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Soybeans

Refers to a famous incident in the early 90s, when the Pakistanis were sanctioned for exploding a nuclear device. At that time, the Pakistanis had requested to purchase 40 F-16 Fighting Falcons from the USA. After the nuclear test, the State Department decided that selling them F-16s was too dangerous since they could be used to deliver a nuclear device. So instead of refunding the Pakistanis their money, they pressured the Pakistanis into accepting an equivalent amount of soybeans and soybean oil.

In reality, what happened was that the export of aircraft was delayed for about 8 years after the nuclear tests, after which the Clinton Administration agreed to refund $467 million of the $658 million that the Pakistanis had originally paid in advance. The Pakistanis were refunded $327 million in cash, $60 million in wheat and $80 million in soybean products. Pakistan was not very happy with the fact that the $60 million was deducted from what they assumed was free wheat as part of an unrelated US aid package to Pakistan. Furthermore, the soybean deal also went badly for Pakistan.

In April and then in June of 2000, the United States pressured Pakistan to take the remaining $80 million of the $140 million in the form of soy bean and soy bean oil, rather than wheat, which Pakistan, by this time had preferred. Pakistan acquiesced and by September 2000 an agreement to that effect had been signed. But in early 2001, Pakistan told the U.S. that importation of soybean would destroy its own fledgling group of local oilseed producers who were struggling that season. The U.S. bluntly told the Pakistanis that if they did not take soybean that they would not receive another penny regarding the F-16 debt. To make matters worse, the United States charged Pakistan above market prices for the commodity as well as shipping costs, with the U.S. selling the soybean to Pakistan at $250 per ton when the commodity was earning only $200 per ton on the international markets. The soybean oil costs were 34% above market prices. In addition Pakistan was told that instead of normal freight charges of $11 per ton it would have to pay exorbitant rates of upwards of $27 per ton for wheat and $24 per ton for soybeans.

The airplanes themselves were sent to the US navy and are used to simulate hostile forces during pilot training.

For years afterwards, Pakistani presidents and citizens would claim that they never received anything for the F-16s that they paid for, which is patently untrue, because they did get wheat and soybeans instead.

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