Reopening NATO supply routes: Pakistan to gain $365m annually

Published: May 16, 2012
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The supply routes had been suspended after the killing of 24 Pakistani soldiers during an air raid last year on border posts located in Mohmand Agency. PHOTO: REUTERS/FILE

The supply routes had been suspended after the killing of 24 Pakistani soldiers during an air raid last year on border posts located in Mohmand Agency. PHOTO: REUTERS/FILE

Pakistan is all set to gain $365 million annually under an agreement after the reopening of supply routes for North Atlantic Treaty Organisation (Nato) troops in Afghanistan, a report on The Christian Science Monitor website has revealed.

The Defence Committee of the Cabinet (DCC) had earlier given a go-ahead to lift the six-month old blockade on Nato supplies passing through the country. The supply routes had been suspended after the killing of 24 Pakistani soldiers during an air raid last year on border posts located in Mohmand Agency.

The United States-led (US) coalition is expected to pay Pakistan a fee of $1,500 to $1,800 for every truck carrying supplies through the country. Officials, speaking on the condition of anonymity, said that the bill is estimated to go up to $1 million per day.

Officials in the US have said that they are not aware of how much cost they will have to bear.

The US, in return, has asked Pakistan to provide security for the supplies which are transported using private local companies, faster customs clearance and checkpoints, reveals the report. Pakistan has not provided security to trucks carrying Nato supplies in the past.

It is estimated that as many as 600 trucks will pass through Pakistan every day between now and next year.

Last week, Nato chief General Anders Fogh Rasmussen had tacitly linked Pakistan’s participation in the Chicago summit on Afghanistan with the resumption of supply lines.

Rasmussen had later extended an invitation to President Asif Ali Zardari. The presidential spokesperson had insisted that the invitation was unconditional and not linked to the opening of Nato supply routes or to any other issue.

Pakistan has also repeatedly demanded that the US issue a formal apology for the raid, while Washington has only expressed deep regret and offered condolences on the killing of Pakistani troops.

The demand for an apology has been the bone of contention between Pakistan and the US for reopening the supply routes. Acting Assistant Defence Secretary George Little had earlier said that the US was still noncommittal to a Pakistani demand for a formal apology.

Many set to gain from reopening of supply routes

Traders of looted goods, the military and militants in tribal areas are all set to gain from the reopening of supply routes.

A report in The Washington Post states that local transport associations have revealed the military indirectly controls 30% of Nato oil tanker contracts. The military had declined to comment on its share.

Traders of looted goods had earlier experienced a downward trend for their business, but are now expecting a boost. A trader who spoke to The Washington Times said that he was selling food, daggers, computers, technological goods and American flags at reasonable prices.

He said that suspension of supply routes had made it hard to meet expenses, but the reopening will be beneficial.

Militants in the tribal area too will benefit once supply routes reopen. They are known to demand protection money from transport companies and also attack trucks to steal the goods.

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Reader Comments (70)

  • Chacha
    May 16, 2012 - 7:20PM

    Faustian bargain.

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  • Shuaib
    May 16, 2012 - 7:25PM

    What a joke considering that this so called “war on terror” has cost Pakistan at least 70 billion dollars and ever increasing as well as over 35,000 people killed! What a small price!

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  • Ali Tanoli
    May 16, 2012 - 7:29PM

    Front of Almighty Dollars if whole nation get killed our shurfah and armees dont even danm care…..

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  • Ashraf P
    May 16, 2012 - 7:30PM

    Mashallah, Pakistan will again be rich !!! Thank you NATO! Thank you America !!

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  • May 16, 2012 - 7:34PM

    Pakistan has lost 68 Billion Dollars (according to Govt’s own figures) since 2001 in 11 years. A simple division operation makes this amount about 6.2 Billion Dollars per annum.
    And here we are; sacrificing the nation & exposing it to a loss of 6.2 billion Dollars in return for 365 million dollars (0.365 Billion). What an idea Sir Jee.
    6.2 Billion Dollars loss (per annum)
    vs
    365 million Dollar income.

