Order Code RL33498
Pakistan-U.S. Relations
Updated July 23, 2007
K. Alan Kronstadt
Specialist in Asian Affairs
Foreign Affairs, Defense, and Trade Division

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Pakistan-U.S. Relations
Summary
A stable, democratic, economically thriving Pakistan is considered vital to U.S.
interests. U.S. concerns regarding Pakistan include regional and global terrorism;
Afghan stability; human rights protection and democratization; the ongoing Kashmir
problem and Pakistan-India tensions; and economic development. A U.S.-Pakistan
relationship marked by periods of both cooperation and discord was transformed by
the September 2001 terrorist attacks on the United States and the ensuing enlistment
of Pakistan as a key ally in U.S.-led counterterrorism efforts. Top U.S. officials
regularly praise Pakistan for its ongoing cooperation, although doubts exist about
Islamabad’s commitment to some core U.S. interests. Pakistan is identified as a base
for terrorist groups and their supporters operating in Kashmir, India, and Afghanistan.
In 2003, Pakistan’s army began conducting unprecedented counterterrorism
operations in the country’s western tribal areas. Islamabad later shifted to a strategy
of negotiation with the region’s pro-Taliban militants (combined with longer-term
economic and infrastructure development in the region), a tack that has elicited
scepticism in Western capitals and that appears to have failed in its central purposes.

Separatist violence in India’s Muslim-majority Jammu and Kashmir state has
continued unabated since 1989, with some notable relative decline in recent years.
India blames Pakistan for the infiltration of Islamic militants into Indian Kashmir, a
charge Islamabad denies. The United States and India have received pledges from
Islamabad that all “cross-border terrorism” would cease and that any terrorist
facilities in Pakistani-controlled areas would be closed. The United States strongly
encourages maintenance of a bilateral cease-fire and continued, substantive dialogue
between Pakistan and India, which have fought three wars since 1947. A perceived
Pakistan-India nuclear arms race has been the focus of U.S. nonproliferation efforts
in South Asia. Attention to this issue intensified following nuclear tests by both
countries in 1998. More recently, the United States has been troubled by evidence
of the transfer of Pakistani nuclear technologies and materials to third parties,
including North Korea, Iran, and Libya. Such evidence became stark in 2004.
Pakistan’s macroeconomic indicators have turned positive since 2001, with
some meaningful poverty reduction seen in this still poor country. President Bush
seeks to expand U.S.-Pakistan trade and investment relations. Democracy has fared
poorly in Pakistan; the country has endured direct military rule for more than half of
its existence. In 1999, the elected government was ousted in a coup led by Army
Chief General Pervez Musharraf, who later assumed the title of president. Supreme
Court-ordered elections seated a new civilian government in 2002 (Musharraf ally
Shaukat Aziz now serves as prime minister), but it remains weak, and Musharraf has
retained his position as army chief. The United States urges restoration of full
democracy, expecting Pakistan’s planned 2007 elections to be free, fair, and
transparent. Congress has annually granted one-year presidential authority to waive
coup-related aid sanctions. Pakistan is among the world’s leading recipients of U.S.
aid, obtaining about $3.2 billion in direct U.S. assistance for FY2002-FY2006,
including more than $1.2 billion in security-related aid. Pakistan also has since 2001
received some $5 billion in reimbursements for its support of U.S.-led
counterterrorism operations.

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Contents
Most Recent Developments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Setting and Regional Relations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Historical Setting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Current U.S.-Pakistan Engagement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Political Setting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Regional Relations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Pakistan-India Rivalry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
The “IPI” Pipeline Project . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Afghanistan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
The China Factor . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Pakistan-U.S. Relations and Key Country Issues . . . . . . . . . . . . . . . . . . . . . . . . 14
Terrorism . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Al Qaeda in Pakistan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Infiltration Into Afghanistan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Infiltration into Kashmir and India . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
Domestic Terrorism . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Other Security Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Pakistan-U.S. Security Cooperation . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Nuclear Weapons and Missile Proliferation . . . . . . . . . . . . . . . . . . . . 25
U.S. Nonproliferation Efforts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Pakistan-India Tensions and the Kashmir Issue . . . . . . . . . . . . . . . . . . 28
Baluchistan Unrest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Narcotics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Islamization, Anti-American Sentiment, and Madrassas . . . . . . . . . . . . . . . 32
Democratization and Human Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
Democracy and Governance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
Human Rights Problems . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
Economic Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Trade and Investment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
U.S. Aid and Congressional Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
U.S. Assistance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
Proliferation-Related Legislation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
Coup-Related Legislation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
Other Legislation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
9/11 Commission Recommendations . . . . . . . . . . . . . . . . . . . . . . . . . 47
Selected Pakistan-Related Legislation in the 110th Congress . . . . . . . . . . . 48
List of Figures
Figure 1. Map of Pakistan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53

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List of Tables
Table 1. Overt U.S. Assistance to Pakistan, FY2001-FY2008 . . . . . . . . . . . . . . 51

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Pakistan-U.S. Relations
A stable, democratic, economically thriving Pakistan actively working to
counter Islamist militancy is considered vital to U.S. interests. Current top-tier U.S.
concerns regarding Pakistan include regional and global terrorism; Afghan stability;
and domestic political stability and democratization. Pakistan remains a vital U.S.
ally in U.S.-led anti-terrorism efforts. Yet the outcomes of U.S. policies toward
Pakistan since 9/11, while not devoid of meaningful successes, have neither
neutralized anti-Western militants and reduced religious extremism in that country,
nor have they contributed sufficiently to the stabilization of neighboring Afghanistan.
Many observers thus urge a broad re-evaluation of such policies. This is especially
so in light of a months-old judicial/political crisis that has severely damaged the
status of the military-dominated government of President Gen. Pervez Musharraf and
a surge in domestic Islamist militancy following the early July denouement of a
standoff involving Islamabad’s Lal (Red) Mosque complex. There are indications
that anti-American sentiments remain widespread in Pakistan, and that a segment of
the populace views U.S. support for the Musharraf government as being an
impediment to, rather than facilitator of, the process of democratization there. To
date, the Bush Administration publicly proclaims its ongoing strong support for
Musharraf. However, in 2007 the Administration is showing signs that it may shift
its long-standing policies toward Pakistan, in particular on the issues of
democratization and on Islamabad’s counterterrorism policies in western tribal areas,
potentially including direct, but low-profile U.S. military action in western Pakistan.
Most Recent Developments
U.S. Policy Statements. Pakistan is at present going through a period of
considerable instability, including a significant rise in the incidence of Islamist
militancy, and increased political divisiveness caused by opposition to President
Musharraf’s military-dominated government. On July 17, Secretary of State for
South and Central Asian Affairs Richard Boucher lauded Islamabad for “dealing
decisively” with Islamist extremism and he listed four aspects of a plan for future
action against such extremism in western Pakistan: 1) targeted military action; 2)
U.S. support for efforts to strengthen Pakistan’s security capabilities, especially with
the Frontier Corps; 3) U.S. support for efforts to develop the tribal areas
economically; and 4) U.S. support for democratic transition in Islamabad. He also
claimed that the terms of a September 2006 truce between the Pakistani government
and pro-Taliban forces in North Waziristan had been violated by militants, allowing
Al Qaeda to “operate, meet, plan, recruit, [and] obtain financing in more comfort in
the tribal areas than previously.” He set out three “fundamental conditions” for

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Pakistan’s tribal areas: “no Talibanization, no cross-border activity, and no Al Qaeda
plotting and planning.”1
U.S. Intelligence on Al Qaeda in Pakistan. At a July 11 House Armed
Services Committee hearing on global threats, top U.S. intelligence officials offered
an assessment that the Al Qaeda terrorist network had become progressively active
in western Pakistan, where they are determined to be enjoying “safe haven” and
increased financial support. A subsequent unclassified version of a new National
Intelligence Estimate on terrorist threats to the U.S. homeland concluded that Al
Qaeda “has protected or regenerated key elements of its Homeland attack capability,
including: a safehaven in the Pakistan Federally Administered Tribal Areas (FATA),
operational lieutenants, and its top leadership.”2 A Pakistan Foreign Ministry
statement criticized the document’s “unsubstantiated assertions.” In mid-July,
several top U.S. officials said the United States would not rule out taking unilateral
military action on Pakistani territory given “actionable targets.” Pakistan’s Foreign
Ministry issued a statement calling such statements “irresponsible and dangerous.”
Afghan Insurgency and Conflict in Western Pakistan. An ongoing Taliban
insurgency in Afghanistan and its connection to developments in Pakistan remain
matters of serious concern, especially in light of signs that Al Qaeda terrorists move
with impunity on the Pakistani side of the rugged border. U.S.-led forces operating
in Afghanistan reportedly have been involved in recent battles affecting Pakistani
territory: In mid-June, a suspected missile attack, possibly launched by U.S. forces
in Afghanistan, killed some 32 pro-Taliban militants in North Waziristan near the
Pakistan-Afghanistan border. Some of the dead may have been Arabs. Days later,
NATO forces in Afghanistan apparently directed air-to-ground and artillery fire at
Taliban militants fleeing across the Durand Line into Pakistan, killing some 33
people there, including several women and children.
On July 15, pro-Taliban militants in North Waziristan announced their
withdrawal from a controversial September 2006 truce made with the Islamabad
government, claiming the accord had been violated by army deployments and attacks
on tribals. On the same day, U.S. National Security Advisor Hadley told an
interviewer that Washington had determined President Musharraf’s policies in the
region to be ineffective and he said the United States was fully supporting new efforts
to crack down on Pakistan’s pro-Taliban militants. Islamabad still defends the North
Waziristan truce and seeks to see it restored, but Pakistan’s efforts to make peace
with pro-Taliban tribesmen are widely viewed as having failed. Islamist militants
from the tribal agencies have spread their influence to Pakistan’s “settled areas,”
including North West Frontier Province (NWFP) districts such as Dir and Swat, and
suicide bomb attacks on military and police targets have become more prevalent in
recent months. The Pakistan army reportedly plans to move 15,000 additional troops
into western Pakistan in response to the surge in militancy there, even as the
Islamabad government dispatched a team of tribal elders to North Waziristan in an
effort to restore the truce with pro-Taliban militants (see also “Infiltration into
1 See [http://www.state.gov/p/sca/rls/rm/2007/88582.htm].
2 See [http://www.dni.gov/press_releases/20070717_release.pdf].

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Afghanistan” section below). Legislation in the 110th Congress seeks to address this
issue (see “U.S. Aid and Congressional Action” section below).
Judicial and Political Crisis. On July 20, in what was widely seen as a major
political defeat for President Musharraf, Pakistan’s Supreme Court unanimously
cleared the country’s Chief Justice, Iftikhar Chaudhry, of any wrongdoing, and
reinstated him to office after determining that the Musharraf government had “acted
illegally” in suspending him. A judicial crisis had begun with Musharraf’s summary
March 9 dismissal of Chaudhry on charges of nepotism and misconduct. Analysts
widely believe the action was an attempt by Musharraf to remove a potential
impediment to his continued roles as president and army chief, given Chaudhry’s
recent rulings that exhibited independence and went contrary to government
expectations. The move triggered immediate outrage among numerous Pakistani
lawyers, and several judges and a deputy attorney general quickly resigned in protest.
Ensuing street protests by lawyers grew in scale and were joined by both secular and
Islamist opposition activists. By providing an issue upon which anti-Musharraf
sentiments could coalesce, the imbroglio soon morphed into a full-fledged political
crisis and the greatest threat to Musharraf’s government since it was established in
1999. Numerous Pakistani and Western analysts now assert that Musharraf is
significantly weakened and discredited, and that the viability of his continued rule is
in question (see also “Democracy and Governance” section below).
The Chief Justice’s refusal to be cowed by the Musharraf government and
voluntarily resign his post, coupled with subsequent speeches in which he issued
strong but veiled criticisms of the Musharraf government, have made him a popular
figure in Pakistan; numerous rallies have brought out tens of thousands of avid
supporters in Punjab and Sindh. On May 12, Chaudhry flew to Karachi, but was
blocked from leaving the city’s airport, reportedly by activists of the government-
allied MQM party. Ensuing street battles between pro- and anti-government activists
left at least 40 people dead, most of them PPP members. Reports had local police
and security forces standing by without intervening while the MQM attacked anti-
Musharraf protesters, leading many observers to charge the government with
complicity in the bloody rioting. The May 12 incidents did significant further
damage to President Musharraf’s standing. In a June letter to Secretary of State
Condoleezza Rice, the Chair of the Senate Foreign Relations Committee and the
Chair and Ranking Member of the House Foreign Affairs Committee asserted that
U.S. and Pakistani national interests “are both served by a speedy restoration of full
democracy to Pakistan and an end to state-sponsored intimidation ... of Pakistani
citizens protesting government actions in a legal and peaceful manner.”
The Musharraf government showed little sign of compromising on the judicial
issue, and his government has intimidated media outlets and warned them against
“defaming” the country’s military. On June 1, the army’s corps commanders issued
a statement reaffirming their full support for Musharraf’s continued rule and warning
against a “malicious campaign against the institutions of the state” being undertaken
by a “small minority.” Days later Musharraf berated members of his political
coalition for their allegedly insufficient support and for “always [leaving him] alone
in times of trial and tribulation.” A June 4 ordinance expanding government
authority to restrict press freedom has not been implemented: in likely reaction to
criticisms from the U.S. and other governments — as well as from domestic and

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international human rights groups — implementation was halted days later. The
government met with a setback when, on June 11, the Supreme Court agreed to hear
Chaudhry’s challenge against the charges, thus taking precedence over a panel of
appointed judges that may have been more sympathetic to the government’s case.
Chaudhry’s July 20 reinstatement has been lauded as an unusual exercise in judicial
independence in Pakistan — a U.S. State Department spokesman called it a positive
expression of rule of law — and it further complicates Musharraf’s intentions to win
reelection as president by currently seated assemblies, as well as his suspected plans
to retain his status as army chief beyond 2007, when the legal provision allowing it
is to expire.
The Lal (Red) Mosque Crisis. In early July, a ten-day siege at Islamabad’s Lal
(Red) Mosque ended when Pakistani commandos stormed the complex and,
following a 20-hour battle, defeated the well-armed Islamist radicals therein.
Beginning in January and escalating steadily over the course of the year, an open
Islamist rebellion of sorts had been taking place in Pakistan’s relatively serene
capital. Radical Islamists at the Lal Mosque and their followers in the attached
women’s Jamia Hafsa seminary had occupied illegally constructed religious
buildings, kidnaped and detained local police officers and alleged Chinese
prostitutes, battled security forces, and threatened to launch a violent anti-
government campaign unless Sharia (Islamic law) was instituted nationwide. Several
thousand people were holed up in the mosque complex, reportedly including a small
number of foreign militants. Government efforts to negotiate with the mosque’s
clerics made no progress and were viewed by many Pakistanis as appeasement of the
Islamists. Some cynics in Pakistan suggested that the government was complicit in
allowing the standoff to fester, its alleged slow and uncertain response being a
purposeful effort to bolster its own standing as a bulwark against spreading Islamist
radicalism.
On June 29, burka-clad Jamia Hafsa students kidnaped nine people, including
six alleged Chinese prostitutes. The hostages were released unharmed less than one
day later, but the incident further alarmed the Beijing government, which expressed
growing concern about the safety of its citizens in Pakistan. As street battles broke
out between security forces and militants on July 3, commandos laid siege to the
mosque complex. A day later one of its two radical cleric leaders, Mohammed Abdul
Aziz, was captured as he tried to escape wearing a woman’s burka and high-heeled
shoes. Up to 1,200 seminary students took up the government’s offer of safe passage
and a small cash payment in return for their surrender. On July 8, the colonel leading
special forces troops outside the mosque was killed by militants’ gunfire, and the
remaining radical cleric leader vowed to pursue martyrdom rather than surrender. On
July 10, with negotiations appearing to fail conclusively, commandos launched a full-
scale, pre-dawn assault on the complex. The mosque’s remaining top cleric,
Mohammed’s younger brother Abdur Rashid Ghazi, was killed in the heavy fighting,
which left more than 100 people dead, including approximately 10 security troops,
60 militants, and an unknown number of civilians, among them women and children.
The Red Mosque denouement appears to have elicited a rapid and fierce
backlash among Pakistani Islamists sympathetic to the radicals’ cause: up to 200
people, most of them soldiers and police recruits, were killed in more than one dozen
suicide bombings in western Pakistan in the two weeks following the commando

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assault. Some observers express concern that the violence could spur President
Musharraf to declare a state of emergency (analogous to martial law) and perhaps
delay planned national elections in what could be a blow to Pakistan’s
democratization process. Musharraf has stated that he has no intention of taking such
a course and that he firmly believes “the solution lies in the democratic process.”
Immediately after fighting in Islamabad had ended, Musharraf vowed to “eliminate
terrorism and extremism from every nook and corner of the country.” By taking
decisive action against the Islamists, Musharraf may have bolstered his credibility
among Pakistani moderates, but it is yet to be seen if he follows through on his latest
vow to eradicate extremism. Self-exiled former Prime Minister Benazir Bhutto, who
leads the moderate opposition Pakistan People’s Party (PPP), called the mosque
incident unfortunate, but lauded the end of an ambiguous “policy of appeasement”
that encourages militants.
Mid-June Visits by U.S. Officials. Previous to the Lal Mosque denouement,
and in the midst of Pakistan’s months-long judicial and political crisis, three senior
U.S. officials paid separate but simultaneous June visits to Islamabad. Deputy
Secretary of State John Negroponte, Assistant Secretary of State for South and
Central Asia Boucher, and Commander of U.S. Central Command Admiral William
Fallon each held meetings with President Musharraf, as well as with other top
Pakistani officials. Deputy Secretary Negroponte voiced strong U.S. support for the
Musharraf government, emphasizing the long-term, multi-faceted nature of the U.S.-
Pakistan “strategic partnership,” while also asserting that “free, fair, and transparent”
elections should go forward in Pakistan. President Musharraf in turn conveyed
satisfaction with ongoing bilateral cooperation, urged faster movement toward the
creation of proposed Reconstruction Opportunity Zones in western Pakistan, and
underscored Islamabad’s desire for a Free Trade Agreement with the United States.3
Given widespread assumptions that the visiting U.S. officials were issuing
unsolicited advice to the Islamabad leadership, many Pakistanis were reported to feel
resentment at perceived U.S. interference in their country’s internal affairs.
In other developments:
! On July 19, three separate suicide bomb attacks killed at least 52
people. The worst attack, which killed at least 30, involved a car
bomb attack on a vehicle carrying Chinese workers in Hub, near
Karachi. The Chinese were unhurt, but 7 police escorts and 23
bystanders died.
! On July 18, Islamist militants ambushed a Pakistani military
convoy in North Waziristan, killing 17 soldiers.
! On July 17, a suicide bomber killed at least 14 other people and
injured at least 40 others at the site of a political rally in Islamabad.
Most of the dead and injured were PPP activists.
3 See [http://usembassy.state.gov/pakistan/h07061602.html] and [http://www.mofa.gov.pk/
Press_Releases/2007/june/PR_163_07.htm].

