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U.S. lifts final sanctions on Pakistan

WASHINGTON (CNN) -- U.S. President George W. Bush has signed legislation lifting the remaining sanctions against Pakistan, paving the way for the introduction of much needed financial aid to its new ally.

A statement from the White House Monday said that Bush signed the legislation at the weekend as part of a reward package for Pakistan's support and cooperation in the U.S.-led campaign against terrorism and the strikes on Afghanistan.

The U.S. imposed sanctions against Pakistan and India in 1998 after the two countries tested nuclear weapons.

Further sanctions were slapped on Pakistan the following year after General Pervez Musharraf seized power in a military coup.

The first sanctions were dropped last month as the U.S. sought to shore up support from Pakistan in the wake of the September 11 attacks.

Anti-U.S. and anti-government sentiment has swept across Pakistan following the beginning of strikes against Afghanistan although Musharraf has maintained that the protests are confined to only a small minority of the predominantly Muslim population

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The latest waiver cleared the way for an economic aid package to Pakistan expected to be announced as early as this week, ranging between $300 to $500 million.

The U.S. and Pakistan have already rescheduled about $380 million of about $3 billion in debt.

Bush and Pakistani President Pervez Musharraf are expected to meet in New York on November 10 on the sidelines of a United Nations General Assembly.

Monday's statement from the U.S. follows a similar move by Japan last week, which announced it was suspending sanctions against Pakistan and India.

Japan had frozen all new loans and grants to the South Asian countries, except for humanitarian aid, following their tit-for-tat series of nuclear weapons tests in 1998.

Japanese officials said they wanted to call the lifting of the sanctions a "suspension" to leave the way open for Japan to revive punitive steps if Pakistan and India scrap their self-imposed moratorium on nuclear testing.

While stopping short of announcing fresh aid, Chief Cabinet Secretary Yasuo Fukuda said Tokyo would look at specific economic steps to help ensure stability in the two south Asian countries.

Fukuda added that Japan expected India to play a big role in the war against terror.


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