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  • Pardeep Singh
    May 16, 2012 - 7:36PM

    @Shuaib: “70 billion dollars”?? It is actually 70 trillion dollars, my friend. Kehne mein kya hai. FYI, Pakistan’s (officially inflated) GDP amounts to $150 billion. In reality it is close to $100 billion.

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  • A2Z
    May 16, 2012 - 7:41PM

    $365m in the pockets of politicians and generals. Its price of 24 soldiers…Our elite and generals don’t give a damn about ordinary Pakistanis.

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  • Sexton Blake
    May 16, 2012 - 7:41PM

    If Pakistan is providing security for the trucks, does this mean Pakistan has to bear the cost if petrol tankers are blown up? Could be a bad deal.

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  • John B
    May 16, 2012 - 7:43PM

    As I said earlier, in the end PAK will settle for the money. It has always been about money.

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  • May 16, 2012 - 7:44PM

    Pakistan has lost 68 Billion Dollars (according to Govt’s own figures) since 2001 in 11 years. A simple division operation makes this amount about 6.2 Billion Dollars per annum.
    And here we are; sacrificing the nation & exposing it to a loss of 6.2 billion Dollars in return for 365 million dollars (0.365 Billion). What an idea Sir Jee..
    6.2 Billion Dollars loss (per annum)
    vs
    365 million Dollar income

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  • nomi
    May 16, 2012 - 7:46PM

    At the end its all about the money.

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  • KiJ
    May 16, 2012 - 7:48PM

    and a good contribution to the next election to buy votes for PPP…Recommend

  • Jan
    May 16, 2012 - 7:51PM

    @Shuaib:

    70 billion dollars, Pakistan wouldn’t be able to reserve 70 billion dollars if it was an initiative in 20 years. Yet alone having spent that amount on U.S. interests over the last 10. Pakistan has always profited from conflict in Afghanistan.

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  • True Muslim Paki
    May 16, 2012 - 7:53PM

    So the math is simple. Earn 365 mil at the cost of 24 soldiers. How’s different from blood money?

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  • May 16, 2012 - 7:54PM

    For those who may say 68 Billion Dollars is a cooked up figure by Anti-American propagandists (that is what all sane voices are called); here is the link from Tribune (about Pakistan’s 2011 official Economic Survey)
    http://tribune.com.pk/story/181426/cost-of-being-a-frontline-state-68b

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  • ashok
    May 16, 2012 - 8:05PM

    @Tribal Insafian:

    Government figures?

    Ask your government whatever happened to $28 billion (equivalent to almost Pakistan rupees 2800 billions) given to Pakistan since 2002 in addition to waiver of interests in billions of dollars and secretly funding of ISI budget up to 50% since 2002.

    Military says they did not get it and civilian government says they did not and do not have any say in the disbersement of USA dollar aid while USA has receipt of all that was delivered to establishment.Recommend

  • j. von hettlingen
    May 16, 2012 - 8:09PM

    This agreement shows that both Pakistan and the U.S. are rational and pragmatic players. One hopes that this relationship of convenience would go on without setbacks till 2014.

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  • Nadir
    May 16, 2012 - 8:13PM

    NLC about to make a pack of money!

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  • Bakhtawar
    May 16, 2012 - 8:13PM

    we are sovereign, we are sovereign, we are sovereign, we are sovereign, we are sovereign, we are sovereign, we are sovereign,
    .
    .
    PLz make me believe it!!

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  • Batman
    May 16, 2012 - 8:14PM

    @ashok, I hate when people make up figures. $28 billion aid rofl most of which are reimbursments thus don’t even qualify as “aid”.

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  • Cautious
    May 16, 2012 - 8:17PM

    Your relationship with America has devolved into a tariff per truck – doesn’t that concern anyone? The trucks will eventually stop and probably sooner than you expect since America is already winding down it’s war — but Pakistan’s need for American’s political and economic clout will continue. You have all but ruined your relationship with American amd it’s likely that a few years from now many will question whether it was worth it.