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! On July 15, suicide bombers killed at least 70 soldiers, police
recruits, and civilians in two separate attacks in the NWFP.
! On July 13, H.Res. 546, recognizing Pakistani gang rape victim
Mukhtaran Mai for her courage and for her humanitarian work, was
introduced in the House.
! On July 12, the House Government Reform and Oversight
Subcommittee on National Security and Foreign Affairs held a
hearing on Pakistan, at which Assistant Secretary of State Boucher
reviewed U.S.-Pakistan relations.
! On July 10, President Bush waived democracy-related aid
sanctions on Pakistan for FY2007, saying such a waiver will
facilitate the transition to democratic rule in Pakistan and is
important to U.S. counterterrorism efforts. Also, H.R. 2962, to
permit Pakistani nationals to be eligible for temporary protected
status under Section 244 of the Immigration and Nationality Act,
was introduced in the House.
! On July 6, Anne Patterson was sworn in as the 23rd U.S.
Ambassador to Pakistan. Also, the first meeting of the joint
Pakistan-Afghanistan-Turkey working group was held in Ankara.
! On July 4, two-day Pakistan-India talks on terrorism and
narcotics trafficking ended in New Delhi.
! On June 27, the House Foreign Affairs Subcommittees on the
Middle East and South Asia, and Terrorism, Nonproliferation, and
Trade held a joint hearing on the A.Q. Khan nuclear
proliferation network.
! On June 20, at the 15th annual U.S.-Pakistan Friendship Day,
Assistant Secretary of State Boucher lauded Pakistan as a “key ally
in the war on terror” and reviewed the U.S. “commitment to the
Pakistani people.”
! On June 18, Foreign Minister Kasuri arrived in Washington for
meetings with top U.S. officials.
! On June 14, nine Pakistani intelligence officials were killed and
three others injured when suspected Baloch nationalist militants
ambushed their vehicle in Quetta.
! On June 12, the U.S. State Department’s annual Trafficking in
Persons Report placed Pakistan on the “Tier 2 Watch List” for not
fully complying with the minimum standards for the elimination of
human trafficking.

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! On June 10, the Islamabad government unveiled a 1.6 trillion
rupee ($26.5 billion) federal budget plan for FY2007-FY2008 that
calls for a 22% boost in public development spending and a 10% rise
in defense spending.
! On June 1, a letter to Secretary of State Rice signed by the Chair
of the Senate Foreign Relations Committee and the Chair and
Ranking Member of the House Foreign Affairs Committee
asserted that U.S. and Pakistani national interests “are both served
by a speedy restoration of full democracy to Pakistan ....”
! On May 26, the U.S.-Pakistan-Afghanistan Tripartite
Commission held its 22nd session.
! On May 15, suicide bomber killed up to 25 other people when he
attacked a Peshawar restaurant popular with Afghan refugees.
! On May 12, senior Taliban commander Mullah Dadullah was
killed by U.S.-led troops in Afghanistan.
! On May 9, the House Committee on Oversight and Government
Reform Subcommittee on National Security and Foreign Affairs
held a hearing on education reform in and U.S. aid to Pakistan.
See also CRS Report RL4075, Pakistan: Significant Recent Events, March 26 - June
21, 2007.
Setting and Regional Relations
Historical Setting
The long and checkered Pakistan-U.S. relationship has its roots in the Cold War
and South Asia regional politics of the 1950s. U.S. concerns about Soviet
expansionism and Pakistan’s desire for security assistance against a perceived threat
from India prompted the two countries to negotiate a mutual defense assistance
agreement in 1954. By 1955, Pakistan had further aligned itself with the West by
joining two regional defense pacts, the South East Asia Treaty Organization and the
Central Treaty Organization (or “Baghdad Pact”). As a result of these alliances,
Islamabad received nearly $2 billion in U.S. assistance from 1953 to 1961, one-
quarter of this in military aid, making Pakistan one of America’s most important
security assistance partners of the period. Differing expectations of the security
relationship have long bedeviled bilateral ties, however. During and immediately
after the Indo-Pakistani wars of 1965 and 1971, the United States suspended military
assistance to both sides, resulting in a cooling of the Pakistan-U.S. relationship and
a perception among many in Pakistan that the United States was not a reliable ally.

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In the mid-1970s, new strains arose over Pakistan’s efforts to respond to India’s
1974 underground nuclear test by seeking its own nuclear weapons capability. U.S.
aid was suspended by President Carter in 1979 in response to Pakistan’s covert
construction of a uranium enrichment facility. However, following the Soviet
invasion of Afghanistan later that year, Pakistan again was viewed as a frontline ally
in the effort to block Soviet expansionism. In 1981, the Reagan Administration
offered Islamabad a five-year, $3.2 billion aid package. Pakistan became a key
transit country for arms supplies to the Afghan resistance, as well as home for some
three million Afghan refugees, most of whom have yet to return.
Despite this renewal of U.S. aid and close security ties, many in Congress
remained troubled by Pakistan’s nuclear weapons program. In 1985, Section 620E(e)
(the Pressler amendment) was added to the Foreign Assistance Act, requiring the
President to certify to Congress that Pakistan does not possess a nuclear explosive
device during the fiscal year for which aid is to be provided. With the Soviet
withdrawal from Afghanistan, Pakistan’s nuclear activities again came under
intensive U.S. scrutiny and, in 1990, President George H.W. Bush again suspended
aid to Pakistan. Under the provisions of the Pressler amendment, most bilateral
economic and all military aid ended, and deliveries of major military equipment
ceased. In 1992, Congress partially relaxed the scope of sanctions to allow for food
assistance and continuing support for nongovernmental organizations. Among the
notable results of the aid cutoff was the nondelivery of F-16 fighter aircraft purchased
by Pakistan in 1989. Nine years
later, the United States agreed to
compensate Pakistan with a $325
PAKISTAN IN BRIEF
million cash payment and $140
Population: 165 million; growth rate: 1.8%
million in goods, including surplus
(2007 est.)
Area: 803,940 sq. km. (slightly less than twice
wheat, but the episode engendered
the size of California)
lingering Pakistani resentments.
Capital: Islamabad
Head of Government: President and Chief of
During the 1990s, with U.S.
Army Staff General Pervez Musharraf
attention shifted away from the
Ethnic Groups: Punjabi, Sindhi, Pashtun,
Baloch, Muhajir (immigrants from India at
r e g i o n , Is l a m a b a d f u r t h e r
the time of partition and their descendants)
consolidated its nuclear weapons
Languages: Punjabi 58%, Sindhi 12%, Pashtu
capability, fanned the flames of a
8%, Urdu 8%; English widely used
growing separatist insurgency in
Religions: Muslim 96% (Sunni 81%, Shia
15%), Christian, Hindu, and other 4%
neighboring Indian-controlled
Life Expectancy at Birth: female 65 years;
Kashmir, and nurtured the Taliban
male 63 years (2007 est.)
movement in Afghanistan, where the
Literacy: female 35%; male 62% (2004 est.)
radical Islamist group took control of
Gross Domestic Product (at PPP): $412
Kabul in 1996. After more than a
billion; per capita: $2,580; growth rate
6.2% (2006)
decade of alienation, U.S. relations
Currency: Rupee (100 = $1.66)
with Pakistan were once again
Inflation: 7.9% (2006)
transformed in dramatic fashion, this
Military Expenditures: $4.0 billion (3.6% of
time by the September 2001 terrorist
GDP; 2005)
attacks on the United States and the
U.S. Trade: exports to U.S. $3.67 billion;
imports from U.S. $2 billion (2006)
ensuing enlistment of Pakistan as a
Sources: CIA, The World Factbook; Departments of
p i v o t a l a l l y i n U . S . - l e d
Commerce and State; Government of Pakistan; Economist
Intelligence Unit; Global Insight; Military Balance
counterterrorism efforts. A small
trickle of foreign assistance to

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CRS-9
Pakistan again became a prodigious flow and, in a sign of renewed U.S. recognition
of the country’s importance, President George W. Bush designated Pakistan as a
major non-NATO ally of the United States in June 2004. One month later, a
Congressional Pakistan Caucus was formed and has since been joined by 71
Members of the U.S. House of Representatives.
Current U.S.-Pakistan Engagement
U.S. engagement with Pakistan continues to be deep and multifaceted.
President Bush traveled to Pakistan in March 2006 for the first such presidential visit
in six years, and numerous high-level governmental meetings have ensued. During
the visit, President Bush and President Pervez Musharraf issued a Joint Statement on
the U.S.-Pakistan “strategic partnership” that calls for a “strategic dialogue” and
“significant expansion” of bilateral economic ties, including mutual trade and
investment, as well as initiatives in the areas of energy, peace and security, social
sector development, science and technology, democracy, and nonproliferation.4 In
the wake of that meeting, diplomatic engagements have continued apace. Over the
past year, visits to Islamabad have been made by Vice President Cheney, Secretary
of State Rice, Secretary of Defense Gates, Speaker of the House Pelosi, and several
top U.S. military commanders, among other U.S. officials. Pakistani visitors to
Washington in the past year have included President Musharraf, Foreign Minister
Kasuri, and the Chairman of Pakistan’s Joint Chiefs of Staff Committee, General
Ehsan ul-Haq. Among formal sessions were the following:
! a June 2006 meeting of the U.S.-Pakistan Energy Dialogue held in
Washington;
! the July inaugural meeting of the U.S.-Pakistan Joint Committee
on Science and Technology, also in Washington; and
! a November meeting of the U.S.-Pakistan Education Dialogue
hosted by Education Secretary Margaret Spellings in Washington.
Political Setting
The history of democracy in Pakistan is a troubled one, marked by tripartite
power struggles among presidents, prime ministers, and army chiefs. Military
regimes have ruled Pakistan for more than half of its nearly 60 years of existence,
interspersed with periods of generally weak civilian governance. From 1988 to 1999,
Islamabad had democratically elected governments, and the army appeared to have
moved from its traditional role of “kingmaker” to one of power broker. Benazir
Bhutto (leader of the Pakistan People’s Party) and Nawaz Sharif (leader of the
Pakistan Muslim League) each served twice as prime minister during this period.
The Bhutto government was dismissed on charges of corruption and nepotism in
1996 and Nawaz Sharif won a landslide victory in ensuing elections, which were
judged generally free and fair by international observers. Sharif moved quickly to
bolster his powers by curtailing those of the president and judiciary, and he emerged
as one of Pakistan’s strongest-ever elected leaders. Critics accused him of
intimidating the opposition and the press.
4 See [http://usembassy.state.gov/pakistan/h06030404.html].

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CRS-10
In October 1999, in proximate response to Prime Minister Sharif’s attempt to
remove him, Chief of Army Staff Gen. Pervez Musharraf overthrew the government,
dismissed the National Assembly, and appointed himself “chief executive.” In the
wake of this military overthrow of the elected government, Islamabad faced
considerable international opprobrium and was subjected to automatic coup-related
U.S. sanctions under section 508 of the annual foreign assistance appropriations act
(Pakistan was already under nuclear-related U.S. sanctions). Musharraf later
assumed the title of president following a controversial April 2002 referendum.
National elections were held in October of that year, as ordered by the Supreme
Court. A new civilian government was seated — Prime Minister M.Z. Jamali was
replaced with Musharraf ally Shaukat Aziz in August 2005 — but it has remained
weak. In apparent contravention of democratic norms, Musharraf continues to hold
the dual offices of president and army chief. Many figures across the spectrum of
Pakistani society welcomed Musharraf, or at least were willing to give him the
benefit of the doubt, as a potential reformer who would curtail both corruption and
the influence of religious extremists. Yet his domestic popularity has suffered
following indications that, as with Pakistan’s previous president-generals, expanding
his own power and that of the military would be his central goal.
Pakistan’s next parliamentary elections are slated for late 2007. President Bush
has said that electoral process will be “an important test of Pakistan’s commitment
to democratic reform” and, during his March 2006 visit to Islamabad, said President
Musharraf understands the elections “need to be open and honest.” Secretary of State
Rice and other U.S. diplomats have repeated the admonition. Under the Pakistani
system, the president is elected by an electoral college comprised of the membership
of all national and provincial legislatures. Controversy has arisen over Musharraf’s
apparent intention to seek re-election by the current assemblies, which are considered
likely to be more favorable to his continued rule than assemblies elected in 2007
might be. In June 2007, the House Appropriations Committee (H.Rept. 110-197)
expressed concern about the Pakistani government’s “slow progress with regard to
democracy reforms,” and some House-passed legislation contains democracy-related
language regarding Pakistan. (See “Democracy and Governance” section below. See
also CRS Report RL32615, Pakistan’s Domestic Political Developments.)
Regional Relations
Pakistan-India Rivalry. Three full-scale wars — in 1947-1948, 1965, and
1971 — and a constant state of military preparedness on both sides of their mutual
border have marked six decades of bitter rivalry between Pakistan and India. The
acrimonious partition of British India into two successor states in 1947 and the
unresolved issue of Kashmiri sovereignty have been major sources of tension. Both
countries have built large defense establishments at significant cost to economic and
social development. The Kashmir problem is rooted in claims by both countries to
the former princely state, divided since 1948 by a military Line of Control (LOC) into
the Indian state of Jammu and Kashmir and Pakistan-held Azad [Free] Kashmir.
India blames Pakistan for supporting a violent separatist rebellion in the
Muslim-dominated Kashmir Valley that has taken from 41,000 to as many as 66,000
lives since 1989. Pakistan admits only to lending moral and political support to the
rebels, and it criticizes India for human rights abuses in “Indian-held Kashmir.”

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CRS-11
India held Pakistan responsible for late 2001 terrorist attacks in Kashmir and on
the Indian Parliament complex in New Delhi. The Indian response, a massive
military mobilization, was mirrored by Pakistan and within months some one million
heavily-armed soldiers were facing-off at the international frontier. During an
extremely tense 2002 another full-scale war seemed a real and even likely possibility,
and may have been averted only through international diplomatic efforts, including
multiple visits to the region by top U.S. officials. An April 2003 peace initiative
brought major improvement in the bilateral relationship, allowing for an October
cease-fire agreement initiated by Pakistan. The process led to a January 2004 summit
meeting in Islamabad and a joint agreement to re-engage a “Composite Dialogue” to
bring about “peaceful settlement of all bilateral issues, including Jammu and
Kashmir, to the satisfaction of both sides.”5
During 2004, numerous mid-level meetings, normalized diplomatic relations,
and increased people-to-people contacts brought modest, but still meaningful
progress toward normalized relations. Regular dialogue continued in 2005 and a
third round of Composite Dialogue talks was held in 2006. Numerous confidence-
building measures have been put in place, most notably travel and commerce across
the Kashmiri LOC for the first time in decades, and bilateral trade has increased. Yet
militarized territorial disputes over Kashmir, the Siachen Glacier, and the Sir Creek
remain unresolved, and Pakistani officials regularly express unhappiness that more
substantive progress, especially on the “core issue” of Kashmir, is not occurring.
Following July 2006 terrorist bombings in Bombay, India, New Delhi postponed
planned foreign secretary-level talks, bringing into question the continued viability
of the already slow-moving process. However, after meeting on the sidelines of a
Nonaligned Movement summit in Cuba in September, President Musharraf and
Indian Prime Minister Singh announced a resumption of formal peace negotiations
and also decided to implement a joint anti-terrorism mechanism. The Composite
Dialogue resumed in November after a four-month hiatus when Foreign Secretary
Riaz Khan paid a visit to New Delhi for talks with his Indian counterpart. No
progress was made on outstanding territorial disputes, and India is not known to have
presented evidence of Pakistani involvement in the 7/11 Bombay terrorist bombings,
but the two officials did give shape to a joint anti-terrorism mechanism proposed in
September and they agreed to continue the dialogue process in early 2007. A notable
step came in December 2006, when bilateral talks on the militarized Sir Creek
dispute ended with agreement to conduct a joint survey.
In January 2007, Pakistani Foreign Minister Khurshid Kasuri hosted his Indian
counterpart, Pranab Mukherjee, in Islamabad for the first such visit in more than a
year. The two men reviewed past progress and planned for a fourth Composite
Dialogue round in March. On February 18, two bombs exploded on an Indian
segment of the Samjhauta [Friendship] Express train linking Delhi, India, with
Lahore. Resulting fires killed 68 people, most of them Pakistanis. Days later, Kasuri
traveled to New Delhi, where he and Mukherjee reaffirmed a bilateral commitment
to the peace process despite the apparent effort to subvert it. While India refused a
5 [http://www.indianembassy.org/press_release/2004/jan/07.htm].

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CRS-12
Pakistani request to undertake a joint investigation into that attack, the two countries
did sign an agreement to reduce the risk of accidental nuclear war.
The new joint Pakistan-India anti-terrorism mechanism met for the first time in
Islamabad in March and produced a joint statement in which both governments
agreed to use the mechanism for exchanging information about investigations of
and/or efforts to prevent terrorist acts on either side of the shared border, and to meet
quarterly while immediately conveying urgent information. Hopes that the February
train bombing would provide a fitting “test case” apparently were dashed, however,
when India declined to share relevant investigative information with Pakistan.
Moreover, Indian officials were unhappy with Islamabad’s insistence that the
“freedom struggle” underway in Kashmir should not be treated as terrorism under
this framework. Still, the continuing engagement even after a major terrorist attack
was widely viewed as evidence that the bilateral peace process had gained a sturdy
momentum. A new rounds of dialogue was then launched in mid-March, when the
two foreign ministers met again in Islamabad. No new agreements were reached, but
both officials lauded improved bilateral relations and held “the most sustained and
intensive dialogue” ever on the Kashmir problem.6
The “IPI” Pipeline Project. Islamabad insists it is going ahead with a
proposed joint pipeline project to deliver Iranian natural gas to Pakistan and on to
India. In January 2007, officials from the three countries resolved a long-running
price-mechanism dispute, opening the way for further progress. In February, the
fourth meeting of the Pakistan-India Joint Working Group on the IPI [Iran-Pakistan-
India] Pipeline was held in Islamabad, where the two countries agreed to split equally
expected gas supplies. In June, Pakistani and Indian officials reportedly reached an
agreement in principle on transportation charges, and officials from all three
countries suggested a final deal was imminent. Prime Minister Aziz has described
the pipeline as being critical to Pakistan’s economic growth and political stability.
Doubts about financing the $5-7 billion project combined with concerns about
security in Pakistan’s Baluchistan progress have some analysts skeptical about
fruition. Some independent observers and Members of Congress assert that
completion of the pipeline would represent a major confidence-building measure in
the region and could bolster regional energy security while facilitating friendlier
Pakistan-India ties (see, for example, H.Res. 353 in the 109th Congress). As part of
its efforts to isolate Iran economically, the Bush Administration actively seeks to
dissuade the Islamabad government from participation in this project, and a State
Department official has suggested that current U.S. law dictates American
opposition: The Iran-Libya Sanctions Act (P.L. 107-24) required the President to
impose sanctions on foreign companies that make an “investment” of more than $20
million in one year in Iran’s energy sector. The 109th Congress extended this
provision in the Iran Freedom Support Act (P.L. 109-293). No firms have been
sanctioned under this act to date. (See also CRS Report RS20871, The Iran
Sanctions Act (ISA).)
6 See Pakistan Foreign Ministry Press Release No. 81/2007 at [http://www.mofa.gov.pk/-
Press_Releases/2007/March/PR_81_07.htm].

