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unintended victims

This should be self-explanatory.



Financial Times. 16th July 1998.

US clears way for wheat sales
By Stephen Fidler in Washington

President Bill Clinton said yesterday he had signed legislation to exempt
export credits for farm sales from US sanctions imposed on India and
Pakistan last month in response to their nuclear tests.

The legislation, which passed rapidly through Congress in the past week,
came in response to sharply falling wheat prices which are hurting US
farmers. "We need to make sure our sanctions policy furthers our foreign
policy goals without imposing undue burdens on our farmers," Mr Clinton
said. The lifting of the restriction will allow the US to sell almost 13m
bushels of wheat to Pakistan, one of the most important customers for US

Mr Clinton said: "US wheat and other farm products will not be the
unintended victims of an important non-proliferation law. When
implementing sanctions, we must never forget their humanitarian impact."

The administration was compelled by law to impose the sanctions after the
nuclear tests by both countries. However, the impact of the sanctions has
been watered down by the failure of other countries to follow suit - and
this move will be viewed as a further weakening of their effectiveness.
Moreover, the sanctions were seen as biting far harder on Pakistan - which
at least informed the US in advance of its intention to test - than on

Earlier this week, the administration asked Congress for waiver authority
for all the sanctions now in place against India and Pakistan. Karl
Inderfurth, assistant secretary of state in the Bureau of South Asian
Affairs, said the authority would only be used if the countries had
responded to US objectives - such as signing the Comprehensive Test Ban
Treaty - or if a specific sanction had "serious negative or unintended

"We would also like additional flexibility to guard against an
overwhelmingly disproportionate effect of these sanctions on one country
versus another," he said in a clear reference to Pakistan's greater
dependence on external finance than India.

Mr Inderfurth also criticised the Pakistani leadership for not taking the
necessary steps to deal with its weak economic position and for alienating
independent power producers "with what can only be described as a
shakedown effort to conserve hard currency." Pakistan's credit rating was
slashed this week by Standard & Poor's to a level suggesting default could
occur in the next two months. Reserves have dwindled to $700m against
short-term liabilities of $10.2bn.

Under the sanctions legislation, the US must vote against new loans by the
IMF and World Bank to the two countries - but does not have the formal
voting power to block new lending.

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