Pakistan: U.S. Foreign Assistance
Susan B. Epstein

Specialist in Foreign Policy
K. Alan Kronstadt
Specialist in South Asian Affairs
October 4, 2012
Congressional Research Service
7-5700
www.crs.gov
R41856
CRS Report for Congress
Pr
epared for Members and Committees of Congress

Pakistan: U.S. Foreign Assistance

Summary
The 112th Congress has focused on measures to reduce the federal budget deficit. This backdrop
may continue to influence congressional debate over a top-ranking U.S. aid recipient, Pakistan—a
country vital to U.S. national security interests but that some say lacks accountability and even
credibility as a U.S. ally.
Pakistan has been among the leading recipients of U.S. foreign assistance both historically and in
recent years. The country arguably is as important to forwarding U.S. security interests as any in
the world. Developments in 2011 put immense strains on bilateral relations, making uncertain the
future direction of U.S. aid to Pakistan. Disruptions included the May killing of Osama bin Laden
in a Pakistani city and a November NATO military raid into Pakistani territory near Afghanistan
that inadvertently left 24 Pakistani soldiers dead. For many lawmakers, the core issue remains
balancing Pakistan’s strategic importance to the United States with the pervasive and mounting
distrust in the U.S.-Pakistan relationship, as well as with budget deficit-reduction pressures.
U.S. assistance to Pakistan has fluctuated considerably over the past 60 years. In the wake of
9/11, however, aid to Pakistan increased steadily as the Bush and Obama Administrations both
characterized Pakistan as a crucial U.S. partner in efforts to combat terrorism and to promote
stability in both Afghanistan and South Asia. Since 1948, the United States has pledged more than
$30 billion in direct aid, about half for military assistance. Two-thirds of this total was
appropriated in the post-9/11 era from FY2002 to FY2011. Many observers question the gains
accrued to date, viewing a lack of accountability and reform by the Pakistani government as
major obstacles. Moreover, any goodwill generated by U.S. aid is offset by widespread and
intense anti-American sentiment among the Pakistani people.
In 2009, Congress passed the Enhanced Partnership with Pakistan Act of 2009 (P.L. 111-73). The
law authorizes the President to provide $1.5 billion in annual nonmilitary aid to Pakistan for
FY2010 through FY2014 and requires annual certification for release of security-related aid; such
conditionality is a contentious issue. Congress also established two new funds in 2009—the
Pakistan Counterinsurgency Fund (PCF) within the Defense Department appropriations and the
Pakistan Counterinsurgency Capability Fund within the State-Foreign Operations
Appropriations—to help build Pakistan’s counterinsurgency capabilities. When $1.5 billion in
“coalition support fund” military reimbursements are added to economic and security aid totals,
the United States provided a total of $4.3 billion for Pakistan for FY2010 alone, making it the
second-highest recipient after Afghanistan. In addition to these ongoing programs, the United
States pledged about $700 million in a response to extensive mid-2010 flooding in Pakistan.
In its Second Session, the 112th Congress considered and, in some cases, enacted further
conditions and limitations on assistance to Pakistan. Among these was a new certification
requirement in the Consolidated Appropriations Act, 2012 (P.L. 112-74). Moreover, the National
Defense Authorization Act for FY2012 (P.L. 112-81) would withhold 60% of any FY2012
appropriations for PCF unless the Secretary of Defense reports to Congress a strategy for the use
of such funds and the metrics for determining their effectiveness, among other provisions.
This report will be updated as warranted by events. For broader discussion of U.S.-Pakistan
relations, see CRS Report R41832, Pakistan-U.S. Relations, by K. Alan Kronstadt. See also CRS
Report R42116, Pakistan: U.S. Foreign Aid Conditions, Restrictions, and Reporting
Requirements
, by Susan B. Epstein and K. Alan Kronstadt.
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Pakistan: U.S. Foreign Assistance

Contents
Introduction...................................................................................................................................... 1
Key Recent Developments............................................................................................................... 3
Waiver of Certification Requirements Conditioning U.S. Assistance................................. 3
Ground Lines of Communication Reopened, Coalition Support Funds Released .............. 3
The Shakil Afridi Case and U.S. Assistance ....................................................................... 4
Notable Foreign Assistance Funding Issues........................................................................ 4
Flooding and Humanitarian Assistance............................................................................... 4
Fluctuating U.S. Aid to Pakistan Before 9/11.................................................................................. 4
U.S. Aid to Pakistan After 9/11........................................................................................................ 6
Bilateral Economic, Development, and Humanitarian Assistance ............................................ 6
FATA Development Plan ..................................................................................................... 7
The Enhanced Partnership With Pakistan Act (EPPA) of 2009........................................... 8
Debate in Pakistan Over the “KLB” Bill........................................................................... 10
Security Assistance.................................................................................................................. 12
Coalition Support Funds (CSF)......................................................................................... 13
Defense Supplies............................................................................................................... 14
Military Training and Law Enforcement........................................................................... 17
Pakistan Counterinsurgency Fund/Pakistan Counterinsurgency Capability Fund
(PCF/PCCF) ................................................................................................................... 18
Other International Economic Donors..................................................................................... 18
FY2013 Request for Aid to Pakistan and Objectives..................................................................... 23
Issues for Congress ........................................................................................................................ 25
Conditions on Aid to Pakistan ................................................................................................. 25
Debate Overview............................................................................................................... 25
Current Conditionality and Administration Certifications/Waivers .................................. 27
Government Reform................................................................................................................ 29
Corruption, Transparency, and Oversight Issues ..................................................................... 30
Corruption and Transparency ............................................................................................ 30
U.S. Government Oversight and Auditing ........................................................................ 32
Aid Delivery and Security Concerns ....................................................................................... 34
Branding and Public Diplomacy.............................................................................................. 35
Possible Adjustments to U.S. Assistance Programs................................................................. 37
Other Aid Issues ...................................................................................................................... 38
Conclusions.................................................................................................................................... 39

Figures
Figure 1. Pakistani Views of the United States.............................................................................. 36
Figure A-1. U.S. Aid in Current and Constant Dollars .................................................................. 40
Figure B-1.FY2013 Budget Request for Aid to Pakistan .............................................................. 41
Figure C-1.Official Development Assistance to Pakistan, by Donor ............................................ 42

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Tables
Table 1. Enhanced Partnership with Pakistan Funds ..................................................................... 10
Table 2. Direct Overt U.S. Aid and Military Reimbursements to Pakistan, FY2001-
FY2012 ....................................................................................................................................... 20

Appendixes
Appendix A. History of U.S. Aid to Pakistan ................................................................................ 40
Appendix B. Current Year Request................................................................................................ 41
Appendix C. Major Donor Bilateral Development Assistance to Pakistan, CY2010.................... 42
Appendix D. Principles and Purposes of the Enhanced Partnership with Pakistan Act of
2009 ............................................................................................................................................ 43

Contacts
Author Contact Information........................................................................................................... 44

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Introduction1
Experts commonly list Pakistan among the most strategically important countries for U.S. policy
makers. The 112th Congress has grappled with deeply troubled and even deteriorated U.S.-
Pakistani relations, as well as the need to balance Pakistan’s importance to U.S. national security
interests with U.S. domestic budgetary pressures.
In the post-9/11 period, assisting in the creation of a more stable, democratic, and prosperous
Pakistan actively combating religious militancy has been a central U.S. foreign policy effort.
Global and South Asian regional terrorism, and a decade-long effort to stabilize neighboring
Afghanistan, are viewed as top-tier concerns. Pakistan’s apparently accelerated nuclear weapons
program and the long-standing dispute with India over Kashmir continue to threaten regional
stability. Pakistan is identified as a base for numerous U.S.-designated terrorist groups and, by
some accounts, most of the world’s jihadist terrorist plots have some connection to Pakistan-
based elements. With anti-American sentiments and xenophobic conspiracy theories remaining
rife among ordinary Pakistanis, persistent economic travails and a precarious political setting
combine to present serious challenges to U.S. decision makers. Opinion surveys show a solid
majority of Pakistanis holding strong and unfavorable views toward the United States.2
Meanwhile, Americans tend to have poor views of Pakistan; one survey—taken soon after the
May 2011 bin Laden raid—found only 2% identifying Pakistan as a U.S. “ally.”3 Aware of these
and other concerns, the U.S. government has provided large-scale foreign assistance to Pakistan
with an eye toward short-term U.S. security interests and longer-term interests in realizing a more
stable, democratic, and prosperous Pakistani state.
The United States has provided significant foreign aid to Pakistan over the nearly 65 years since
that country’s independence, but at levels that fluctuated widely. Major aid flows during some
periods and drastic cuts in others contributed to creating a perception among many in Pakistan
that the United States is not a fully reliable ally. At the same time, some U.S. lawmakers continue
to question providing large amounts of aid to a Pakistani government that is seen as an unreliable
partner in U.S. counterterrorism efforts—as evidenced in 2011 by revelations that Al Qaeda
founder Osama bin Laden found refuge in a Pakistani city for several years and that the Haqqani
Network of Afghan insurgents may continue to receive support for Pakistan’s main intelligence
service. To many, Pakistan also appears incapable of providing sustainable economic
development and security for its own people, and often is unaccountable to the United States for
aid results. Beyond these issues, some question whether the aid results in public diplomacy
benefits for the United States.
Pakistan is a poor, fragile, and insecure state, representing a daunting challenge to U.S. and other
foreign donors. Pakistan’s estimated per capita GDP of $2,792 (at purchasing power parity) in
2011 ranks it 136th of 183 world countries (by comparison, the U.S. figure is $46,860 and India’s,

1 For broader discussion of U.S.-Pakistan relations, see CRS Report R41832, Pakistan-U.S. Relations, by K. Alan
Kronstadt. See also CRS Report R42116, Pakistan: U.S. Foreign Aid Conditions, Restrictions, and Reporting
Requirements
, by Susan B. Epstein and K. Alan Kronstadt.
2 A June 2012 Pew Global Attitudes poll found that 74% of Pakistanis consider the United States an “enemy” (a 5%
increase over 2011), while only 9% consider it to be a “partner” (see “Pakistani Public Opinion ever More Critical of
U.S.,” June 27, 2012, at http://www.pewglobal.org/2012/06/27/pakistani-public-opinion-ever-more-critical-of-u-s).
3 Another 11% called Pakistan “friendly,” while 38% called it “unfriendly” and another 23% identified Pakistan as “an
enemy of the United States” (see http://today.yougov.com/news/2011/05/23/2-call-pakistan-ally-us).
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with seven times as many citizens as Pakistan, is $3,703). From 2008 to 2010 the country
experienced aggregate inflation of nearly 50% against GDP growth of less than 13%. Pakistan’s
education sector is among the world’s least effective: the government devotes less than 2% of
GDP to education and nearly one-quarter of primary school age children have no formal
education of any kind. Less than half of Pakistanis have access to modern energy services, and
the energy infrastructure is so overburdened that chronic electricity shortages result in rolling
blackouts lasting 10 or more hours per day, even in vital business centers such as Karachi. Potable
water shortages are widespread, and a dilapidated health sector provides insufficient access to
basic health services, meaning that many citizens—women and children, especially—die each
year from preventable diseases. Meanwhile, security threats remain rife: Pakistan is home to
multiple Islamist, separatist, sectarian, and other politically motivated militants and terrorist
groups. The U.S. National Counterterrorism Center reports there were an average of more than 26
terrorist attacks each week in Pakistan in 2011; only Afghanistan and Iraq suffered a higher
number of incidents.4
The post-2001 U.S. assistance program for Pakistan has seen notable accomplishments, not least
in the area of humanitarian relief related to that country’s devastating 2005 earthquake and 2010
floods. U.S. aid has measurably improved Pakistan’s energy, health, and education sectors,
bolstered its infrastructure, and facilitated better governance and gender equity.5 In the security
realm, U.S. assistance has provided Pakistan’s military and law enforcement agencies with
equipment and training that has improved their capacity to combat the country’s indigenous
terrorism threat. It has also contributed to successes realized by the Pakistani military in offensive
military operations undertaken in tribal areas, and enabled Pakistan to better support U.S.-led
military operations in Afghanistan. Pakistani law enforcement agencies have received equipment
and training. However, by most objective measures, U.S. assistance to Pakistan since 2001 has
not achieved its central goals, especially as Islamist extremism and militancy there have
increased, the civilian government remains unstable, and the national economy continues to
suffer. Many independent assessments of the U.S. aid program are critical of the way Washington
has delivered and overseen aid. In the representative words found in a major June 2012 study,
International, particularly U.S., military and civilian aid has failed to improve Pakistan’s
performance against jihadi groups operating on its soil or to help stabilize its nascent
democracy. Lopsided focus on security aid after the 11 September 2001 attacks has not
delivered counterterrorism dividends, but entrenched the military’s control over state
institutions and policy, delaying reforms and aggravating Pakistani public perceptions that
the U.S. is only interested in investing in a security client.6
This critique, like many others, urges the United States to apply conditions on military, but not
civilian, assistance, and to give both the U.S. Agency for International Development (USAID)
and its implementing partners more freedom to devise and prioritize their efforts.

4 Data in this paragraph from IMF World Economic Outlook Database, September 2011; World Bank Country Strategy
Progress Report; USAID, “U.S. Assistance to Pakistan—Sectoral Working Papers;” and NCTC Worldwide Incidents
Tracking System.
5 See http://transition.usaid.gov/pk/about.
6 “Aid and Conflict in Pakistan,” International Crisis Group Asia Report No. 227, June 2012.
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Key Recent Developments
Waiver of Certification Requirements Conditioning U.S. Assistance
In mid-August 2012, the State Department quietly notified Congress of its intention to cite U.S.
national security provisions in waiving two certification requirements that placed conditions on
U.S. assistance to Pakistan. These provisions required the Secretary to certify that Pakistan was
cooperating with the United States on a range of counterterrorism, nonproliferation, democracy,
and other issue-areas. On September 13, Secretary Clinton formally notified Congress that the
Administration would continue the U.S. aid flow by waiving certifications required in Section
203 of the Enhanced Partnership with Pakistan Act of 2009 (P.L. 111-73) and in Section 7046 of
the Consolidated Appropriations Act, 2012 (P.L. 112-74), finding that it was in the national
security interest of the United States to do so.
This marks the first time the Obama Administration has waived aid sanctions on Pakistan.
(Congress had permanently waived all proliferation and debt-arrearage sanctions on Pakistan in
October 2002, and the Bush Administration issued six waivers of democracy-related sanctions—
for FY2002-FY2007—until these were permanently waived following an April 2008
determination that a democratic government had been restored in Islamabad. Further discussion is
in the “Current Conditionality and Administration Certifications/Waivers” section below.)
Ground Lines of Communication Reopened, Coalition Support Funds
Released

In angry response to the inadvertent killing of 24 Pakistani soldiers by NATO forces in November
2011, Islamabad closed the vital ground lines of communication (GLOCs) used by NATO forces
to access Afghanistan and placed bilateral relations “on hold.” Ties then remained largely frozen
during the first half of 2012. On July 3, 2012, negotiations finally succeeded and the GLOCs
were reopened. The breakthrough came following a telephone call to Foreign Minister Hina
Rabbani Khar in which Secretary of State Hillary Clinton said, “We are sorry for the losses
suffered by the Pakistani military.”7 The State Department indicates that civilian aid flows were
uninterrupted during the seven-month period.
In an apparent quid pro quo for the GLOCs’ reopening, on July 6, 2012, the Administration
announced it would release $1.18 billion in Coalition Support Fund (CSF) military
reimbursements for Pakistan’s support during the period July 2010-May 2011. Congress took no
action to block the transfer. This payment, the first since December 2010, equaled 60% of the
$1.88 billion claimed by Pakistan for that period.8 Congressional sources indicate that the
Administration is currently processing further Pakistani requests for the period June-November
2011, but has no intention of providing CSF for the period that the Pakistani GLOCs were closed
(late November 2011-early July 2012). CSF requests for July 2012 and beyond will be taken
under consideration.