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CRS-13
Afghanistan. Pakistani leaders have long sought access to Central Asia and
“strategic depth” with regard to India though friendly relations with neighboring
Afghanistan. Such policy contributed to President General Zia ul-Haq’s support for
Afghan mujahideen “freedom fighters” who were battling Soviet invaders during the
1980s and to Islamabad’s later support for the Afghan Taliban regime from 1996 to
2001. British colonialists had purposely divided the ethnic Pashtun tribes inhabiting
the mountainous northwestern reaches of their South Asian empire with the 1893
“Durand Line.” This porous, 1,600-mile border is not accepted by Afghan leaders,
who have at times fanned Pashtun nationalism to the dismay of Pakistanis.
Following Islamabad’s major September 2001 policy shift, President Musharraf
consistently has vowed full Pakistani support for the government of Afghan President
Hamid Karzai and he insists that Pakistan is playing a “totally neutral role” in
Afghanistan. Islamabad claims to have arrested more than 500 Taliban militants in
2006, remanding 400 of them to Afghan custody, and reportedly has provided $300
million in economic assistance to Kabul since 2001. Nevertheless, the two leaders
continuously exchange public accusations and recriminations about the ongoing
movement of Islamic militants in the border region, and U.S. officials have issued
increasingly strong claims about the problems posed by Taliban insurgents and other
militants who are widely believed to enjoy safehaven on the Pakistani side of the
Durand Line. Moreover, Pakistan is wary of signs that India is pursuing a policy of
“strategic encirclement,” taking note of New Delhi’s past support for Tajik and
Uzbek militias which comprised the Afghan Northern Alliance, and the post-2001
opening of numerous Indian consulates in Afghanistan. Both Pakistan and
Afghanistan play central roles as U.S. allies in global efforts to combat Islamic
militancy. Continuing acrimony between Islamabad and Kabul is thus deleterious to
U.S. interests (see also “Infiltration into Afghanistan” section below).
The China Factor. Pakistan and China have enjoyed a generally close and
mutually beneficial relationship over several decades. Pakistan served as a link
between Beijing and Washington in 1971, as well as a bridge to the Muslim world
for China during the 1980s. China’s continuing role as a major arms supplier for
Pakistan began in the 1960s and included helping to build a number of arms factories
in Pakistan, as well as supplying complete weapons systems. After the 1990
imposition of U.S. sanctions on Pakistan, the Islamabad-Beijing arms relationship
was further strengthened (see CRS Report RL31555, China and Proliferation of
Weapons of Mass Destruction and Missiles: Policy Issues). Indian leaders have
called the Islamabad-Beijing nuclear and missile “proliferation nexus” a cause of
serious concern in New Delhi, and U.S. officials remain seized of this potentially
destabilizing dynamic.
Analysts taking a realist, power political perspective view China as an external
balancer in the South Asian subsystem, with Beijing’s material support for Islamabad
allowing Pakistan to challenge the aspiring regional hegemony of a more powerful
India. Many observers, especially in India, see Chinese support for Pakistan as a key
aspect of Beijing’s perceived policy of “encirclement” or constraint of India as a
means of preventing or delaying New Delhi’s ability to challenge Beijing’s region-
wide influence.

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CRS-14
In April 2005, the Chinese prime minister visited Islamabad, where Pakistan and
China signed 22 accords meant to boost bilateral cooperation. President Musharraf’s
five-day visit to Beijing in February 2006 saw bilateral discussions on
counterterrorism, trade, and technical assistance. Chinese President Hu’s November
2006 travel to Islamabad was the first such visit by a Chinese president in ten years;
another 18 new bilateral pacts were inked, including a bilateral Free Trade
Agreement and plans for joint development of airborne early warning radars.
Islamabad may seek future civil nuclear assistance from Beijing, including potential
provision of complete power reactors, especially in light of Washington’s categorical
refusal of Pakistan’s request for a civil nuclear cooperation similar to that being
planned between the United States and India. In May 2007, Prime Minister Aziz
visited Beijing, where Pakistan and China signed 27 new agreements and memoranda
of understanding to “re-energize” bilateral cooperation in numerous areas, including
defense, space technology, and trade. No public mention was made regarding civil
nuclear cooperation. The Chinese government has assisted Pakistan in constructing
a major new port at Gwadar, near the border with Iran; Islamabad and Beijing aspire
to make this port, officially opened in March 2007, a major commercial outlet for
Central Asian states. Some analysts are concerned that the port may be used for
military purposes and could bolster China’s naval presence in the Indian Ocean
region. Pakistan continues to view China as an “all-weather friend” and perhaps its
most important strategic ally.
Pakistan-U.S. Relations and Key Country Issues
U.S. policy interests in Pakistan encompass a wide range of issues, including
counterterrorism, nuclear weapons and missile proliferation, South Asian and Afghan
stability, democratization and human rights, trade and economic reform, and efforts
to counter narcotics trafficking. Relations have been affected by several key
developments, including proliferation- and democracy-related sanctions; a continuing
Pakistan-India nuclear standoff and conflict over Kashmir; and the September 2001
terrorist attacks against the United States. In the wake of those attacks, President
Musharraf — under intense U.S. diplomatic pressure — offered President Bush
Pakistan’s “unstinted cooperation in the fight against terrorism.” Pakistan became
a vital ally in the U.S.-led anti-terrorism coalition. U.S. sanctions relating to
Pakistan’s 1998 nuclear tests and 1999 military coup quickly were waived and, in
October 2001, large tranches of U.S. aid began flowing into Pakistan. Direct
assistance programs include training and equipment for Pakistani security forces,
along with aid for health, education, food, democracy promotion, human rights
improvement, counternarcotics, border security and law enforcement, as well as trade
preference benefits. The United States also supports grant, loan, and debt
rescheduling programs for Pakistan by the various major international financial
institutions. In June 2004, President Bush designated Pakistan as a major non-NATO
ally of the United States under Section 517 of the Foreign Assistance Act of 1961.
Revelations that Pakistan has been a source of nuclear proliferation to North Korea,
Iran, and Libya may complicate future Pakistan-U.S. relations.

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CRS-15
Terrorism
After the September 2001 terrorist attacks on the United States, Pakistan
pledged and has provided major support for the U.S.-led global anti-terrorism
coalition. According to the U.S. Departments of State and Defense, Pakistan has
afforded the United States unprecedented levels of cooperation by allowing the U.S.
military to use bases within the country, helping to identify and detain extremists,
tightening the border between Pakistan and Afghanistan, and blocking terrorist
financing. Top U.S. officials regularly praise Pakistani anti-terrorism efforts. In a
landmark January 2002 speech, President Musharraf vowed to end Pakistan’s use as
a base for terrorism of any kind, and he banned numerous militant groups, including
Lashkar-e-Taiba and Jaish-e-Muhammad, both blamed for terrorist violence in
Kashmir and India, and both designated as terrorist organizations under U.S. law.
In the wake of the speech, thousands of Muslim extremists were detained, though
most of these were later released. In the spring of 2002, U.S. military and law
enforcement personnel began engaging in direct, low-profile efforts to assist
Pakistani security forces in tracking and apprehending fugitive Al Qaeda and Taliban
fighters on Pakistani territory. Pakistani authorities have remanded to U.S. custody
approximately 500 such fugitives to date.
Important Al Qaeda-related arrests in Pakistan have included Abu Zubaydah
(March 2002), Ramzi bin al-Shibh (September 2002), Khalid Sheik Mohammed
(March 2003), and Abu Faraj al-Libbi (May 2005). Other allegedly senior Al Qaeda
figures were killed in gunbattles and missile attacks, including in several apparent
U.S.-directed attacks on Pakistani territory from aerial drones. Yet Al Qaeda
fugitives and their Taliban allies remain active in Pakistan, especially in the
mountainous tribal regions along the Afghan border. Meanwhile, numerous banned
indigenous groups continue to operate under new names: Lashkar-e-Taiba became
Jamaat al-Dawat; Jaish-e-Mohammed was re-dubbed Khudam-ul Islam (the former
was banned under U.S. law in April 2006).
President Musharraf repeatedly has vowed to end the activities of religious
extremists in Pakistan and to permanently prevent banned groups from resurfacing
there. His policies likely spurred two lethal but failed attempts to assassinate him in
December 2003. At present, Islamabad declares a four-pronged strategy to counter
terrorism and religious extremism, containing military, political, administrative, and
development aspects. Nonetheless, some analysts have long called Musharraf’s
efforts cosmetic, ineffective, and the result of international pressure rather than a
genuine recognition of the threat posed. In recent years, some Pakistani nationals and
religious seminaries have been linked to Islamist terrorism plots in numerous
countries, especially the United Kingdom. In a January 2007 review of global
threats, then-U.S. Director of Intelligence Negroponte issued what may be the
strongest relevant statements from a Bush Administration official to date, telling a
Senate panel that, “Pakistan is a frontline partner in the war on terror. Nevertheless,
it remains a major source of Islamic extremism and the home for some top terrorist
leaders.” He identified Al Qaeda as posing the single greatest terrorist threat to the
United States and its interests, and warned that the organization’s “core elements ...

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CRS-16
maintain active connections and relationships that radiate outward from their leaders’
secure hideout in Pakistan” to affiliates on four continents.7
In February 2007, Vice President Dick Cheney and the Deputy Director of the
CIA, Steve Kappes, made an unannounced four-hour visit to Islamabad, where they
reportedly warned President Musharraf that a Democratic-controlled Congress could
cut U.S. aid to Pakistan unless that country takes more aggressive action to hunt
down Al Qaeda and Taliban operatives on its soil. The unusually strong admonition
came after U.S. intelligence officials concluded that a “terrorist infrastructure” had
been rebuilt in western Pakistan, that Islamabad’s counterterrorism efforts had been
feckless to date, and that the Bush Administration was recognizing that current U.S.
and Pakistani policies were not working. When asked during a February Senate
hearing about the possible source of a hypothetical future Al Qaeda attack on the
United States, the new Director of National Intelligence, Mike McConnell, stated a
belief that such an attack “most likely would be planned and come out of the [Al
Qaeda] leadership in Pakistan.”8 The State Department’s Country Reports on
Terrorism 2006, released in April 2007, said “Pakistan executed effective
counterterrorism cooperation and captured or killed many terrorists” while also
reiterating U.S. concerns that the FATA is “a safe haven for Al Qaeda, the Taliban,
and other militants.”9 Pakistani officials are resentful of criticisms and doubts about
their commitment to the counterterrorist fight, and they aver that U.S. pressure on
Pakistan to “do more” could undermine President Musharraf and destabilize his
government.10 (See also CRS Report RL32259, Terrorism in South Asia.)
Al Qaeda in Pakistan. Pakistani authorities reportedly have remanded to
U.S. custody approximately 500 wanted Al Qaeda fugitives to date, including some
senior alleged operatives. However, despite clear successes in disrupting Al Qaeda
and affiliated networks in Pakistan since 2001, there are increasing signs that anti-
U.S. terrorists are now benefitting from what some analysts call a Pakistani policy
of appeasement in western tribal areas near the Afghan border. By seeking
accommodation with pro-Taliban leaders in these areas, the Musharraf government
appears to have inadvertently allowed foreign (largely Arab) militants to obtain safe
haven from which they can plot and train for terrorist attacks against U.S. and other
7 Statement before the Senate Select Committee on Intelligence, January 11, 2007, at
[http://intelligence.senate.gov/hearings.cfm?hearingId=2467].
8 Statement before the Senate Armed Services Committee, February 27, 2007. A July 2007
National Intelligence Estimate on the terrorist threat included the assessment that Al Qaeda
has “protected or regenerated” its capability to attack the United States, in part due to its
enjoying “safehaven” in Pakistan’s tribal areas (see [http://www.dni.gov/
press_releases/20070717_release.pdf]).
9 See [http://www.state.gov/s/ct/rls/crt/2006/82734.htm].
10 David Sanger and Mark Mazzetti, “Cheney Warns Pakistan to Act on Terrorism,” New
York Times, February 25, 2007; Shahzeb Jillani, “US May Be ‘Undermining’ Pakistan,”
BBC News, March 1, 2007.

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CRS-17
Western targets. Moreover, many observers warn that an American preoccupation
with Iraq has contributed to allowing Al Qaeda’s reemergence in Pakistan.11
Al Qaeda founder Osama Bin Laden and his lieutenant, Egyptian Islamic radical
leader Ayman al-Zawahri, are believed by many to be hiding somewhere in
Pakistan’s western border region. Pakistani officials reject such suspicions and
generally insist there is no evidence to support them, but numerous U.S. officials
have suggested otherwise. While some mid-2006 reports placed the Al Qaeda
founder in the remote Dir Valley of northwestern Pakistan, the country’s prime
minister said those hunting Bin Laden had no clues as to his whereabouts, a claim
bolstered by several Western press reports indicating that the U.S. and other special
forces tasked with finding Bin Laden had not received a credible lead in years.
President Bush has said he would order U.S. forces to enter Pakistan if he received
good intelligence on Osama Bin Laden’s location.
Infiltration Into Afghanistan. Tensions between the Kabul and Islamabad
governments — which stretch back many decades — have at times reached alarming
levels in recent years, with top Afghan officials accusing Pakistan of manipulating
Islamic militancy in the region to destabilize Afghanistan. Likewise, U.S. military
commanders overseeing Operation Enduring Freedom have since 2003 complained
that renegade Al Qaeda and Taliban fighters remain able to attack coalition troops in
Afghanistan, then escape across the Pakistani frontier. They have expressed dismay
at the slow pace of progress in capturing wanted fugitives in Pakistan and urge
Islamabad to do more to secure its rugged western border area. U.S. government
officials have voiced similar worries, even expressing concern that elements of
Pakistan’s intelligence agency might be assisting members of the Taliban. In June
2006, the State Department’s top counterterrorism official told a Senate panel that
elements of Pakistan’s “local, tribal governments” are believed to be in collusion
with the Taliban and Al Qaeda, but that the United States had no “compelling
evidence” that Pakistan’s intelligence agency is assisting militants. In September, the
Commander of the U.S. European Command, Gen. James Jones, told the same
Senate panel it was “generally accepted” that the Taliban headquarters is somewhere
in the vicinity of Quetta, in Pakistan’s southwestern Baluchistan province.12
Pakistan Launches Internal Military Operations. During the autumn of
2003, in an unprecedented show of force, President Musharraf moved 25,000
Pakistani troops into the traditionally autonomous Federally Administered Tribal
Areas (FATA) on the Afghan frontier. The first half of 2004 saw an escalation of
Pakistani Army operations, many in coordination with U.S. and Afghan forces just
across the international frontier (U.S. forces have no official authorization to cross
the border into Pakistan). Combat between Pakistani troops and militants in the two
Waziristan agencies and other border areas reportedly has killed more than 800
11 See, for example, Bruce Riedel, “Al Qaeda Strikes Back,” Foreign Affairs, May 2007, at
[http://www.foreignaffairs.org/20070501faessay86304/bruce-riedel/al-qaeda-strikes-back
.html]; Greg Miller, “Influx of Al Qaeda, Money Into Pakistan is Seen,” Los Angeles Times,
May 20, 2007.
12 See also Elizabeth Rubin, “In the Land of the Taliban,” New York Times, October 22,
2006.

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CRS-18
Islamist extremists (many of them foreigners), along with some 600-700 Pakistani
soldiers, and many hundreds of civilians. The battles, which continued sporadically
throughout 2005 and again became fierce in the spring of 2006, exacerbated volatile
anti-Musharraf and anti-American sentiments held by many Pakistani Pashtuns.
Kabul’s October 2004 elections were held without major disturbances,
apparently in part due to Musharraf’s commitment to reducing infiltrations. Yet
concerns sharpened in 2005 and, by the middle of that year, Afghan leaders were
openly accusing Islamabad of actively supporting insurgents and providing their
leadership with safe haven. Islamabad adamantly denied the charges and sought to
reassure Kabul by dispatching additional troops to border areas, bringing the total to
80,000. Still, 2006 was the deadliest year to date for U.S. troops in Afghanistan and,
at year’s end, there were growing indications that Islamabad’s efforts to control the
tribal areas were meeting with little success.
President Musharraf’s “carrot and stick” approach of offering amnesty to those
militant tribals who “surrender,” and using force against those who resist, clearly did
not rid the region of indigenous Islamic militants or Al Qaeda operatives. Late 2005
and early 2006 missile attacks on suspected Al Qaeda targets — apparently launched
by U.S. aerial drones flying over Pakistani territory — hinted at more aggressive U.S.
tactics that could entail use of U.S. military assets in areas where the Pakistanis are
either unable or unwilling to strike. Yet the attacks, in particular a January 13, 2006,
strike on Damadola in the Bajaur tribal agency that apparently killed women and
children along with several alleged Al Qaeda suspects, spurred widespread Pakistani
resentment and a perception that the country’s sovereignty was under threat.
A series of deadly encounters between government forces and militants in the
FATA left scores dead in the spring of 2006, among them many civilians. Pakistani
troops reportedly are hampered by limited communications and other
counterinsurgency capabilities, meaning their response to provocations can be overly
reliant on imprecise, mass firepower. Simultaneously, tribal leaders who cooperated
with the federal government faced dire threats from the extremists — as many as 200
were the victims of targeted killings in 2005 and 2006 — and the militants have
sought to deter such cooperation by periodically beheading accused “U.S. spies.”
Islamabad Shifts Strategy. As military operations failed to subdue the
militants while causing much “collateral damage” and alienating local residents,
Islamabad in 2004 began shifting strategy and sought to arrange truces with Waziri
commanders, first at Shakai in South Waziristan in April 2004, then again in
February 2005. Officials in Islamabad recognized that the social fabric of the FATA
had changed following its role as a staging and recruiting area for the war against the
Soviet Army in Afghanistan during the 1980s: the traditional power base was eroded
as the influence of religious elements had greatly increased. President Musharraf
lambasts the creeping “Talibanization” of the tribal areas and has sought to
implement a new scheme, shifting over time from an almost wholly militarized
approach to one emphasizing negotiation and economic development in the FATA,
as well as (re-)elevating the role of tribal maliks who would work in closer
conjunction with federal political agents. The aim, then, became restoration of a kind
of enhanced status quo ante with a limited state writ (maliks would enjoy more pay

