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Biden administration is strengthening Pakistan with impunity in response to India’s support to Russia

Abhishek Kumar Singh by Abhishek Kumar Singh
26 June 2022
in Geopolitics
Biden administration is strengthening Pakistan with impunity in response to India’s support to Russia
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There is a saying in Hindi, “Marta Kya Na Karta” (if you are dying, you will cross any moral boundary to help yourself). Currently, it is an apt way to describe US’ attempt to rekindle its stature in Southeast Asia. Biden administration is now trying to revive a failed state in response to India’s support to Russia.

Pakistan to get more IMF loans

According to a report by The Hindu, the doors for Pakistan availing loan from IMF have reopened. In July 2019, IMF had agreed to provide $6 billion to the Pakistanis. The country was supposed to avail it over 39 months. But, Imran Khan-led government could not fulfil the collateral commitments to IMF and up until now, only $3 billion has been availed to the military state.

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Read more: Pakistan’s ‘non-existent roads’ are faster than India’s 8-lane expressways; says the IMF

After the change of guards, Pakistan finally committed to fulfilling some of those commitments. One of them is sucking money out of already empty Pakistani pockets. In a country already hit by drought and hyperinflation, Pakistani authorities imposed an extra levy on fuel to generate estimated revenue of Rs 43,600 crores. Additionally, taxes have been imposed on firms according to their income bracket, effectively punishing them for succeeding in an already corrupt environment.

Through these measures, Pakistan has been able to persuade the IMF to facilitate $2 billion in addition to the already existing $6 billion bourses. Now, the total loan extended to Pakistan is worth over $8 billion.

Biden administration is assisting Pakistan

The development is welcoming for Pakistan’s economy, though it is not so for geopolitical equations. Institutions like IMF are run mainly by the US and its allies. Without their explicit (sometimes) approval, it is next to impossible to get any kind of funding from the institution.

This is exactly what is wrong with the extended loan to Pakistan. The United States is aiding Pakistan in getting money from IMF. Not only from IMF, but the Biden administration has also coerced its companies to invest in Pakistan. Let me explain the coercion angle.

Pakistan’s economy is in the doldrums, inflation is the highest in its entire existence. The situation is so bad that people of the country can’t even afford tea at the moment. Add to that increasing internal strife and India planning to chokehold the Indus water supply.

The future ahead is bleak and any novice investor can tell you that investing in that Geography is like living in a fools’ paradise.

Read more: Chai, Lassi and Sattu – The three horsemen of Pakistan’s economic revival

But, if we look at the numbers, US companies are actively investing in the terrorist nation. In the first quarter of the Financial Year22, FDI coming from the US surpassed that coming from China. In fact, on year-on-year terms, it increased by more than 400 per cent.

Though trend keeps changing, by and large, the USA is always there in the top 3. In May this year, the US was second behind Norway. Compared to China’s $17.3 billion, US companies invested $17.6 billion. The humongous sums being invested are not possible without coercion. Coercion may come in form of an incentive, but it is still coercion.

The US is trying to counter Russia

Wherever the US government invests its money and muscle, its ultimate motive is taking some strategic brownie point out of it. By investing in Pakistan, it is trying to counter Russia. For the last few months, the India-Russia bond has grown stronger than ever. Russia is now the second-largest supplier of oil to India.

On the other hand, India has paid it back with covert diplomatic support by staying neutral on every resolution against Russia. Additionally, it has not participated in the sanctions war against the Putin regime.

Read more: From Southeast Asia to Europe: The World is hungry for Indian Rice and India is ready to feed them

The sanctions on Russia did not work. In his State of the Union address, Biden promised to tank Russian Rouble; instead, Rouble became stronger than ever. Russia then went on to initiate efforts to counter the US’ efforts by pitching for its currency of BRICS nation.

Similarly, the plan to launch a G8 by Russia also has sent shivers down the White House’s neck. In all these aforementioned leads which Russia has been able to register, India’s role became pivotal. Without doing much on its own, India is acting as a moral pivot for bringing the developing world, otherwise strategically neutral under Russia and its own sphere of influence.

This is what is irking the Biden administration. They cannot afford to take China on board, simply because China has a habit of backstabbing. On the back of rising economic and other statures, India no longer wants to stay in the good books of the USA. The White House knows it.

Fostering terrorism always backfires

The only nuclear power left in the region, which America can control is Pakistan. And there could not be a better opportunity to take it on board. Pakistan badly needs money. China is slowly decreasing its funding to Pakistan. Over the last few months, its FDI in Pakistani territory has decreased. Its other investments in CPEC are also at risk since separatists in Pakistan are working hard to eliminate Chinese influence in the region.

Once again, the US is trying to emerge as a messiah. But, once again it is going to be a colossal disaster. Even if we assume that Terrorism has no religion, it has certainly a territory and that is Pakistan. Fostering terrorism to counter Putin is not a smart move on Biden’s part.

 

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