US disburses $550 million under CSF to Pakistan

Published: March 10, 2017
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ISLAMABAD: The United States has disbursed $550 million under the Coalition Support Fund (CSF) grant to Pakistan, rekindling Islamabad’s hopes for a better external account position that had come under stress due to delay in release of the money.

The Trump administration transferred the funds this month with a fresh tranche of $200 million coming early this week, said an official of the finance ministry. However, despite the beginning of the process of release of CSF funds, it is unlikely that Islamabad will get $1.65 billion in CSF disbursements before the end of June.

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The finance ministry had projected $1.65 billion receipts from Washington on account of CSF when making the budget for the current fiscal year. The government expects to receive at least another $400 million but there is no surety that Washington will disburse this amount on time.

Pakistan’s ambassador-designate to the US Aizaz Ahmad Chaudhry met Finance Minister Ishaq Dar on Thursday before his departure for Washington. Dar asked Chaudhry to put efforts for further augmenting Pak-US economic cooperation and trade.  Although the $550 million appears a small sum for a $300 billion economy, it still matters a lot due to Islamabad’s dependence on external dole-outs.

The $1.65 billion or Rs170 billion are part of the government’s non-tax revenues and any shortfall against these estimates would widen the budget deficit by the same amount, which will force the government to borrow from the banks.

In the last fiscal year too, Pakistan received roughly $1 billion from the US against its budget estimates of $1.7 billion.

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The CSF disbursements are also very crucial for building foreign currency reserves, maintaining dollar-rupee exchange rate parity and lessening strains on the external accounts. During the week ending on March 3, SBP’s reserves increased by $289 million to $17.14 billion, announced the central bank on Thursday. It added that during the last week SBP received $350 million under CSF and made payments of $62 million on account of external debt servicing.

The $200 million came after March 3, therefore are not part of the $17.14 billion reserves, held by the SBP. Had the central bank not received $350 million early this month, its reserves would have fallen further due to debt payments. The CSF payments again increased the reserves level to $17 billion.

Published in The Express Tribune, March 10th, 2017.

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Reader Comments (15)

  • Arif Mohammed
    Mar 10, 2017 - 9:21AM

    We have Nukes !Recommend

  • BrainBro
    Mar 10, 2017 - 9:23AM

    This proves that the bank account of the government, and the bank accounts of its citizens, are totally different.
    The funds should be raised from thousands of civilian businessmen, who do not pay any taxes, but take hundreds of millions of dollars out of this economy, every year.Recommend

  • abood
    Mar 10, 2017 - 9:30AM

    Whats the point of this CSF all the money is used by the high ranking officers.musharraf is living a luxury life in dubai with lots of cash.these guys loot us more than anyone else.Recommend

  • salman
    Mar 10, 2017 - 10:16AM

    This money has proper check and balance so it doesn’t go into Govt or General’s pockets.

    Secondly operational cost of ongoing militarily operations is too high and Pakistan will depute their forces at Afghan border for a considerable time now which includes cross border raids as well so money will be needed for that.

    If US can’t stop militants entering into Pakistani land from Afghan soil, than they better keep us providing with financial aid like this with no cuts this year atleast.Recommend

  • Dr.shaikh
    Mar 10, 2017 - 11:45AM

    Well! we should not feel bad that we depend on foreign assistance… every developing country of the world including China receive foreign assistance to the tune of billions and in fact it is duty of the well off societies to help out less well off societies… ind also received 2.5 bn dollar aid just from u.k it also receives aid to the tune of 10s of billions from USA Japan Israel Germany besides the foreign investment it receives in addition… remember that these countries have big pockets of poverty so deserve the help…Recommend

  • Ruby
    Mar 10, 2017 - 12:21PM

    It is not the 300billion dollar economy that matters. US is giving Pakistan 1.3 billion out of its 44 billion dollar federal budget. That is the number by which US’s generosity should be judged.Recommend

  • Feroz
    Mar 10, 2017 - 2:15PM

    Wonder what support has been provided to the coalition to justify the big bills raised and funds received. Not a word in explanation has been provided. Not sure how long this arrangement can carry on and who benefits from it.Recommend

  • Feroz
    Mar 10, 2017 - 2:44PM

    @Dr.shaikh:
    Please let us know the source from which you gathered the information that India has received USD 2 billion in aid from the UK. Amazing how propaganda is lapped up even by those who are educated.Recommend

  • Murali
    Mar 10, 2017 - 2:48PM

    Shows renting the Army is pretty well-paying!Recommend

  • Rex Minor
    Mar 10, 2017 - 7:10PM

    @Murali:
    UNO could pay more but after its lousy performance in Somlia peace mission, there is a hesitation n the inner circles of the UNO. Perhaps their latest practice with its own citizens they have improved their policing skill and there is no harm in applying for some productive humanitarian work.

    Rex MinorRecommend

  • Pakistani
    Mar 10, 2017 - 7:12PM

    Thank you USA for keeping your word.

    Lets build a solid long term partnership.

    We want friendship with everyone.

    I hope you wil understand Pakistan’s perspective that Indian backed terrorists operating out of Afghanistan have to be neutralised.Recommend

  • Gujneja Jee
    Mar 10, 2017 - 11:02PM

    It is not a free ride but transaction service charges for use of infrastructure (road, airports etc.). I could be wrong but think that Pakistan is being paid less than actual costs of such logistic support.Recommend

  • mohammed
    Mar 11, 2017 - 12:29AM

    thank you America , may allah give you 100 time thanks Recommend

  • Rex Minor
    Mar 11, 2017 - 1:28AM

    @Gujneja Jee:
    It is not a small sum, considering that the chinese are also participating in the dole?

    Rex MinorRecommend

  • Arthur
    Mar 12, 2017 - 1:08AM

    So who is going to be richer now? I would like to see the before and after balances of the bank accounts of people concerned. Both local and foreign accounts by the way.Recommend

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