US offers financial aid against reopening of NATO supply route

* Offer given to finance minister for upcoming federal budget

* Pakistan likely to accept over $3 billion assistance package

By Manzoor Qadir

ISLAMABAD: The US has offered a lucrative monetary favour to the coalition government led by the Pakistan Peoples’ Party (PPP) for the federal budget 2012-13 in exchange for resumption of supply routes of NATO forces stationed in Afghanistan, Daily Times has learnt.

The sources privy to recent diplomatic parleys between Pakistani authorities and US Deputy Secretary of State Thomas Nides said that the offer was made to Finance Minister Abdul Hafeez Shaikh for the upcoming budget, which the PPP-led government wants to make “people-friendly” in order to muster public support for the next general elections.

The sources said the fresh US offer was an additional attraction for Pakistan as Washington had already expressed its willingness to pay compensation for 24 soldiers killed in NATO air strikes at Salala checkpost. The US has also offered “other” taxes on NATO supplies passing through Pakistan, they added.

The offer depicts US’ keenness to have NATO supply resumed as soon as possible. It also puts Pakistan’s top hierarchy at crossroads as “what to do and what not to”, the sources said.

The PPP intends to announce the budget for 2012-13 with focus on economic stability, prudent fiscal policy, generating opportunities for youth, protecting vulnerable groups, controlling inflation and social safety net programme. The US offer for financial assistance becomes important in the wake of PPP’s ambitious budget plans.

The sources said the government was in a fix following opposition parties putting conditions before the NATO supply route was re-opened. One of these conditions is forcing the US to end its drone strikes in the Tribal Areas.

However, the sources added, Pakistan was ready to accept the lucrative US offer which would be over $3 billion.

The US offer comes at time when the budget deficit is expected to shoot up to five percent of the GDP because key foreign inflows such as Coalition Support Fund are not likely to fully materialise by June 30, the sources said.

Nides, the US deputy secretary of state for management and resources, had visited Islamabad to discuss resumption of NATO supplies to allied forces.

During his visit, Nides met with different Pakistani officials with a view to formulate a new agreement between the two countries.

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