Lavrov and Pompeo urge closer US-Russia ties, still disagree over Iran nuclear deal

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US Secretary of State Mike Pompeo (L) and Russian Foreign Minister Sergey Lavrov pose for a photo prior to their talks in the Black Sea resort city of Sochi, southern Russia, Tuesday, May 14, 2019. (Russian Foreign Ministry Press Service via AP)
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US Secretary of State Mike Pompeo and Russian Foreign Minister Sergey Lavrov attend a joint news conference after their talks in the Black Sea resort city of Sochi, Russia May 14, 2019. (Reuters)
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Russian Foreign Minister Sergei Lavrov and US Secretary of State Mike Pompeo hold a joint press conference following their talks in Sochi on May 14, 2019. (AFP)
Updated 15 May 2019
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Lavrov and Pompeo urge closer US-Russia ties, still disagree over Iran nuclear deal

SOCHI: Russia and the United States voiced hope for better ties Tuesday as President Vladimir Putin welcomed Secretary of State Mike Pompeo but tensions were laid bare in a clash over election meddling.
In a late-night encounter in Putin's forested dacha in the Black Sea resort of Sochi, Pompeo became the highest-ranking American to meet the Russian leader in 10 months.
"I would very much like your visit to Russia to benefit Russia-US relations and promote their development," Putin told Pompeo as he took a seat across from him in a sleek conference room, saying that they should "fully restore" relations.
Putin praised a two-year investigation by US special counsel Robert Mueller, despite its findings that Russia meddled extensively in the 2016 election on behalf of then-candidate Donald Trump, especially by manipulating social media.
But the probe found that his campaign did not collude with Russia -- lifting one cloud that has hung over Trump since his unexpected victory.
"Despite the exotic nature of Mr Mueller's commission, on the whole he conducted quite an objective investigation and confirmed the absence of any collusion between the US administration and Russia," Putin said.
Pompeo, speaking earlier at a joint news conference with Foreign Minister Sergei Lavrov, acknowledged deep differences on election meddling -- and warned Russia to stay out of next year's vote.
"Interference in American elections is unacceptable. If Russia engaged in that in 2020, it would put our relationship in an even worse place than it has been," Pompeo said.
"I conveyed that there are things that Russia can do to demonstrate that these kinds of activities are a thing of the past. I hope that Russia takes advantage of those opportunities," he said.
Lavrov hit back against "those who are inflating this topic" and saying of collusion: "It's clear that such insinuations are absolute fiction."
"We want and we are ready to deal with cybersecurity issues along with our American partners, without any politicisation," he said.
Pompeo nonetheless also voiced hope for a better future with Russia.
He said that his mission came from Trump, who has persistently praised Putin -- a loathed figure for virtually all of the US political class.
Trump, he said, wants the United States and Russia "to do everything we can" to create a future that is "more successful" for both countries and the world as a whole.
"Some of our cooperation has been excellent -- on North Korea, on Afghanistan, we've done good work -- (and) counter-terrorism work -- together. These are things we can build upon," Pompeo said.
Pompeo was the highest-ranking American to see Putin since July when the Russian leader met in Helsinki with Trump -- who shocked the US establishment by seeming to take at face value Putin's denials of election interference.
Putin's aide Yuri Ushakov said the president and Pompeo discussed Iran, Syria, Afghanistan and the situation in North Korea, following leader Kim Jong Un's first visit to Russia last month.
However in the 90 minutes of closed-door talks they did not touch on the Ukraine crisis and only briefly discussed sanctions imposed by Washington over Russia's backing of separatist rebels in the country.
They equally did not touch on Michael Calvey, a prominent American investor who has been behind bars in Moscow since mid-February on controversial fraud charges, Ushakov said.


Pakistan bracing for austere budget under IMF, finance chief says

Updated 25 May 2019
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Pakistan bracing for austere budget under IMF, finance chief says

ISLAMABAD: Pakistan is preparing a belt-tightening budget to tame its fiscal deficit, the de facto finance minister said on Saturday, adding that both civilian and military rulers agreed austerity measures were needed to stabilise the economy.
But Hafeez Shaikh, Prime Minister Imran Khan's top finance adviser, declined to say whether the military's hefty budget would be cut following last week's agreement in principle with the International Monetary Fund for a $6 billion loan.
The IMF has said the primary budget deficit should be trimmed by the equivalent of $5 billion, but previous civilian rulers have rarely dared to trim defence spending for fear of stoking tensions with the military.
Unlike some other civilian leaders in Pakistan's fragile democracy, Khan appears to have good relations with the country's powerful generals.
More than half of state spending currently goes on the military and debt-servicing costs, however, limiting the government's options for reducing expenditure.
"The budget that is coming will have austerity, that means that the government's expenditures will be put at a minimum level," Shaikh told a news conference in the capital Islamabad on Saturday, a few weeks before the budget for the 2019/20 fiscal year ending in June is due to be presented.
"We are all standing together in it whether civilians or our military," said Shaikh, a former finance minister appointed by Khan as part of a wider shake-up of his economic team in the last two months.
In the days since last week's agreement with the IMF, the rupee currency dropped 5% against the dollar and has lost a third of its value in the past year.
Under the IMF's terms, the government is expected to let the rupee fall to help correct an unsustainable current account deficit and cut its debt while trying to expand the tax base in a country where only 1% of people file returns.
Shaikh has been told by the IMF that the primary budget deficit -- excluding interest payments -- should be cut to 0.6% of GDP, implying a $5 billion reduction from the current projection for a deficit of 2.2% of GDP.
The next fiscal year's revenue collection target will be 5.55 trillion rupees ($36.88 billion), Shaikh told the news conference, highlighting the need for tough steps to broaden the tax base.