Friends not masters — Part III

This is not the first time that we are on the brink of being abandoned and punished by the US. Remember president Ayub Khan’s 1967 book, Friends Not Masters? A document of disillusionment and disappointment with a ‘friend’ who not only did not come to our aid in our 1965 war against India but had stopped all military and economic aid for going to war against our eastern neighbour with the weapons the US gave us to defend ourselves against communist threat.

Next, by the time the decade of 1990s had ended, Pakistan — the most allied ally of the US during the Cold War — had become the most sanctioned country in the world after Libya. President Bush had stopped all US military and economic aid to the country invoking the Pressler amendment in October 1990 charging Pakistan with crossing the nuclear red-line. In May 1998, president Clinton imposed additional sanctions invoking the Glen amendment punishing Pakistan for the May 1998 nuclear tests. And the Kargil misadventure had carried its own penalties. And in October 1999, the US imposed sanctions related to Musharraf’s military takeover.

At about the same time even the multilateral aid agencies led by the World Bank had effectively turned off for Pakistan their concessional assistance tap on the plea that the newly independent Eastern European countries as well as the Central Asian countries needed the help of these aid agencies more than countries like Pakistan. Japan perhaps was the only country out of all the members of the Paris Club that had continued to donate about $500 million annually to Pakistan during the period.

Still, Pakistan seemed to have negotiated the 1990s not only with equanimity but had waged during this period two low-intensity 10-year-long wars — one on the side of the Afghan Taliban against the Northern Alliance led by the Afghan ‘Mujahid’ Ahmed Shah Masood and assisted by India and Iran, and the other on the side of the Kashmiri freedom fighters inside the Indian-Occupied Kashmir using the so-called non-state actors against the occupying Indian troops.

How did we manage to govern the country and wage the two wars when Pakistan’s economy was being denied the usual quantum of international dole and when the domestic tax-to-GDP ratio had dipped to an abysmally low point?

Well, it was during this period that we had started receiving oil from Saudi Arabia on deferred payment plus the contributions that had been flowing in from most of the Muslim countries, especially from the Middle East all through the first Afghan war that had seemingly continued even when it was over at the same pace and volume for the two jihads we were waging in the 1990s. These transactions had remained mostly clandestine without leaving any official tell-tale paper trail.

On the face of it, the 1990s in retrospect appear to be a lost decade in economic terms. The country had experienced a decade-long shrinking of economic growth and the three unfinished IMF programmes that it had entered and exited in quick succession during this period further curtailed the growth in the name of the Fund imposed austerity.

Meanwhile, the debt-to-GDP ratio had escalated to a depressing 103%. Because of the military takeover of October 1999 even the helping hand of the IMF was not available to Pakistan, as under their respective laws both the UK and US representatives sitting on the Fund board were obliged to vote against the application of a country under military rule. The second Afghan war that immediately followed the 9/11 just about saved Pakistan from complete disaster and we were back in the good books of the US and quickly became its non-Nato ally.

This time we are looking at China not only for the immediate rescue but are also seeing the on-going $60 billion CPEC project as a new avenue of escape from the US wrath. But while enjoying the Chinese ‘largesse’ which also comes with a price tag we must keep in mind that Beijing would never come to our aid if we blunder into a hot war with any of our near or distant neighbours.

Published in The Express Tribune, January 6th, 2018.

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