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CRS-19
and larger levies), and the reduction and ultimately full withdrawal of army troops.13
Some reports had the U.S. government initially offering cautious support for this new
political strategy.14
Cease-Fire and North Waziristan Truce. In late June 2006, militants in
North Waziristan announced a unilateral 30-day cease-fire to allow for creation of a
tribal council seeking resolution with government forces. The Islamabad government
began releasing detained Waziri tribesmen and withdrawing troops from selected
checkposts in a show of goodwill. Hundreds of Pashtun tribesmen and clerics later
held a tribal council with government officials, and the cease-fire was extended for
another month. Throughout July and August, Pakistan reported arresting scores of
Taliban fighters and remanding many of these to Afghanistan. Then, on September
5, the Islamabad government and pro-Taliban militants in Miramshah, North
Waziristan, signed a truce to ensure “permanent peace” in the region. The key
government participant was a political agent representing the NWFP governor, who
agreed on behalf of the government to end army operations against local tribesmen;
release all detainees; lift all public sanctions, pay compensation for property damage,
return confiscated vehicles and other goods; and remove all new army checkposts.
In turn, two representatives of the North Waziristan “local mujahideen students”
(trans. “Taliban”) agreed to end their attacks on government troops and officials; halt
the cross-border movement of insurgents to Afghanistan; and evict all foreigners who
did not agree to live in peace and honor the pact.15 There was subsequent talk of
extending the scheme to other FATA agencies and perhaps even to Afghanistan.
News of the truce received lukewarm reception in Washington, where officials
took a “wait-and-see” approach to the development. By the final weeks of October
2006, there was a growing concern among both U.S. government officials and
independent analysts that the September arrangement in North Waziristan
represented a Pakistani “surrender” and had in effect created a sanctuary for
extremists, with the rate of Taliban activities in neighboring Afghanistan much
increased and some reports having the militants failing to uphold their commitments.
Still, Islamabad pressed ahead with a plan to extend a similar truce to the Bajaur
tribal agency. Then, only hours before such a deal was to be struck on October 30,
82 people were killed in a dawn air attack on a madrassa in Chingai, Bajaur. The
Pakistani military claimed to have undertaken the attack after the school’s pro-
Taliban leader continued to train terrorists and shelter “unwanted foreigners,” yet
many observers speculated that the attack had in fact been carried out by U.S.
Predator drones, perhaps after intelligence reports placed fugitive Al Qaeda
lieutenant Ayman al-Zawahri at the site. Nine days later, after a local pro-Taliban
militant leader vowed to retaliate against Pakistani security forces, a suicide bomber
killed 42 army recruits at a military training camp at Dargai in the North West
13 Author interview with Pakistan government official, Islamabad, September 2006;
“President General Pervez Musharraf’s Address to the Nation,” July 20, 2006, at
[http://www.presidentofpakistan.gov.pk/SpeechAddressList.aspx].
14 Jonathan Landay, “White House Backing New Plan to Defuse Insurrection in Pakistan,”
McClatchy Newspapers, August 16, 2006.
15 A translated version of the pact is at [http://www.pbs.org/wgbh/pages/frontline/taliban/
etc/nwdeal.html].

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CRS-20
Frontier Province, not far from the sight of the Chingai attack. The bombing was the
most deadly attack on the Pakistani military in recent memory.
The FATA in 2007. The situation in the FATA in mid-2007 has grown highly
unstable, with a large trust deficit between government forces and tribal leaders, and
a surge of concern among U.S. officials that President Musharraf’s strategy of
making truce deals with pro-Taliban militants has failed. In January, the director of
the U.S. Defense Intelligence Agency, Lt. Gen. Michael Maples, told a Senate panel
that tribals leaders in Waziristan had not abided by most terms of the September 2006
North Waziristan agreement.16 In March, Undersecretary of Defense for Policy Eric
Edelman reported to the same panel that there was “an almost immediate and steady
increase of cross-border infiltration and attacks” just after that agreement had been
reached. Some reports even describe anecdotes of the Pakistani military providing
fire support for Taliban units operating in Afghanistan.17
In late March, battles erupted between tribal forces and Uzbek militants in South
Waziristan. Heavy arms — including mortars, large-caliber machineguns, and
rockets — were used by both sides, and some 300 people, most of them Uzbeks,
were reported killed. President Musharraf later acknowledged that the Pakistani
army had provided support for what essentially were pro-Taliban tribal forces. The
fighting was touted by Islamabad as a sign that its new strategy was paying dividends.
Yet such conflict may well have been more about long-brewing local resentments
toward Uzbeks, and there is further concern among skeptics that the battles served
to strengthen the “Pakistani Taliban” and helped to consolidate their control in the
tribal areas.18 Also in March, the Musharraf government made a third pact with tribal
leaders, this time in Bajaur. Days later, NATO’s top military commander, U.S. Army
Gen. John Craddock, told an interviewer that the 2006 truce with pro-Taliban forces
in North Waziristan “hasn’t worked since it went into effect” and that he believed it
should be ended.19 By July, a spate of militant attacks on Pakistani military targets
— apparently in retaliation for the government’s armed assault on Islamabad’s
radical Red Mosque — led Islamabad to further bolster the army’s presence in the
region and coincided with an announcement by North Waziristan tribal leaders that
they were withdrawing from the September 2006 truce agreement due to alleged
government violations. Top U.S. Bush Administration officials subsequently
conceded that the agreement had failed to produce the desired results for both
Pakistan and the United States, and they suggested the tack should be abandoned by
the Musharraf government.
Despite acknowledged setbacks, the Bush Administration claims to strongly
support President Musharraf’s efforts to adopt a more comprehensive approach to
16 Statement before the Senate Select Committee on Intelligence, January 11, 2007, at
[http://intelligence.senate.gov/hearings.cfm?hearingId=2467].
17 David Sanger and David Rhode, “U.S. Pays Pakistan to Fight Terror, But Patrols Ebb,”
New York Times, May 20, 2007.
18 Kim Barker, “Pakistan’s Unlikely Alliances Worry West,” Chicago Tribune, April 22,
2007; Ismail Khan, “The Game is Up for Uzbeks,” Dawn (Karachi), April 5, 2007.
19 Jim Michaels, “General: Pakistani Border Deal Fails,” USA Today, April 2, 2007.

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CRS-21
include economic and social development and governance reform to the region,
flowing in part from an acknowledgment that “purely military solutions are unlikely
to succeed.”20 Yet international donors and lending agencies appear hesitant to
finance projects in the region while the security situation remains tense, and the U.S.
government is reported to be wary of infusing development aid that could end up in
the hands of elements unfriendly to U.S. interests.21 Meanwhile, it appears the
“Pakistani Taliban” in North Waziristan has succeeded in establishing a local
administrative infrastructure much as was done in South Waziristan following a
similar truce there in April 2004.22 Reports continue to indicate that the FATA
increasingly serves as a base for a new generation of potential terrorists and is the site
of numerous terrorist training camps, some associated with Al Qaeda.23 Many
analysts insist that only by bringing the tribal areas under the full writ of the Pakistani
state and facilitating major economic development there can Islamabad’s FATA
problem be resolved.24
Infiltration into Kashmir and India. Islamabad has been under continuous
U.S. and international pressure to terminate the infiltration of separatist militants
across the Kashmiri Line of Control (LOC). Such pressure reportedly elicited a
January 2002 promise from President Musharraf to then-U.S. Deputy Secretary of
State Richard Armitage that all such movements would cease. During a June 2002
visit to Islamabad, Deputy Secretary Armitage reportedly received another pledge
from the Pakistani president, this time an assurance that any existing terrorist camps
in Pakistani Kashmir would be closed. Musharraf has assured India that he will not
permit any territory under Pakistan’s control to be used to support terrorism, and he
insists that his government is doing everything possible to stop infiltration and shut
down militant base camps in Pakistani-controlled territory. Critics contend, however,
that Islamabad continues to actively support anti-India militants as a means both to
maintain strategically the domestic backing of Islamists who view the Kashmir issue
as fundamental to the Pakistani national idea, and to disrupt tactically the state
government in Indian Kashmir in seeking to erode New Delhi’s legitimacy there.
20 Statement of Assistant Secretary of State for South and Central Asian Affairs Richard
Boucher before the House Committee on Foreign Affairs, Subcommittee on Middle East and
South Asia, Regional Overview of South Asia,” March 7, 2007, at
[http://www.internationalrelations.house.gov/110/bou030707.htm]. Pakistani strategy as
conveyed by the country’s Ambassador to the U.N. in Munir Akram, “A United Front
Against the Taliban,” New York Times, April 4, 2007.
21 Jane Perlez, “Aid to Pakistan in Tribal Areas Raises Concerns,” New York Times, July 16,
2007.
22 See, for example, “Miramshah Taliban Open Office,” Dawn (Karachi), September 28,
2006; M. Ilyas Khan, “Taliban Spread Wings in Pakistan,” BBC News, March 5, 2007.
23 Aryn Baker, “The Truth About Talibanization,” Time, April 2, 2007, is representative.
24 See, for example, Barnett Rubin and Abubakar Siddique, “Resolving the Pakistan-
Afghanistan Stalemate,” U.S. Institute of Peace Special Report, 176, October 2006;
“Pakistan’s Tribal Areas: Appeasing the Militants,” International Crisis Group Asia Report
No. 125, December 11, 2006; Christine Fair, Nicholas Howenstein, and Alexander Thier,
“Troubles on the Pakistan-Afghanistan Border,” U.S. Institute for Peace Briefing, December
2006.

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CRS-22
Positive indications growing from the latest Pakistan-India peace initiative
include a cease-fire at the LOC that has held since November 2003 and statements
from Indian officials indicating that rates of militant infiltration were down
significantly. However, Indian leaders periodically reiterate their complaints that
Islamabad has taken insufficient action to eradicate the remaining “infrastructure of
terrorism” on Pakistani-controlled territory. With indications that terrorism on Indian
soil beyond the Jammu and Kashmir state may have been linked to Pakistan-based
terrorist groups, Indian leaders repeat demands that Pakistan uphold its promises to
curtail the operations of Islamic militants and violent Kashmiri separatists originating
on Pakistani-controlled territory.
Following conflicting reports from Indian government officials about the
criminal investigation into July 2006 Bombay terrorist bombings that left nearly 200
people dead, India’s prime minister claimed in October that India had “credible
evidence” of Pakistani government complicity in the plot. Islamabad rejected such
allegations as “propaganda” designed “to externalize an internal [Indian] malaise.”25
Several other terrorist attacks against Indian targets outside of Kashmir have been
linked to Pakistan-based groups, including lethal assaults on civilians in Delhi and
Bangalore in 2005, and in Varanasi in 2006. Indian security officials also routinely
blame Pakistan’s intelligence service for assisting the infiltration of Islamist militants
into India from Nepal, Bangladesh, and Bhutan, as well as across the Kashmiri LOC.
Domestic Terrorism. Pakistan is known to be a base for numerous
indigenous terrorist organizations, and the country continues to suffer from terrorism
at home, in particular that targeting the country’s Shia minority. Until a March 2006
car bombing at the U.S. consulate in Karachi that left one American diplomat dead,
recent attacks on Western targets had been rare, but 2002 saw several acts of lethal
anti-Western terrorism, including the kidnaping and murder of reporter Daniel Pearl,
a grenade attack on a Protestant church in Islamabad that killed a U.S. Embassy
employee, and two car bomb attacks, including one on the same U.S. consulate,
which killed a total of 29 people. These attacks, widely viewed as expressions of
militants’ anger with the Musharraf regime for its cooperation with the United States,
were linked to Al Qaeda, as well as to indigenous militant groups.
From 2003 to the present, Pakistan’s worst domestic terrorism has been directed
against the country’s Shia minority and included suicide bomb attacks that killed
scores of people in 2005 and 2006 (in addition, nearly 60 Sunnis were killed in an
April 2006 suicide bombing in Karachi). Indications are that the indigenous Lashkar-
e-Jhangvi (LJ) Sunni terrorist group is responsible for the most deadly anti-Shia
violence. Two attempts to kill Musharraf in December 2003 and failed efforts to
assassinate other top Pakistani officials in mid-2004 were linked to the LJ and other
Al Qaeda-allied groups, and illuminated the grave and continuing danger presented
by religious extremists.
25 “We Have Credible Evidence: Manmohan,” Hindu (Madras), October 25, 2006; Anand
Giridharadas, “India’s Police Say Pakistan Helped Plot July Train Bombings,” New York
Times, October 1, 2006; Pakistan Ministry of Foreign Affairs Media Briefing, October 2,
2006.

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CRS-23
Following a July 2006 suicide bombing in Karachi that killed a prominent Shiite
cleric, Musharraf renewed his pledge to crack down on religious extremists; hundreds
of Sunni clerics and activists were subsequently arrested for inciting violence against
Shiites through sermons and printed materials. However, serious sectarian and other
religiously-motivated violence flared anew in late 2006 and continue in 2007. Bomb
attacks, many of them by suicidal extremists motivated by sectarian hatreds, killed
scores of people; some reports link the upsurge in such attacks to growing sectarian
conflict in Iraq. Among the spate of at least 16 significant domestic terrorist attacks
suffered by Pakistan in 2007 were
! a late January bomb blast in Peshawar that killed 15 people, most of
them policemen, including the city’s police chief, in a likely anti-
Shia attack;
! the early February murder of six opposition People’s Party activists
west of Islamabad;
! a mid-February suicide bombing that killed 16 people, including a
judge, and critically injured 6 others in a Quetta courtroom;
! the targeted killing of a female provincial minister in Punjab by an
Islamist zealot;
! a late April suicide bombing that killed at least 28 other people and
narrowly missed Pakistan’s interior minister at a political rally in
Peshawar; and
! a mid-May suicide bombing that killed up to 25 other people at a
Peshawar restaurant said to be popular with Afghan refugees;
! an early June roadside bombing the Bajaur tribal agency that killed
five people, including a government official and a journalist; and
! at least six separate mid-July suicide bomb attacks that left more
than 100 people dead in the North West Frontier Province, the tribal
agencies, and one bombing at an opposition political rally in
Islamabad that killed some 14 people, most of them PPP members.
A leading pro-Taliban militant in the South Waziristan tribal agency, Baitullah
Mehsud, issued vows to avenge Pakistani military and paramilitary attacks in the
region in early 2007; he subsequently has been linked to at least four anti-government
suicide bombings in Pakistan.26 Some analysts believe that, by redirecting Pakistan’s
internal security resources, an increase in such violence can ease pressure on Al
Qaeda and affiliated groups and so allow them to operate more freely there. In June,
Pakistan’s National Security Council reportedly warned President Musharraf that
Islamist militancy was rapidly spreading beyond western tribal areas and that a
“policy of appeasement” had emboldened the Taliban. The Council was said to have
formulated new plans to address the issue, including the deployment of pilotless
reconnaissance drones, bolstering local law enforcement capabilities, and shifting
more paramilitary troops to the region from other parts of Pakistan.
26 “Doubts Over Peace Deal,” BBC News, January 17, 2007; “Baitullah Linked to Suicide
Attacks, Says FIA Official,” Dawn (Karachi), March 21, 2007.

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CRS-24
Other Security Issues
Pakistan-U.S. Security Cooperation. U.S.-Pakistan security cooperation
accelerated quickly after 2001, and President Bush designated Pakistan as a major
non-NATO U.S. ally in June 2004. The close U.S.- Pakistan security ties of the cold
war era — which came to a near halt after the 1990 aid cutoff — have been restored
as a result of Pakistan’s role in the U.S.-led anti-terrorism campaign. In 2002, the
United States began allowing commercial sales that enabled Pakistan to refurbish at
least part of its fleet of American-made F-16 fighter aircraft. In March 2005, the
United States announced that it would resume sales of F-16 fighters to Pakistan after
a 16-year hiatus. A revived high-level U.S.-Pakistan Defense Consultative Group
(DCG) — moribund since 1997 — now sits for high-level discussions on military
cooperation, security assistance, and anti-terrorism; its most recent session came in
May 2006. In 2003, a U.S.-Pakistan-Afghanistan Tripartite Commission was
established to bring together military commanders for discussions on Afghan stability
and border security; a session held in Pakistan in January 2007 included
establishment of the first joint intelligence sharing center in Kabul to boost
cooperation against Taliban and other extremists. Officers from NATO’s
International Security Assistance Force in Afghanistan have joined the body, which
met for the 22nd time in May 2007.
Major government-to-government arms sales and grants since 2001 include 6
C-130 military transport aircraft; 6 AN/TPS-77 surveillance radars; air traffic control
systems; nearly 6,000 military radios; 100 Harpoon anti-ship missiles (with the
possibility of sales of another 90); 6 Phalanx guns (with upgrades on another 6); and
2,014 TOW anti-armor missiles. In 2004, the U.S. Navy agreed to grant 8 excess P-
3C Orion maritime patrol aircraft to Pakistan; plans for their major refurbishment and
service by U.S. firms could be worth $1 billion in coming years. Other pending sales
include up to 500 Sidewinder air-to-air missiles and 115 self-propelled howitzers.
Major Excess Defense Article grants have included 20 refurbished AH-1F Cobra
attack helicopters (with 20 more for parts) and 4 F-16A fighters (24 more such
fighters will be transferred to Pakistan as they become excess to the U.S. Air Force).
Further potential arms sales include costly plans to refurbish and modify three excess
P-3 aircraft with the E-2C Hawkeye airborne early warning suite. The Department
of Defense has characterized F-16 fighters, P-3C patrol aircraft, and anti-armor
missiles as having significant anti-terrorism applications, claims that elicit skepticism
from some analysts. The Pentagon reports total Foreign Military Sales agreements
with Pakistan worth $863 million in FY2002-FY2005. In-process sales of F-16s
have raised the value to $3.5 billion in FY2006 alone.
Security-related U.S. assistance programs for Pakistan are said aimed especially
at bolstering Islamabad’s counterterrorism and border security efforts, and have
included U.S.-funded road-building projects in the NWFP and FATA; and the
provision of night-vision equipment, communications gear, protective vests, and
transport helicopters and aircraft. The United States also has undertaken to train and
equip new Pakistan Army Air Assault units that can move quickly to find and target
terrorist elements. Modest U.S.-funded military education and training programs
seek to enhance the professionalism of Pakistan’s military leaders, and develop
respect for rule of law, human rights, and democratic values. U.S. security assistance
to Pakistan’s civilian sector is aimed at strengthening the country’s law enforcement

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CRS-25
capabilities through basic police training, provision of advanced identification
systems, and establishment of a new Counterterrorism Special Investigation Group.
U.S. efforts reportedly are hindered by Pakistani shortcomings that include poorly
trained and poorly equipped personnel who generally are underpaid by ineffectively
coordinated and overburdened government agencies.27 (See also CRS Report
RL32259, Terrorism in South Asia.)
Renewed F-16 Sales and Congressional Concerns. In June 2006, the
Pentagon notified Congress of a possible Foreign Military Sale to Pakistan worth up
to $5.1 billion. The deal involves 18 newly-built advanced F-16 combat aircraft (and
an option for 18 more), along with related munitions and equipment, and would
represent the largest-ever weapons sale to Pakistan. Associated munitions for new
F-16s and for mid-life upgrades on others will include 500 AMRAAM air-to-air
missiles and 700 BLU-109 bombs. Congressional concerns about the sale and
displeasure at the Bush Administration’s apparently improper notification procedures
spurred a July hearing of the House International Relations Committee. During that
session, many Members worried that F-16s were better suited to fighting India than
to combating terrorists; some warned that U.S. military technology could be passed
from Pakistan to China. The State Department’s lead official on political-military
relations sought to assure the committee that the sale would serve U.S. interests by
strengthening the defense capabilities of a key ally without disturbing the regional
balance of power and that all possible measures would be taken to prevent the
onward transfer of U.S. technologies. H.J.Res. 93, disapproving the proposed sale,
was introduced in the House, but died in committee.
Secretary of State Rice subsequently sent a letter to Congress indicating that no
F-16 combat aircraft or related equipment would be delivered to Pakistan until
Islamabad provided written security assurances that no U.S. technology will be
accessible by third parties. Islamabad has, however, denied that any “extraordinary”
security requirements were requested. After further negotiations on specifics,
including a payment process that will require a major outlay from the Pakistani
treasury, the United States and Pakistan in September signed a letter of acceptance
for the multi-billion dollar F-16 deal. Since then, several major U.S. defense
corporations have won contracts worth hundreds of millions of dollars to supply F-16
parts and munitions to Pakistan. (See also CRS Report RL33515, Combat Aircraft
Sales to South Asia: Potential Implications.)
Nuclear Weapons and Missile Proliferation. Many policy analysts
consider an apparent arms race between India and Pakistan to be among the most
likely potential causes of the future use of nuclear weapons by states. In May 1998,
India conducted unannounced nuclear tests, breaking a 24-year, self-imposed
moratorium on such testing. Despite U.S. and world efforts to dissuade it, Pakistan
quickly followed. The tests created a global storm of criticism and represented a
serious setback to two decades of U.S. nuclear nonproliferation efforts in South Asia.
Pakistan currently is believed to have enough fissile material, mainly enriched
27 See, for example, Seth Jones, et al., “Securing Tyrants or Fostering Reform?,” RAND
Corporation Monograph, January 7, ch. 6, 2007, at [http://www.rand.org/pubs/monographs/
2006/RAND_MG550.pdf].

