US Assistant Secretary for South and Central Asia, Donald Lu, said on Tuesday that President Joe Biden has requested $101 million in aid for Pakistan to support democracy and human rights in the country.
Lu, whom Pakistan Tehreek-e-Insaf (PTI) founder Imran Khan blamed for toppling his government in 2022, made the statement before a committee of the American House of Representatives convened to discuss the United States budget for South Asia. He stated that the funds would be allocated to combat terrorism, support economic reforms, and provide debt relief.
Lu emphasized that this financial assistance aims to stabilize Pakistan’s economy, which remains in dire straits despite the government’s recent 37-month International Monetary Fund (IMF) program. This program followed a short-term $3 billion agreement that helped stabilize the economy, avert a sovereign debt default, and set challenging revenue targets for budget approval.
The new IMF agreement includes increased taxes on agricultural incomes to boost government revenue and reduce the recurrent deficit. The highest effective tax rate is set to rise to 45% from the current 15%, effective from 2025, a move deemed “unprecedented” by JS Global, a brokerage and investment banking firm.
Additionally, Lu expressed concern over the situation of women and minority groups in Afghanistan, noting that relations with the Taliban government cannot normalize until the rights of Afghan citizens are respected. He also demanded the release of all American prisoners held by the Afghan Taliban.
Despite the Taliban’s takeover of Kabul nearly three years ago, the US remains the largest aid donor to Afghanistan. Since the US withdrawal was completed on August 30, 2021, Washington has provided more than $17.9 billion in assistance to the impoverished nation.