7 See http://www.state.gov/secretary/rm/2012/07/194502.htm.
8 The vast majority of the reimbursements ($1.08 billion) was for Pakistan Army expenses; about 60% was for food,
water, medical services, and vehicle repairs and maintenance.
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The Shakil Afridi Case and U.S. Assistance
In May 2012, a tribal court in Pakistan convicted Shakil Afridi of treason and sentenced him to 33
years in prison. Afridi was a physician who had worked with the CIA in an apparently
unsuccessful attempt to collect DNA samples from Osama bin Laden’s Abbottabad compound
previous to the May 2011 U.S. commando raid there. Members of the U.S. Congress reacted
strongly and with considerable bipartisan anger to news of Afridi’s sentencing. A day later, a
Senate Appropriations Subcommittee approved an amendment to the FY2013 State and Foreign
Operations Appropriations bill that would withhold $33 million ($1 million for each year of the
sentence) of requested Foreign Military Financing aid to Pakistan. Senator Rand Paul was among
several Members who sought to end all foreign assistance to Pakistan until Afridi was released
and the charges dropped, and he pushed for the Senate to consider such provisions in his bill (S.
3576). On September 22, the bill was defeated by a vote of 10-81.
Notable Foreign Assistance Funding Issues
The Obama Administration’s FY2013 request for aid to Pakistan totaled $2.2 billion, of which
$800 million for PCCF is in Overseas Contingency Operations (OCO), considered to be short-
term, temporary funds. Another $1.4 billion is considered to be enduring (or regular) funding.
The goal to provide $1.5 billion in annual nonmilitary assistance to Pakistan for FY2010 through
FY2014, as authorized by the Enhanced Partnership with Pakistan Act of 2009 (EPPA, also
known as the Kerry-Lugar-Berman or “KLB bill”), has been met only in FY2010. It fell short in
FY2011 by $414 million, in FY2012 by an estimated $500 million, and in the FY2013 request by
$428 million. Administration officials say Congress did not appropriate the funds for FY2011 and
FY2012. For FY2013, the Administration did not request $1.5 billion mainly due to budgetary
constraints.9 To date, only 2%-3% of FY2012 KLB funds have been disbursed.
Flooding and Humanitarian Assistance
For the third consecutive year, Pakistan is experiencing major seasonal flooding that, while not as
severe as that of 2010 and 2011, has resulted in more than 430 deaths and has negatively affected
nearly 4.8 million people with deteriorated living conditions. The Islamabad government has
pledged $91 million toward relief and is coordinating response efforts. As of end September,
2012, the State Department and USAID humanitarian assistance totaled $134.6 million. U.S.
flood-relief provided to Pakistan in FY2010 and FY2011 totaled more than $600 million in funds
and in-kind aid and services.
Fluctuating U.S. Aid to Pakistan Before 9/11
Over the past six decades, the United States has turned aid to Pakistan on and off to correspond
with U.S. foreign policy objectives and to reflect the state of the bilateral relationship. Aid was
provided or restricted for numerous reasons over those 60 years. In some years, U.S. aid would
support balance in the region and contain Soviet expansionism; in other years, the U.S.

9 See the February 13, 2012,“Background Briefing on 2013 State Department-USAID Budget” at http://www.state.gov/
r/pa/prs/ps/2012/02/183848.htm.
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government would withhold aid because of nuclear weapons proliferation and lack of
democratization gains. U.S. aid levels to Pakistan (after adjusting for inflation) peaked in 1962
when Pakistan aligned itself with the West by joining two regional defense pacts, the South East
Asia Treaty Organization (SEATO) and the Central Treaty Organization (CENTO, also known as
the “Baghdad Pact”; see Figure A-1). President Dwight D. Eisenhower famously called Pakistan
America’s “most allied ally in Asia.” In contrast, U.S. aid to Pakistan was at its lowest level in the
1990s after the Soviet Army withdrew from Afghanistan in 1989, and President George H. W.
Bush suspended aid to Pakistan in 1990 because of its nuclear activities.
During and immediately after the Indo-Pakistani wars of 1965 and 1971, the United States
suspended military assistance to both sides. This resulted 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. 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. President Jimmy Carter
suspended most U.S. aid in response to Pakistan’s covert construction of a uranium enrichment
facility. However, in 1979, the Soviet Union invaded Afghanistan, and the United States viewed
Pakistan as a frontline ally in the effort to block Soviet expansionism. In 1981, therefore, the
Reagan Administration negotiated a five-year, $3.2 billion economic and military aid package
with Pakistan. As a result, Pakistan became a key transit country for arms supplies to the Afghan
resistance, as well as home for millions of Afghan refugees, many of whom have yet to return.
In 1985 Congress passed the Pressler Amendment (§620E(e) of the Foreign Assistance Act of
1961) that required the President to certify to Congress that Pakistan did not possess a nuclear
explosive device during the fiscal year for which the aid was provided. President Reagan and
President George H. W. Bush certified Pakistan each year until 1990.
After the 1990 suspension of aid to Pakistan, U.S. aid to that country remained at low levels not
seen since the early 1950s, largely due to a disengagement from Pakistan and Afghanistan after
the defeat of the Soviet Union there, as well as an overall reduction in foreign aid in an effort to
balance the U.S. budget. This left a lasting effect on Pakistani perceptions of the United States.
Former Pakistani Army Chief and President Musharraf repeatedly voiced a narrative in which
Pakistan joined the United States to “wage jihad” in Afghanistan in the 1980s, only to see
“disaster” follow when the “military victory was bungled up” and the United States then left the
region “abandoned totally.” When combined with ensuing sanctions on U.S. aid, this left many
Pakistanis with the sense they had been “used and ditched.”10 According to the succeeding
Pakistani President Asif Zardari, writing in January 2009, “Frankly, the abandonment of
Afghanistan and Pakistan after the defeat of the Soviets in Afghanistan in the 1980s set the stage
for the era of terrorism that we are enduring.”11
Unpredictability of U.S. aid has contributed to Pakistan’s view that the United States is an
unreliable partner. That view may play a role in Pakistan’s level of cooperation with the United
States on various national security issues while keeping its options open with U.S. competitors,
such as China. Pakistani Prime Minister Yousef Raza Gilani’s May 2011 state visit to Beijing was
viewed by many as an implicit response to a recent deterioration in U.S.-Pakistan ties.12

10 “President’s Address at Royal United Services Institute, London,” January 25, 2008.
11 Asif Ali Zardari, Partnering With Pakistan” (op-ed), Washington Post, January 28, 2009.
12 “Pakistan’s Gilani visits ally Beijing Amid US Rift,” Associated Press, May 16, 2011.
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U.S. Aid to Pakistan After 9/11
Following a decade of alienation in the 1990s, U.S. relations with Pakistan were once again
transformed in dramatic fashion, this time with the September 11, 2001, terrorist attacks on the
United States and the ensuing enlistment of Pakistan as a pivotal ally in U.S.-led counterterrorism
efforts. Post-9/11 U.S. aid to Pakistan rose dramatically and included a $600 million emergency
cash transfer in September 2001. In 2003, President George W. Bush hosted then-Pakistani
President General Pervez Musharraf at Camp David, MD, 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 FY2005.13
From FY2000 at $36.76 million to FY2001 at $187.7 million, U.S. aid increased five-fold, and in
FY2002 (the first post-9/11 fiscal year) aid increased by another nearly 11-fold to $2,000 million.
Aid trended up between 2006 and 2010; FY2007 was the first year of the Bush Administration’s
plan to devote $750 million in U.S. development aid to Pakistan’s tribal areas over a five-year
period. The 2010 U.S. aid to Pakistan of some $4.3 billion represented an increase of 2,185%
when compared to the pre-9/11 level in FY2001. In FY2010, Pakistan ranked second among top
U.S. aid recipients, after Afghanistan and before Israel. It ranks third in FY2012 with U.S. aid
estimated at $2.1 billion, about half of the FY2010 peak.
About two-thirds of U.S. aid from FY2002 to FY2012, some $15.8 billion (including Coalition
Support Fund reimbursements), has supported security assistance in Pakistan. Of that, about $9.5
billion has been funded through Defense Department appropriations, with $6.4 billion in security
assistance for Pakistan funded through the Department of State appropriations. Economic
assistance for Pakistan from FY2002 to FY2012 has totaled more than $7.8 billion. About 85%
(or $6.6 billion) of that was within the Economic Support Fund (ESF),14 which grew dramatically
in FY2009 and FY2010, but has been scaled back since.
Over the years, disbursements of aid to Pakistan generally track appropriation levels of aid.
However, in some years not all aid appropriated is actually disbursed. For example, of the $400
million in PCF/PCCF funds in 2009, a total of $125 million has been received by Pakistan. With
other accounts, some funds are transferred to meet certain needs on the ground. During years of
natural disasters, some funds from ESF have been transferred to the International Disaster
Assistance (IDA) or the Migration and Refugee Assistance (MRA) account. (See Table 2 for both
appropriation and disbursement levels.)
Bilateral Economic, Development, and Humanitarian Assistance
The United States provides bilateral economic, development, and humanitarian assistance to
Pakistan through a number of funding accounts: the Economic Support Fund (ESF), Food for
Peace Title II (P.L. 480), Global Health and Child Survival, as well as International Disaster
Assistance (IDA), and Migration and Refugee Assistance (MRA). Often funds within ESF are

13 The Foreign Operations FY2005 Appropriations bill (P.L. 108-447) established a new “base program” of $300
million for military assistance for Pakistan.
14 ESF is a bilateral economic assistance program employed to advance U.S. strategic and political interests through the
use of foreign aid.
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transferred to IDA or MRA for emergency assistance, such as in response to the Pakistan flooding
crisis in 2010.
In FY2011, ESF funds reflected about 85% of U.S. economic assistance to Pakistan, with the
above-noted accounts making up the remaining 15% (see Table 2). Some of the largest increases
in ESF funding were from FY2009 and FY2010 supplemental appropriations passed by Congress.
ESF is used to fund a wide array of activities. In Pakistan the program is used to help establish
political parties and bolster Pakistan’s ability to conduct elections; help the government provide
services to its citizens; promote delivery of health-related technologies, such as vaccines; provide
basic education support, such as building schools and providing funds for text books and
teachers; and improve the quality of universities in Pakistan.
ESF funds also provide help for the government of Pakistan to pursue economic reforms, such as
improving tax collection, strengthening border management, and building infrastructure—roads
and power supply—to improve citizens’ faith in their government and promote job growth and
stability. ESF promotes agriculture, which is a key component of job growth in rural districts, and
supports linkages between farmers, markets, and business service providers to increase access to
modern farm equipment. ESF also promotes private-sector competitiveness to strengthen the
business community, create jobs, and expand the economy.
Food for Peace aid to Pakistan fluctuates from year to year, largely related to needs on the
ground. During years of humanitarian crisis (either natural or war-related), food aid levels can
rise dramatically. The 2010 floods in Pakistan created a severe humanitarian crisis, affecting more
than 20 million people and resulting in the United States more than doubling food aid over the
previous year’s level, from $55 million in 2009 to $124 million in 2010.
Global Health and Child Survival (GHCS) funding levels within the past decade range from $14
million in FY2002 to $34 million in FY2009 and totaled $249 million from FY2002 to FY2012.
This program provides funds to Pakistani nongovernmental organizations, national, and
provincial organizations to partner and fight more effectively the spread of HIV/AIDS and
support the national HIV/AIDS strategy, among other things.
FATA Development Plan
Pakistan’s western tribal areas are remote, isolated, poor, and traditional in cultural practices. The
social and economic privation of the inhabitants may make the region an attractive breeding
ground for violent extremists. The U.S.-assisted development initiative for the Federally
Administered Tribal Areas (FATA), launched in 2003, seeks to improve the quality of education,
develop healthcare services, and increase opportunities for economic growth and micro-enterprise
specifically in Pakistan’s western tribal regions.15 A senior USAID official estimated that, for
FY2001-FY2007, about 6% of U.S. economic aid to Pakistan was allocated for projects in
the FATA.16 Facilitating economic development through road-building has been a key aspect of

15 See http://www.usaid.gov/pk/sectors/fata.
16 Statement of Acting Deputy USAID Administrator James Kunder before the Senate Foreign Relations Committee,
December 6, 2007.
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the effort; to date, the United States has devoted more than $150 million for roads and other
infrastructure projects in the South Waziristan agency alone.17
In 2008, the Bush Administration urged Congress to continue funding the five-year, $750 million
aid plan for the FATA initiated in FY2007. The plan supports Islamabad’s own 10-year, $2 billion
sustainable development effort there. In H.Rept. 111-151, the 111th Congress expressed its
intention that the majority of the $399 million in unallocated FY2009 supplemental assistance for
Pakistan be used to support programs in the FATA and KPk (formerly North West Frontier)
province “to counter the influence of violent extremists through local initiatives, including
infrastructure, health, education, governance, rule of law, and employment opportunities.”
Skepticism has arisen about the potential for the policy of significantly boosted FATA-specific
funding to be effective. Corruption is endemic in the tribal region and security circumstances are
so poor that Western nongovernmental contractors find it extremely difficult to operate there.
Moreover, as much as half of the allocated funds reportedly are devoted to administrative costs.18
Islamabad insists that implementation of aid programs in the FATA be carried out wholly by
Pakistani civil and military authorities and that U.S. aid, while welcomed, must come with no
strings attached.19 Attacks on aid workers exacerbate a circumstance in which corruption and
tangled bureaucracy thwart U.S. aid efforts in the FATA. In 2009, the KPk governor himself
complained that very little new assistance funds were reaching the tribal belt.20
According to former USAID Afghanistan-Pakistan Task Force Director James Bever, aid efforts
in the FATA have been hampered by the limited presence of Pakistani federal ministries and
constrained provision of services. Some Pakistan-based analysts raise like concerns and have
recommended that the United States and other international donors refrain from handing control
of development programs in the crucial FATA region to the Pakistani government until political
reforms and effective financial oversight mechanisms are in place.21 Given such limitations,
USAID’s primary aim is to build confidence in the Pakistani government by working with the
FATA Secretariat on small-scale projects in relatively secure areas. All of the activities are
developed, monitored, and evaluated in partnership with the FATA’s civilian authorities.22
The Enhanced Partnership With Pakistan Act (EPPA) of 2009
A key aspect of the Obama Administration’s approach to Pakistan has been a tripling of annual
nonmilitary aid to improve the lives of the Pakistani people, with a particular focus on conflict-
affected regions, and increased U.S. military aid to Islamabad on counterinsurgency goals while
conditioning such aid on that government’s progress in both combating militancy and further
democratizing. As Senators in the 110th Congress, President Obama, Vice President Joe Biden,
and Secretary of State Clinton all supported the Enhanced Partnership With Pakistan Act of 2008

