Pakistan's Secret Arms Deal with US: Key to IMF Bailout and Political Fallout Revealed
Pakistan's secret arms deal with the US helped secure an IMF bailout, leading to political favor and overcoming resistance to structural reforms. The deal's impact sparked widespread protests and raised concerns about the country's democracy.
Pakistan's secret arms deal with the United States played a crucial role in securing a bailout from the International Monetary Fund (IMF), according to internal government documents cited by The Intercept. The report states that Pakistan sold arms to the US, which were intended to aid Ukraine in the Russia-Ukraine conflict. The deal confirmed Pakistan's involvement in the conflict and its change in stance under the new government, which had led to the removal of former Prime Minister Imran Khan. The US had warned Pakistan of consequences if Khan remained in power and urged the military to remove him. With Khan out of office, Pakistan became a major supporter of the US in the conflict and was subsequently rewarded with the IMF bailout.
The arms sale not only helped Pakistan secure the financial assistance it desperately needed but also earned the country political favor. This political goodwill proved vital in overcoming resistance to the IMF's stringent structural policy reforms, which triggered widespread protests across Pakistan. The protests are the latest development in an ongoing political crisis that has lasted 18 months and has seen major strikes and opposition against the government. Observers suggest that Pakistani democracy may ultimately suffer as a result of its involvement in the Ukraine conflict and its adherence to IMF demands.
Pakistan is recognized as a production hub for the basic munitions required in protracted warfare. Reports have surfaced alleging that the Ukrainian army is using munitions and ordinances produced by Pakistan, although neither Pakistan nor the US has publicly confirmed this secret agreement. Internal government documents leaked by a source within the Pakistani military provide further evidence of the arms deal with the US. These documents outline the sale of munitions from the summer of 2022 to the spring of 2023 and reveal discussions with US officials regarding contracts, licensing, and requisitions linked to the arms deal.
The deal facilitated by Global Military Products, a subsidiary of arms dealer Global Ordnance, has drawn scrutiny due to the controversial associations of Global Ordnance in Ukraine. The authenticity of the documents has been verified by comparing signatures and matching Pakistani documents with corresponding American ones. The Intercept report highlights the significant role played by the arms deal in Pakistan's quest for a bailout from the IMF. The funds generated from the sale of munitions to Ukraine were instrumental in covering the financial gap and fulfilling the IMF's requirements. However, the austerity measures imposed as part of the bailout conditions sparked major protests and strikes in the country.