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CRS-26
uranium, for 55-90 nuclear weapons; India, with a program focused on plutonium,
may be capable of building a similar number. Both countries have aircraft capable
of delivering nuclear bombs (U.S.-supplied F-16 combat aircraft in Pakistan’s air
force reportedly have been refitted to carry nuclear bombs). Pakistan’s military has
inducted short- and medium-range ballistic missiles (allegedly acquired from China
and North Korea), while India possesses short- and intermediate-range missiles. All
are assumed to be capable of delivering nuclear warheads over significant distances.
In 2000, Pakistan placed its nuclear forces under the control of a National Command
Authority led by the president. According to the director of the U.S. Defense
Intelligence Agency, Pakistan is building its stockpile of fission weapons and is
likely to continue work on advanced warhead and delivery systems.28 (See also CRS
Report RL32115, Missile Proliferation and the Strategic Balance in South Asia; and
CRS Report RS21237, Indian and Pakistani Nuclear Weapons.)
The A.Q. Khan Nuclear Proliferation Network. Press reports in late 2002
suggested that Pakistan assisted Pyongyang’s covert nuclear weapons program by
providing North Korea with uranium enrichment materials and technologies
beginning in the mid-1990s and as recently as July 2002. Islamabad rejected such
reports as “baseless,” and Secretary of State Powell was assured that no such
transfers were occurring. If such assistance is confirmed by President Bush, all non-
humanitarian U.S. aid to Pakistan may be suspended, although the President has the
authority to waive any sanctions that he determines would jeopardize U.S. national
security. In early 2003, the Administration determined that the relevant facts “do not
warrant imposition of sanctions under applicable U.S. laws.” Press reports during
2003 suggested that both Iran and Libya benefitted from Pakistani nuclear assistance.
Islamabad denied any nuclear cooperation with Tehran or Tripoli, although it
conceded in December 2003 that certain senior scientists were under investigation
for possible “independent” proliferation activities.
The investigation led to the February 2004 “public humiliation” of metallurgist
Abdul Qadeer Khan, known as the founder of Pakistan’s nuclear weapons program
and a national hero, when he confessed to involvement in an illicit nuclear smuggling
network. Khan and at least seven associates were said to have sold crucial nuclear
weapons technology and uranium-enrichment materials to North Korea, Iran, and
Libya. President Musharraf, citing Khan’s contributions to his nation, issued a
pardon that was later called conditional.29 The United States has been assured that
the Islamabad government had no knowledge of such activities and indicated that the
decision to pardon is an internal Pakistani matter.
While Musharraf has promised President Bush that he will share all information
learned about Khan’s proliferation network, Pakistan refuses to allow any direct
access to Khan by U.S. or international investigators. In May 2006, days after
releasing from detention nuclear scientist and suspected Khan collaborator
28 Statement of Lt. Gen. Michael Maples before the Senate Select Committee on
Intelligence, January 11, 2007, at [http://intelligence.senate.gov/070111/maples.pdf].
29 In May 2007, Pakistan’s Ambassador to the United States reportedly said that if Khan had
not been a national hero, “we would have strung him from the highest tree” (“A
‘Worrisome’ Time in Pakistan” [interview], USA Today, May 23, 2007).

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CRS-27
Mohammed Farooq, the Islamabad government declared the investigation “is
closed.” Some in Congress remained skeptical, however, and a House panel
subsequently held a hearing at which three nongovernmental experts insisted that
U.S. and international investigators be given direct access to Khan, in particular to
learn more about assistance given to Iran’s nuclear program. No alleged Pakistani
participants, including Khan himself, have faced criminal charges in the case. In
May 2007, the London-based International Institute for Strategic Studies released a
report on the Khan network, finding that “at least some of Khan’s associates appears
to have escaped law enforcement attention and could, after a period of lying low,
resume their black-market business.”30 Shortly after, a House panel held another
hearing on the Khan network, at which several Members and nongovernmental
experts called for Pakistan to allow direct access to Khan for U.S. investigators. In
July, Islamabad reportedly eased house arrest restrictions on Khan, although the
Foreign Ministry denied any change in Khan’s status. (See also CRS Report
RL32745, Pakistan’s Nuclear Proliferation Activities and the Recommendations of
the 9/11 Commission.)
Major New Plutonium Facilities? Revelations in July 2006 that Pakistan
is in the midst of constructing a major heavy water nuclear reactor at the Khushab
complex brought a flurry of concern from analysts who foresee a regional
competition in fissile material production, perhaps including China. A subsequent
report identified a third plutonium production reactor at Khushab. Upon completion,
which could be several years away, two new reactors with combined 1,000-megawatt
capacity might boost Pakistan’s weapons-grade plutonium production capabilities to
more than 200 kilograms per year, or enough for up to 50 nuclear weapons.
Moreover, a January 2007 report warned that Pakistan may soon be reprocessing
weapons-grade plutonium at its Chashma facility, further adding to its potential
stockpile and aiding in the development of thermonuclear weapons.31 While
Islamabad does not comment directly on the constructions, government officials there
insist that Pakistan will continue to update and consolidate its nuclear program for
the purpose of minimum credible deterrence. The Bush Administration responded
to the 2006 revelations by claiming it had been aware of Pakistani plans and that it
discourages the use of the facilities for military purposes.
Pakistan’s New Nuclear Transparency. During October 2006, Islamabad
appeared to launch a public relations effort aimed at overcoming the stigma caused
by Khan’s proliferation activities. The effort included dispatching to Washington the
chief of the country’s Strategic Plans Division, Lt. Gen. Khalid Kidwai, who
attempted to make more transparent Pakistan’s nuclear command and control
structure, and who acknowledged that Pakistan’s past proliferation record had been
“poor and indefensible.”32 Many analysts now assert that meaningful efforts have
been made to improve the physical security of Pakistan’s strategic arsenal.
30 See [http://www.iiss.org/publications/strategic-dossiers/nbm].
3 1 See David Albright and Paul Brannan, J une 21, 2007, at
[http://www.isis-online.org/publications/southasia/ThirdKhushabReactor.pdf]; and
January18, 2007, at [http://www.isis-online.org/publications/southasia/chashma.pdf].
32 Speech at the Carnegie Endowment for International Peace, Washington, DC, October 24,
2006.

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CRS-28
U.S. Nonproliferation Efforts. The United States has long sought to halt or
limit the proliferation of nuclear weapons in South Asia. In May 1998, following the
Indian and Pakistani nuclear tests, President Clinton imposed full restrictions on all
non-humanitarian aid to both countries as mandated under Section 102 of the Arms
Export Control Act. However, Congress and the President acted almost immediately
to lift certain aid restrictions and, in October 2001, all remaining nuclear-related
sanctions on Pakistan (and India) were removed. Officially, the United States
continues to urge Pakistan and India to join the Nuclear Nonproliferation Treaty
(NPT) as non-nuclear weapon states and it offers no official recognition of their
nuclear weapons capabilities, which exist outside of the international
nonproliferation regime.
During the latter years of the Clinton Administration, the United States set forth
nonproliferation “benchmarks” for Pakistan and India, including halting further
nuclear testing and signing and ratifying the Comprehensive Test Ban Treaty
(CTBT); halting fissile material production and pursuing Fissile Material Control
Treaty negotiations; refraining from deploying nuclear weapons and testing ballistic
missiles; and restricting any and all exportation of nuclear materials or technologies.
The results of U.S. efforts were mixed, at best, and neither Pakistan nor India are
signatories to the CTBT or the NPT. The Bush Administration quickly set aside the
benchmark framework. Concerns about onward proliferation, fears that Pakistan
could become destabilized by the U.S.-led counterterrorism efforts in Afghanistan,
and confusion over the issue of political succession in Islamabad have heightened
U.S. attention to weapons proliferation in the region. Section 1601 of P.L. 107-228
outlined U.S. nonproliferation objectives for South Asia. Some Members of
Congress identify “contradictions” in U.S. nonproliferation policy toward South
Asia, particularly as related to the Senate’s rejection of the CTBT and indications that
the United States seeks to build new nuclear weapons.
Pakistan-India Tensions and the Kashmir Issue. In the interests of
regional stability, the United States strongly encourages an ongoing Pakistan-India
peace initiative and remains concerned about the potential for long-standing
disagreements to cause open hostilities between these two nuclear-armed countries.
Relations between Pakistan and India remain deadlocked on the issue of Kashmiri
sovereignty, and a separatist rebellion has been underway in the region since 1989.
Tensions were extremely high in the wake of the Kargil conflict of 1999, when an
incursion by Pakistani soldiers led to a bloody six-week-long battle. Throughout
2000 and 2001, cross-border firing and shelling caused scores of both military and
civilian deaths. A July 2001 Pakistan-India summit meeting failed to produce even
a joint statement, reportedly due to pressure from hardliners on both sides. Major
stumbling blocks were India’s refusal to acknowledge the “centrality of Kashmir” to
future talks and Pakistan’s objection to references to “cross-border terrorism.”
The 2002 Crisis. Secretary of State Powell visited South Asia in an effort to
ease escalating tensions over Kashmir, but an October 2001 bombing at the Jammu
and Kashmir state assembly building was followed by a December assault on the
Indian Parliament in New Delhi (both incidents were blamed on Pakistan-based
terrorist groups). India mobilized some 700,000 troops along the Pakistan-India
frontier and threatened war unless Islamabad ended all “cross-border infiltration” of
Islamic militants. This action triggered a corresponding Pakistani military

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mobilization. Under significant international diplomatic pressure and the threat of
India’s use of force, President Musharraf in January 2002 vowed to end the presence
of terrorist entities on Pakistani soil, and he outlawed five militant groups, including
those most often named in attacks in India: Lashkar-e-Taiba and Jaish-e-
Mohammed.
Despite the Pakistani pledge, infiltrations into Indian-held Kashmir continued,
and a May 2002 terrorist attack on an Indian army base at Kaluchak killed 34, most
of them women and children. This event again brought Pakistan and India to the
brink of full-scale war, and caused Islamabad to recall army troops from patrol
operations along the Pakistan-Afghanistan border. Intensive international diplomatic
missions to South Asia reduced tensions during the summer of 2002 and appear to
have prevented the outbreak of war. Numerous top U.S. officials were involved in
this effort and continued to strenuously urge the two countries to renew bilateral
dialogue.33
The Most Recent Peace Process. Pakistan and India began full military
draw-downs in October 2002 and, after a cooling-off period, a “hand of friendship”
offer to Pakistan by the Indian prime minister in April 2003 led to the restoration of
full diplomatic relations. Yet surging separatist violence that summer contributed to
an exchange of sharp rhetoric between Pakistani and Indian leaders at the United
Nations, casting doubt on the nascent peace effort. A new confidence-building
initiative got Pakistan and India back on a positive track, and a November 2003
cease-fire was initiated after a proposal by then-Pakistani Prime Minister Zafarullah
Khan Jamali. President Musharraf subsequently suggested that Pakistan might be
willing to “set aside” its long-standing demand for a plebiscite in Kashmir, a proposal
welcomed by the United States, but called a “disastrous shift” in policy by Pakistani
opposition parties.
Although militant infiltration did not end, New Delhi acknowledged that it was
significantly decreased and, combined with other confidence-building measures,
relations were sufficiently improved that the Indian prime minister attended a January
2004 summit meeting of the South Asian Association for Regional Cooperation in
Islamabad. There Pakistan and India issued a joint “Islamabad Declaration” calling
for a renewed “Composite Dialogue” to bring about “peaceful settlement of all
bilateral issues, including Jammu and Kashmir, to the satisfaction of both sides.”34
A major confidence-building development came in April 2005, when a new bus
service was launched linking Muzaffarabad in Pakistani Kashmir and Srinagar in
Indian Kashmir, and a summit meeting produced an agreement to address the
Kashmir issue “in a forward looking manner for a final settlement.” Still, many
Kashmiris reject any settlement process that excludes them.
Even as the normalization of India-Pakistan relations moves forward — and
likely in reaction to their apparent marginalization in the face of this development —
separatist militants continue their attacks, and many observers in both India and the
33 See Polly Nayak and Michael Krepon, “US Crisis Management in South Asia’s Twin
Peaks Crisis” at [http://www.stimson.org/southasia/pdf/USCrisisManagement.pdf].
34 [http://www.indianembassy.org/press_release/2004/jan/07.htm].

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United States believe support for Kashmiri militants remains Pakistani state policy.
Yet many indicators show positive long-term trends. Steadily reduced rates of
infiltration may be attributed to the endurance of the Pakistan-India dialogue.
Moreover, President Musharraf has made considerable efforts to exhibit flexibility,
including December 2006 statements that Pakistan is “against independence” for
Kashmir, and his offering of a four-point proposal that would lead to “self-
governance ... falling between autonomy and independence.”35 This was seen by
many analysts as being roughly in line with New Delhi’s Kashmir position. Indeed,
the Indian prime minister welcomed Musharraf’s proposals, saying they “contribute
to the ongoing thought process.” Prospects for a government-to-government
accommodation may thus be brighter than ever before.
Baluchistan Unrest. Pakistan’s vast southwestern Baluchistan province is
about the size of California and accounts for 44% of the country’s land area, but only
5% of its population. The U.S. military made use of bases in the region to support
its operations in neighboring Afghanistan. The province is the proposed setting for
a pipeline that would deliver Iranian natural gas to both Pakistan and India, a project
which, if brought to fruition, could bring hundreds of millions of dollars in annual
transit fees to Islamabad’s national treasury. The United States opposes this “IPI”
pipeline project as part of its effort to isolate Iran internationally. Security problems
in Baluchistan reduce the appeal to investors of building a pipeline across the
province. The presence in Baluchistan of Jundallah, a trans-border militant group
that claims to fight on behalf of Baloch rights, has caused friction between Islamabad
and Tehran. More broadly, such problems raise serious questions about Pakistan’s
internal stability and national cohesion.
Over the decades of Pakistani independence, many of the ethnic Baloch and
some of the Pashtun tribes who inhabit this relatively poor and underdeveloped
province have engaged in armed conflict with federal government forces, variously
seeking more equitable returns on the region’s rich natural resources, greater
autonomy under the country’s federal system, or even outright independence and
formation of a Baloch state that might include ethnic brethren and some territories
in both Afghanistan and Iran. Non-Baloch (mostly Punjabis) have been seen to
benefit disproportionately from mineral and energy extraction projects, and
indigenous Baloch have been given only a small role in the construction of a major
new port in Gwadar. Many Baloch complain of being a marginalized group in their
own homeland. Long-standing resentments led to armed conflicts in 1948, 1958, and
1973. The latter insurrection, which lasted four years, involved tens of thousands of
armed guerillas and brought much destruction to the province; it was put down only
after a major effort by the Pakistan Army, which made use of combat helicopters
provided by Iran. Some 8,000 rebels and Pakistani soldiers were killed.
The Current Conflict. Mid-2004 saw an increase in hit-and-run attacks on
army outposts and in the sabotage of oil and gas pipelines. The alleged rape of a
Baloch doctor by Pakistani soldiers in January 2005 sparked provincial anger and a
major spike in such incidents over the course of the year. In December 2005, rockets
35 Somini Sengupta, “Pakistani Says Concessions Could Produce Kashmir Pact,” New York
Times, December 6, 2006.

