US on alert as Pakistan hit by allegations of mismanagemen of USD 400 million loan

Washington [US], October 3 : The US has acknowledged claims made by Pakistan Peoples' Party (PPP) Chairman, Bilawal Bhutto Zardari on accusations of alleged mismanagement of USD 400 million received by Pakistan in loans and aid from the World Bank, meant for flood relief actions in the country.
According to Ary News, Bilawal accused the central government of Pakistan of appropriating funds that were originally intended for flood victims and utilizing them for other unrelated projects.
Bilawal condemned the government for its inability to construct a single house for flood victims in recent years and demanded that the aid be redirected to its intended purpose.
Responding to the allegations, US State Department spokesperson Mathew Miller, in a press briefing on October 2, emphasized that the United States was closely monitoring the situation. He said, "We take this matter very seriously, not just in Pakistan but also wherever American taxpayer dollars are used, and where urgent humanitarian interests are at stake".
Miller explained that both the State Department and USAID follow strict protocols to monitor and evaluate the use of foreign aid given by the country to other countries in need. This is done to ensure transparency and accountability.
"We halt assistance when we observe any misdirection or misuse of funds," he added, indicating potential concerns over the misuse of flood relief resources in Pakistan.
Pakistan has been facing a climate crisis in recent years. These extreme weather events include heatwaves, cyclones, floods and glacier melting that resulted in the catastrophic 2022 floods. The Climate Risk Index has included Pakistan in the top 10 most vulnerable countries to climate change.
Ary News reported that the allegations by Bilawal Bhutto Zardari and the US's swift acknowledgement of the situation have heightened the attention on the Pakistan government's handling of international aid, especially that coming for humanitarian efforts into the country.
According to Asian Development Bank, climatic changes are expected to have wide-ranging impacts on Pakistan, affecting agricultural productivity, water availability, and increased frequency of extreme climatic events. These risks have been translated into economic crises, damaging lives and threatening the livelihoods of Pakistani citizens.
The mismanagement of funds accusation makes matters worse for PM of Pakistan, Shehbaz Sharif as a trust deficit expressed through these allegations will make it tougher for the country to secure aid, grants and loans from organisations and other countries as Pakistan continues to reel under severe economic stress.