WASHINGTON, Feb. 6 (UPI) -- President George W. Bush will be requesting nearly $390 million in grants for Pakistan for the upcoming fiscal year beginning Oct. 1 -- a considerable increase from the $305 million the country secured for the 2003 fiscal year, a Pakistani government official said Thursday.
The Bush administration has been increasing the amount of grants provided to developing countries for humanitarian assistance and basic social needs, and has been cutting back on interest-bearing loans, often provided to less socially oriented projects. Pakistan is a close U.S. ally in the war against terror and Washington has been stepping up efforts to spur economic growth in the largely Muslim country of 160 million people.
Of the $389.25 million Pakistan hopes to secure, the country is expecting to set aside $200 million for its economic support fund.
"We will get this money in cash for social and development sectors," said Pakistan's Deputy Chief of Mission Mohammed Sadiq.
The grant requested for 2004 also includes development assistance funding to the tune of $50 million, as well as $75 million for buying arms from U.S. suppliers, and $1.25 million for training Pakistani military officers in the United States.
Meanwhile, Pakistan hopes to secure $25 million for its child survival and health program fund, while the government is pegging $38 million for law enforcement and narcotics control.
The 2004 grant, however, cannot be used for debt relief, unlike the funding for the current fiscal year, which did allow Pakistan to use the money to pay off its foreign debts. For the current fiscal year, the country allocated $200 million of the $305 million available to reduce its debts.
Pakistan continues to shoulder $36 billion in debt to foreign creditors, which has shrunk slightly from the $38.5 billion it held two years ago. Nonetheless, Pakistan's efforts to service its debts has been the government's single biggest expenditure, and the country owes $1.9 billion to the United States alone, having secured $1 billion in debt relief from the administration last year when Pakistani President Pervez Musharraf met with Bush last year.