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  • May 16, 2012 - 8:26PM

    @ashok:
    28 Billion Dollars? Double-check your data please. Check this link to know the exact figure of aid to Pakistan since 2001 (max 20 Billion including 9 Billion Dollars of CSF)
    http://en.wikipedia.org/wiki/Foreignaidto_Pakistan

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  • asim
    May 16, 2012 - 8:33PM

    This government got 20b plus loans in last 04 years. Where are those?
    So this money will also go into their pockets

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  • YP Toronto
    May 16, 2012 - 8:33PM

    Overseas Pakistanis remit about 12 billion dollars annually.

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  • Mwaqar
    May 16, 2012 - 8:41PM

    GOOD N POSITIVE MOVE.PAKISTAN SHOULDN’T ISOLATE ITSELF IN INTERNATIONAL COMMUNITY.
    All those who are bashing Zardari or asking where is the Army Chief are living in denial.First,Pakistan is making money cause of this,second,some people have jobs cause of this.Third,Lets face reality,Pakistan depends on foreign aid,if you challenge international community then you are the one who will be screwed.Recommend

  • Hasan Mehmood
    May 16, 2012 - 9:13PM

    @Tribal Insafian:
    What a stupid comparison. 6.2 Billion $ is our estimate not accepted by anyone nor there being any possibility / avenue / mechanism for its reimbursment. On the other hand 365 Million is a real money coming through a real deal.

    By the way a huge portion of the so called 68 Billion Dollar direct and indirect loss can be safely attributed to the local militants beloved to a significant portion of our rightist intelligensia.

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  • BlackJack
    May 16, 2012 - 9:18PM

    To all those who are complaining about the billions that you lost in the war on terror because of the militants that you did not create and the extremism that you did not nurture, there is a concept in economics called sunk-cost fallacy. Pls go through it and take renewed delight in the $365 mn that you have gained.

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  • Hasan Mehmood
    May 16, 2012 - 9:19PM

    @John B:
    Why are you always so sarcastic. Any problem?
    Maybe you want us to carry out aerial bombardment of NATO convoys.
    Will that make you happy?

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  • Sajjad Ashraf
    May 16, 2012 - 9:24PM

    For God sake learn to live by principles. We are a rentier state. Doing things for money against honor is the world’s oldest profession. There is no ‘ghairat’ in our position. Honorable nations act differently.

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  • Hasan Mehmood
    May 16, 2012 - 9:25PM

    @True Muslim Paki:
    Well if thats blood money we should be grateful. Try getting any blood money from your beloved militants who routinely slaughter the captured soldiers. Instead of any punitive action we are glad and thankful, if they return the heads after a lot of third party pleading.

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  • zain
    May 16, 2012 - 9:25PM

    Why our Indian neighbours are so interested in our internal matters? – We spend 28 billion or 2800 billions, it is pakistan internal matter. Are we seeking funding from India ? .Are we pakistanies too special or important for you guys? Literally I see every other day, Indian coming up with lame statements on many topics on this website.

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  • David Salmon
    May 16, 2012 - 9:35PM

    Why not use the “transit fees” to pay down the circular debt and reduce loadshedding?

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  • Muhammad
    May 16, 2012 - 9:45PM

    Shows how good are these politicians in keeping up with their words.They have made Pakistan a rental state. You just pay in advance or in compensation and do everything you want. No one cares about common people. Its just like saying “oh people!!! you will get like 100 million every year. and with this 100 million begged and gifted amount we will improve your lifestyle and Pakistan”. Guess what happens, those millions of dollars go in their pockets. Worst part is Pakistan’s economy is dictated and is run by United States funds, well mostly.