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were fired at a Baluchistan army camp during a visit to the site by President
Musharraf. A Baloch separatist group claimed responsibility and the Pakistani
military began major offensive operations to destroy the militants’ camps. In the
midst of increasingly heavy fighting in January 2006, Musharraf openly accused India
of arming and financing militants fighting in Baluchistan. New Delhi categorically
rejected the allegations. U.N. and other international aid groups soon suspended their
operations in Baluchistan due to security concerns. Shortly after, Baloch militants
shot and killed three Chinese engineers and their Pakistani driver, causing disruption
in Islamabad-Beijing relations.
President Musharraf calls Baloch rebels “miscreants” and “terrorists”; the
Islamabad government officially banned the separatist Baluchistan Liberation Army
as a terrorist organization in April 2006 and at times suggests that Baloch militants
are religious extremists. Yet most rebel attacks are taken against military and
infrastructure targets, and — despite a government campaign to link the two
movements — Islam appears to play little or no role as a motive for Baloch
militancy.36 Islamabad has employed helicopter gunships and fixed-wing aircraft in
its effort to defeat the rebel forces.
The Death of Nawab Bugti. Fighting waned in the middle of 2006, with
hundreds of rebels surrendering in return for amnesty. The main rebel tribal leader
and onetime Baluchistan chief minister, 79-year-old Nawab Akbar Bugti, had gone
into hiding and was believed cut off from his own forces. In late August, Bugti was
located in a cave hideout and was killed by Pakistan army troops in a battle that left
dozens of soldiers and rebels dead. Recognizing Bugti’s popularity among wide
segments of the Baloch populace and of the potential for his killing to provide martyr
status, government officials denied the tribal leader had been targeted. Nevertheless,
news of his death spurred major unrest across the province and beyond, with
hundreds of people being arrested in the midst of large-scale street demonstrations.
Bugti’s killing was criticized across the spectrum of Pakistani politicians and
analysts, with some commentators calling it a Pakistani Army miscue of historic
proportions.37 Days of rioting included numerous deaths and injuries, but the more
dire predictions of spreading unrest and perhaps even the disintegration of Pakistan’s
federal system have not come to pass. By October, Pakistan’s interior minister was
claiming a “normalization” and decrease in violence in Baluchistan, although a low-
intensity insurgency continues and the overarching problem remains unresolved.
Narcotics. Pakistan is a major transit country for opiates that are grown and
processed in Afghanistan then distributed worldwide by Pakistan-based traffickers.
The State Department indicates that Pakistan’s cooperation on drug control “remains
strong,” and the Islamabad government has made impressive strides in eradicating
indigenous opium poppy cultivation. However, opium production spiked in post-
Taliban Afghanistan, which is now said to supply up to 95% of the world’s heroin.
Elements of Pakistan’s intelligence agency are suspected of past involvement in drug
36 Frederic Grare, “Pakistan: The Resurgence of Baluch Nationalism,” Carnegie Paper No.
65, January 2006, at [http://www.carnegieendowment.org/files/CP65.Grare.FINAL.pdf].
37 “Bugti’s Killing is the Biggest Blunder Since Bhutto’s Execution,” Daily Times (Lahore),
August 28, 2006.

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trafficking; in March 2003, a former U.S. Ambassador to Pakistan told a House panel
that their role in the heroin trade from 1997-2003 was “substantial.” Taliban
militants are reported to benefit significantly by taxing Afghan farmers and extorting
traffickers.38 Other reports indicate that profits from drug sales are financing the
activities of Islamic extremists in Pakistan and Kashmir.
U.S. counternarcotics programs aim to reduce the flow of opiates though
Pakistan, eliminate Pakistan as a source of such opiates, and reduce the demand for
illegal drugs within Pakistan. Islamabad’s own counternarcotics efforts are hampered
by lack of full government commitment, scarcity of funds, poor infrastructure, and
likely corruption. Since 2002, the State Department’s Bureau of International
Narcotics and Law Enforcement Affairs has supported Pakistan’s Border Security
Project by training border forces, providing vehicles and surveillance and
communications equipment, transferring helicopters and fixed-wing aircraft to the
Interior Ministry’s Air Wing, and road-building in western tribal areas. Congress
funded such programs with more than $54 million for FY2006. (See also CRS
Report RL32686, Afghanistan: Narcotics and U.S. Policy.)
Islamization, Anti-American Sentiment, and Madrassas
With some 160 million citizens, Pakistan is the world’s second-most populous
Muslim country, and the nation’s very foundation grew from a perceived need to
create a homeland for South Asian Muslims in the wake of decolonization. An
unexpected outcome of the country’s 2002 elections saw the Muttahida Majlis-e-
Amal (MMA or United Action Front), a coalition of six Islamic parties, win 11% of
the popular vote and 68 seats in the National Assembly — about one-fifth of the
total. It also controls the provincial assembly in the North West Frontier Province
(NWFP) and leads a coalition in the Baluchistan assembly. These Pashtun-majority
western provinces border Afghanistan, where U.S.-led counterterrorism operations
are ongoing. In 2003, the NWFP provincial assembly passed a Shariat (Islamic law)
bill. In 2005, and again in November 2006, the same assembly passed a Hasba
(accountability) bill that many fear could create a parallel Islamic legal body.
Pakistan’s Supreme Court, responding to petitions by President Musharraf’s
government, has rejected most of this legislation as unconstitutional, but in February
2007 it upheld most of a modified Hasba bill re-submitted by the NWFP assembly.
Such developments alarm Pakistan’s moderates and Musharraf has decried any
attempts to “Talibanize” regions of Pakistan.
Pakistan’s Islamists are notable for expressions of anti-American sentiment, at
times calling for “jihad” against the existential threat to Pakistani sovereignty they
believe alliance with Washington entails. Most analysts contend that two December
2003 attempts to assassinate President Musharraf were carried out by Islamist
militants angered by Pakistan’s post-September 2001 policy shift. The “Pakistani
Taliban” that has emerged in western tribal areas has sought to impose bans on
television and CD players, and has even instigated attacks on girls schools in an
effort to prevent female education. Some observers identify a causal link between
38 “Taliban Reaping Opium Profits,” Associated Press, April 11, 2007.

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the poor state of Pakistan’s public education system and the persistence of
xenophobia and religious extremism in that country.
Anti-American sentiment is not limited to Islamist groups, however. Many
across the spectrum of Pakistani society express anger at U.S. global foreign policy,
in particular when such policy is perceived to be unfriendly or hostile to the Muslim
world (as in, for example, Palestine and Iraq).39 In 2004 testimony before a Senate
panel, senior U.S. expert Stephen Cohen opined: “Pakistan is probably the most anti-
American country in the world right now, ranging from the radical Islamists on one
side to the liberals and Westernized elites on the other side.” A 2005 Pew Center
opinion poll found 51% of Pakistanis expressing confidence in Al Qaeda founder
Osama Bin Laden to “do the right thing in world affairs” and, in subsequent
American magazine interview, President Musharraf conceded that “the man on the
street [in Pakistan] does not have a good opinion of the United States.” He added,
by way of partial explanation, that Pakistan had been “left high and dry” after serving
as a strategic U.S. ally during the 1980s Afghan war.40
A Pew poll taken shortly before the catastrophic October 2005 earthquake found
only 23% of Pakistanis expressing a favorable view of the United States, the lowest
percentage for any country surveyed. That percentage doubled to 46% in an
ACNielson poll taken after large-scale U.S. disaster relief efforts in earthquake-
affected areas, with the great majority of Pakistanis indicating that their perceptions
had been positively influenced by witnessing such efforts. However, a January 2006
missile attack on Pakistani homes near the Afghan border killed numerous civilians
and was blamed on U.S. forces, renewing animosity toward the United States among
segments of the Pakistani populace. An October 2006 missile attack in the same
border area ostensibly was launched by Pakistani forces, but widespread suspicions
of U.S. involvement further engendered anti-Americanism and concerns about
Pakistani sovereignty. Another noteworthy episode in 2006 saw Pakistani cities
hosting major public demonstrations against the publication in European newspapers
of cartoons deemed offensive to Muslims. These protests, which were violent at
times, included strong anti-U.S. and anti-Musharraf components, suggesting that
Islamist organizers used the issue to forward their own political ends. Subsequently,
a June 2006 Pew Center poll found only 27% of Pakistanis holding a favorable
opinion of the United States, suggesting that public diplomacy gains following the
2005 earthquake had receded.
In April 2007, the University of Maryland-based Program on International
Policy Attitudes released a survey of public opinion in four Muslim countries. The
findings indicate that significant resentment toward and distrust of the United States
persists among notable segments of the Pakistani public:
! 67% of Pakistanis have an unfavorable view of the U.S. government;
! 73% think weakening and dividing the Islamic world is a U.S. goal;
! more than one-third approve of attacks on U.S. troops in Iraq and
Afghanistan (another third disapprove of such attacks);
39 Author interviews in Islamabad, September 2006.
40 “10 Questions for Pervez Musharraf,” Time, October 3, 2005.

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! more than one-third also think the U.S. government and/or Israel
were behind the 9/11 attacks (only 2% hold Al Qaeda responsible);
! 27% report having positive feelings toward Osama Bin Laden; and
! 54% agree strongly with the goal of requiring strict application of
Sharia law in every Islamic country.41
Meanwhile, an open Islamist rebellion of sorts has been taking place in Pakistan’s
relatively serene capital, where radical leaders of the Lal (Red) Mosque and their
followers in the attached Jamia Hafsa seminary have since March occupied illegally
constructed religious buildings, kidnaped and detained local police officers, battled
security forces, and threatened to launch a violent anti-government campaign unless
Sharia (Islamic law) is instituted nationwide.
Pakistan’s Religious Schools (Madrassas).42 Afghanistan’s Taliban
movement itself began among students attending Pakistani religious schools
(madrassas). Among the more than 10,000 madrassas training some 1.5 million
children in Pakistan are a small percentage that have been implicated in teaching
militant anti-Western, anti-American, anti-Hindu, and even anti-Shia values. Former
Secretary of State Colin Powell once identified these as “programs that do nothing
but prepare youngsters to be fundamentalists and to be terrorists.”43 Contrary to
popularly held conceptions, however, research indicates that the great majority of
Pakistan’s violent Islamist extremists does not emerge from the country’s madrassas,
but rather from the dysfunctional public school system or even from private, English-
medium schools. One study found that only 17% of international terrorists sampled
had Islamic education backgrounds.44
Many of Pakistan’s madrassas are financed and operated by Pakistani Islamist
political parties such as the JUI-F (closely linked to the Taliban), as well as by
multiple unknown foreign entities, many in Saudi Arabia. As many as two-thirds of
the seminaries are run by the Deobandi sect, known in part for traditionally anti-Shia
sentiments and at times linked to the Sipah-e-Sahaba terrorist group. In its most
recent report on international religious freedom, the U.S. State Department said,
“Some unregistered and Deobandi-controlled madrassas in the FATA and northern
Baluchistan continued to teach extremism” and that schools run by the Jamaat al-
Dawat — considered to be a front organization of the proscribed Lashkar-e-Taiba
terrorist group — serve as recruitment centers for extremists. President Musharraf
himself has acknowledged that a small number of seminaries were “harboring
41 [http://www.worldpublicopinion.org/pipa/pdf/apr07/START_Apr07_rpt.pdf].
42 See also CRS Report RS22009, Education Reform in Pakistan, by K. Alan Kronstadt, and
CRS Report RS21654, Islamic Religious Schools, Madrasas: Background, by Christopher
Blanchard.
43 Statement before the House Appropriations Committee, March 10, 2004.
44 Marc Sageman, Understanding Terror Networks (University of Pennsylvania Press, 2004).
See also Mariam Abou Zahab and Olivier Roy, Islamist Networks (Columbia University
Press, 2004); Peter Bergen and Swati Pandney, “The Madrassa Myth,” New York Times,
June 14, 2005.

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terrorists” and he has asked religious leaders to help isolate these by openly
condemning them.45
International attention to Pakistan’s religious schools intensified during the
summer of 2005 after Pakistani officials acknowledged that suspects in the July
London bombings visited Pakistan during the previous year and may have spent time
at a madrassa near Lahore. While President Musharraf has in the past pledged to
crack down on the more extremist madrassas in his country, there continues to be
little concrete evidence that he has done so, and even the president himself has
admitted that movement on this issue has been slow.46 Some observers speculate that
Musharraf’s reluctance to enforce reform efforts is rooted in his desire to remain on
good terms with Pakistan’s Islamist political parties, which are seen to be an
important part of his political base.47 The U.S. Congress has appropriated many
millions of dollars to assist Pakistan in efforts to reform its education system,
including changes that would make madrassa curriculum closer in substance to that
provided in non-religious schools. More than $200 million has been allocated for
such assistance since 2002. In November 2006, the U.S.-Pakistan Education
dialogue was launched in Washington to bolster further engagement.
Democratization and Human Rights
Democracy and Governance. The status and development of Pakistan’s
democratic institutions is a key U.S. policy concern, especially among those analysts
who view representative government in Islamabad as being a prerequisite for
reducing religious extremism and establishing a moderate Pakistani state. There had
been hopes that the October 2002 national elections would reverse Pakistan’s historic
trend toward unstable governance and military interference in democratic institutions.
Such hopes were eroded by ensuing developments, including President Musharraf’s
imposition of major constitutional changes and his retention of the position of army
chief. International and Pakistani human rights groups continue to issue reports
critical of Islamabad’s military-dominated government. In 2007, and for the eighth
straight year, the often-cited Freedom House rated Pakistan as “not free” in the areas
of political rights and civil liberties. While praising Pakistan’s electoral exercises as
moves in the right direction, the United States expresses concern that seemingly
nondemocratic developments may make the realization of true democracy in Pakistan
more elusive, and U.S. officials continue to press Pakistani leaders on this issue.
Pakistan’s Military-Dominated Government. General Musharraf’s
assumption of the presidency ostensibly was legitimized by a controversial April
45 [http://www.state.gov/g/drl/rls/irf/2006/71443.htm]; “Some Madrassas Bad: Musharraf,”
Daily Times (Lahore), September 8, 2004.
46 See “Pakistan: Reforming the Education Sector,” International Crisis Group Report 84,
October 7, 2004; Charles Sennott, “Radical Teachings in Pakistan Schools,” Boston Globe,
September 29, 2006. Author interviews with Pakistani government officials and scholars
have tended to confirm that movement on madrassa reform is slow, at best.
47 John Lancaster and Kamran Khan, “At an Islamic School, Hints of Extremist Ties,”
Washington Post, June 13, 2004; Vali Nasr, “Military Rule, Islamism, and Democracy in
Pakistan,” Middle East Journal 58, 2, Spring 2004.

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2002 referendum marked by evidence of fraud. In August 2002, Musharraf
announced sweeping constitutional changes to bolster the president’s powers,
including provisions for presidential dissolution of the National Assembly. The
United States expressed concerns that the changes could make it more difficult to
build democratic institutions in Pakistan. The 2002 elections nominally fulfilled
Musharraf’s promise to restore the National Assembly that was dissolved in the wake
of his extra-constitutional seizure of power. The pro-military Pakistan Muslim
League-Quaid-e-Azam (PML-Q) won a plurality of seats, while a coalition of
Islamist parties made a surprisingly strong showing. The civilian government was
hamstrung for more than a year by fractious debate over the legitimacy of
constitutional changes and by Musharraf’s continued status as army chief and
president. A surprise December 2003 agreement between Musharraf and the Islamist
opposition ended the deadlock by bringing the constitutional changes before
Parliament and by eliciting a promise from Musharraf to resign his military
commission before 2005. Non-Islamist opposition parties unified under the Alliance
for the Restoration of Democracy (ARD) accused the MMA of betrayal and insisted
that the new arrangement merely institutionalized military rule in Pakistan.
Other apparent reversals for Pakistani democratization came in 2004, including
the sentencing of ARD leader Javed Hashmi to 23 years in prison for sedition,
mutiny, and forgery, and the “forced” resignation of Prime Minister Jamali for what
numerous analysts called his insufficient deference to President Musharraf.
Musharraf “shuffled” prime ministers to seat his close ally, Finance Minister Shaukat
Aziz. Aziz is seen to be an able financial manager and technocrat favored by the
military, but he has no political base in Pakistan. Moreover, in the final month of
2004 Musharraf chose to continue his role as army chief beyond the stated deadline.
One senior Pakistani scholar offers a cogent (and critical) summary of the country’s
political circumstances under President Musharraf’s rule:
The current power structure, often described as the “Musharraf model of
governance,”is narrow and suffers from a crisis of legitimacy. Its major features
are: a concentration of power in the presidency, with backup from its
army/intelligence and bureaucratic affiliates; induction of retired and serving
military officers into important civilian institutions and thus an undermining of
the latter’s autonomy; co-option of a section of the political elite, who are given
a share of power and patronage in return for mobilizing civilian support, on
President Musharraf’s terms; a reluctant partnership with the Islamic parties,
especially the Muttahida Majis-i-Amal (MMA), and soft-peddling towards
Islamic groups; manipulation of the weak and divided political forces and
exclusion of dissident political leaders.48
A public opinion survey by the International Republican Institute, completed
before the March 2007 judicial crisis began, found President Musharraf to be the
most popular political leader in Pakistan, comfortably ahead of former prime
ministers Bhutto and Sharif, who placed second and third, respectively. The poll also
found a majority of respondents opposed to Musharraf’s continued dual role as
president and army chief, and a plurality saying the military, while seen as the
48 Hasan-Askari Rizvi, “Towards a Solution of the Present Crisis,” Daily Times (Lahore),
June 17, 2007.

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country’s most respected institution, should not play a role in governance.49 The
findings of such surveys may be significantly inaccurate, given widespread illiteracy
and the ability of surveyors to lead respondents. In May 2007, a National Democratic
Institute delegation issued a report on its visit to Pakistan, calling expected national
elections there “critical to the nation’s future,” warning that tainted elections could
strengthen the position of extremist elements or further consolidate the role of the
military in governance, urging Musharraf to retire his military commission in the
interest of public confidence, and calling for a significantly strengthened Pakistan
Election Commission (PEC) to ensure credible polls.50 In an indication that the
Election Commission’s credibility remains in doubt, Benazir Bhutto in June 2007
filed a petition with the Pakistani Supreme Court on the removal of tens of millions
of Pakistanis from election rolls, and the Hong Kong-based Asian Human Rights
Commission later claimed that the PEC was illegitimately denying voting rights to
38 million people, most of them women.
The leadership of the country’s leading moderate, secular, and arguably most
popular party — the Pakistan People’s Party — seek greater U.S. support for
Pakistani democratization and warn that the space in which they are allowed to
operate is so narrow as to bring into question their continued viability as political
forces.51 A number of analysts consider a potential accommodation between
President Musharraf and former Prime Minister Bhutto to be the best option both for
stabilizing Islamabad’s political circumstances and for more effectively creating a
moderate and prosperous Pakistan (some reports have the U.S. government quietly
encouraging Musharraf to pursue this option).52 Such accommodation might include
Musharraf retiring from the military while being assured of reelection as President
and allowing Bhutto to return to Pakistan and run for national office. Even if this
arrangement came to pass, it would be highly unlikely to alter the army’s role as
ultimate arbiter of the country’s foreign and national security policies, but could
create a transitional alliance that would empower Pakistan’s more liberal and secular
elements.
Current Judicial/Political Crisis. On March 9, President Musharraf
summarily dismissed the Chief Justice of Pakistan’s Supreme Court, Iftikhar
Chaudhry, on unspecified charges of misconduct and nepotism. Analysts widely
believe the dismissal was an attempt by Musharraf to remove a potential impediment
to his continued roles as president and army chief, given Chaudhry’s recent rulings
that exhibited independence and went contrary to government expectations. The
move triggered immediate outrage among numerous Pakistani lawyers and others
who claimed Musharraf had acted unconstitutionally. Several judges and a deputy
attorney general resigned in protest, ensuing street protests by lawyers grew in scale
and were joined by both secular and Islamist opposition activists. By providing an
49 See [http://www.iri.org/mena/pakistan/2007-04-26-Pakistan.asp].
50 [http://www.accessdemocracy.org/library/2157_pk_pre_election_statement_051707.pdf].
51 Author interviews with PPP leader Benazir Bhutto, Washington, DC, February 2006, and
PPP officials, Islamabad, January 2004 and September 2006.
52 Najam Sethi, “Musharraf’s Problem — And Opportunity,” Wall Street Journal, July 16,
2007, is representative.

