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Pakistan Aid Adds to Foreign Debt

The world pledged $3.4 billion in new quake aid for Pakistan at a make-or-break donor conference Saturday, but aid groups warned that many of the promises were for loans that will heap more debt on the impoverished country. Pakistan nonetheless hailed the conference as a success. The country`s president, Gen. Pervez Musharraf, thanked the nearly 80 attending nations and international agencies for "helping Pakistan in this hour of need." He said the gesture would "never be forgotten."

The $3.4 billion in new pledges raises the total aid pledge to $5.8 billion, slightly more than the government said it needed to rebuild from the quake. But about two-thirds of the money was in the form of loans, Prime Minister Shaukat Aziz said. Aid groups said that meant the pledges were a mixed bag. Jane Cocking, humanitarian coordinator in Pakistan for the British charity Oxfam, said the new debt would be detrimental in the long term to those suffering from the quake.

The United States, which counts Pakistan as a key ally in the war on terrorism, nearly tripled its aid pledge to $510 million, including $300 million in cash. Musharraf said the calamity provided "an opportunity of a lifetime" for overcoming disputes between Pakistan and India. The nations have fought two wars over Kashmir, which is divided between them but claimed in its entirety by both. After the quake, the two countries agreed to open five crossings on their militarized frontier to facilitate the flow of relief and let separated families reunite.