Pak govt secretly doled out extra Rs 687 bn for army

Pakistan's outgoing government has acknowledged that it provided grants of Rs 687 billion to the powerful military for security-related spending that were in addition to the annual defence budgets.

An annual grant of about Rs 200 billion was kept under wraps for years by the government led by the Pakistan People's Party.

The release of the grants was acknowledged in the budget strategy paper -- a document that covers this fiscal's revised budget estimates and projections for the next three years, The Express Tribune reported on Wednesday.

The burden of the annual grant is likely to be passed on to taxpayers from next year, the report said.

The PPP-led coalition government conceded it was paying the grant for security-related spending, which was earlier largely financed from payments made by the US through its Coalition Support Fund.

The government had never formally admitted the release of the grant in the past though the matter was reported by the media.

The US suspended payments from its Coalition Support Fund after ties hit a low in the wake of the killing of two Pakistani men by American security contractor Raymond Davis in 2011.

Ties were further hit by the unilateral US military raid that killed Osama bin Laden in Abbottabad the same year though payments from the CSF resumed this year.

The budget strategy paper stated that from 2009 to the current fiscal year, a total grant of Rs 687 billion was provided to the armed forces for security-related spending.

The highest payment of Rs 215 billion was made in fiscal 2009-10.

Much of the additional grant was paid out of the reimbursements from the CSF by the US.

During the current fiscal, the US has reimbursed $1.9 billion.

For the period between the next fiscal year beginning in July and 2016, authorities have estimated annual security-related expenses of Rs 190 billion.

However, Planning Commission Deputy Chairman Nadeemul Haque suggested that the grant should be added to the regular defence budget once the CSF facility is exhausted.

In his comments on the strategy paper, Haque wrote that "security-related spending Has gone up from Rs 122 billion in fiscal year 2012 to Rs 185 billion and then remained stagnant at Rs 190 billion for the next three years".

He said the amount was consistent with reimbursements from the CSF, which will end in fiscal year 2014.

However, it was not clear whether the finance ministry would add the security-related spending in the regular defence budget or keep financing it as a separate item.

The strategy paper also increased this year's defence budget to Rs 570 billion, an addition of Rs 25 billion over the amount approved by parliament in June last year.

By adding the security-related spending and the supplementary budget, the revised defence budget amounts to Rs 755 billion.

If services fees received from the United Nations for Pakistani military personnel involved in peacekeeping missions, estimated at Rs 30 billion for this year, and over Rs100 billion for military pensions is included, the accumulative defence spending is more than Rs 880 billion, the report said.

For the next fiscal, the proposed defence budget is Rs 627 billion, an increase of 10 per cent or Rs 57 billion over this year's revised budget, according to official documents.

Image: A Pakistani army soldier stands guard during a patrol in Pakka village in Kurram Tribal Agency.

Photograph: Khuram Parvez/Reuters