Should the U.S. Congress Cut Foreign Aid to Pakistan?

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WASHINGTON, D.C. — On July 12, a U.S. congressional panel, “Pakistan: Friend or Foe in the Fight Against Terrorism,” called for cutting off all U.S. foreign aid to Pakistan — both military and economic.

This demand immediately gained support in the House and the Senate, although the Obama administration consistently recognizes Pakistan as a crucial ally in U.S.-led counterterrorism and counterinsurgency efforts. Many senior congressional leaders doubted Pakistan’s commitment to vital U.S. interests and remarked that Pakistan should be treated as a foe.

“Fifteen years have passed since September 11, billions of dollars have been spent and far too little change has occurred in Pakistan,” said Congressman Matt Salmon, Chairman of the Asia and Pacific subcommittee of House Foreign Affairs Committee, “It seems like paying the mafia.”

It is, in fact, not hard to understand their frustration at years of limited aid effectiveness in Pakistan. Besides secretly diffusing the U.S. aid to regional terrorist groups, Islamabad also inflates the amount it spends on counterterrorism operations in order to receive more aid.

Nor has Pakistan’s economy received a significant boost from the aid. According to World Bank data, Pakistan’s average gross domestic product growth rate from 2010-2014 significantly dwindled from the preceding five years, despite a substantial increase in U.S. economic aid in 2009 with the enactment of the Enhanced Partnership for Pakistan Act.

The act authorized a tripling of the U.S. economic and developmental-related foreign aid to Pakistan over five years to invest in its long-term growth. Nevertheless, the limited capacity of government administration, legitimate concerns about corruption and security and the disruption to assistance inflicted by wars and natural disasters have all contributed to challenges in disbursing the funds.

Some experts and congressmen, however, rejected the notion that the U.S. should cut all foreign aid to Pakistan.

The move to withdraw all aid will have grave repercussions for monetary stability in Pakistan. The funds count as much as 25 percent of all Pakistan’s service exports, or five percent of total exports, which include the $13 billion Coalition Support Fund (CSF) that reimburse the country for its logistical support to U.S. military operations.

“Monetary stability in Pakistan depended on CSF so we couldn’t in good conscience cut it off completely,” said a Pakistani official familiar with the negotiations.

In the long run, the U.S. retraction of all foreign aid to Pakistan will cultivate a minimalist relationship with the country, impeding the creation of a more stable, democratic and prosperous Pakistan in the strategic region of South Asia.

In light of the above discussion, many lawmakers and political scientists believed that the U.S. should continue placing restrictions on its foreign assistance to Pakistan to increase transparency and accountability.

In fact, earlier in May, the U.S. House of Representatives voted in favor of imposing more stringent requirements on military aid for Pakistan. The National Defense Authorization Act 2017 will block $450 million in aid to Islamabad, unless it shows some process in delinking itself from terrorist groups, disrupting the Haqqani network in Afghanistan and promoting stability in the region.

In addition, more funds should be diverted from security-based aid to development-based aid, supporting integrated, longer-term programs in the sectors of energy, economic growth, health and education.

In fact, U.S Agency for International Development (USAID) reported many accomplishments in recent years including irrigating up to one million acres of farmland, saving tens of thousands of lives through maternal and infant health programs and boosting literacy among millions of Pakistani schoolchildren, among others.

USAID also helped build or renovate numerous dams to add more than 1,400 megawatts of new power generation. This month, it approved to provide a grant of $81 million for the construction of Kurram Tangi Dam, which will generate 19 megawatts of electricity besides irrigating over 16,000 acres of land.

“I believe that it is important for Pakistan to show progress. They should be given an opportunity to do so,” U.S. Senator John McCain said.

Yvie Yao

Photo: Flickr

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