17 See the February 2, 2012, U.S. Embassy press release at http://islamabad.usembassy.gov/pr_020212.html.
18 “Doubts Engulf an American Aid Plan for Pakistan,” New York Times, December 25, 2007; “US Aid ‘Failing to
Reach Target,’” BBC News, May 16, 2008.
19 “U.S. Aims to Turn Hostile Pakistani Tribes Friendly,” Reuters, January 30, 2008.
20 “Violence Mars US Aim to Win Hearts, Minds,” Associated Press, February 27, 2009.
21 “Pakistan: Countering Militancy in FATA,” International Crisis Group Asia Report No, 178, October 21, 2009, at
http://www.crisisgroup.org/home/index.cfm?id=6356.
22 Testimony before the House Oversight and Government Reform Subcommittee on National Security and Foreign
Affairs, “U.S. Aid to Pakistan (Part II): Planning and Accountability,” March 16, 2010.
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(which was never voted upon), and they strongly encouraged the 111th Congress to pass a newer
version of that legislation.
During the first session of the 111th Congress, the full House passed a parallel Pakistan Enduring
Assistance and Cooperation Enhancement Act of 2009 (H.R. 1886) and, three months later, the
Senate unanimously passed The Enhanced Partnership With Pakistan Act of 2009 (S. 1707), both
authorizing a tripling of nonmilitary aid to Pakistan for at least five years (through FY2014).
President Obama signed the resulting Enhanced Partnership with Pakistan Act (EPPA) of 2009
into P.L. 111-73 on October 15, 2009. The legislation is sometimes referred to as the “Kerry-
Lugar-Berman” or “KLB” bill (see the law’s principles and purposes in Appendix D).
Senate Foreign Relations Committee Chairman Senator John Kerry lauded the legislation as the
product of extensive “bicameral, bipartisan, and inter-branch consultation” that was meant to
“forge a new long-term relationship between the people of America and Pakistan.” Then-House
Foreign Affairs Committee Chairman Representative Howard Berman emphasized the
importance of forging a “true strategic partnership with Pakistan and its people.” Secretary of
State Clinton called the legislation’s passage “a historic chapter” in bilateral relations that would
“strengthen the bonds of friendship and cooperation between the American people and the
Pakistani people.”23 Independent analysts viewed the legislation as a landmark expression of the
U.S. Administration’s and Congress’s intent to provide significant, long-term support for its
Pakistani allies.
Economic and Development Assistance Under the EPPA
The EPPA authorizes $1.5 billion annually for economic and development aid to Pakistan from
FY2010 to FY2014 to support democratic institutions and the expansion of rule of law, promote
economic freedoms and sustainable economic development, support investment in people, and
strengthen public diplomacy in Pakistan. The act states that no funds may be made available
unless the Administration submits a Pakistan Assistance Strategy Report to the appropriate
congressional committees (the Administration submitted the report on December 14, 2009). It
also limits aid to $750 million unless the President’s Special Representative to Afghanistan and
Pakistan (or, if vacant, the Secretary of State) certifies to Congress that aid provided thus far is
making reasonable progress toward achieving U.S. objectives. The act allows for the Secretary of
State to waive this certification requirement if it is in the U.S. national security interests to do so.
It provides a sense of Congress that the same level of economic aid should continue in FY2015-
FY2019 “subject to an improving political and economic environment in Pakistan.”
The Department of State has been bundling ongoing aid programs for Pakistan as EPPA economic
assistance, including what some would call security assistance (INCLE and NADR). Using this
tactic, the EPPA goal of providing $1.5 billion of economic aid to Pakistan was met in the first
year, but not in FY2011 or FY2012. State Department officials say that the shortfall occurred
because Congress did not fully fund the FY2011 or FY2012 requests. The FY2013 request is also
below the EPPA funding authority level. Department of State budget officials stated that they
requested less than $1.5 billion because they did not think Congress would appropriate that
amount, and they had other programs for which to seek the funding (see Table 1).

23 Sen. Kerry’s September 24, 2009, release at http://kerry.senate.gov/cfm/record.cfm?id=318241; Rep. Berman’s
September 30, 2009, release at http://www.internationalrelations.house.gov/press_display.asp?id=659; Secretary
Clinton’s October 6, 2009, remarks at http://www.state.gov/secretary/rm/2009a/10/130314.htm.
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Table 1. Enhanced Partnership with Pakistan Funds
(in millions of current U.S. $)

FY2010
FY2011
FY2012 estimate
FY2013 request
ESF $1,292.0
$918.9
$864.7
$928.3
GHCS-USAID $29.7 $28.4 —

INCLE $170.0
$114.3
$116.0
$124.0
NADR $23.9
$24.8
$20.8
$19.3
Total $1,515.6
$1,086.4
$1,001.5
$1,071.3
Source: Department of State, F Bureau, November 1, 2011.
Notes: ESF=Economic Support Fund; GHCS=Global Health & Child Survival, INCLE=International Narcotics
Control and Law Enforcement; NADR=Nonproliferation, Antiterrorism, Demining & Related Programs.
A November 2011 State Department report on civilian engagement with Afghanistan and Pakistan
repeatedly emphasizes a need for patience in implementing an aid program as large and complex
as that with Pakistan. It asserts that the approach under KLB is innovative in four notable ways:
(1) a focus on alignment with Pakistani priorities has meant increasingly working with Pakistani
government agencies to the extent that in FY2010 more than half of civilian aid funding was
being implemented by these institutions; (2) a focus on visible infrastructure projects, especially
“signature” projects such as dams and roads; (3) a focus on priority sectors and regions
vulnerable to violent extremism
; and (4) a whole of government effort that taps expertise from a
variety of U.S. agencies. In 2011, State reduced the number of projects in an effort to create a
“more streamlined, visible portfolio.”24
Security Assistance Under EPPA
The EPPA authorizes each year from FY2010 to FY2014 “such sums as be may be necessary” for
security assistance. Security assistance and arms transfers are prohibited by the act unless the
Secretary of State certifies that the government of Pakistan is continuing to cooperate with U.S.
efforts to dismantle nuclear weapons-related material supplier networks and make significant
efforts to combat terrorist groups, and if Pakistan’s security forces are not impeding political or
judicial processes there. The Secretary of State may waive these limitations if doing so is deemed
to be in the U.S. national security interest. Secretary Clinton issued the first such certification in
March 2011.
The EPPA also clarifies activities related to the Pakistan Counterinsurgency Capability Fund
(PCCF), established by Congress in the Supplemental Appropriations Act, 2009 (P.L. 111-32),
including that aid within the PCCF is in addition to any other authority to provide assistance.
Debate in Pakistan Over the “KLB” Bill
In what many considered to be a surprisingly visceral reaction, significant segments of Pakistani
officialdom and society were highly critical of the EPPA, seeing in its language an intent to

24 Department of State, “Status Report: Afghanistan and Pakistan Civilian Engagement,” November 2011, at
http://www.state.gov/documents/organization/176809.pdf.
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interfere with and dictate to Pakistan on sensitive foreign policy and national security issues,
perhaps even with malicious goals. The “conditioning” of assistance was the focus of criticism.
The main opposition party in Islamabad (the Pakistan Muslim League-Nawaz or PML-N)
expressed “strong reservations” over the law’s conditions and requested that the government
present the details for parliamentary approval. Even secular parties within the ruling coalition
described the bill as “interference” in Pakistani affairs.25 The Lahore High Court Bar Association
unanimously passed a resolution rejecting the law, saying its imposition of “cruel conditions”
represented a violation of Pakistani integrity and sovereignty.26 In one representatively rancorous
statement, a Pakistani commentator said the law was “less an assistance program than a treaty of
surrender,” and he criticized its terms and conditions as amounting to a “ten-fold increase in
national humiliation.” Another saw the conditions as aimed at “clipping the wings of Pakistan’s
mighty security establishment.”27 President Zardari himself rejected all such complaints as
misguided and misinformed.
The most serious criticism, however, came from the Pakistani military establishment itself. A
statement following the 122nd Corps Commander Conference in October 2009 included an
expression of “serious concern regarding clauses [of the law] impacting on national security.” In
the diplomatic context, this was taken as an unusually explicit and strong condemnation; Army
chief General Ashfaq Pervez Kayani was reported to have energetically complained in person to
visiting U.S. commander General Stanley McChrystal, focusing especially on clauses related to
civilian control over the military, and references to the Afghan “Quetta shura” and the Lashkar-e-
Taiba’s Muridke compound, which locate U.S.-designated terrorists on Pakistani territory.28
The widely negative and oftentimes vitriolic nature of Pakistani reactions caught many U.S.
officials by surprise and spurred the Senate Foreign Relations Committee leadership to issue an
unusual formal rebuttal of “myths” surrounding the bill. Primary among these was the widely
held—and patently false—assumption that conditions had been placed on the $7.5 billion in
nonmilitary aid authorized for Pakistan. Other important corrections of the record included
clarifications that nothing in the bill threatened Pakistani sovereignty in any way; that the
conditions placed on military aid only reinforced standing policies of the Pakistani government
and military; and that the United States neither required nor desired an oversight role in internal
Pakistani military operations such as promotion decisions, among several others.29 Senator Kerry
then traveled to Islamabad days later in a largely successful effort to allay Pakistani concerns.
Secretary of State Clinton was in Islamabad the same month, only two weeks after Senator Kerry
and, when asked about the strongly negative reactions in Pakistan to the U.S. legislation, she
expressed American “shock”:
For the United States Congress to pass a bill unanimously saying that we want to give $7.5
billion to Pakistan in a time of global recession when we have a 10 percent unemployment

25 “PML-N Asks Govt to Present Kerry-Lugar Bill in Parliament,” News (Karachi), September 29, 2009; “Kerry-Lugar
Bill Interference in Pakistan’s Affairs: ANP,” Daily Times (Lahore), October 11, 2009.
26 “LHCBA Passes Resolution Condemning Kerry-Lugar Bill,” Daily Times (Lahore), October 1, 2009.
27 Ayaz Amir, “Kerry-Lugar: Bill or Document of Surrender?” (op-ed), Daily Times (Lahore); “Imtiaz Gul, “Kerry-
Lugar Aimed at Dispiriting the Army?” (op-ed), Friday Times (Lahore), both October 2, 2009.
28 See the October 7, 2009, ISPR release at http://www.ispr.gov.pk/front/main.asp?o=t-press_release&date=2009/10/7;
“U.S. Aid Package Riles Pakistan’s Army,” New York Times, October 8, 2009.
29 See the SFRC’s October 9, 2009, release at http://kerry.senate.gov/cfm/record.cfm?id=318845.
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rate, and then for Pakistani press and others to say we don’t want that, that’s insulting—I
mean, it was shocking to us. So clearly, there is a failure to communicate effectively.30
Many independent observers saw the unexpectedly strong Pakistani reaction as being fueled and
perhaps even generated by a combination of military elements and opposition political forces who
shared a common cause of weakening the Pakistan People’s Party-led civilian government. Anti-
government media outlets eagerly participated. More specifically, this perspective had Army
Chief Kayani engaged in an ongoing struggle with President Zardari and Prime Minister Gilani
over ultimate control of the country’s military. One effect of the U.S. legislation was to place the
United States in the middle of this battle.31 However, the spate of criticisms ended almost as
quickly as it had begun, and by the end of 2009, Pakistani officials and most media critics had
fallen silent.
Security Assistance
As noted above, U.S.-Pakistan security cooperation accelerated rapidly in the post-9/11 period,
and President George W. Bush formally designated Pakistan as a major non-NATO U.S. ally in
2004. The close U.S.-Pakistan security ties of the Cold War era, which came to a near halt after
the 1990 aid cutoff, were 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 and, three years later,
Washington announced that it would resume sales of new F-16 fighters to Pakistan after a 16-year
hiatus. During the Bush Administration, a revived U.S.-Pakistan Defense Consultative Group
(DCG)—moribund from 1997 to 2001—sat for high-level discussions on military cooperation,
security assistance, and anti-terrorism. The forum continued under the Obama Administration.
Pentagon officials have for some time been frustrated by the allegedly feckless counterinsurgency
efforts of the internally squabbling Islamabad government. Reports indicate that U.S. officials
have been disheartened by signs that the Pakistani military is slow to shift away from a
conventional war strategy focused on India, and they have made clear the United States stands
ready to assist Pakistan in reorienting its army for counterinsurgency efforts. This is not a task the
Pakistani military leadership has appeared eager to complete. In an effort to more effectively
channel U.S. security assistance so as to specifically strengthen Pakistan’s counterinsurgency
capabilities, the Pentagon proposed, and Congress later endorsed, creation of a dedicated fund,
the Pakistan Counterinsurgency Fund (PCF), later designated as the Pakistan Counterinsurgency
Capability Fund (PCCF).32
In addition to conditions on security assistance found in the EPPA, Pakistan is subject to more
general conditionality on such aid. For example, in the spring of 2010, concerns arose that