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issue upon which anti-Musharraf sentiments could coalesce, the imbroglio soon
morphed from a judicial crisis to a full-fledged political crisis and the greatest threat
to Musharraf’s government since it was established in 1999. Numerous analyses
conclude that the developments have severely weakened Musharraf politically and
could threaten the viability of his continued rule.53
The U.S. State Department at first declared the issue to be a purely internal
matter and withheld further comment but, as a sense of crisis increased in Pakistan,
a Department spokesman called Chaudhry’s dismissal “a matter of deep concern”
that the U.S. government was “monitoring very closely,” and he called for the issue
to be handled in a transparent manner in accordance with Pakistani law. However,
in a statement which triggered concern among many Pakistanis and skeptical analysts
alike, the spokesman also claimed President Musharraf was “acting in the best
interest of Pakistan and the Pakistani people.”54 Musharraf has vowed not to interfere
in the case and claims the judge’s fate is out of his hands. He also has called the
dismissal constitutional and, without offering evidence, claimed the uproar was a
political conspiracy aimed at him and his government.
In refusing to be cowed by the Musharraf government and voluntarily resign his
post, the suspended Chief Justice became a popular figure in Pakistan. On May 5,
tens of thousands of supporters lined the streets as Chaudhry drove from Islamabad
to Lahore to address the High Court there (a normally 4-hour drive took more than
24 hours). One week later, Chaudhry flew to Karachi but was blocked from leaving
the city’s airport, reportedly by activists of the government-allied MQM party.
Ensuing street battles between MQM cadres and opposition activists left at least 40
people dead, most of them members of Benazir Bhutto’s People’s Party. Reports had
local police and security forces standing by without intervening while the MQM
attacked anti-Musharraf protesters, leading many observers to charge the government
with complicity in the bloody rioting. The May 12 incidents did significant further
damage to President Musharraf’s standing. At present, Musharraf shows no signs of
compromising on the judicial issue, and his government has cracked down on media
outlets, warning them against “defaming” the country’s military. On June 1, the
army’s corp commanders issued a statement reaffirming their full support for
Musharraf’s continued rule and decrying a “malicious campaign against the
institutions of the state” being undertaken by a “small minority.” Three days later,
Musharraf issued an ordinance expanding government authority to restrict press
freedom (this was later suspended).
U.S. Policy. The United States indicates that it expects Pakistan’s scheduled
2007 general elections to be “free, fair, transparent, and credible ... with the
participation of all political parties.”55 Bush Administration officials repeatedly have
53 Representative is Teresita Schaffer, “Pakistan: Shrinking Control,” CSIS Commentary,
May 18, 2007, at [http://www.csis.org/media/csis/pubs/070518_schaffer_commentary.pdf].
54 See [http://www.state.gov/r/pa/prs/dpb/2007/mar/81762.htm]; [http://www.state.gov/r/pa/-
prs/dpb/2007/mar/81838.htm].
55 Statement by U.S. Assistant Secretary of State for South And Central Asia Richard
Boucher, June 20, 2007, at [http://www.state.gov/p/sca/rls/rm/2007/87169.htm]. In June,
(continued...)

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CRS-39
emphasized that such a development is key to the creation of a more moderate and
prosperous Pakistan. However, numerous critics of Administration policy assert that
the Islamabad government has for more than five years been given a “free pass” on
the issue of representative government, in part as a means of enlisting that country’s
assistance in U.S.-led counterterrorism efforts. U.S. congressional committees
repeatedly have expressed concern with “the slow pace of the democratic
development of Pakistan” (S.Rept. 109-96) and “the lack of progress on improving
democratic governance and rule of law” there (H.Rept. 109-486). Pakistan’s
nominally non-party August-October 2005 municipal elections saw major gains for
candidates favored by the PML-Q and notable reversals for Islamists, but were also
marked by widespread accusations of rigging. The Bush Administration made no
public comment on reported irregularities. In February 2007, the Director of
National Intelligence, Mike McConnell, repeated for a Senate panel the U.S.
intelligence community’s conclusion that
[D]emocracy has not been fully restored since the Army took power in 1999. ...
Musharraf continues to be criticized for remaining both the President and Chief
of Army Staff, but there are no political leaders inside the country able to
challenge his continued leadership. Musharraf’s secular opponents are in
disarray, and the main Islamic parties continue to suffer from internal divisions
and an inability to expand their support base.56
The U.S. State Department’s Country Report on Human Rights Practices 2006,
issued by the Bureau of Democracy, Human Rights, and Labor in March 2007, does
not use the word “democracy” or any of its derivatives in discussing Pakistan, but
does note that “restrictions on citizens’ right to change their government” represent
a “major problem.”57 In a June letter to Secretary of State Condoleezza Rice, several
senior Members of Congress decried the “spiral of civil unrest and harshly
suppressed protest in Pakistan” and asserted that U.S. and Pakistani national interests
“are both served by a speedy restoration of full democracy to Pakistan and the end
to state-sponsored intimidation — often violent — of Pakistani citizens protesting
government actions in a legal and peaceful manner.” Leading opposition political
figures in Islamabad have warned that unconditional U.S. support for Musharraf’s
military-dominated government could result in an anti-American backlash among
Pakistan’s moderate forces.58 Yet others opine that overt U.S. conditionality is
unlikely to be effective and may only foster anti-U.S. resentments in Pakistan.59 One
55 (...continued)
a State Department spokesman said the U.S. government expects President Musharraf to
“follow through on his commitments” to retire his military commission (he later clarified
that this was not a “condition of the United States”).
56 See [http://armed-services.senate.gov/statemnt/2007/February/McConnell%2002-27-
07.pdf].
57 See [http://www.state.gov/g/drl/rls/hrrpt/2006/78874.htm].
58 Letter to Secretary of State Rice from Sen. Joe Biden, Rep. Tom Lantos, and Rep. Ileana
Ros-Lehtinen, June 1, 2007; Jo Johnson and Farhan Bokhari, “US Warned Over Backing
for Musharraf,” Financial Times (London), June 12, 2007.
59 Lisa Curtis, “Bolstering Pakistan in its Fight Against Extremism,” Heritage Foundation
(continued...)

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recent analysis by a former Bush State Department official concludes that “the United
States should resist the urge to threaten [Musharraf] or demand a quick democratic
transition,” arguing that the Pakistani military must be pushed toward political reform
in ways that do not jeopardize its “core interests.”60 (See also CRS Report RL32615,
Pakistan’s Domestic Political Developments.)
Human Rights Problems. The State Department’s Country Report on
Human Rights Practices 2006 (issued March 2007) again determined that the
Pakistan government’s record on human rights “remained poor.” Along with
concerns about anti-democratic practices, the report lists extrajudicial killings,
torture, and abuse by security forces; “widespread” government and police
corruption; lack of judicial independence; political violence; terrorism; and
“extremely poor” prison conditions among the major problems. It further notes an
increase in restrictions on press freedoms and in reports of “disappearances” of
political activists. Improvement was noted, however, with government efforts to
crack down on human trafficking.61 (The most recent State Department report on
trafficking in persons again said, “Pakistan does not fully comply with the minimum
standards for the elimination of trafficking; however, it is making significant efforts
to do so.”62)
According to the Department of State, the Islamabad government is known to
limit freedoms of association, religion, and movement, and to imprison political
leaders. In June 2007, the House Appropriations Committee (H.Rept. 110-197)
expressed concern about the Pakistani government’s apparent lack of respect for
human rights. Senate reports have expressed similar concerns. The Human Rights
Commission of Pakistan and international human rights groups have issued reports
critical of Pakistan’s lack of political freedoms, lawlessness in many areas (especially
the western tribal agencies), and of the country’s perceived abuses of the rights of
minorities. Controversial statutory restrictions include harsh penalties for blasphemy
and are abused to oppress non-Muslims and for personal vendettas.
Gender Discrimination. Discrimination against women is widespread and
traditional constraints — cultural, legal, and spousal — keep women in a subordinate
position in society. In 2005, Pakistani gang rape victim Mukhtaran Mai — and
Islamabad’s (mis)handling of her case — became emblematic of gender
discrimination problems in Pakistan. The Hudood Ordinance was promulgated
during the rule of President Gen. Zia ul-Haq and is widely criticized for imposing
stringent punishments and restrictions under the guise of Islamic law. Among its
59 (...continued)
WebMemo 1554, July 13, 2007, at [http://www.heritage.org/Research/NationalSecurity/
wm1554.cfm] is representative.
60 Daniel Markey, “A False Choice in Pakistan,” Foreign Affairs, July 2007, at
[http://www.foreignaffairs.org/20070701faessay86407/daniel-markey/a-false-choice-in-p
akistan.html].
61 See [http://www.state.gov/g/drl/rls/hrrpt/2006/78874.htm]. A Pakistan Foreign Ministry
spokeswoman claimed the report “lacks objectivity and contains inaccuracies.”
62 [http://www.state.gov/g/tip/rls/tiprpt/2007/82806.htm].

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provisions, the ordinance criminalizes all extramarital sex and makes it extremely
difficult for women to prove allegations of rape (those women who make such
charges without the required evidence often are jailed as adulterers). In November
2006, the Hudood laws were amended in the Women’s Protection Bill. President
Musharraf supported the changes and the ruling PML party joined with the
opposition PPP to overcome fierce resistance by Islamist parties. Musharraf called
the bill’s passage “just the beginning” and “a victory for moderates,” and said his
government would soon introduce further legislation to improve the status of women.
The step is viewed as a landmark in efforts to create more a moderate Pakistani state.
However, the February 2007 murder of a female provincial minister in Punjab by a
radical Islamist, and threats being issued against girls’ schools and female health
workers in the NWFP indicate that well-entrenched societal discrimination continues.
Religious Freedom. The State Department’s International Religious
Freedom Report 2006 again found that in practice the Islamabad government
imposes limits on the freedom of religion in Pakistan. The report noted “some steps
to improve the treatment of religious minorities,” but indicated that “serious
problems remained,” including discriminatory laws and violence against religious
minorities.63 The State Department has rejected repeated U.S. Commission on
International Religious Freedom recommendations that Pakistan be designated a
“country of particular concern.” The 2007 annual report from that Commission
claims that, “Sectarian and religiously motivated violence persists in Pakistan ... and
the government’s somewhat improved response to this problem continues to be
insufficient and not fully effective.”64
Press Freedom. Press freedom and the safety of journalists recently has
become a major concern in Pakistan, spurred especially by the June 2006 discovery
of the handcuffed body of Pakistani journalist Hayatullah Khan in a rural area of
North Waziristan. Khan, who had been missing for more than six months, was
abducted by unknown gunmen after he reported on an apparent U.S.-launched missile
attack in Pakistan’s tribal region. Khan’s family is among those who suspect the
involvement of Pakistani security forces; an official inquiry into the death was
launched. Other journalists have been detained and possibly tortured, including a
pair reportedly held incommunicado without charges for three months after they shot
footage of the Jacobabad airbase that was used by U.S. forces. Pakistani journalists
have taken to the streets to protest perceived abuses and they complain that the
government seeks to intimidate those who would report the facts of Pakistani
counterterrorism operations. In May 2007, the New York-based Committee to
Protect Journalists placed Pakistan sixth in a list of the ten countries where press
freedom had most deteriorated since 2002.65 In early June, in apparent reaction to
media coverage of rallies in support of Pakistan’s suspended Chief Justice, the
Musharraf government issued an ordinance allowing the Pakistan Electronic Media
Regulatory Agency to impose strict curbs on television and radio station operations.
63 [http://www.state.gov/g/drl/rls/irf/2006/71443.htm].
64 [http://www.uscirf.gov/countries/publications/currentreport/index.html].
65 See [http://cpj.org/backsliders/index.html].

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CRS-42
Human Rights Watch later called the decree a “disgraceful assault on media
freedom.”66 Implementation of the ordinance has been halted.
“Disappeared” Persons. According to the U.S. State Department, there was
an increase of politically motivated disappearances in Pakistan in 2006, with police
and security forces holding prisoners incommunicado and refusing to provide
information on their whereabouts, particularly in terrorism and national security
cases. In November 2006, Pakistan’s Supreme Court ordered the government to
disclose the whereabouts of 41 suspected security detainees who have “disappeared.”
Human rights groups claim to have recorded more than 400 cases of such secret
detentions since 2002. London-based Amnesty International has criticized Islamabad
for human rights abuses related to its cooperation with the U.S.-led “war on terror,”
including the arbitrary detention, enforced disappearance, and torture of hundreds of
people. In 2005, New York-based Human Rights Watch released a list of 26 “ghost
detainees” thought to be in U.S. custody, at least 16 of whom were arrested in
Pakistan. The families of missing persons have increased their efforts to pressure the
government on this issue.
Economic Issues
Overview. Pakistan is a poor country, but the national economy has gathered
significant positive momentum in recent years, helped in large part by the
government’s pro-growth policies and by post-2001 infusions of foreign aid.
However, presently high rates of domestic inflation (near 8%) have many analysts
concerned about the country’s macroeconomic stability, and some observers warn
that the domestic capacity to sustain growth does not exist. According to the World
Bank, nominal GDP per capita in 2006 was only $771, but poverty rates have
dropped from 34% to 24% over the past five years. Severe human losses and
property damage from an October 2005 earthquake in northern Pakistan have had
limited follow-on economic impact, given a large influx of foreign aid and the
stimulus provided by reconstruction efforts. The long-term economic outlook for
Pakistan is much improved since 2001, even as it remains clouded in a country still
dependent on foreign lending and the importation of basic commodities. Substantial
fiscal deficits and dependency on external aid have been chronic (public and external
debt equal more than 80% of GDP), and counterbalance a major overhaul of the tax
collection system and what have been major gains in the Karachi Stock Exchange,
which nearly doubled in value as the world’s best performer in 2002 and is up more
than 32% in the first half of 2007. Along with absolute development gains in recent
years, Pakistan’s relative standing has also improved: The U.N. Development
Program ranked Pakistan 134th out of 177 countries (between Laos and Bhutan) on
its 2006 human development index, up from 144th in 2003.67
Output from both the industrial and service sectors has grown substantially since
2002, but the agricultural sector continues to lag considerably (in part due to
droughts), slowing overall growth. Agricultural labor accounts for nearly half of the
66 See [http://hrw.org/english/docs/2007/06/06/pakist16084.htm].
67 [http://hdr.undp.org/hdr2006/pdfs/report/HDR06-complete.pdf].

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country’s work force, but only about one-fifth of national income and 2% of tax
revenue. Pakistan’s real GDP grew by 7% in the fiscal year ending June 2007, driven
by booming manufacturing and service sectors. Overall growth was up from the
previous year and has averaged nearly 7% over the past five years. Expanding textile
production and the government’s pro-growth measures have most analysts foreseeing
solid expansion ahead, with predictions at or above 6% for the next two years.
In June 2007, the Musharraf government unveiled a 1.6 trillion rupee ($26.5
billion) federal budget plan for FY2007-FY2008 calling for a 22% boost in public
development spending and a 10% jump in defense spending. Defense spending and
interest on public debt together consume two-thirds of total revenues, thus squeezing
out development expenditure. Pakistan stabilized its external debt at about $33
billion by 2003, but this rose to nearly $39 billion in 2005 and remains well above
$37 billion. Still, such debt is less than one-third of GDP today, down from more
than one-half in 2000. The country’s total liquid reserves reached $13.7 billion by
May 2007, an all-time high and a nearly five-fold increase since 1999. Foreign
remittances have exceeded $4 billion annually since 2003 (at around $5.5 billion in
FY2006-2007), up from slightly more than $1 billion in 2001. High oil prices have
driven inflationary pressures, resulting in a year-on-year consumer rate of 6.9% in
April 2007. While inflation is expected to ease later in 2007, many analysts call it
the single most important obstacle to future growth. Pakistan’s resources and
comparatively well-developed entrepreneurial skills may hold promise for more rapid
economic growth and development in coming years. This is particularly true for the
country’s textile industry, which accounts for two-thirds of all exports (and up to
90% of exports to the United States). Analysts point to the pressing need to further
broaden the country’s tax base in order to provide increased revenue for investment
in improved infrastructure, health, and education, all prerequisites for economic
development.
Attempts at economic reform historically have floundered due to political
instability. The Musharraf government has had notable successes in effecting
macroeconomic reform. Rewards for participation in the post-September 2001 anti-
terror coalition eased somewhat Pakistan’s severe national debt situation, with many
countries, including the United States, boosting bilateral assistance efforts and large
amounts of external aid flowing into the country. According to the Asian
Development Bank’s Outlook 2007:
Buoyant growth, improved macroeconomic fundamentals, and strengthened
international credit ratings have been the economy’s hallmarks in recent years.
In FY2006, high oil prices, a weak agricultural performance, as well as the effect
of the October 2005 earthquake, trimmed the expansion, while strong demand-
side pressures have exposed macroeconomic stresses. The economy is expected
to pick up slightly in FY2007, reflecting some strengthening in agriculture and
manufacturing. Inflation is set to moderate, after a further tightening of
monetary policy, but still come in above the central bank’s target. Spurred by an
expansionary, pro-growth fiscal policy, the budget deficit will widen slightly, as

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will the current account deficit. The medium-term outlook remains positive, but
macroeconomic stability has to be maintained and structural issues addressed.68
Trade and Investment. Pakistan’s primary exports are cotton, textiles and
apparel, rice, and leather products. The United States is by far Pakistan’s leading
export market, accounting for about one-quarter of the total. During 2006, total U.S.
imports from Pakistan were worth nearly $3.7 billion (up 13% over 2005). Almost
90% of this value came from purchases of textiles and apparel. U.S. exports to
Pakistan during 2006 were worth about $2 billion (up 60% over 2005). Civilian
aircraft and associated equipment accounted for about 42% of this value; electricity
generating machinery and textile fibers were other notable U.S. exports (2005 figures
had been depressed as a result of completed delivery of aircraft in 2004).69 Pakistan
is the 54th largest export market for U.S. goods. According to the 2007 National
Trade Estimate of the U.S. Trade Representative (USTR), Pakistan has made
substantial progress in reducing import tariff schedules, though a number of trade
barriers remain. While estimated trade losses due to copyright piracy in Pakistan
were notably lower in 2005 and 2006, book piracy accounted for about half of the
2006 losses and remains a serious concern.70 Pakistan also has been a world leader
in the pirating of music CDs and has appeared on the USTR’s “Special 301” Watch
List for 17 consecutive years (in 2004, continuing violations caused the USTR to
move Pakistan to the Priority Watch List; improved intellectual property rights
protection saw it lowered back to the Watch List in 2006).71 From the USTR report:
The government of Pakistan continued to take noticeable steps during 2006 to
improve copyright enforcement, especially with respect to optical disc piracy.
Nevertheless, Pakistan does not provide adequate protection of all intellectual
property. Book piracy, weak trademark enforcement, lack of data protection for
proprietary pharmaceutical and agricultural chemical test data, and problems
with Pakistan’s pharmaceutical patent protection remain serious barriers to trade
and investment.72
In April 2007, the USTR again named Pakistan to its Special 301 watch list, lauding
Islamabad for progress on intellectual property rights enforcement, but also
expressing ongoing concerns about Pakistan’s lack of effective protections in the
pharmaceutical sector.
68 [http://www.adb.org/Documents/Books/ADO/2007/PAK.asp].
69 [http://www.census.gov/foreign-trade/statistics/country/index.html].
70 The International Intellectual Property Alliance, a coalition of U.S. copyright-based
industries, estimated U.S. losses of $100 million due to copyright piracy in Pakistan in 2006
([http://www.iipa.com/rbc/2007/2007SPEC301PAKISTAN.pdf]).
71 [http://www.ustr.gov/assets/Document_Library/Reports_Publications/2006/2006_NTE
_Report/asset_upload_file797_9198.pdf] and [http://www.ustr.gov/assets/
Document_Library/Reports_Publications/2006/2006_Special_301_Review/asset_upload
_file190_9339.pdf].
72 See [http://www.ustr.gov/Document_Library/Reports_Publications/2007/2007_Trade_
Policy_Agenda/Section_Index.html]

