Pakistan, India welcome lifting of U.S. sanctions

Pakistan, India welcome lifting of U.S. sanctions

ISLAMABAD (AFP): Pakistan and India welcomed on Sunday the U.S. decision to waive sanctions imposed after the two South Asian rivals staged tit-for-tat nuclear weapons tests in 1998.

The response was more effusive in Islambad where the government's efforts to pull the country back from the brink of bankruptcy had been hampered by the sanctions' economic impact.

"This is a positive move and I think we appreciate it very much," Finance Minister Shaukat Aziz said in an interview with CNN.

A Pakistan Foreign Ministry statement said the sanctions had always been "unjustified," but added that their lifting would help strengthen cooperation with Washington.

In waiving the sanctions on Saturday, U.S. President George W. Bush said their continuation was no longer in the US national security interest.

India and Pakistan had been lobbying hard for the lifting of the measures, which restricted military sales, financial and economic assistance.

Both sides are expected to play a key role in a war on terrorism declared by the United States in the aftermath of the September 11 terrorist attacks on New York and Washington that left more than 6,800 people dead or missing.

Indian Finance Minister Yashwant Sinha welcomed the sanctions' waiver, but added it was not a "development of earth-shaking importance".

"It's a minor issue as far as the Indian economy is concerned because sanctions have spent themselves out," Singh told the Press Trust of India.

"As far as the Indian economy itself was concerned, except for certain defense supplies, sanctions had no meaning."

On Pakistan's part, Aziz insisted that the move should not be seen as a reward for Pakistan's support for possible U.S. military strikes on Afghanistan, where the ruling Taliban regime has rejected repeated US demands to hand over Osama bin Laden -- suspected to be the mastermind behind the terror attacks.

"There is no question of a payback. This is just a reflection of a better understanding of our views," Aziz said.

While tough austerity measures introduced by the military government of President Pervez Musharraf have kept the national economy afloat, Pakistan is still in dire need of international assistance.

"What (the sanctions waiver) means is that the United States can now support us very directly in multi-national institutions like the International Monetary Fund, Asian Development Bank and the World Bank," Aziz said.

The move also opens the door to U.S. companies looking to invest in Pakistan's textile and oil and gas sectors, and reopens connections with the U.S. Exim Bank.

"In terms of buying commercial aircraft, machinery ... etc, Pakistani entrepreneurs can now look to the US as a source of supply. This would create investment here, create jobs and help the common man," Aziz said.

Pakistan has more than 30 billion dollars in external debt and Islambad is expected to sign an agreement here on Monday on rescheduling 600 million dollars of U.S. loans.

In India, the move is likely to be greeted with a sigh of relief at a large number of major corporations who have been denied access to crucial technologies.

"There are 51 companies which had been classified under an entities list who will be able to get technology," said Commodore Uday Bhaskar, deputy director of the Institute of Defense Studies and Analysis.

These companies had been stopped from gaining technology classified as "dual use" -- with both commercial and military applications.

Pakistan first faced U.S. sanctions under the Symington amendment to the Foreign Assistance Act in 1961 due to concerns over its nuclear program. Most restrictions were later lifted by Congress.

Then, in 1990, all U.S. military and economic aid to Pakistan was suspended under the Pressler amendment which required the president to annually certify that Islamabad did "not possess a nuclear explosive device."

A separate set of measures to punish Musharraf for overthrowing the elected government of Nawaz Sharif in a military coup in October 1999 will only be lifted when democracy is restored.

"We hope in time all sanctions will be removed," Aziz said.