US nails Pakistan's terror role; Choking of foreign aid next?

United States Vice President Kamala Harris on Thursday met Prime Minister Narendra Modi in Washington. During her interaction with PM Modi, Harris acknowledged Pakistan's sinister role in assisting and aiding the terror groups operating from its soil. Therefore, Kamala Harris has asked Pakistan to take action against the terror groups.

However, it is also pertinent to mention here that the United States has also funded Pakistan over the years. Therefore, Harris' statement on Thursday also puts forth a question related to the same issue. Will the United States cut off or stall its foreign aid to Pakistan?

US assistance to Pakistan

According to the United States embassy in Pakistan, the country has committed over USD 6 billion in civilian assistance and emergency humanitarian response since 2009. In addition, it has also been stated that the United States was the top donor during Pakistan's 2019-2020 fiscal year. 

"Since 2009, the U.S. government has committed over $5 billion in civilian assistance to Pakistan and over $1 billion in emergency humanitarian response. During Pakistan’s 2019-2020 fiscal year, the United States was once again the top donor country to Pakistan of on-budget, grant-based assistance," the US Embassy in Pakistan website reads 

Apart from this, the embassy website also states that the US has committed Pakistan with USD 32.5 billion in civilian and military support since 2002. However, the US Vice President's statement may also indicate that Pakistan might be in a fix when it comes to receiving foreign funding from the US. Moreover, if foreign funding is cut off for Pakistan, which is already debt-ridden will only further its economic woes. 

Back in 2018, former US President Donald Trump too had come down heavily on Pakistan for failing to take action against terrorism. The Trump administration cancelled $300 million in military aid to Islamabad for not doing enough against terror groups like the Haqqani Network and the Taliban active on its soil.

Pakistan might face current account deficit of $12-17BN in 2021-22: Pak PM's ex-aide

Recently, a veteran bureaucrat and former aide to Pakistan's prime minister Imran Khan, Dr Waqar Masood Khan predicted that Pakistan’s economy will be under increasing pressure during the ongoing fiscal and likely to face a current account deficit of USD 12 to 17 billion for 2021-22. Quoting Khan, the Dawn reported that Pakistan's balance of payments crisis is likely to be severe.

“Pakistan’s economy will be under increasing pressure during the ongoing fiscal due to the looming crisis of balance of payments. The country was likely to face a current account deficit of USD 12 billion to USD 17 billion for 2021-22,” he was quoted as saying in the report.