Friends of Pakistan
October 22, 2008 MUCH was expected by Pakistan from its Friends, in particular about $100 billion, but the man who expressed this idea, President Asif Zardari, has surely been disabused of this idea by his preliminary meetings with representatives of the Friends. But what has caused a shock to most Pakistanis has been that the USA has been blatant enough to leave it to its Assistant Secretary of State, Richard Boucher, to make the announcement. The Friends of Pakistan who will meet as scheduled in Dubai are actually an orchestration by the USA of how much aid is to come to Pakistan. More important than the amount, though that is also important in this era of cash-strapped economies crippled by the current financial crisis, is apparently who is lending the money. The USA is clearly inclined to Pakistan receiving a loan from the IMF, with all the attendant conditionalities that IMF is notorious for.
The Friends of Pakistan meeting is nothing more than a device to ensure that Pakistan turns to the IMF for the help it needs to survive a crisis that has occurred in the USA, partly because of the bad judgement of American financial experts, and mostly owing to our own faults. As a reward for that, and for being the USA's most devoted ally in the War on Terror, Pakistan is left with no recourse but to go to the IMF, and be its lab for all its economists' failed theorisings. Boucher, who has been responsible for bringing to Islamabad various messages on how the War was to be conducted, has been responsible for delivering a message that clearly indicates that the friends of Pakistan, China and the Gulf countries, refused Pakistan help in its hour of need because they were subject to US pressure. The Gulf countries refused to provide Pakistan the facility of obtaining oil on deferred payments, while China refused Pakistan a simple cash loan.
Now that it has become inevitable, Pakistan should accept the IMF loan, provided that it does not accept any conditionality that in any way militates against the national interest. It should also make sure that any loan, or string of loans, is not misused on any official extravagance, or merely spent on keeping the official machinery running, but only on development which helps increase exports through improvements in industry and agriculture. The government must put itself in a position where it can appeal to all Pakistanis to show the right spirit. Also, Pakistan must not accept American dictation on its economy, especially from an administration that is both outgoing, and has so clearly demonstrated that it cannot handle its own economy, let alone others'. The government also should engage in some soul searching about its financial credibility.