    We should stand for our own good and work hard to be successful rather than living on aid and money earned by selling our souls. Friendship should be sincere. And yes one more fact, every year Americans loose millions of Dollars in terms of destroyed and stolen containers. It is not just the need of USA but the need of Pakistani crocodiles, because if there is no supplies of stuff, a chance of millions of dollars of corruption is fading. Recommend

  • Prasad Babu
    May 16, 2012 - 9:47PM

    @Zain – “Why our Indian neighbours are so interested in our internal matters?”

    Because we Indians love you so muchhhh…

    But seriously, are you asking us to leave you alone? Do you see the irony in that request?

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  • anonymous
    May 16, 2012 - 10:02PM

    The $365 million per year may seem like a smaller amount, as posted above by some folks. However, the intangible benefits also need to be taken into account: avoided isolation, sanctions, and got an invitation for Chicago summit to decide things further.

    This in no way means the lost lives are less valuable, but folks need to move on for the betterment of survivors. The alternative could have been pretty bleak.

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  • May 16, 2012 - 10:06PM

    So they say it right …“Every thing has a Price…”

    @Our Dear Friends in INDIA and rest of the world , who are too obsessed with our each and every matter … Common !! Find another hobby … Don’t Worry We are not going to do any thing like what your media tells you in each and every news break ..Seriously !!

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  • anonymous
    May 16, 2012 - 10:23PM

    @Zain Try visiting TimesOfIndia or other Indian newspapers and you would find many Pakistanis commenting on Indian news reports. I don’t see anything wrong as long as the comments are constructive. Remember we are human first, before our national, or religious identities. Curiosity crowd rings bell?

    Secondly, I do think there is a moderator who gets most of the junk and abusive comments out.

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  • Kanwal
    May 16, 2012 - 10:38PM

    Why there is no referendum in Pakistan to ask the nation what they want. I guess they know what we want. thats why they are doing exactly the opposite.

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  • Hedgefunder
    May 16, 2012 - 10:57PM

    @zain:
    You too are free to express your views all over the world !
    Cpme to UK publications and do express your views ! Its free too !
    But when one keeps an Eye on their neighbours, it is with concern as their track record is pretty Lame and one simply can not afford more Unstability in their own countries !

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  • Hedgefunder
    May 16, 2012 - 10:59PM

    @Kanwal:
    This is Democracy, Pakistan style !

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  • AK
    May 16, 2012 - 11:06PM

    $365m for how long..? I heard troops are about to pull out of Afghanistan by 2014. It will be a payback time for Pakistan after that.

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  • May 16, 2012 - 11:22PM

    We just need money, no matter who is doing what, let them do their job we just need $s. But these US dollars will direct go to swiss banks these $s not for the poor people of pakistan.
    I afraid of our leaders and politicians they will agree for everything when someone show them $.
    Oh Allah Please help pakistan and its people..

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  • Ahsan Nisar
    May 16, 2012 - 11:59PM

    Just like an apple a day keep the doctor away, similarly, a million dollars a day keep all the worries away…!!!

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  • Afridi
    May 17, 2012 - 12:01AM

    if military doesnt care abt the people then why should the politicians do ..

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  • Kaspar
    May 17, 2012 - 12:04AM

    This good news should give us a feeling of de ja vu This is not new territory. We received such money (in billions of dollars, not millions, mind you!) during Zia’s tenure, when the dollar was worth much more. Then we received millions during Musharraf’s rule. Many generals and politicians and soldiers and officials deputed on lucrative posts plus contractors asked to supply specific goods and transporters who transported such goods got rich, some of them filthy rich, but the country remained poor. So did the ordinary man.
    So don’t expect miracles from these $365 million!! What amazes one is the stark political and intellectual bankruptcy of the current regime. They seem to have succeeded in hoodwinking the people by holding parliamentary debates on the supply route, passing resolutions in parliament about the ‘guideline’ on the issue, and vowing not to open the supply route. And what did they end up? Not that opening or not opening the supply line is correct. The point is that they are either stupid or too clever, street smart, so to say. They should have been straight forward, asked the US and NATO to pay more for keeping the supply line open. At least they wouldn’t then have appeared as hypocrites and cowards!**Recommend

  • Ahsan Raza
    May 17, 2012 - 12:28AM

    Oh what a shame … for the Americans. They could’ve bought our national leaders out for much MUCH cheaper than this.