30 See the State Department’s October 30, 2009, release at http://www.state.gov/secretary/rm/2009a/10/131103.htm.
31 “Pakistan Aid Places U.S. in the Midst of a Divide,” New York Times, October 13, 2009.
32 Appearing before both Senate and House panels in May 2009, Secretary of Defense Gates urged Congress to quickly
provide significant new counterinsurgency funding for Pakistan, arguing that the newly authorized PCF/PCCF should
be overseen by U.S. military commanders rather than by State Department civilians. Yet many in Congress voiced
doubts about the wisdom of creating a major new stream of military funding under Pentagon oversight, as such aid
traditionally has been subject to Foreign Assistance Act restrictions. When the House Appropriations Committee took
up the issue, its members determined to place PCCF oversight in the hands of the State Department after FY2010, a
plan then endorsed by the full House (“Gates Pushes Congress to Boost Pakistan Aid,” Washington Post, May 1, 2009;
“Democrats Steer Pakistan Security Account to State,” Associated Press, May 7, 2009).
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allegedly serious human rights abuses by the army—especially in the Swat Valley northwest of
Islamabad—including extrajudicial killings and the holding of thousands of suspected militants in
indefinite detention, would trigger so-called “Leahy Amendment” restrictions on future U.S.
security assistance (§620J of the Foreign Assistance Act of 1961 (P.L. 87-195, as amended)), also
known as the Leahy Amendment, states that “No assistance shall be furnished under this Act or
the Arms Export Control Act to any unit of the security forces of a foreign country if the
Secretary of State has credible evidence that such unit has committed gross violations of human
rights”).33 In October of that year, the Obama Administration announced that it would abide by
these provisions by withholding train and equip funding for several Pakistani army units believed
to be complicit in human rights abuses, and it remains concerned about potential mass
disappearances of detainees into the hands of Pakistani security forces.34
Coalition Support Funds (CSF)
At the Bush Administration’s behest, Congress in FY2002 began appropriating billions of dollars
to reimburse Pakistan and other nations for their operational and logistical support of U.S.-led
counterterrorism operations. These “coalition support funds” (CSF) have accounted for nearly
half of U.S. financial transfers to Pakistan since 2001; as of May 2011, some $8.9 billion had
been disbursed. The amount equals roughly one-fifth to one-quarter of Pakistan’s total military
expenditures during this period. According to Secretary of Defense Gates, CSF payments have
been used to support many scores of Pakistani army operations and help to keep more than
100,000 Pakistani troops in the field in northwest Pakistan by paying for their food, clothing, and
housing. They also compensate Islamabad for coalition usage of Pakistani airfields and seaports.35
During the latter years of the previous decade, however, concerns grew in Congress and among
independent analysts that standard accounting procedures were not being employed in overseeing
these large disbursements from the U.S. Treasury. The Government Accountability Office (GAO)
was tasked to address oversight of coalition support funds that go to Pakistan. Its 2008 report
found that, until about one year before, only a small fraction of Pakistani requests were
disallowed or deferred. In early 2007, the value of rejected requests spiked considerably, although
it still represented one-quarter or less of the total. The apparent increased scrutiny corresponded
with the arrival in Islamabad of a new U.S. Defense Representative, Vice Admiral Michael
Lefever, who reportedly played a greater role in the oversight process. GAO concluded that
increased oversight and accountability was needed over Pakistan’s reimbursement claims for
coalition support funds.36
The State Department claims that Pakistan’s requests for CSF reimbursements are carefully vetted
by several executive branch agencies, must be approved by the Secretary of Defense, and

33 “Pakistan Army Accused of Extrajudicial Killings, Human Rights Abuses,” Washington Post, April 5, 2010;
“Pakistan Holding Thousands in Indefinite Detention, Officials Say,” Washington Post, April 21, 2010. When asked
directly during a June 2010 Senate Appropriations Committee hearing, Secretary Gates assured Congress that his
department was working to ensure that the “Leahy Law” is being implemented in both Pakistan and Afghanistan
(statement of Secretary of Defense Robert Gates before the Senate Appropriations Committee, June 16, 2010).
34 “Pakistani Army Chief Orders Video Inquiry,” New York Times, October 7, 2010; “Pakistani Troops Linked to
Abuses Will Lose U.S. Aid,” New York Times, October 22, 2010; “Disappearances With Reported Ties to Pakistan
Worry U.S.,” New York Times, December 30, 2010.
35 Statement before the Senate Armed Services Committee, February 6, 2008.
36 See http://www.gao.gov/new.items/d08806.pdf. See also “Pentagon Puts Brakes on Funds to Pakistan,” Los Angeles
Times
, May 7, 2008.
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ultimately can be withheld through specific congressional action. However, a large proportion of
CSF funds likely have been lost to waste and mismanagement over the years, given a dearth of
adequate controls and oversight. The Bush Administration may have concluded in late 2008 that
Pakistan diverted much of the funds toward a military buildup focused on India.37
Senior Pentagon officials reportedly have taken steps to overhaul the process through which
reimbursements and other military aid are provided to Pakistan. The National Defense
Authorization Act (NDAA) for FY2008 (P.L. 110-181) for the first time required the Secretary of
Defense to submit to Congress itemized descriptions of coalition support reimbursements to
Pakistan. More recent NDAAs require the Secretary of Defense to submit to Congress detailed
quarterly reports on the uses of CSF. In 2010, the now deceased Special Representative for
Afghanistan and Pakistan Ambassador, Richard Holbrooke, claimed that about 60%-65% of
Pakistan reimbursement requests under CSF are fulfilled. When questioned about CSF oversight
at a March 2011 House hearing, the Commander of U.S. Central Command stated that he had
“some very keenly attentive field grade officers in Islamabad” who track the money “very, very
carefully.”38 A May 2011 press report suggests that this is being accomplished, and that U.S.
auditors are now much more careful in their examination of Pakistani claims.39
Defense Supplies
Major U.S. arms sales and grants to Pakistan since 2001 have included items useful for
counterterrorism operations, along with a number of “big ticket” platforms more suited to
conventional warfare. In dollar value terms, the bulk of purchases are made with Pakistani
national funds, but U.S. grants have eclipsed this in recent years. The Pentagon reports total
Foreign Military Sales agreements with Pakistan worth $5.4 billion for FY2002-FY2010 (in-
process sales of F-16 combat aircraft and related equipment account for more than half of this).
The United States also has provided Pakistan with more than $2.1 billion in Foreign Military
Financing (FMF) grants since 2001 (including FY2010 funds). These funds are used to purchase
U.S. military equipment for longer-term modernization efforts. Pakistan also has been granted
U.S. defense supplies as Excess Defense Articles (EDA). Major post-2001 defense supplies
provided or soon to be provided under FMF include
• eight P-3C Orion maritime patrol aircraft and their refurbishment (valued at
$474 million; four delivered, but two of these were destroyed in a March 2011
attack by Islamist militants);
• about 6,312 TOW anti-armor missiles ($186 million; at least 2,007 delivered);

37 “Pakistani Military ‘Misspent Up to 70% of American Aid,’” Guardian (London), February 28, 2008; “Revamping
Aid to Pakistan is Expected in Bush Report,” New York Times, December 7, 2008. In mid-2008, the leader of
Pakistan’s ruling party, now-President Zardari claimed, without providing evidence, that, as president, Pervez
Musharraf had been passing only a fraction of the funds over to the Pakistani military, leaving some $700 million of
reimbursements per year “missing” (quoted in “Where’s the Money?,” Sunday Times (London), August 10, 2008).
38 See the State Department’s March 2, 2010, release at http://www.state.gov/p/sca/rls/rmks/2010/137693.htm;
statement of General James Mattis in “House Armed Services Committee Holds Hearing on the Proposed Fiscal 2012
Budget for the Defense Department’s U.S. Central Command and U.S. Special Operations Command,” CQ Transcripts,
March 3, 2011.
39 By this account, Pakistan has “routinely” submitted “unsubstantiated” or “exaggerated” claims, and denial rates have
climbed from less than 2% in 2005 to 44% in 2009 (“U.S. Balks at Pakistani Bills,” Wall Street Journal, May 17,
2011).
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• more than 5,600 military radio sets ($163 million);
• six AN/TPS-77 surveillance radars ($100 million);
• six C-130E transport aircraft and their refurbishment ($76 million);
• the USS McInerney, an ex-Perry class missile frigate (via EDA, $65 million for
refurbishment, delivered);
• 20 AH-1F Cobra attack helicopters (via EDA, $48 million for refurbishment, 12
delivered); and
• 121 refurbished TOW missile launchers ($25 million).
Supplies paid for with a mix of Pakistani national funds and FMF include
• up to 60 Mid-Life Update kits for F-16A/B combat aircraft (valued at $891
million, with $477 million of this in FMF; Pakistan’s plans are to purchase 45
such kits and 8 have been delivered); and
• 115 M-109 self-propelled howitzers ($87 million, with $53 million in FMF).
Notable items paid for entirely with Pakistani national funds include
• 18 new F-16C/D Block 52 combat aircraft, with an option for 18 more (valued at
$1.43 billion, all delivered);40
• F-16 armaments including 500 AMRAAM air-to-air missiles; 1,450 2,000-pound
bombs; 500 JDAM bomb tail kits for gravity bombs; and 1,600 Enhanced
Paveway laser-guided bomb kits, also for gravity bombs ($629 million);
• 100 Harpoon anti-ship missiles ($298 million);
• 500 Sidewinder air-to-air missiles ($95 million); and
• six Phalanx Close-In Weapons System naval guns ($80 million).
Other major articles transferred via EDA include
• 14 F-16A/B combat aircraft; and
• 59 T-37 military trainer jets.41
Under Coalition Support Funds (part of the Pentagon budget), Pakistan has received 26 Bell 412
utility helicopters, along with related parts and maintenance, valued at $235 million. Under
Section 1206 (global train and equip), Frontier Corps, and PCF/PCCF authorities, Pakistan has
received four Mi-17 multirole helicopters (another six were provided temporarily at no cost), 4
King Air 350 surveillance aircraft, 450 vehicles for the Frontier Corps, 20 Buffalo explosives
detection and disposal vehicles, helicopter spare parts, night vision devices, radios, body armor,
helmets, first aid kits, litters, and other individual soldier equipment. Pakistan is eager to receive
more counterinsurgency hardware for use in western Pakistan, potentially including armored

40 The first of the new F-16s were delivered in June 2010, when three aircraft were inducted into the Pakistani Air
Force at the Shabaz Air Base near Jacobabad. The final plane was delivered in February 2012. These advanced aircraft
are subject to especially stringent security to prevent any technology leakage to third parties.
41 Figures reported by the U.S. Department of Defense. See also CRS Report RS22757, U.S. Arms Sales to Pakistan.
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personnel carriers, laser target designators, laser-guided munitions, and more night-vision goggles
and surveillance gear. They also request better and more sophisticated surveillance and
communications equipment, along with more attack and utility helicopters.
Despite the provision of equipment suited to unconventional warfare, some analysts have
continued to criticize the programming of security-related aid to Pakistan. Foremost among these
are assertions that the Pakistani military maintains an institutional focus on conventional war-
fighting capabilities oriented toward India and that it has used U.S. security assistance to bolster
these capabilities while paying insufficient attention to the kinds of counterinsurgency capacity
that U.S. policy makers might prefer to see strengthened.42 For example, of the some $2.1 billion
in Foreign Military Financing provided to Pakistan from FY2002-FY2010, more than half has
been used by Islamabad to purchase weapons of limited use in the context of counterterrorism.43
These include maritime patrol aircraft, anti-armor missiles, surveillance radars, update kits for F-
16 combat aircraft, and self-propelled howitzers. Counterarguments contend that such purchases
facilitate regional stability and allow Pakistan to feel more secure vis-à-vis India, its better
equipped neighbor.44
The Defense Department has characterized F-16 fighters, P-3C patrol aircraft, and anti-armor
missiles as having significant anti-terrorism applications. The State Department has claimed that,
since 2005, FMF funds have been “solely for counterterrorism efforts, broadly defined.”45 Such
claims elicit skepticism from some observers, and analysts who emphasize the importance of
strengthening the U.S.-India strategic partnership have called U.S. military aid to Pakistan
incompatible with U.S. strategic goals in the region. Moreover, U.S. officials are concerned that
Pakistan has altered some conventional U.S.-supplied weapons in ways that could violate the
Arms Export Control Act. Such alleged modifications include expanding the capability of both
Harpoon anti-ship missiles and P-3C naval aircraft for land-attack missions. The Islamabad
government categorically rejects the allegations.46 Indian observers were unsurprised by the
claims; New Delhi’s leaders continuously complain that Pakistan diverts most forms of U.S.
assistance toward India. Some more suspicious analysts even see purpose in such a dynamic: a
U.S. wish to maintain Pakistan’s viability as a regional balancer to Indian hegemony.47
During the course of autumn 2009 fighting in South Waziristan, Pakistan received low-profile but
significant U.S. assistance in the form of transport helicopters, parts for helicopter gunships, and

42 The Omnibus Appropriations Act, 2009 (P.L. 111-8), limits FY2009 Foreign Military Financing for Pakistan to
counterterrorism programs only, and it bars the Administration from using such funds for any programs initially funded
under Section 1206 of the 2006 defense authorization (P.L. 109-163), which pertains to Pentagon programs for training
and equipping foreign military forces.
43 Of the $2.1 billion, about $1.2 billion was used to upgrade P-3C maritime patrol aircraft and F-16 combat aircraft,
and for the purchase of TOW anti-tank missiles and launchers.
44 See, for example, the Pentagon’s June 28, 2006, notification at http://www.dsca.osd.mil/PressReleases/36-b/2006/
Pakistan_06-09.pdf.
45 F-16 aircraft are reported by some to be effective in Pakistan’s counterinsurgency efforts, with improved training and
enhanced capabilities allowing for more precise targeting resulting in fewer civilian casualties (see the December 17,
2009, statements of a Pentagon official at http://www.defense.gov/transcripts/transcript.aspx?transcriptid=4528);
State’s release at http://2001-2009.state.gov/p/sca/rls/rm/2007/97946.htm.
46 “U.S. Says Pakistan Made Changes to Missiles Sold for Defense,” New York Times, August 30, 2009; Foreign
Ministry’s August 30, 2009, release at http://www.mofa.gov.pk/Press_Releases/2009/Aug/PR_335_09.htm.
47 “Aid to Pakistan ‘Invariably Directed’ Against India - Minister,” BBC Monitoring South Asia, August 17, 2009;
Gurmeet Kanwal, “US Arms Sales Are Propping Up Pakistan as a Regional Challenger,” Institute for Defense Studies
and Analysis (New Delhi), February 11, 2010.
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infantry equipment, along with unprecedented intelligence and surveillance video sharing from
American UAVs. In anticipation of new counterinsurgency operations in 2010, the United States
provided the Pakistani air force with about 1,000 quarter-ton bombs, along with up to 1,000 kits
for making gravity bombs laser-guided-capable. As noted above, transfers to Pakistan of such
offensive weaponry are viewed with a wary eye by the Indian government.
Pakistani officials have continued to complain that U.S.-supplied defense equipment, especially
that most needed for counterinsurgency operations such as attack and utility helicopters, has been
too slow in coming. The Pakistani Ambassador to the United States has been quoted as claiming
that, in his first two years in Washington, Pakistan received only eight used Mi-17 transport
helicopters and that Pakistan’s military operations have been hindered by a lack of equipment.
Such claims rile U.S. officials, who document that the United States has provided Pakistan with at
least 50 helicopters since 2006—12 of them armed Cobra models—and who note that the
delivery of more top-line attack helicopters has been delayed because of Pakistani inaction.48
Former U.S. Joint Chiefs Chairman and Secretary of State Colin Powell has urged the Obama
Administration to do a better job of providing the Pakistani military with the mobility and
intelligence capabilities needed for counterinsurgency operations.49
Military Training and Law Enforcement
The George W. Bush Administration launched an initiative to strengthen the capacity of the
Frontier Corps (FC), a 65,000-man paramilitary force overseen by the Pakistani Interior Ministry.
The FC has primary responsibility for border security in Pakistan’s western Khyber Pakhtunkhwa
(KPk) and Baluchistan provinces, which border Afghanistan. In 2007, the Pentagon began using
its funds to train and equip the FC, as well as to increase the involvement of the U.S. Special
Operations Command in assisting with Pakistani counterterrorism efforts. Americans have also
engaged in training Pakistan’s elite Special Service Group commandos with a goal of doubling
that force’s size to 5,000. These efforts continued under the Obama Administration. The U.S.
program to train Pakistan’s paramilitary forces reportedly has been hampered by Pakistan’s
reluctance to send troops who are needed for urgent operations elsewhere. Some analysts also
contend that only U.S. military personnel (as opposed to contractors) can effectively train
Pakistani soldiers.
Other security-related programs for Pakistan are aimed especially at bolstering Islamabad’s
counterterrorism and border security efforts, and have included U.S.-funded road-building
projects in the KPk and FATA. 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. 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. At least 2,000 Pakistani officers have received such training since 2001.
U.S. security assistance to Pakistan’s civilian sector is aimed at strengthening the country’s law
enforcement capabilities through basic police training, provision of advanced identification
systems, and establishment of a new Counterterrorism Special Investigation Group. U.S. efforts
may be hindered by Pakistani shortcomings that include poorly trained and poorly equipped
personnel who generally are underpaid by ineffectively coordinated and overburdened

