USA to lift some sanctions

WASHINGTON, Nov 7 (UNI) — In a major development, US President Bill Clinton has decided to lift a bulk of the economic sanctions that the USA had imposed on India and Pakistan in protest against their nuclear tests in May.

However, the ban on weapons sale and transfer of dual-use equipment such as the supercomputer will remain in place as before. But, the two countries will have access to US credit and development agencies.

Prohibitions in Indian and Pakistani participation in US foreign investment and trade promotion programmes also will be lifted. The programmes are carried out by the Overseas Private Investment Corporation (OPIC) and the Export-Import Bank. The programmes were worth $ 300 million in case of India before the imposition of sanctions.

A senior US official, who made this announcement last night, said the decision to relax sanctions followed the progress made by the two countries in curbing their nuclear weapons programmes and their commitment to have a moratorium on further testing.

President Clinton, who was given authority to waive sanctions by Congress last month, is expected to make a formal announcement, lifting the curbs on New Delhi and Islamabad, within the next few days.

Official circles here hope that this US gesture will help persuade the two countries to formally sign the CTBT, abandoning their reservations.

The official drew attention to the promise by India and Pakistan to adhere to the Comprehensive Test Ban Treaty (CTBT) which the USA wants both countries to formally sign before it comes into force in September, 1999.

He said they had committed themselves to strengthening controls on sensitive materials used in the weapons of mass destruction. Besides, they were considering controls on the production of fissile materials and agreed to participate in the negotiations, currently going on in the conference on disarmament in Geneva, on a treaty on the subject.

Details of sanctions to be lifted

The following are the details of the sanctions that the USA has decided to lift:

1. The US Export-Import Bank (EX-IM), Overseas Private Investment Corporation (OPIC) and the Trade Development Authority (TDA) will now be able to participate in deals in both countries.

2. Pentagon will resume international military education and training programmes in India and Pakistan.

3. Access to US development agencies will be restored.

4. Earlier, Mr Clinton had signed legislation exempting US grain exports from a ban on US commodity credit financing and had softened the sanctions to allow World Bank funding of humanitarian projects such as water supply facilities.

5. Mr Clinton has authorised US officials to approve international bank loans and a debt restructuring agreement with the International Monetary Fund in case of Pakistan.

The curbs left in place :

1. Bans on military equipment sales to both countries.

2. Restrictions on the export of USA-made "dual use" items that could have military applications.

3. US objection — which amount to a vet — to development-project lending to India by the World Bank and other international lending institutions. (There has never total ban on trade with or investment in either country).

4. US banking sector loans to government and their agencies in India and Pakistan.

Steps taken on India and Pakistan that weighed with Mr Clinton in relaxing sanctions are:

1. Their accommodation with the international arms control system, including voluntary moratoriums on further tests.

2. Their commitment to adhere to the Comprehensive Test Ban Treaty (CTBT) by September 1999.

3. Their participation in negotiations on a treaty banning the production of fissile materials.

4. Resumption of direct dialogue between India and Pakistan about the "disputed territory" of Kashmir and holding their first bilateral discussions on the nuclear issue.

What the USA expects in return for sanction-easing:

Administration officials hope that relaxation of sanctions would encourage new positive steps during Deputy Secretary of State Strobe Talbott’s next meeting with his Indian interlocutor Jaswant Singh, in Rome on November 19. And during the December 2 visit here to Pakistan Prime Minister Nawaz Sharif.

2. Restraints on the deployment of intermediate-range ballistic missiles that could deliver nuclear warheads.

India deprecates 'selective' approach

NEW DELHI, (PTI): India today deprecated the "selective and discriminatory" approach of the USA in permitting lending from multi-lateral financial institutions to support an IMF agreement with Pakistan "whose implosion Washington is keen to prevent".

Giving a guarded reaction to reports from Washington regarding the lifting of some economic restrictions imposed by the USA against India and Pakistan, an External Affairs Ministry spokesman said "we have always maintained that such unilateral and coercive measures are unjustified and counter-productive, and should be lifted."

He said India had nothing against economic assistance to Pakistan and had consistently voted in the World Bank and other fora in favour of such assistance.

"The remarks attributed to US officials, however, reveal a selective and discriminatory approach which we find hard to understand and reconcile with," he said.

Pak welcomes decision

ISLAMABAD PTI: Pakistan today welcomed US President Bill Clinton’s decision to partially lift economic sanctions and hinted that the move would pave the way for flow of much-needed fund and rescheduling of its $ 2 billion loan repayment after signing of an agreement with the IMF.

Mr Clinton, in a letter to Pakistani Prime Minster Nawaz Sharif, who is scheduled to visit Washington early next month, said America would also exercise "influence" with the international financial institutions to meet Islamabad’s economic difficulties, according to an official Press note issued here.

"We intend to lift restrictions on private banks lending and authorise the overseas private investment corporations to resume their activities in Pakistan," the note quoted the President as saying in the letter.