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  • Aftab Kenneth Wilson
    May 17, 2012 - 12:31AM

    Your Most Obedient Servant ……… anyhow, the deal is not bad.

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  • Hadi Ansari
    May 17, 2012 - 12:33AM

    Sometimes,though for a change,we must discount the statistics provided by the governments and other institutions around the globe.We have no credible means to counter check them.The current global financial crises and Greece episode are the examples we can learn a lot.We hear politicians claiming loss of 50 to 80 billion dlrs but no one as for as I know has explained how those figures have been arrived at.There is no doubt country did loose huge sums of money and valuable lives as a front state in fighting war on terror.Whatever Pakistan received from NATO/USA as reimbursement towards expenditure incurred by Pakistan must not be considered as aid or loan.
    Closure of supply route to NATO/USA was not a popular or only option for Pakistan.It shows how ignorant and irresponsible advisors the ruling elite has on it’s pay role.Country’s foreign policy and day to day functioning of govt machinery should have no room for irrational emotion.

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  • haroon ali
    May 17, 2012 - 12:49AM

    you can few million dollars per lose billions of dollars because of the atmosphere created due to this decision.

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  • FactCheck
    May 17, 2012 - 12:58AM

    @Shuaib:

    Cost $70 billion to fight the snakes Pakistan created and still nurturing. It is always money for Pakistanis. Eventually, Pakistan will sell its land piece by piece to the Saudi’s and deposit the money in Dubai, buy Villas in the French Rivera, buy condos in London and Paris.

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  • Mohammad Ali Siddiqui
    May 17, 2012 - 1:17AM

    Money can buy anything.

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  • Balma
    May 17, 2012 - 1:30AM

    Am I the only one with a good sense of humor here or did no one else notice the following comment in the article?

    Traders of looted goods, the military and militants in tribal areas are all set to gain from the reopening of supply routes.Recommend

  • Arindom
    May 17, 2012 - 1:50AM

    @M.Aswad Mehatb:
    Sorry, can’t help it – other news sites are dull and boring – all about policies and progress and development. But Pakistani news sites are full of ACTION and MAYHEM and MURDER!!!

    Really spices up my mornings!!!

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  • Polpot
    May 17, 2012 - 1:55AM

    It is now cast in stone: The US PAK relationship is 100% transactional.

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  • curious
    May 17, 2012 - 3:13AM

    NATO is paying TOO LOW.

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  • Jack
    May 17, 2012 - 3:21AM

    its all about money money money

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  • AFPAK
    May 17, 2012 - 8:40AM

    @Tribal Insafian:

    You may want to learn the corruption in Pakistan army and millions given by USA to Pakistan to reimburse fake bills for road construction by the army which squandered billions in buying India specific weapons in the name of fighting Taliban and AlQuada.

    US aid to Pakistan- US tax payers have funded Pakistani corruption – research paper by Izeem Ibrahim –

    http://belfercenter.ksg.harvard.edu/files/FinalDP20090608092009.pdf

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  • from india
    May 17, 2012 - 8:46AM

    That is $1 million a day. Is that what NDN countries are also getting. Me thinks Pak settled for very less. Who was negotiating these deals?

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  • May 17, 2012 - 9:57AM

    @Shuaib:

    The entire budget of Pakistan is around $10 Billion. What sense does it make if you claim Pakistan is losing 7 times that amount?

    The Pakistan GDP is valued around $150 Billion. If it was indeed losing 70 annually, it would have collapsed long long back.

    Somebody in the Urdu Media is giving your wrong info. It just doesn’t make any sense.

    Also, how can USA help if some of the World’s most dangerous Terrorists are found in Pakistan? Is it their responsibility or is it the responsibility of the security forces in Pakistan?

