Logistics support and Security. The estimated fair price of US$ 15-20b per year will still be a tiny fraction of the cost of Afghan operation by US / NATO.

 

[waraich66]

Pakistan has been fighting the American war on Terror virtually free of charge. We have been stupid enough to take the Ownership of the war, for rather paltry wages. Great swaths of our territory have been frozen out of national economic mainstream due to Army operations.
the real cost is estimated to be more like US$ 60b, not $ 34.8b.
The only beneficiaries are a select coiterie of Generals and corrupted political leaders.
The only honorable options to do is to pull our forces out from the Western Border; or for the US to pay all the arrears, followed by the right price for Logistics support and Security. The estimated fair price of US$ 15-20b per year will still be a tiny fraction of the cost of Afghan operation by US / NATO.

Dont see WOT in that prospective that what we are spending ,our success is to keep in guage US and NATO in that area.US is spending 25% of 860 BUSD annually.Pakistan could not say no to bigest war machine of world straight forward.

There is big game going on in Afghanistan OBL is not major target now real target is Pakistan's nukes.Israel and India are now key player in new strategy of WOT

If you remember the bush statement before the start of WOT either you are with us or against us ,in that case Pakistan adopted right strategy knowing that once US and NATO in they could not leave Afghanistan for next ten years.

US want to get excess of safe path to tap oil resources in central asia china and pakistan have joint strategy to keep US for longer period and let them get exhausted .

Ultimately victory will be for Pakistan and Afghans and china.

 

[fatman17]

US fails to pay terror war charges to Pakistan

Thursday, January 22, 2009

By Mehtab Haider

ISLAMABAD: Despite losing precious lives of its Army personnel in the US-led war against terrorism, Islamabad has not received a single penny from Washington out of its forwarded reimbursement bills during the financial year 2008-09, official sources confirmed to The News.

Pakistan’s budget planners have estimated that Islamabad would get around $1 billion from the US in the shape of reimbursements for rendering services in the fight against the Taliban in the volatile tribal areas bordering Afghanistan. But nothing has so far been received from the US after a passage of six and half months of the current fiscal year, sources maintained. The government had been borrowing from banks to manage day-to-day expenditure incurring on the military. The US will not pay the interest rate on the principal amount either.

When Adviser on Finance Shaukat Tareen was asked in this regard, he confirmed that Islamabad was waiting for reimbursement of $156 million, which was expected to be released within the current month.

However, sources said Pakistan had sent $156 million reimbursement bill in April 2008 and it was expected to be released within the next couple of weeks. “There were other bills as well which we sent to Washington after reconciliation done by the US officials here in Islamabad,” sources said and added the total forwarded military reimbursement bills so far stood at $500-600 million.

The delay in reimbursement could be attributed to the transitory phase in the US politics after the presidential elections in November, sources said. Pakistan is negotiating a change in the reimbursement mechanism with the US, which Islamabad had already spent on the military. But US officials say they required approval of the Congress 15 days before releasing any amount under its law.

“Every year we bear the cost of interest payment to the tune of Rs 5-10 billion as delay in payment is a constant phenomena,” an official said. The US has designated a brigadier-level officer at the US Embassy in Islamabad, who is responsible for forwarding defence-related spending to the Pentagon after reconciling it with the Pak military authorities on monthly basis.

According to a break-up of total US assistance of up to $9.3 billion, Pakistan was going to receive around $5 billion as reimbursement against expenditures already incurred by Islamabad on the war against terrorism in the tribal areas.

“It is a budgetary item and receiving reimbursement from the US is treated as non-tax revenue,” the official said. Against total bilateral assistance of $4.3 billion, Islamabad has so far received around $297 million every year from 2003-04 to 2007-08 in the shape of Foreign Military Grants (FMG) as $3 million service charges are being deducted by US authorities every year. Total amount in the shape of the FMG received by Pakistan was around $1.3 billion till 2007-08.

The US government had also promised to provide $300 million every year out of $3 billion. This amount has been shifted to projects going on under the USAID programme from the current fiscal year. The official said Pakistan was paying a heavy price after becoming a frontline state in the ongoing war against terrorism by losing precious lives of its military personnel and also because the war was now costing heavily in terms of growing financial difficulties.