US and Pakistan Sign Debt Deal
The United States signed an agreement in Islamabad Monday rescheduling $375.4 million of debt owed by Pakistan and spreading the repayment period over 20 years.
Under negotiation since January, the signing of the agreement was accelerated following Pakistan's decision to support possible US military strikes on Afghanistan.
The loan under the US Official Development Assistance (ODA) Program comprised the US portion of a $1.8-billion package that had been negotiated with the Paris Club.
Under the agreement, signed by US Ambassador Wendy Chamberlin and Nawid Ahsan, the secretary for economic affairs in the Pakistan government, the ODA debt will now be payable over a 20-year period, including a 10-year grace period beginning November 1, 2011.
"This agreement will give Pakistan critical breathing space and reduce Pakistan's repayment burden," Chamberlin said, adding that the United States would, in the coming weeks, be looking at a "broad range" of ways to assist Pakistan's reform program and economic development.
The signing came one day after US President George W. Bush waived a raft of sanctions imposed on Pakistan following its 1998 nuclear tests.
The waiver did not include sanctions imposed after Pakistan President General Pervez Musharraf overthrew the elected government of Nawaz Sharif in a military coup in October 1999.
However, Chamberlin said the US administration would be looking "very seriously" at those remaining sanctions although they would have to be handled by a "different legislative mechanism."
Pakistan Finance Minister Shaukat Aziz, who attended the signing ceremony, said the debt rescheduling would help his government pursue its reform objectives of increasing economic growth and reducing poverty.
Musharraf has promised "unstinted cooperation" to the US war on terrorism and agreed to assist US strikes on neighboring Afghanistan, targeting indicted terrorist Osama bin Laden and the Taliban militia that shelters him.
The United States has identified bin Laden as the prime suspect in the September 11 terrorist attacks on New York and Washington that claimed more than 6,800 lives -- ISLAMABAD (AFP)
© 2001 Al Bawaba (www.albawaba.com)