48 “Pakistan Wants Combat Copters,” Washington Times, June 16, 2010; author interviews with Pentagon officials.
49 See the November 15, 2010, CNN transcript at http://transcripts.cnn.com/TRANSCRIPTS/1011/15/lkl.01.html.
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government agencies. Pakistan’s weak criminal justice sector is marked by conviction rates below
10%, poorly trained investigators, and rampant corruption. Some analysts link the problem to
democratization more broadly, and urge much greater U.S. and international attention to
bolstering Pakistan’s civilian security sector.50 The findings of a 2008 think-tank report reflected a
widely held view that Pakistan’s police and civilian intelligence agencies are better suited to
combating insurgency and terrorism than are the country’s regular army. The report found that
Pakistan’s police forces are “incapable of combating crime, upholding the law, or protecting
citizens and the state against militant violence,” and placed the bulk of responsibility on the
politicization of the police forces. The report recommended sweeping reforms to address
corruption and human rights abuses.51
Pakistan Counterinsurgency Fund/Pakistan Counterinsurgency Capability
Fund (PCF/PCCF)

Title III of the Supplemental Appropriations Act, 2009 (P.L. 111-32; H.Rept. 111-105),
appropriated $400 million for the Secretary of Defense, with the concurrence of the Secretary of
State, for the newly established Pakistan Counterinsurgency Fund (PCF) to provide assistance for
Pakistan’s security forces to bolster their counterinsurgency efforts. The House Appropriations
Committee recommended that the funding be in the DOD appropriations for FY2009 and that the
Secretary of Defense authority would expire with the expiration of the funds. An additional $400
million was appropriated within the State Department appropriations to be made available as of
September 30, 2009, for its Pakistan Counterinsurgency Capability Fund (PCCF). The committee
recommended that the Secretary of State authority (PCCF) would be assumed in subsequent fiscal
years. The committee noted that DOD would be responsible for delivery of the assistance.
Other International Economic Donors
Of the $5.1 billion in total aid committed for Pakistan in 2010, about 24% was from multilateral
agencies and 76% from bilateral sources. The United States is the largest single bilateral donor of
development assistance to Pakistan, providing more than half of all bilateral commitments
(56.3%) in 2010. Japan committed 11.7%, Germany committed 5.5%, and the United Arab
Emirates committed 1.7% that same year.
The largest multilateral agency commitments in 2010 were $430 million from the World Bank’s
International Development Association (as compared with $1.9 billion in FY2009), $270 million
from European Union Institutions, and $290 million from the Asian Development Fund. See
Appendix C for bilateral economic development aid commitments to Pakistan by other donor
countries in FY2009.
Global cooperation involving a “Friends of Democratic Pakistan” (FODP) group was launched in
September 2008, when President Zardari and the top diplomats of the United Arab Emirates,
Britain, and the United States were joined by foreign ministers from Australia, Canada, France,
Germany, Italy, Japan, and Turkey, and representatives of China, the European Union, and the
United Nations. A resulting statement expressed agreement to work in strategic partnership with

50 See “Reforming Pakistan’s Criminal Justice System,” International Crisis Group Asia Report No. 196, December 6,
2010.
51 “Reforming Pakistan’s Police,” International Crisis Group Asia Report No. 157, July 14, 2008.
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Pakistan to combat violent extremism; develop a comprehensive approach to economic and social
development; coordinate an approach to stabilizing and developing border regions; address
Pakistan’s energy shortfall; and support democratic institutions.52
In April 2009, 31 countries and 18 international institutions sent representatives to an
FODP/Donors’ Conference in Tokyo. There Ambassador Holbrooke announced the
Administration’s intent to provide a total of $1 billion in assistance to Pakistan over the 2009-
2010 period, bringing to more than $5 billion the total offered by the international community in
addition to the $11.3 billion International Monetary Fund package first arranged in late 2008. In
the lead-up to the 2009 conference, Pakistani officials called for a “Marshall Plan” for Pakistan
that would provide $30 billion in international donations over a five-year period. The Pakistani
Ambassador to the United States is among those who called the proposed $5.7 billion in aid
“miniscule” when compared to the bailouts being provided to American automobile and other
companies, a characterization that rankled some in Congress.53
At an FODP summit meeting in New York in September 2010 co-chaired by President Obama,
President Zardari, and British Prime Minister Gordon Brown, the forum reiterated its central
goals, but no further specifics were discussed pending more detailed Pakistani development
proposals. The FODP’s Third Ministerial Meeting took place in October 2010, when donors
continued to press Pakistan to reform its economy, especially through an expansion of the tax
base.54
China, a close and long-standing ally of Pakistan in part because of its own rivalry with India, has
provided some aid and loans to Pakistan, but nothing close to the level of the United States and
other major donors. Between 2004 and 2009, China provided $9.0 million in grant assistance and
$217 million in loans to Pakistan.55 China, through large-scale and mainly extractive investment
projects, stands to gain access to resources in Pakistan, and may even benefit from a planned
pipeline that would deliver Iranian natural gas through Pakistan.


52 See State’s September 26, 2008, release at http://2001-2009.state.gov/r/pa/prs/ps/2008/sept/110353.htm.
53 “Pakistan Asks U.S. for 30 Billion Dollar ‘Marshall Plan’ to Stabilize Region” (interview), Washington Times, April
8, 2009.
54 “Friends Tell Pakistan to Shape Up in Exchange for Aid,” Daily Times (Lahore), October 16, 2010.
55 The Center for Global Development, Pakistan Aid Facts, by Wren Elhai, August 26, 2010. http://blogs.cgdev.org/
mca-monitor/2010/08/pakistan-aid-facts.php?utm_source=nl_weekly
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Table 2. Direct Overt U.S. Aid and Military Reimbursements to Pakistan, FY2001-FY2012
(appropriations, with disbursements in parentheses, rounded to the nearest millions of dollars)
FY2002
-
Program or
FY2012
FY2012
FY2013
Account FY2002 FY2003 FY2004 FY2005 FY2006 FY2007 FY2008 FY2009 FY2010 FY2011 (est.)
Total
(req.)
1206
— — — — 28 14 131 139

e
312

CN —
— —
8
24
49
54
47d
43
39e
e
264
e
(1)
(1)
(9)
(14)
(37)
(72)
(25)
(n/a)
(n/a)
(159)
CSFa
1,169 1,247 705b 964 862 731
1,019 685e 1,499 1,118
f
9,999
f
FMF
75
225
75
299
297
297
298
300
294h
295
295
2,750
350
(75)
(225)
(75)
(298)
(298)
(297)
(298)
(300)
(83)
(148)
(2,097)
IMET
1
1
1
2
2
2
2
2
5
4
5
27
6
(1)
(1)
(1)
(2)
(2)
(2)
(2)
(2)
(5)
(0.4)
(18)
INCLE
91
31
32
32
38
24
22
88g
170h
114
116
758
124
(91)
(31)
(1)
(17)
(—)
(10)
(33)
(35)
(16)
(29)
(263)
NADR
10
1
5
8
9
10
10
13g
24
25
21
136
19
(10)
(1)
(5)
(7)
(5)
(6)
(1)
(5)
(3)
(14)
(57)
PCF/PCCF
— — — — — — — 400 700
800
800
2,700
800
(125)
(160)
(376)
(661)
Total
Security


1,346 1,505 818 1,313 1,260 1,127 1,536 1,674g 2,735 2,395
1,237 16,946 1,299
CSH/GHCS
14
16
26
21
28
22
30
34
30
28

249

(1)
(1)
(6)
(16)
(19)
(25)
(18)
(31)
(21)
(19)
(157)
DA
10
35
49
29
38
95
30
— —


286

(0)
(2)
(9)
(39)
(43)
(29)
(32)
(45)
(19)
(218)
ESF
615
188
200c
298
338
394d
347
1,114
1,292h
919
865
6,570
928
(602)
(190)
(206)
(203)
(218)
(269)
(86)
(209)
(672)
(658)
(3,313)
Food Aidi













(5)
(40)
(22)
(6)
(48)
(10)
(3)
(79)
(97)
(115)
(63)
(488)
HRDF
1 — 2 2 1 11 — — —


17

(1)
(1)
(1)
(3)
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FY2002
-
Program or
FY2012
FY2012
FY2013
Account FY2002 FY2003 FY2004 FY2005 FY2006 FY2007 FY2008 FY2009 FY2010 FY2011 (est.)
Total
(req.)
IDA
— — — — 70
50
50
103
232
145

650

(53)
(9)
(6)
(27)
(245)
(127)
(467)
MRA/ERMA













(5)
(3)
(4)
(3)
(3)
(4)
(10)
(60)
(96)
(45)
(237)
Total
640 239 277 350 475 572 457
1,251g 1,554 1,143 865 7,772 928
Economic
Grand
1,986 1,744 1,095 1,663 1,735 1,699 1,993 2,925g 4,289 3,538 2,102 25,379 2,227
Total
Sources: U.S. Departments of State, Defense, and Agriculture; U.S. Agency for International Development.
Abbreviations:
1206: Section 1206 of the National Defense Authorization Act (NDAA) for FY2006 (P.L. 109-163, global train and equip; Pentagon budget); CN: Counternarcotics Funds
(Pentagon budget); CSF: Coalition Support Funds (Pentagon budget); CSH: Child Survival and Health (Global Health and Child Survival, or GHCS, from FY2010); DA:
Development Assistance; ERMA: Emergency Refugee and Migration Assistance; ESF: Economic Support Funds; FC: Section 1206 of the NDAA for FY2008 (P.L. 110-181,
Pakistan Frontier Corp train and equip; Pentagon budget); FMF: Foreign Military Financing; HRDF: Human Rights and Democracy Funds; IDA: International Disaster
Assistance (Pakistani earthquake and internally displaced persons relief); IMET: International Military Education and Training; INCLE: International Narcotics Control and
Law Enforcement (includes border security); MRA: Migration and Refugee Assistance; NADR: Nonproliferation, Anti-Terrorism, Demining, and Related (the majority
allocated for Pakistan is for anti-terrorism assistance); PCF/PCCF: Pakistan Counterinsurgency Fund/Pakistan Counterinsurgency Capability Fund (Pentagon budget through
FY2010, State Department thereafter)
Notes:
n/a=not available. Country al ocations were not available at the time of publication. Disbursements may not be spent in the same year as funds are appropriated or may
reflect transfers from one account to another and thus may exceed some years’ appropriations levels. MRA/ERMA appropriations are not allocated specifically by country;
these disbursements are estimates that reflect payments to nongovernmental organizations or international organizations for MRA/ERMA-funded protection and
humanitarian assistance in Pakistan. Food Aid data only shows disbursements since food aid appropriations are not designated by country.
a. CSF is Pentagon funding to reimburse Pakistan for its support of U.S. military operations. It is not officially designated as foreign assistance.
b. Includes $220 million for Peacekeeping Operations reported by the State Department.
c. Congress authorized Pakistan to use the FY2003 and FY2004 ESF allocations to cancel a total of about $1.5 billion in concessional debt to the U.S. government. From
FY2005-FY2007, $200 million per year in ESF was delivered in the form of “budget support”—cash transfers to Pakistan. Such funds have been mostly “projectized”
from FY2008 on.
d. Includes $110 million in Pentagon funds transferred to the State Department for projects in Pakistan’s tribal areas (P.L. 110-28).
e. This funding is “requirements-based”; there are no pre-al ocation data.
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f.
Congress appropriated $1.69 billion for FY2012, and the Administration has requested $1.75 billion for FY2013, in additional CSF for all U.S. coalition partners.
Pakistan has in the past received more than three-quarters of such funds. The FY2013 Defense Appropriations bill passed by the House in July 2012 would limit CSF
payments to $650 million in the next fiscal year.
g. Includes a “bridge” ESF appropriation of $150 million (P.L. 110-252), $15 million of which the Administration later transferred to INCLE. Also includes FY2009
supplemental appropriations of $539 million for ESF, $66 million for INCLE, and $2 million for NADR.
h. The Administration’s request for supplemental FY2010 appropriations includes $244 million for ESF, $40 million for INCLE, and $60 million for FMF funds for Pakistan.
These amounts are included in the estimated FY2010 total.
i.
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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FY2013 Request for Aid to Pakistan and Objectives
The FY2013 budget request veers away from previous years’ assertions that aid was to support a
partnership with Pakistan, but states the following instead:
The United States seeks to foster economic and political stability in Pakistan through
sustained assistance, which directly supports the core U.S. national security objective to
disrupt, dismantle, and defeat Al Qaida, as well as to deny safe haven to it and its affiliates in
the region. Despite recent challenges in the relationship, the United States and Pakistan must
continue to identify shared interests and cooperate on joint actions that will help achieve
these objectives .56
For FY2013, the Administration is requesting a total of $2,227.6 million within the International
Affairs 150 function (State-Foreign Operations Appropriations). Of this amount, about 42% is for
economic assistance and 58% is for security assistance, including $800.0 million for PCCF,
considered to be Overseas Contingency Operations (OCO) that is not part of the core request, but
is identified by the Administration as extraordinary, temporary funding needs for frontline states.
Consistent with the EPPA, the FY2013 civilian assistance will focus on five key areas: energy,
stabilization, social services (especially health and education), economic growth (including
agriculture), and improving governance, including transparency and gender equality. Security
assistance will focus on building counterinsurgency and counterterrorism capabilities,
strengthening military-to-military cooperation, and addressing long-term modernization needs of
the Pakistan military.
The Administration’s FY2013 request of funds for Pakistan continues the six objectives put forth
by the Bush Administration: (1) Peace and Security; (2) Governing Justly and Democratically; (3)
Investing in People; (4) Economic Growth; (5) Humanitarian Assistance; and (6) Monitoring,
Evaluation, and Oversight. Performance assessments are to be used to determine resource
allocations for Pakistan in the budget and planning process in future years.57
The Economic Support Fund (ESF), $928.25 million for Pakistan in the FY2013 request,
supports
Governing Justly and Democratically—ESF strengthens the rule of law and
human rights, supports good governance activities, building political competition
and civil society. (FY2011—$122.0 million; FY2012 estimate—$120.0 million;
FY2013 request—$124.0 million.)
Investing in People—ESF promotes health and education services and provides
protection for vulnerable populations. (FY2011—$203.4 million; FY2012
estimate—$213.8 million; FY2013 request—$150.0 million.)
Economic Growth—ESF funds are used to build a macro foundation for growth
in the economy by expanding trade and investment, improving the financial
sector, building infrastructure, supporting the agricultural sector, encouraging

