'Pak suffers loss of Rs 450 bn after joining war on terror'

Pakistan's step to join the US-led war on terror has cost it dearly as its economy suffered an accumulated loss of over Rs 450 billion and the country is unlikely to come out of the "vicious circle" soon in view of the world financial crisis, says a new report issued today.      

Pakistan's decision to become part of the global war on terror "has affected the economy adversely and its bad effects will continue," the annual report of the Institute of Public Policy said.     

"With global recession knocking at the door, it seems impossible to get out of the vicious circle in the coming few years," the 143-page report said.      

Pakistan's involvement in the US-led war against terror has caused losses of over Rs 450 billion, it said.     

The energy crisis, reduction in local and foreign investments and drop in exports and industrial activity have caused losses of Rs 210 billion during the current financial year, the report said.      

"Pakistan is facing the challenges of security, law and order, economic meltdown and political instability. And to meet them a strong resolve and long-term policies are needed to be adopted," the report said.

The report noted that the economic meltdown has reduced the purchasing power of 70 per cent of the population of the country. It will also increase the number of poor.    

"The number of poor will increase from 100 million to 150 million in the coming year," it predicted.      

The report said the chances of any improvement in the security situation and political stability are bleak and thus the democratic government will further weaken.