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  • khan of quetta
    May 17, 2012 - 12:08PM

    we have to do what they say we are dependent on them

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  • Hunter Punter
    May 17, 2012 - 1:47PM

    @Tribal Insafian: Totally cooked up figure. In pakistan, everything is a big lie. Thats why world has no faith and trust in pakistan.
    In anycase add to this 30% of cargo looted and thats a huge figure
    Frankly pakistan overplayed its hands and went on like a stuck record about 24 soldiers. More than that number have been killed and behaeded by pak taliban, and not one pakistani protested. perhaps because you cant expect Taliban to pay compensation!
    Pak is part of GWOT. it has been for 30 years. it has made loads of money from NATO/USA. Army and Generals are filty rich, and politicians and businessmen are enjoying lavish good times. Maximum number of lavish property owners in London, canada, New york are pakistanis. Pak university students too have lavish lifestyles.

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  • Sexton Blake
    May 17, 2012 - 8:26PM

    $365 million works out at less than $2 per Pakistani, or less than 180PKR. On a daily basis this works out to half of 1PKR, which will not place too much bread on the table. When one considers that NATO/U.S countries have created most of the military/terrorist problems in the Pakistan/Afghan region, and will now have full use of Pakistan infrastructure, and other resources, for 0.5PKR per person. I would think by any measurement that the West have got themselves a good deal. Without wishing to sound critical of the Pakistan Government, because they have a lot of problems, they have to stiffen up their negotiating skills, because the Americans will take advantage of them every time, although I thought this had been made obviously apparent over the last twenty years. I do not know what it costs to clean up after daily drone attacks, but I will take an even bet with anybody that it will require much more than 1,000,000KPR per drone. This reduces the average Pakistanis take even more. I recently had a minor car accident. I solved the problem at the cheapest possible cost. The bottom line for me was 1,100,000KPR. If a bomb is dropped it damages vehicles, houses, drainage, people, and requires hospital treatment. I know that many comments refer to corruption. I do not doubt them. Why should Pakistan be different from other countries? However, the Government has to cope with a lot of hidden costs, many of which are the result of their so called foreign friends.Recommend

  • shakil
    May 18, 2012 - 2:13AM

    can anyone ever stamp their authority and refuse to accept the charity or to be precise the toll tax for using our soil to manipulate our neighbours into hating us even more with more hostility along the border and never ending feuds. When would we open our eyes, till we are dead and buried?

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  • Sandip
    May 18, 2012 - 2:25AM

    @Tribal Insafian: You sure these figures are right? All Pakistani governments have earned a lot of notoriety for fudging figures big time. Please have these numbers checked.

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  • Sandip
    May 18, 2012 - 2:38AM

    @Batman: Most of the “reimbursements” don’t qualify as reimbursements either. What a nice way to first light fires and then ask for money to douse it. That is when the establishment is not busy fudging figures and presenting false bills for reimbursements.

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  • Sandip
    May 18, 2012 - 2:42AM

    @Sajjad Ashraf: Sure they do. You had an example next door – Taliban. Now they are living in the mountains. Are you prepared to do that? If yes, then march on. But please do not expect too many to follow you. Not even from your very own “Ghairat” brigade. You would be surprized to see that the brigade would be smaller than a company.

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  • Sandip
    May 18, 2012 - 2:44AM

    @zain: Indians love you guys. Hence they do not want to see you suffer. After all both are estranged brothers. Right?

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  • Sandip
    May 18, 2012 - 2:49AM

    @Ahsan Raza: You bet. But they also had to buy the guys in uniform. So the packge deal pushed up the amount by equal measure. Not a very good deal. You usually get it cheaper when you go for packaged deals.

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  • O B Server
    May 18, 2012 - 4:22AM

    Damned if you decide and damned if you don’t!

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  • Pak Tester
    May 18, 2012 - 4:34PM

    365 what a figure?? It counts to the days in a year. A co-incidence??

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