56 The Congressional Budget Justification Foreign Operations Annex: Regional Perspectives, FY2013, p. 687.
57 Program information is based on details found in the Department of State’s Congressional Budget Justification for
FY2012, Foreign Operations, Vol. II, pp. 660-675.
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private sector competitiveness, and expanding economic opportunity. (FY2011—
$583.5 million; FY2012 estimate—$525.0 million; FY2013 request—$649.3
million.)
Humanitarian Assistance—ESF is used directly or is transferred to other
accounts to assist Pakistan during humanitarian crises. (FY2011—$10.0 million;
FY2012 estimate—$5.9 million; FY2013 request—$5.0 million.)
Global Health and Child Survival (GHCS) funds are not part of the FY2013 request. In
FY2011, GHCS funds were used for
Investing in People—GHCS funds supported the health sector generally, as well
as the National HIV/AIDS Strategy and local health nongovernmental
organizations (NGOs). (FY2011—$28.4 million; FY2012 estimate—$0;
FY2013—$0.)
Food For Peace Title II,58 none requested for Pakistan in FY2013, provides aid for
Humanitarian Assistance, particularly during emergencies. (FY2011—$115.1
million; FY2012 estimate—$0; FY2013—$0.)
Foreign Military Financing (FMF), $350 million for Pakistan in the FY 2013 request, provides
support for
Peace and Security—FMF funds are used to develop increased professionalism
in Pakistan’s military, promote closer ties with the United States, and
complement other security-related activities such as counterterrorism and its own
defense capabilities. (FY2011—$295.4 million; FY2012 estimate—$295.4
million; FY2013—$350.0 million.)
International Military Education and Training (IMET), $6 million for Pakistan in the FY2013
request, supports
Peace and Security—IMET funds support military education and training, mostly
in the United States, for Pakistani military personnel and leaders to develop
personal ties with their U.S. counterparts, promoting long-term respect between
them. (FY2011—$4.1 million; FY2012 estimate—$5.0 million; FY2013
request—$6.0 million.)
Nonproliferation, Antiterrorism, Demining, and Related Programs (NADR), $19.3 million
for Pakistan in the FY2013 request, supports
Peace and Security—NADR funds assist Pakistan with antiterrorism efforts and
combating weapons of mass destruction. (FY2011—$24.8 million; FY2012
estimate—$20.8 million; FY2013 request—$19.3 million.)
International Narcotics Control and Law Enforcement (INCLE), $124 million for Pakistan in
the FY2013 request, contributes

58 Food For Peace (P.L. 480 Title II) is within the 150 function but is not in the State-Foreign Operations
appropriations; it is funded within the Agriculture appropriations. During humanitarian crises, funds from certain
Foreign Operations accounts, such as the International Disaster Assistance and Economic Support Fund, may be
transferred to the Food For Peace account for critical food needs.
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Peace and Security—INCLE funds support the government of Pakistan’s access
to the frontier areas to combat militant and criminal elements, anti-narcotic
operations, and law enforcement training, particularly in the provinces.
(FY2011—$107.2 million; FY2012 estimate—$105.0 million; FY2013 request—
$115.6 million.)
Governing Justly and Democratically—INCLE helps Pakistan to expand the rule
of law program that is jointly administered by the Department of State’s Bureau
of International Narcotics and Law Enforcement Affairs (INL) and the
Department of Justice with prosecutor and judicial training. It also supports
corrections programs and training in Pakistan and jail renovations. (FY2011—
$7.1 million; FY2012 estimate—$11.0 million; FY2013 request—$8.4 million.)
Monitoring and Program Evaluation. The Administration is fostering community and third-
party oversight of aid programs in Pakistan. The oversight combines with USAID monitoring and
regular audits done by State and USAID Inspector Generals, the U.S. Government Accountability
Office, the Pakistan Auditor General, and Pakistani accounting firms to expand the capability of
accomplishing the sixth objective:
Performance Monitoring and Evaluation. USAID is basing FY2012 project
choices and budgetary decisions in Pakistan on the resulting performance
information.
In August 2011, USAID initiated a five-year, $71 million monitoring and evaluation contract that
provides for third-party monitoring and evaluation services across all USAID projects. Critics
contend that many of the stated institutional and development goals of U.S. assistance to Pakistan
remain largely unmet. For much of the post-2001 period, this was at least in part due to a
perceived U.S. overreliance on security-related aid, which has accounted for the great bulk of
U.S. assistance to Pakistan.59 Many observers argue that it would be more useful to target U.S.
assistance programs in such a way that they more effectively and more directly benefit the
country’s citizens.
Issues for Congress
A number of issues concern many in Congress about making Pakistan one of the top U.S. aid
recipients, not the least of which is its willingness or capability to be a reliable partner. Notable
issues follow.
Conditions on Aid to Pakistan
Debate Overview
One idea long floated in foreign assistance critiques is the “conditioning” of aid to Pakistan,
mainly through the creation of benchmarks and certification that they have been met. For

59 A major 2007 study found that only about one-tenth of U.S. post-2001 aid was directed toward development,
governance, and humanitarian programs (Craig Cohen, “A Perilous Course: U.S. Strategy and Assistance to Pakistan,”
Center for Strategic and International Studies, August 2007).
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example, in 2003, a task force of senior American South Asia watchers issued a report on U.S.
policy in the region that included a recommendation to directly link U.S. support for Islamabad to
that government’s own performance in making Pakistan a more “modern, progressive, and
democratic state.”60 Some commentators have emphasized that, to be truly effective,
conditionality should be applied by many donor countries rather than just the United States and
should be directed toward the Pakistani leadership—especially the military—to the exclusion of
the general public.61 In the wake of political crises and deteriorating security circumstances in
Pakistan in the late 2000s, some senior Members of Congress became more vocal in calling for
conditions on further U.S. assistance in the absence of improvements in these areas.62
Many analysts, however, including policymakers in the George W. Bush Administration and some
in the Obama Administration, have contended that conditioning U.S. aid to Pakistan had a past
record of failure and likely would be counterproductive by reinforcing Pakistani perceptions of
the United States as an unreliable partner. From this perspective, putting additional pressure on an
already weak Islamabad government might lead to significant political instability in Pakistan.63
For numerous Pakistan watchers, a policy of enhanced cooperation and structured inducements is
viewed as likely to be more effective than a policy based on pressure and threats. In a May 2011
Senate Foreign Relations Committee hearing, Ranking Member Senator Richard Lugar stated,
“American conditionalities, ‘you need to do A, B and C,’ is not necessarily helpful. What is
helpful is identifying the most appropriate projects and then following through, not changing
midcourse.”64
One senior Washington-based analyst, a longtime advocate against placing conditions on U.S. aid
to Pakistan, instead offered an admittedly modest approach: he argued for modifying current U.S.
policy through more forceful private admonitions to Islamabad to better focus its own
counterterrorism efforts while also targeting Taliban leadership, increasing provision of U.S.
counterinsurgency technologies and training to Pakistani security forces, and establishing
benchmarks for continued provision of coalition support funding.65 Private admonitions are
considered by some analysts to be meaningless in the absence of public consequences, however.
For Pakistanis themselves, aid conditionality in U.S. legislation can raise unpleasant memories of
1985’s Pressler Amendment, which led to a near-total aid cutoff in 1990. Islamabad’s sensitivities
are thus acute: in 2007, the Pakistan Foreign Ministry said aid conditions legislated in the
Implementing the 9/11 Commission Recommendations Act of 2007 (P.L. 110-53) “cast a shadow”
on existing U.S.-Pakistan cooperation and create linkages that “did not serve the interest of
bilateral cooperation in the past and can prove to be detrimental in the future.”66 Calls for further

60 Specifically, the experts urged directing two-thirds of U.S. aid to economic programs and one-third to security
assistance, and conditioning increases in aid amounts to progress in Pakistan’s reform agenda (“New Priorities in South
Asia: U.S. Policy Toward India, Pakistan, and Afghanistan,” Chairmen’s Report of an Independent Task Force
Cosponsored by the Council on Foreign Relations and the Asia Society, October 2003).
61 See, for example, Frederic Grare, “Rethinking Western Strategies Toward Pakistan,” Carnegie Endowment for
International Peace, 2007.
62 See, for example, “Senate Leader Wants Bush to Pressure Pakistan,” Reuters, January 10, 2008; “Democrat
Questions US Aid to Pakistan,” Associated Press, May 27, 2008.
63 See, for example, Daniel Markey, “A False Choice in Pakistan,” Foreign Affairs, July 2007.
64 Senate Foreign Relations Committee, Hearing on U.S. Policy and its Limits in Pakistan, May 5, 2011.
65 Ashley Tellis, “Pakistan: Conflicted Ally in the War on Terror,” Carnegie Endowment Policy Brief 56, December
2007.
66 See http://www.mofa.gov.pk/Press_Releases/2007/july/PR_199_07.htm.
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conditionality from some in Congress led Islamabad to again warn that such moves could harm
the bilateral relationship and do damage to U.S. interests. Nevertheless, the State Department in
2009 reported being “comfortable” with congressional conditions and “confident” that required
reports could be issued.67
After Osama bin Laden was found in a military cantonment city not far from Islamabad, expert
witnesses at a May 2011 Senate hearing asserted that certification and conditionality should be
taken far more seriously than they have been in the past, but that economic assistance to Pakistan
should continue. However, Senator Carl Levin, chairman of the Senate Armed Services
Committee, reportedly has suggested that he would favor a curtailment of development rather
than security aid, the argument being that short-term U.S. interests in combating terrorism and
Afghan insurgents trump longer-term interests in seeing Pakistan transformed into a more
prosperous and democratic state. Senior Pakistani officials continue to insist that “onerous”
restrictions on aid are counterproductive, arguing that Pakistan needs support, not criticism.68
Current Conditionality and Administration Certifications/Waivers69
Key Congressional Conditions on U.S. Assistance to Pakistan
The most notable sets of conditions on U.S. assistance to Pakistan are found in two laws: the
country-specific Enhanced Partnership with Pakistan Act of 2009, and the State and foreign
operations appropriations provisions found in the Consolidated Appropriations Act, 2012 (P.L.
112-74). In the former, Section 203 contains the most explicit and stringent conditions on U.S. aid
to Pakistan in the post-2001 period. As noted above, these substantive conditions apply only to
security-related assistance for FY2011-FY2014 and arms transfers for FY2012-FY2014
(nonmilitary aid is not subject to conditions in this law).70 The law precludes such assistance and
transfers until the Secretary of State certifies annually for Congress that the Pakistani government
(1) is continuing to cooperate with the United States in efforts to dismantle supplier networks
relating to the acquisition of nuclear weapons-related materials, such as providing relevant
information from or direct access to Pakistani nationals associated with such networks;
(2) had during the preceding fiscal year has demonstrated a sustained commitment to and is
making significant efforts towards combating terrorist groups ... including taking into
account the extent to which the Government of Pakistan has made progress on matters such

