RAWALPINDI: The Finance Minister, Mr N.M.

Uguaili, today [June 10] announced a reduction in the country`s defence expenditure for the next year from the peak level of Rs 285.50 crores reached in 1965-66 by 24 per cent as proof of `our earnest desire to reach an honourable settlement in a peaceful manner on all outstanding issues with India`.

At the same time, he gave the solemn assurance to the nation that `if we fail to find a purposeful response in India, we will review the entire situation and will provide whatever additional resources may be required for defence, even if means sacrificing our development programme`.

Explaining the reasons for the reduction, the Finance Minister said in the face of the mounting defence expenditure by India and the threat that it posed for Pakistan, it might strike [one] as a little odd that Pakistan was once again thinking in terms of reduction in her defence expenditure after the reduction of Rs 61 crores during the current year.

He said defence expenditures were largely unproductive. Apart from purely economic considerations, escalation of military expenditure and an arms race between poor countries which, as the President of Pakistan had repeatedly declared, should be bending their entire energies towards ameliorating the lot of their unfortunate people was altogether senseless.

It was to break the vicious circle in which the defence outlays of Pakistan and India seem to have been caught at present and to demonstrate once again Pakistan`s earnest desire to reach an honourable settlement in a peaceful manner of all her outstanding disputes with India, including that of Kashmir, that Pakistan has decided to reduce her defence expenditure.

However, Mr Uguaili stressed, `The preservation of the country`s integrity and independence is our first and foremost obligation and no resources and efforts would be spared to meet this obligation`.Special Representative.