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According to Pakistan’s Ministry of Finance, total foreign direct investment in
Pakistan exceeded $7 billion for the year ending June 2007 — an unprecedented
amount doubling that of the previous year — but many investors remain wary of the
country’s uncertain security circumstances. About one-third of the value came from
U.S.-based investors. Islamabad is eager to finalize a pending Bilateral Investment
Treaty and reach a Free Trade Agreement with the United States, believing that its
vital textile sector will be bolstered by duty-free access to the U.S. market. The
establishment of Reconstruction Opportunity Zones that could facilitate development
in Pakistan’s poor tribal regions, an initiative of President Bush during his March
2006 visit to Pakistan, may require congressional action in 2007. The Heritage
Foundation’s 2007 Index of Economic Freedom — which may overemphasize the
value of absolute growth and downplay broader quality-of-life measurements —
again rated Pakistan’s economy as being “mostly unfree” and ranked it 89th out of
157 countries. The index identified restrictive trade policies, a heavy fiscal burden,
weak property ownership protections, and limited financial freedoms.73 Corruption
is another serious problem: in 2007, Berlin-based Transparency International placed
Pakistan 142nd out of 163 countries in its annual ranking of world corruption levels.74
U.S. Aid and Congressional Action
U.S. Assistance. A total of about $15 billion in direct U.S. aid went to
Pakistan from 1947 through 2006, including more than $4 billion in military
assistance. In June 2003, President Bush hosted President Musharraf at Camp David,
Maryland, where he vowed to work with Congress on establishing a five-year, $3
billion aid package for Pakistan. Annual installments of $600 million each, split
evenly between military and economic aid, began in FY2005.75 When additional
funds for development assistance, law enforcement, earthquake relief, and other
programs are included, the non-food aid allocation for FY2006 was $759 million (see
Table 1). The Bush Administration’s FY2007 request called for another $739
million in aid to Pakistan, however, the House Appropriations Committee (H.Rept.
109-486) recommended reducing that amount by $150 million, ostensibly for
domestic budgetary reasons unrelated to Pakistan-U.S. relations. The Senate
Appropriations Committee (S.Rept. 109-277) called for no such decreases, but did
recommend shifting about $94 million in requested economic support to
development, health, education, and governance programs. Thus, while the total
FY2007 allocation for Pakistan is yet to be determined, it may fall somewhere
between $585 million and $740 million (see Table 1, note a).
Congress also has appropriated billions of dollars to reimburse Pakistan for its
support of U.S.-led counterterrorism operations. As of mid-2007, a total of more
than $7 billion had been appropriated for FY2002-FY2007 Defense Department
spending for coalition support payments to “Pakistan, Jordan, and other key
cooperating nations.” Pentagon documents show that disbursements to Islamabad
73 See [http://www.heritage.org/research/features/index/country.cfm?id=Pakistan].
74 See [http://www.transparency.org].
75 The Foreign Operations FY2005 Appropriations bill (P.L. 108-447) established a new
base program of $300 million for military assistance for Pakistan.

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— at nearly $5 billion or an average of more than $80 million per month — account
for the great majority of these funds. The amount is equal to more than one-quarter
of Pakistan’s total military expenditures. The Defense Department Appropriations
Act, 2007 (P.L. 109-289) allows that up to $900 million in Pentagon funds be used
for FY2007 reimbursements. The Bush Administration requested another $1 billion
in emergency supplemental coalition support funds for FY2007, however, the
supplemental bill finally signed into law by the President in May 2007 (P.L. 110-28)
allowed for only $200 million in additional CSF appropriations. The Administration
also has requested another $1.7 billion in coalition support for FY2008.
Proliferation-Related Legislation. Through a series of legislative
measures, Congress incrementally lifted sanctions on Pakistan resulting from its
nuclear weapons proliferation activities.76 After the September 2001 terrorist attacks
on the United States, policymakers searched for new means of providing assistance
to Pakistan. President Bush’s issuance of a final determination that month removed
remaining sanctions on Pakistan (and India) resulting from the 1998 nuclear tests,
finding that restrictions were not in U.S. national security interests. Some Members
of the 108th Congress urged reinstatement of proliferation-related sanctions in
response to evidence of Pakistani assistance to third-party nuclear weapons programs.
However, the Nuclear Black-Market Elimination Act (H.R. 4965) died in committee.
Legislation in the 109th Congress included the Pakistan Proliferation Accountability
Act of 2005 (H.R. 1553), which sought to prohibit the provision of military
equipment to Pakistan unless the President can certify that Pakistan has verifiably
halted all proliferation activities and is fully sharing with the United States all
information relevant to the A.Q. Khan proliferation network. This bill also did not
emerge from committee.
In the 110th Congress, the Implementing the 9/11 Commission
Recommendations Act of 2007 (H.R. 1), passed by the House in January 2007,
contains provisions that would suspend all arms sales licenses and deliveries to any
“nuclear proliferation host country” unless the President certifies that such a country
is, inter alia, fully investigating and taking actions to permanently halt illicit nuclear
proliferation activities.
Coup-Related Legislation. Pakistan’s October 1999 military coup triggered
U.S. aid restrictions under Section 508 of the annual Foreign Assistance
appropriations act. Post-September 2001 circumstances saw Congress take action
on such restrictions. P.L. 107-57 (October 2001) waived coup-related sanctions on
Pakistan through FY2002 and granted presidential authority to waive them through
FY2003. A November 2003 emergency supplemental appropriations act (P.L. 108-
106) extended the President’s waiver authority through FY2004. The foreign
76 The Agricultural Export Relief Act of 1998 (P.L. 105-194) allowed U.S. wheat sales to
Pakistan after July 1998. The India-Pakistan Relief Act of 1998 (in P.L. 105-277)
authorized a one-year sanctions waiver exercised by President Clinton in November 1998.
The Department of Defense Appropriations Act, 2000 (P.L. 106-79) gave the President
permanent authority to waive nuclear-test-related sanctions applied against Pakistan and
India after October 1999, when President Clinton waived economic sanctions on India
(Pakistan remained under sanctions as a result of the October 1999 coup). (See CRS Report
RS20995, India and Pakistan: U.S. Economic Sanctions, by Dianne Rennack.)

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operations FY2006 appropriations bill (P.L. 109-102) extended it through FY2006.
The House-passed Implementing the 9/11 Commission Recommendations Act of
2007 (H.R. 1) would provide a two-year extension through FY2008. President Bush
has exercised this waiver authority annually.
Other Legislation. In the 108th Congress, conference managers making
foreign operations appropriations directed the Secretary of State to report to Congress
on Pakistan’s education reform strategy and the U.S. strategy to provide relevant
assistance (H.Rept. 108-792; see CRS Report RS22009, Education Reform in
Pakistan). Also in the 108th Congress, the House-passed Foreign Relations
Authorization Act, FY2004-2005 (H.R. 1950) would have required the President to
report to Congress on Pakistani actions related to terrorism and WMD proliferation.
The Senate did not take action on this bill. The House-passed version of the
Intelligence Authorization Act, FY2005 contained similar reporting requirements;
this section was removed in the Senate. In the 109th Congress, the Targeting
Terrorists More Effectively Act of 2005 (S. 12) and the Real Security Act of 2006 (S.
3875) contained Pakistan-specific language; both died in committee.
In the 110th Congress, the National Defense Authorization Act for FY2008
(H.R. 1585), passed by the full House in May 2007, includes a provision to expand
programs to build the capacity of Pakistan’s counterterrorism security forces. A
Senate version (S. 1548), introduced in early June, contains no such provision, but
would halt coalition support reimbursements to Pakistan unless the President certifies
that Islamabad “is making substantial and sustained efforts to eliminate safe havens
for the Taliban, Al Qaeda, and other violent extremists in areas under its sovereign
control ....” The Senate bill also would require the President to report to Congress
a description of a long-term U.S. strategy for engaging with Islamabad on the
problems of cross-border infiltration of militants into Afghanistan and safe havens
enjoyed by such militants in Pakistan.
S.Res. 99, expressing the sense of the Senate that U.S. military assistance to
Pakistan should be guided by demonstrable progress by the government of Pakistan
in achieving certain objectives related to counterterrorism and democratic reforms,
was introduced in the Senate in March 2007, but has not moved out of committee.
In early June, the Afghanistan Freedom and Security Support Act of 2007 (H.R.
2446) was passed by the full House. The bill contains provisions that would require
the President to report to Congress on implementation of policies to encourage
greater Pakistan-Arab country reconstruction assistance to Afghanistan and on
Pakistan-Afghanistan cooperation; authorize the President to appoint a new special
envoy to promote closer Pakistan-Afghanistan cooperation; and require the President
to report to Congress on actions taken by Pakistan to permit or impede transit of
Indian reconstruction materials to Afghanistan across Pakistani territory.
9/11 Commission Recommendations. The 9/11 Commission Report,
released in July 2004, identified the government of President Musharraf as the best
hope for stability in Pakistan and Afghanistan, and it recommended that the United
States make a long-term commitment to provide comprehensive support for
Islamabad so long as Pakistan itself is committed to combating extremism and to a
policy of “enlightened moderation.” In the Intelligence Reform and Terrorism
Prevention Act of 2004 (P.L. 108-458), Congress broadly endorsed this

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recommendation by calling for U.S. aid to Pakistan to be sustained at a minimum of
FY2005 levels and requiring the President to report to Congress a description of
long-term U.S. strategy to engage with and support Pakistan. A November 2005
follow-on report by Commissioners gave a “C” grade to U.S. efforts to support
Pakistan’s anti-extremism policies and warned that the country “remains a sanctuary
and training ground for terrorists.” In the 109th Congress, H.R. 5017 and S. 3456
sought to insure implementation of the recommendations of the 9/11 Commission.
The bills contained Pakistan-specific language, but neither emerged from committee.
A new Democratic majority took up the issue again in 2007. The premiere
House resolution of the 110th Congress (H.R. 1, the Implementing the 9/11
Commission Recommendations Act of 2007) was passed in January containing
discussion of U.S. policy toward Pakistan, including a requirement that the President
report to Congress a long-term U.S. strategy for engaging Pakistan and a statement
of policy linking increases in U.S. foreign assistance to Pakistan to the Islamabad
government’s demonstrated commitment to democratization . The bill also includes
a provision that would end U.S. military assistance and arms sales licensing to
Pakistan in FY2008 unless the President certifies that the Islamabad government is
“making all possible efforts” to end Taliban activities on Pakistani soil. The Bush
Administration opposes this provision on the grounds that it would be
counterproductive to the goal of closer U.S.-Pakistan relations. A Senate version (S.
4) was passed in March, but contains no Pakistan-specific language.
Selected Pakistan-Related Legislation in the 110th Congress
H.R. 2206: The U.S. Troop Readiness, Veterans’ Care, Katrina Recovery, and Iraq
Accountability Appropriations Act, 2007 (became P.L. 110-28 on May 27,
2007)
! Provides up to $200 million in further coalition support payments to
“Pakistan, Jordan, and other key cooperating nations” in FY2007.
! Provides up to $60 million in counterdrug funds for Pakistan and
Afghanistan in FY2007.
! Allows that up to $110 million in Pentagon funds may be used for
Economic Support Funds (ESF) for development projects in
Pakistan’s tribal areas in FY2007.
! Withholds all FY2007 supplemental ESF for Pakistan until the
Secretary of State submits to Congress a report on the oversight
mechanisms, performance benchmarks, and implementation
processes for such funds.
! Earmarks $5 million in FY2007 ESF for the Human Rights and
Democracy Fund of the Bureau of Democracy, Human Rights, and
Labor, Department of State, for political party development and
election observation programs in Pakistan.
H.R. 1: The Implementing the 9/11 Commission Recommendations Act of 2007
(passed by the full House on January 9, 2007)

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CRS-49
! Would end U.S. military assistance and arms sales licensing to
Pakistan in FY2008 unless the President certifies that the Islamabad
government is “making all possible efforts” to end Taliban activities
on Pakistani soil.
! Would require the President report to Congress a long-term U.S.
strategy for engaging Pakistan and a statement of policy linking
increases in U.S. foreign assistance to Pakistan to the Islamabad
government’s demonstrated commitment to democratization.
! Would suspend all arms sales licenses and deliveries to any “nuclear
proliferation host country” unless the President certifies that such a
country is, inter alia, fully investigating and taking actions to
permanently halt illicit nuclear proliferation activities.
! Would provide an extension of the President’s authority to waive
coup-related sanctions through FY2008.
H.R. 1585: The National Defense Authorization Act for FY2008 (passed by the full
House on May 17, 2007)
! Would expand programs to build the capacity of Pakistan’s
counterterrorism security forces.
H.R. 2446: The Afghanistan Freedom and Security Support Act of 2007 (passed by
the full House on June 6, 2007)
! Would require the President to report to Congress on
implementation of policies to encourage greater Pakistan-Arab
country reconstruction assistance to Afghanistan and on Pakistan-
Afghanistan cooperation.
! Would authorize the President to appoint a new special envoy to
promote closer Pakistan-Afghanistan cooperation.
! Would require the President to report to Congress on actions taken
by Pakistan to permit or impede transit of Indian reconstruction
materials to Afghanistan across Pakistani territory.
H.R. 2764: The Department of State, Foreign Operations and Related Programs
Appropriations Act, 2008 (passed by the full House on June 22, 2007)
! Would earmark an additional $75 million in aid to Pakistani
education reform programs by shifting an identical amount from
ESF budgetary support.
! Would provide an extension of the President’s authority to waive
coup-related sanctions through FY2008.
S. 1548: The Department of Defense Authorization Act for Fiscal Year 2008
(introduced on June 5, 2007)
! Would require the President to report to Congress a description of
a long-term U.S. strategy for engaging with Islamabad on the
problems of cross-border infiltration of militants into Afghanistan
and safe havens enjoyed by such militants in Pakistan.

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CRS-50
! Would halt coalition support reimbursements to Pakistan unless the
President certifies that Islamabad “is making substantial and
sustained efforts to eliminate safe havens for the Taliban, Al Qaeda,
and other violent extremists in areas under its sovereign control ....”
S.Res. 99 (introduced on March 7, 2007)
! Would express the sense of the Senate that U.S. military assistance
to Pakistan should be guided by demonstrable progress by the
government of Pakistan in achieving certain objectives related to
counterterrorism and democratic reforms.

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CRS-51
Table 1. Overt U.S. Assistance to Pakistan, FY2001-FY2008
(in millions of dollars)
FY
FY
FY
FY
FY
FY
FY
Total
FY
2008
2001
2002
2003
2004
2005
2006
FY2002-FY2006
2007a
(req.)
Economic Support Funds
—
624.5
188.0b
200.0b
297.6
296.6
1,606.7
a
382.9
Other Development Aidc
—
40.0
50.1
75.0
50.0
119.8
334.9
a
57.8
Total Economic Aid
—
664.5
238.1
275.0
347.6
416.4
1,941.6
a
440.7
Foreign Military Financing
—
75.0
224.5
74.6
298.8
297.0
969.9
a
300.0
Other Security-Related Aidd
3.5
101.5e
32.0
37.8
42.0
45.6
258.9
a
44.0
Total Security-Related Aid
3.5
176.5
256.5
112.4
340.8
342.6
1,228.8
a
344.0
Coalition Support Funds
—
1,169.1f
1,246.6
705.3
963.8
844.9
4,929.7
g
g
Total Non-Food Aid Plus
Coalition Support Funds
3.5
2,010.1
1,741.2
1,092.7
1,652.2
1,603.9
8,100.1
a
785.0
Food Aidh
87.5
90.8
18.7
24.0
18.0
17.7
169.2
—
—
Grand Total
91.0
2,100.9
1,759.9
1,116.7
1,670.2
1,621.6
8,269.3
a
785.0
Sources: U.S. Departments of State, Defense, and Agriculture; U.S. Agency for International Development.
Notes:
a. FY2007 appropriations come under the Continuing Appropriations Resolution (P.L. 109-289 as amended). Estimated country allocations are expected later in 2007. In passing
the Foreign Operations Appropriations Act, 2007, the House Appropriations Committee (H.Rept. 109-486) recommended reducing ESF by $50 million and FMF by $100 million
from the previous year’s levels, ostensibly for domestic budgetary reasons unrelated to Pakistan-U.S. relations. The Senate Appropriations Committee (S.Rept. 109-277) called
for no decreases, but recommended shifting about $94 million in ESF to CSF, DA, and democracy and governance programs.
b. Congress authorized Pakistan to use the FY2003 ESF allocation to cancel $988 million and the FY2004 allocation to cancel $495 million in concessional debt to the U.S. government.
c. Includes Child Survival and Health; Development Assistance; Emergency Refugee and Migration Assistance; and International Disaster and Famine Assistance.
d. Includes International Military Education and Training; International Narcotics Control and Law Enforcement; and Nonproliferation, Anti-Terrorism, Demining and Related.
e. Includes $73 million for border security projects that continued in FY2003.

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CRS-52
f. Includes $220 million in Peacekeeping Operations Emergency Response Funds reported by the State Department.
g. The Bush Administration requested $1 billion in further CSF funds for “Pakistan, Jordan, and other key cooperating nations” in FY2007; Congress appropriated only $200 million
for such purposes (P.L. 110-28). The Administration has requested $1.7 billion in further CSF funds in FY2008.
h. P.L.480 Title I (loans), P.L.480 Title II (grants), and Section 416(b) of the Agricultural Act of 1949, as amended (surplus agricultural commodity donations). Food aid totals do
not include freight costs.

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CRS-53
Figure 1. Map of Pakistan

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