67 “Pakistan Rejects Call for Conditions on U.S. Aid,” Reuters, January 11, 2008; State Department claim at
http://2001-2009.state.gov/p/sca/rls/rm/2007/97946.htm.
68 Senate Foreign Relations Committee, Hearing Transcripts, pp. 8, 9, 13, May 5, 2011; Sen. Levin quoted in “Pakistan
Military Aid Safer Than the Economic Aid,” The Cable (ForeignPolicy.com), May 11, 2011; “Sherry Says Strict
Congressional Curbs Won’t Help US-Pak Ties,” Nation (Lahore), May 20, 2012.
69 For a complete review of Pakistan-specific conditionality and reporting requirements, see CRS Report R42116,
Pakistan: U.S. Foreign Aid Conditions, Restrictions, and Reporting Requirements, by Susan B. Epstein and K. Alan
Kronstadt.
70 For these purposes, “security-related assistance” is defined as grant assistance to carry out section 23 of the Arms
Export Control Act (22 U.S.C. 2763) and assistance under chapter 2 of part II of the Foreign Assistance Act of 1961
(22 U.S.C. 2311 et. seq). It does not include assistance authorized to be appropriated or otherwise made available under
any provision of law that is funded from accounts within budget function 050 (National Defense) or amounts
appropriated or otherwise available to the Pakistan Counterinsurgency Capability Fund established under the
Supplemental Appropriations Act, 2009 (P.L. 111-32).
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as A) ceasing support, including by any elements within the Pakistan military or its
intelligence agency, to extremist and terrorist groups, particularly to any group that has
conducted attacks against United States or coalition forces in Afghanistan, or against the
territory or people of neighboring countries; B) preventing al Qaeda, the Taliban and
associated terrorist groups, such as Lashkar-e-Taiba and Jaish-e-Mohammed, from operating
in the territory of Pakistan, including carrying out cross-border attacks into neighboring
countries, closing terrorist camps in the FATA, dismantling terrorist bases of operations in
other parts of the country, including Quetta and Muridke, and taking action when provided
with intelligence about high-level terrorist targets; and C) strengthening counterterrorism and
anti-money laundering laws; and
(3) is ensuring that its security forces are not materially and substantially subverting the
political or judicial processes of Pakistan.
The law includes a provision allowing the Secretary to waive this certification requirement if s/he
finds that it is important to U.S. national security interests to do so.
Section 7046(c) of the Consolidated Appropriations Act, 2012 added another layer of
conditionality requiring special certification from the Secretary of State to release assistance
funds. These provisions would restrict all FY2012 transfers under ESF, INCLE, FMF, and PCCF,
and so for the first time placed conditions on military and nonmilitary aid. Under this law, the
Secretary was required to certify that Pakistan was
(1) cooperating with the United States in counterterrorist efforts against Haqqani Network,
the Quetta Shura Taliban, Lashkar-e-Taiba, Jaish-e-Mohammed, Al Qaeda, and other
domestic and foreign terrorist organizations, including taking steps to end support for them
and preventing them from basing and operating in Pakistan and carrying out cross border
attacks into neighboring countries;
(2) not supporting terrorist activities against U.S. or coalition forces in Afghanistan, and
Pakistan military and intelligence agencies are not intervening extra-judicially into political
and judicial processes in Pakistan;
(3) dismantling improvised explosive devices (IED) networks and interdicting precursor
chemicals used to manufacture IEDs;
(4) preventing the proliferation of nuclear-related material and expertise;
(5) issuing visas in a timely manner for U.S. visitors engaged in counterterrorism efforts and
assistance programs in Pakistan; and
(6) providing humanitarian organizations access to detainees, internally displaced persons,
and other Pakistani civilians affected by the conflict.
This law also contained a national security waiver (not included in the House-passed version, but
inserted in the Senate).
Certifications and Waivers, FY2011-Present
In apparent conflict with problematic U.S. government reporting on Pakistan’s progress in the
areas of counterterrorism cooperation came a March 2011 certification by Secretary Clinton as
required under Section 203 of the EPPA. In the wake of subsequent revelations that Al Qaeda’s
founder was living in plain sight in a Pakistani city, and with top U.S. military officials
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persistently complaining that Pakistan has failed to take action against the Haqqani network of
Afghan insurgents in the FATA, this certification was met with deep skepticism and appeared to
many observers to be driven primarily by political considerations rather than realities on the
ground. When asked about the certification during an October 2011 House hearing, Clinton
insisted she had “closely considered the requirements set forth in the statute” and “determined
that on balance Pakistan had met the legal threshold.”71
By mid-2012, however, conditions were such that a second certification under the EPPA appeared
extremely difficult to justify. The November 2011 Salala border incident had spurred an angry
Islamabad to close vital supply lines used by NATO forces in Afghanistan, and these remained
closed for more than seven months until difficult negotiations finally resulted in their reopening
in early July 2012 (in an apparent quid pro quo, Washington days later released nearly $1.2
billion in pending CSF payments). Despite this breakthrough, U.S.-Pakistan relations remained
uneasy and, with the fiscal year in its final quarter, the Administration faced having to make a
decision on if and how to free planned FY2012 aid to Pakistan, given congressional conditions.
In mid-August 2012, the State Department quietly notified Congress of its intent, “consistent with
U.S. national security interests,” to waive the certification requirements of the EPPA. The stated
justification was that proceeding with “cooperation and joint action in areas of mutual interest
with Pakistan” requires the Administration to have available all foreign policy tools, including
foreign assistance.72 One month later, on September 14, the relevant congressional committees
received formal notification from Secretary Clinton that she found it important to the national
security interests of the United States to waive the limitations on security aid to Pakistan found in
Section 203 of P.L. 111-73.73 The Secretary’s accompanying justification for the waiver was
delivered in classified form. Also on September 14, Secretary Clinton notified the House and
Senate Appropriations Committees that she was waiving the Pakistan-related certification
requirements in Section 7046(c) of P.L. 112-74. This waiver was similarly made under the law’s
national security provision.
Government Reform
The politics of reforming Pakistan’s governance process and tax structure may be among the most
important obstacles to improving aid effectiveness. The United States has provided assistance in
recent years to help build governance capacity in Pakistan, improve political party competition,
promote participation of women and religious minorities in government, and expand rule of law
training. On several occasions Secretary Clinton has pushed Pakistan on tax reform. For example,
when speaking about Pakistan’s flood crisis in October 2010 she said
The international community can only do so much. Pakistan itself must take immediate and
substantial action to mobilize its own resources, and in particular, to reform its economy.
The most important step that Pakistan can take is to pass meaningful reforms that will
expand its tax base. The government must require that the economically affluent and elite in
Pakistan support the government and people of Pakistan.... It is absolutely unacceptable for

71 “Rep. Ileana Ros-Lehtinen Holds a Hearing on Afghanistan and Pakistan Transition,” CQ Transcriptions, October
27, 2011.
72 State Department electronic communication with congressional staff, August 14, 2012.
73 “Waiver of Requirement to Certify Conditions Under Section 203 of the Enhanced Partnership With Pakistan Act of
2009 (P.L. 111-73),” document received by the Clerk of the Senate Armed Services Committee, September 14, 2012.
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those with means in Pakistan not to be doing their fair share to help their own people while
taxpayers of Europe, the United States, and other contributing countries are all chipping in to
do our part.74
Secretary Clinton is one of several top U.S. officials critical of Pakistan’s 9% tax-to-GDP ratio,
one of the lowest in the world. For most observers, this represents what essentially is mass tax
evasion by the country’s economic elite, and is exacerbated by a federal budget overemphasizing
military spending. The government has pursued establishment of a Reformed General Sales Tax,
but to date has found it difficult to win sufficient parliamentary support for what are considered
even modest changes.
To many, the energy sector provides another representative example of needed government
reform. International donors have for many years pressed Pakistani leaders to reduce price
subsidies on electricity, without success. In the words of one group of aid experts,
Time and again, project documents cite the same problems, the donors recommend the same
solutions, the government of Pakistan promises to implement the same reform, the
government breaks (and donors lament) the same promises. Meanwhile, the basic politics
maintaining the status quo have not changed-there are too many reaping the benefits of
subsidized power, and ordinary consumers feel they aren't getting service that warrants
paying more.75
Pakistan’s prime minister has contended that his government is firmly committed to economic
reforms, but asks donors to “kindly be patient” with this “work in progress.”76 Nevertheless, there
is a resistance to long-term policy reform in Pakistan which may counter any progress U.S. aid
achieves, and more than one year after Gilani’s plea no meaningful reforms have been effected.
Corruption, Transparency, and Oversight Issues
Corruption and Transparency
Corruption is endemic to South Asia and to Pakistan in particular. It presents a persistent and
serious problem for the national economy, harming both domestic and foreign investment rates,
as well as creating skeptical international aid donors.77 For 2011, Berlin-based Transparency
International (an organization that tracks global corruption trends) placed Pakistan 134th out of
183 countries in its annual ranking of world corruption levels, giving it a lower ranking than such
countries as Mozambique and Bangladesh, among others.78 A September 2010 agreement
between the U.S. government and Transparency International (TI) established a hotline through

74 P.J. Aroon, “Clinton: It’s ‘unacceptable’ that Pakistani elites aren’t paying more taxes,” Foreign Policy, October 14,
2010.
75 Nancy Birdsall, Wren Elhai, and Molly Kinder, “Pakistan’s Political Crisis: The Limits of U.S. Leverage,” Foreign
Policy
(online), January 20, 2011.
76 Quoted in “Pakistan PM Urges Donors for Patience on Reforms,” Reuters, November 15, 2010.
77 A major 2011 public opinion survey found that combating corruption was by far the most important priority
identified by respondents, with fully 48% ranking corruption as the “greatest threat to Pakistan” (in second place was
the United States, named as the greatest threat by 29%). Bribery, nepotism, and profit from public office were each
identified as “huge problems” by about three-quarters of respondents (Joel Faulkner Rogers, “Public Opinion in
Pakistan and the Newfound Popularity of Pakistan Tehreek-e-Insaf (PTI),” YouGov-Cambridge, December 23, 2011).
78 See http://www.transparency.org.
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which people can report any misuse of U.S. assistance funds. TI subsequently contended that its
workers in Pakistan have faced threats and harassment, and there were even reports that the
Islamabad government planned legal action against TI for allegedly paying bribes to officials to
extract information.79
Corruption and lack of sufficient transparency is identified as a key obstacle to effective
implementation of U.S. aid programs in Pakistan, and has drawn significant attention in
Congress. A 2009 House hearing addressed what one senior Member called the “serious
accountability and transparency concerns that have plagued U.S. programs and operations in both
Afghanistan and Pakistan for the past seven years.” At the hearing, Administration witness
Ambassador Holbrooke expressed his support for expanding the responsibilities of the Special
Inspector General for Afghanistan Reconstruction (SIGAR) to monitor U.S. aid programs in
Pakistan.80 At a subsequent House hearing on potential fraud and waste in U.S. aid to Pakistan
and Afghanistan, a senior House Member expressed “serious concerns about the [U.S. aid]
community’s ability to provide comprehensive coverage that keeps pace with the rapid boom in
U.S. activities in the region.”81 During a 2010 hearing on security and stability in Pakistan, the
chairman of the House Armed Services Committee acknowledged that the Administration had
developed “good metrics” for tracking progress in Pakistan, but expressed being disappointed that
insufficient information was being provided to Congress.82
Ambassador Robin Raphel, the U.S. Coordinator for Economic and Development Assistance in
Pakistan, vowed in mid-2009 that the United States will employ the “highest standards of
accountability” in efforts to minimize future administrative outlays.83 While such efforts are no
doubt sincere, evidence of substantive improvements is scarce nearly three years later. Moreover,
U.S. funds to the government of Pakistan for budget support have been comingled with other
resources, according to a 2010 U.S. Inspectors General report, contributing to further ongoing
accountability and reporting challenges.84
A reliance on foreign contractors may have fueled significant resentment among Pakistanis who
saw them as enriching themselves with aid dollars.85 According to skeptics, large-scale U.S. aid
only engenders Pakistani corruption and has allowed Islamabad to boost its India-oriented
military capabilities in ways that would not have otherwise been possible. Corruption concerns
reportedly have led to resentment in Pakistan, where some officials feel slighted after launching a
vigorous and risky campaign against militants.86

79 “Graft Fighter Alleges Pakistan Threat,” Wall Street Journal, November 29, 2010.
80 Transcript: “Joint Hearing of the House Oversight and Government Reform Committee and National Security and
Foreign Affairs Subcommittee of the House Oversight and Government Reform Committee, ‘Afghanistan and
Pakistan: Oversight of a New Interagency Strategy,” June 24, 2009.
81 Statement of Rep. John Tierney, “Transcript: House Oversight and Government Reform Subcommittee on National
Security and Foreign Affairs Holds Hearing on Detecting Fraud and Waste in Afghanistan and Pakistan,” September 9,
2009.
82 See the opening remarks of Rep. Ike Skelton, “House Armed Services Committee Holds Hearing on Security and
Stability in Pakistan,” CQ Transcripts, April 29, 2010.
83 “‘US Aid Administrative Costs to be Minimalized,’” Daily Times (Lahore), August 29, 2009.
84 Quarterly Progress and Oversight Report on the Civilian Assistance Program in Pakistan by the Inspector General for
USAID, Inspector General for the Department of State, and the Inspector General for the department of Defense,
December 31, 2010, p. 34.
85 “Setbacks Plague U.S. Aid to Pakistan,” Wall Street Journal, January 21, 2011.
86 Azeem Ibrahim, “How America is Funding Corruption in Pakistan,” Foreign Policy (online), August 11, 2009;
(continued...)
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There are concerns that consulting fees and administrative overhead account for too large a
proportion of appropriated aid, meaning significant sums may never reach the people they are
meant to benefit.87 Press reports suggest that roughly half of all U.S. assistance pledged for
Pakistan is spent on administrative costs, including highly paid foreign experts, thus forwarding
the argument that aid flows would be more effective if channeled through Pakistani agencies.88
Pakistani officials have tended to agree with those in the United States who believe that
administrative costs can be reduced by channeling U.S. aid primarily through Pakistani
government agencies rather than through NGOs.89 Under Ambassador Holbrooke’s guidance, the
State Department in late 2009 made plans to significantly scale back its use of U.S. aid
contractors in Pakistan and begin channeling more money directly to Pakistani officials and local
groups.90 This shift has not come without resistance from some quarters, with analysts warning
that Pakistan’s civilian bureaucracies do not have sufficient capacity to be effective implementing
partners.91
U.S. Government Oversight and Auditing
A 2011 GAO report listed substantive risk mitigation strategies undertaken by USAID in its shift
to increased reliance upon local and Pakistani government implementing partners—now
accounting for more than half of economic assistance disbursements—while also recommending
executive action going forward:
To help prevent waste, fraud, and abuse of U.S. funds, it is important that USAID effectively
implement and monitor efforts to address the weaknesses and enhance the capacity of these
[local] organizations, particularly those that are identified as having a high-risk or medium-
risk of not meeting standards for managing U.S. funds.... To enhance the accountability of
U.S. civilian assistance to Pakistan, we recommend that the USAID Administrator should
ensure that U.S. assistance to Pakistani organizations identified as high- or medium-risk be
provided through contracts, grants, or agreements that require these organizations to address
weaknesses identified in their preaward assessment that would improve the accountability of
funds.92
In a sign that oversight of its assistance to Pakistan was becoming more stringent, USAID had in
late 2010 suspended a U.S.-based nonprofit organization from receiving new awards pending an

