On Tuesday, US Assistant Secretary for South and Central Asia, Donald Lu, announced that President Joe Biden has requested $101 million in aid for Pakistan aimed at supporting democracy and human rights within the country.
Speaking before a committee of the American House of Representatives convened to discuss the United States budget for South Asia, Lu outlined the intended use of the funds. He emphasized that the aid would be directed towards combating terrorism, supporting economic reforms, and providing debt relief for Pakistan.
Lu, who was previously accused by Pakistan Tehreek-e-Insaf (PTI) founder Imran Khan of orchestrating the downfall of his government in 2022, detailed the critical role of this financial assistance in stabilizing Pakistan’s economy. Despite securing a 37-month International Monetary Fund (IMF) program, Pakistan’s economic conditions remain precarious.
The IMF program, which follows a short-term $3 billion agreement completed earlier this year, helped stabilize Pakistan’s economy, avert a sovereign debt default, and set challenging revenue targets necessary for IMF approval. The new agreement has introduced increased taxation on agricultural incomes, a move aimed at boosting government revenue and reducing the recurrent deficit. This tax increase could see the highest effective tax rate rise to 45% from the current 15%, beginning in 2025—a move brokerage firm JS Global described as “unprecedented.”
In his address, Lu also expressed concern over the plight of women and minority groups in Afghanistan, underscoring that relations with the Taliban government cannot normalize until the rights of Afghan citizens are respected. He urged the Taliban to release all American prisoners in their custody.
The US remains the largest aid donor to Afghanistan, nearly three years after the Taliban took control of Kabul as the last US troops withdrew in a chaotic end to 20 years of conflict. Since the US withdrawal on August 30, 2021, Washington has provided over $17.9 billion in assistance to Afghanistan.
This significant aid request and ongoing support highlight the US commitment to stabilizing South Asia and promoting human rights and economic reform in the region.
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