The federal cabinet in its 22 August meeting chaired by Prime Minister Shahid Khaqan Abbasi, while identifying the possible implications of the South Asia Policy announced by US President Donald Trump, expressed extreme reservations over the significant financial implications for Pakistan in case Washington withdraws from Pakistan well-informed sources told Business Recorder. The top brass of Ministry of Foreign Affairs headed by Minister for Foreign Affairs, Khawaja Asif, closely interacted with Security Institutions; and concluded that the US could use International Financial Institutions (IFIs) to reduce assistance to Pakistan especially for major energy-related projects.
The World Bank, headed by an American, and International Financial Corporation (IFC) - an arm of World Bank - and USAID are key institutions which are providing financial assistance to Pakistan. The US can pressurize other friendly countries to suspend or stop financial assistance to Pakistan. The US could ask the European Union (EU) and other countries to initiate measures for a reduction in trade with Pakistan, the cabinet members were advised as per informed sources.
The EU had granted Generalised System of Preference plus (GSP +) due to which Pakistan''''s exports to 28 countries increased manifold. The second review of GSP plus scheme is due in January next year for which Pakistan has already started consultations. The EU has already expressed its concerns on continued violations of human rights. The US may use influence on the United Kingdom (UK), a major US partner, against war on terror.
The sources said US could discontinue Coalition Support Fund (CSF) and end security assistance and impose a ban on visits of military officials. The US recently barred Turkey from using Pakistani pilots to operate F-16 fighter jets.
The Cabinet was also informed that the US could pressurize Chinese private investors, which would, in turn, compromise the projects under the China Pakistan Economic Corridor (CPEC). "The cost of investment could increase by using the threat of Financial Action Task Force (FATF) for non-compliance with Security Council," the sources added. President Trump prioritized stabilizing Afghanistan. Any terrorist attack in Afghanistan would entail drone attacks on Pakistan and the attacks could be extended to settled areas, he stated in his policy speech.
The sources said local Afghan Commanders had been given more powers which could lead to frequent border skirmishes with Pakistan. Recently the US Ambassador to Pakistan, in his meeting with Pakistani officials, showed concern over long range missiles and tactical weapons; and exhibited concern over tensions between Pakistan and India and offered to play the role of as a mediator to defuse tension rather than resolving issues.
The new US policies would have regional implications. The US would seek alignment of its policies with India and Afghanistan against Pakistan. It also intends to assuage the ''''grievances'''' of India in terms of nuclear tactical weapons. There was an impression within the government circles that the CPEC projects had ruffled USA feathers and it wanted to prop up India in the region to sabotage CPEC projects.