(...continued)
“Economic Aid for Pakistan a Victim of Corruption Worries,” Los Angeles Times, March 28, 2010.
87“US Aid ‘Failing to Reach Target,’” BBC News, May 16, 2008.
88 “US Aid to Pakistan ‘Depleted by Admin Costs,’” Financial Times (London), August 27, 2009.
89 “Gilani Opposes Aid Disbursement Though NGOs,” Daily Times (Lahore), September 7, 2009.
90 “State Dept Rethinks How to Deliver Aid to Pakistan,” USA Today, October 2, 2009.
91 One major early 2010 study on reforming Pakistan’s civil service warned U.S. and other donor countries to refrain
from supporting bureaucracies such as the FATA Secretariat until reforms there increase transparency and reduce the
risk of large-scale corruption in these “inefficient and unaccountable institutions.” An April 2010 Government
Accountability Office report provided supporting evidence for such warnings, identifying ongoing problems with
efforts to track U.S. development assistance in the FATA (91 “Reforming Pakistan’s Civil Service,” International Crisis
Group Asia Report No. 85, February 16, 2010, at http://www.crisisgroup.org/home/index.cfm?id=6528; GAO,
“Combating Terrorism: Planning and Documentation of U.S. Development Assistance in Pakistan’s Federally
Administered Tribal Areas Need to Be Improved, April 2010, at http://www.gao.gov/products/GAO-10-289).
92 See http://www.gao.gov/new.items/d11310r.pdf.
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investigation into “evidence of serious corporate misconduct, mismanagement, and internal
controls.”93
Problems with USAID-run programs have persisted. A February 2011 report issued by the
Inspectors General of USAID, State, and the Pentagon addressed in some detail USAID’s
improved oversight and monitoring of its programs, especially though the conducting of pre-
award assessments of local implementing partners, and with the establishment of oversight
entities to ensure that aid funds are protected against waste and theft. However, it also found that,
during the period October-December 2010, two audited U.S. aid development programs in the
FATA “had made little progress” in achieving their goals. While sections of the report on “risk
and mitigation strategies” and “oversight status” listed numerous initiatives meant to ensure better
aid management, the auditors identified a considerable lack of progress overall: “We believe that
USAID has an imperative to accumulate, analyze, and report information on the results achieved
under its programs. One year after the launch of the civilian assistance strategy in Pakistan,
USAID has not been able to demonstrate measureable progress” [emphasis added].94
Similarly, a late 2011 IG audit determined that USAID’s “Firms Project”—a four-year, $90
million effort to boost productivity and competitiveness in small- and medium-sized Pakistani
firms—was “not on track to achieve its main goal” two years after its May 2009 launch. Despite a
sustained effort, “no measureable increases in sales or employment” were found in the five
sectors engaged (leather, livestock, textile, date, and mango). Auditors determined that the AID
mission’s performance management plan did not meet agency standards, that the approving
official did not provide sufficient procurement oversight, and that the mission had failed to
complete required annual performance evaluations.95 Lack of success caused the mission to
curtail project activities in all but the mango sector, but even this effort became stalled. The Firms
Project was one of three USAID Pakistan projects to appear in a U.S. Senator’s annual
“Wastebook” guide to “some of the most wasteful and low priority government spending.”96
The State Department and USAID have responded to congressional pressure for better oversight
of Pakistan assistance. A November 2011 State Department report acknowledged that increased
funding, an unstable security environment, and the decision to implement through Pakistani
institutions combine to create significant oversight challenges. Steps taken to address these
include
• subjecting all Pakistani organizations, including government agencies, to pre-
award assessments to ensure that an adequate level of financial and management
controls are in place before any U.S. funds are disbursed;

93 See the December 8, 2010, release at http://www.usaid.gov/press/releases/2010/pr101208.html.
94 “Quarterly Progress and Oversight Report on the Civilian Assistance Program in Pakistan As of December 31,
2010,” February 2011, at http://www.usaid.gov/oig/public/special_reports/
pakistan_quarterly_report_as_of_dec_31_2010.pdf.
95 USAID Office of the Inspector General, “Audit of USAID/Pakistan’s Firms Project,” November 3, 2011, at
http://www.usaid.gov/oig/public/fy12rpts/g-391-12-001-p.pdf.
96 The two others were a $10 million effort to create a Pakistani version of the Sesame Street television program and a
$12 million project to encourage energy savings in Pakistani industry (Senator Tom Coburn’s “Wastebook 2011” is at
http://www.coburn.senate.gov/public/6946d43b-bccf-4579-990e-15a763532b40.html).
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• establishment of State and USAID Inspectors General offices in Islamabad to
uncover waste and/or fraud, and to boost the capacity of the Auditor General of
Pakistan;
• minimizing the risk of fraud with fixed amount reimbursements made only after
infrastructure work is completed and inspected;
• establishment of a Transparency International hotline for anonymous reporting
of any suspicious activity related to U.S.-funded projects;
increased personnel and improved process for oversight and monitoring; and
• initiation of a nation-wide monitoring and evaluation (M&E) contract with a
U.S. firm to provide third-party oversight.
The report expresses confidence that substantial mechanisms are in place “to discourage
deliberate fraud, identify and prosecute fraud cases, and help our Pakistan partners develop better
monitoring and evaluations systems of their own.”97
Aid Delivery and Security Concerns
Security concerns in Pakistan raise several issues, including the inability of American aid workers
to deliver aid and therefore the need to have Pakistani institutions handle much of the delivery;
the difficulty in monitoring and evaluating the effectiveness of the aid; and the security risks
associated with showing the American flag or labeling the aid as coming from the American
people (see following section). Security woes continue to hamper implementation of many
foreign assistance programs, especially in the KPk and FATA regions.
Because of militant attacks, the Pakistani army’s public works division is carrying out numerous
U.S. aid projects in the form of roads, water, and electricity in South Waziristan. A senior
Pakistani government official in the region said that the projects have gained support, but it is too
dangerous to put any USAID logos on them because of possible reprisals against the workers. A
tribal elder in the region said that while locals support the road between the towns of Tank and
Makin, they “don’t like America any more” as a result.98 In 2010, the U.S.-based Mercy Corps
agency halted operations and shut nearly 50 offices due to security issues in both Sindh and
Baluchistan. Similarly, World Food Program operations in northwest Pakistan were temporarily
halted in December 2010 after a suicide bomb attack at a Bajaur food station killed 46 people.99
Along with direct attacks on NGO operations, Pakistani public perceptions of NGOs appear
largely unfavorable.100 Revelations of a CIA-run ruse employing a phony vaccination campaign
in an effort to pinpoint bin Laden’s location reinforced conspiracy theories that foreign agents
were using the cover of Western humanitarian projects. The uproar led Islamabad to establish new

97 Department of State, “Status Report: Afghanistan and Pakistan Civilian Engagement,” November 2011, at
http://www.state.gov/documents/organization/176809.pdf.
98 Quoted in “Setbacks Plague U.S. Aid to Pakistan,” Wall Street Journal, January 21, 2011.
99 “Mercy Corps Leaves South Pakistan,” BBC News, June 14, 2010; “Pakistan Attack Halts Aid,” Wall Street Journal,
December 27, 2010.
100 When asked in a 2010 survey if NGOs are “working for the welfare of the country and society” or are “making
money and nothing else,” about two-thirds of Pakistani respondents gave the latter answer (see
http://www.gallup.com.pk/pollsshow.php?id=2010-03-05).
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restrictions on foreign aid operations and deeply angered the humanitarian community.101 The
Pakistani doctor involved, Shakil Afridi, had claimed to be working for the aid group Save the
Children, spurring that organization to fly eight expatriate workers out of the country for fear they
would face detention. In September 2012, the Islamabad government ordered the group’s six
remaining expatriate staffers to leave the country. Meanwhile, the International Committee of the
Red Cross elected to shut down at least three of its KPk offices after personnel access to the
locations became too difficult, and it later suspended all operations in Peshawar and Karachi after
a British national working for the group was found beheaded.102
Branding and Public Diplomacy
Anti-American sentiment is powerful and pervasive in Pakistan. There is a widely held view that
substantial, long-term development assistance is the only way to win hearts and minds in that
country, and that this should be delivered predictably and through transparent processes that are
in large part prioritized and monitored by locals. Some studies support the argument that donor
countries can reap public diplomacy benefits, perhaps especially through humanitarian aid. A
study of the relationship between foreign disaster assistance following Pakistan’s 2005
earthquake and local attitudes found evidence that trust of foreigners was measurably increased in
areas closest to the fault-line: “The results provide a compelling case that trust in foreigners is
malleable, responds to humanitarian actions by foreigners and is not a deeply-rooted function of
local preferences.”103 In 2010, there were reports of U.S. public diplomacy benefits resulting from
the provision of flood relief in Swat and other areas.104
A rebuttal to these conclusions contends there is very little evidence that humanitarian or
development assistance is effective in promoting greater stability or improved public perceptions
of the United States in Pakistan, and it offers a warning that “greater instrumentalization and
securitization of aid” give the military too large a role in the humanitarian and reconstruction
sectors.105 Figure 1 (below) suggests there is no notable correlation between U.S. humanitarian
aid and Pakistani views of the United States, and that, in Pew Center surveys over the past
decade, favorable views of the United States have never been found in more than 27% of the
Pakistani population. Some evidence suggests that even Pakistanis who directly benefitted from

101 “Pakistanis Distrust of Foreigners Impedes Aid Groups,” Los Angeles Times, January 15, 2012; “Fallout of Bin
Laden Raid: Aid Groups in Pakistan Are Suspect,” New York Times, May 2, 2012; Glenn Greenwald, “The Imperial
Mind,” Salon.com (online), May 5, 2012.
102 “Pakistan Orders Foreign Staff of International Aid Group Save the Children Out of Country,” Associated Press,
September 6, 2012; “ICRC Suspends Operations in Peshawar and Karachi,” BBC News, May 10, 2012.
103 The study found more than three in five Pakistanis living on or very close to the earthquake fault line saying they
trusted foreigners, while slightly more than one in five who lived at least 40 miles from the fault line saying they did so
(Tahir Andrabi and Jishnu Das, “In Aid We Trust: Hearts and Minds and the Pakistan Earthquake of 2005,” September
2010). See also “Study: Aid After 2005 Quake Won Trust in Pakistan,” Washington Post, September 7, 2010.
104 See, for example, Zubair Torwali, “Changing Perceptions of the US” (op-ed), Friday Times (Lahore), September 3,
2010.
105 Andrew Wilder, “Aid and Stability in Pakistan: Lessons From the 2005 Earthquake Response,” Disasters, October
2010. At a 2009 House hearing on U.S. aid to Pakistan, this same nongovernmental expert contended that development
assistance is unlikely to “win hearts and minds” or promote U.S. security objectives. He further warned that aid can
have significant destabilizing effects through its fueling of large-scale corruption, which in turn is corrosive of
government and institutional legitimacy. In order to avoid such an outcome, he argued, a robust effort to rebuild and
repair Pakistan’s civil service bureaucracy should be a priority (Testimony of Andrew Wilder before the House
Oversight and Government Reform Subcommittee on National Security and Foreign Affairs, “U.S. Aid to Pakistan:
Planning and Accountability,” December 9, 2009).
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U.S.-funded aid organizations after the catastrophic mid-2010 floods did not change their views
of the United States—an increasingly negative view has persisted even after the U.S. provision of
more than $700 million in related humanitarian assistance. This attitude may be partially
explained by the many Pakistanis who are ill-informed about levels of U.S. assistance to their
country and express being unaware of any benefits, as well. The perception gap to an extent may
have resulted from the portions of aid lost to corruption and the lack of labeling of aid as coming
from America in some provinces due to security concerns.106
Some reports have U.S. officials seeking greater public diplomacy benefits by pressing
international aid groups to more prominently advertise the source of the goods and services they
provide. Ambassador Holbrooke was himself among those expressing concern that the United
States was not receiving sufficient credit for its assistance efforts. Yet many of those groups are
reluctant, fearing that such visibility would make them targets for militants; 11 of them penned a
letter to USAID asking that requirements on use of U.S. government labels be reconsidered.107
Figure 1. Pakistani Views of the United States

Source: Pew Research Center, Does Humanitarian Aid Improve America’s Image? by Richard Wike, March 6, 2012.
Anti-American sentiment related to perceived gross sovereignty violations—including the May
2011 Abbottabad raid, NATO raids across the Pakistan-Afghanistan border that have left
Pakistani soldiers dead, and ongoing drone strikes—has led the U.S. government to minimize its
“footprint” when providing aid in certain regions, especially those bordering Afghanistan. This

106 “Setbacks Plague U.S. Aid to Pakistan,” Wall Street Journal, January 21, 2011; “U.S. Aid Buys Little Goodwill,”
Washington Post, August 24, 2010.
107 “US Wants More Aid Recognition in Pakistan,” Washington Post, September 25, 2010; Samuel Worthington, “Why
American Aid Workers in Pakistan Need to Keep a Low Profile” (op-ed), Washington Post, October 10, 2010; “Aid
Groups Concerned Over U.S. Branding in Pakistan,” Reuters, October 12, 2010.
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has meant that some projects are conducted in ways similar to covert operations under the cover
of Pakistani government agencies. Although such an approach facilitates delivery of aid, public
diplomacy gains can be sacrificed when aid beneficiaries are unaware of the origin of the
assistance they are receiving. Because development of Pakistan’s tribal areas is identified as a key
U.S. national security goal in and of itself, such costs may be considered acceptable.
Press reports indicate, however, that in 2011 the U.S. government began pressuring aid groups to
more openly advertise their delivery of American assistance. Even a previous ban on such
branding in the FATA was replaced with case-by-case evaluations, and the U.S. Ambassador
began requiring that the American flag be added to the printed AID logo to better ensure that
illiterate Pakistanis know the source of aid. The new policy has upset aid organizations that fear
such branding will make them more vulnerable to targeting by religious militants. The
international humanitarian aid group CARE is among those that have at times rejected U.S.
funding due to AID’s branding requirements. Still, some Pakistanis believe branding is the only
means by which the United States can significantly increase local awareness of projects.108
Possible Adjustments to U.S. Assistance Programs
In a response to the Administration’s December 2009 Pakistan Assistance Strategy, a report by a
large coalition of U.S.-based international nongovernmental organizations lauded the new U.S.
approach while also presenting numerous recommendations meant to ensure greater
accountability and effectiveness in U.S. civilian aid to Pakistan.109 More recently, a working
group convened by a Washington, DC, think tank issued a 2011 report strongly endorsing the so-
called “KLB approach” to civilian aid for Pakistan as being of vital importance to both
countries.110 The report contends that “mid-course changes” are required for KLB to attain its
core goals, and it offered nearly 30 recommendations in this regard, among them the following:
• Continue to implement KLB aid without adding security- or economic-reform-
related conditions—but advocate reforms. Press Pakistan to return to an
arrangement with the International Monetary Fund (IMF).
• To ensure that U.S. aid augments and does not replace local funding, require
Pakistani co-investment in all KLB civilian aid projects except disaster relief.
• Establish a more realistic timeline, with benchmarks, for stepping up the
percentages of U.S. aid to be dispensed through Pakistani government structures.
• Devise metrics for KLB programs in cooperation with Pakistani implementers.
• Use independent third parties for KLB project evaluations.

108 “US Steps Up Push for Aid Recognition in Pakistan,” Associated Press, July 20, 2011; Sabina Khan, “Making US
Aid Work for Pakistan” (op-ed), Express Tribune (Karachi), February 14, 2012.
109 “Recommendations for Implementation of Pakistan Assistance Strategy,” InterAction Policy Paper, March 2010, at
http://www.interaction.org/document/recommendation-implementation-pakistan-assistance-strategy.
110 Wilson Center officials explained their thesis in Jane Harman and Robert Hathaway, “Why Pakistan Still Needs
U.S. Assistance” (op-ed), Washington Post, December 1, 2011. Other analyses also emphasize the importance of
development rather than military aid to Pakistan, usually with the assumption that the latter has largely failed to achieve
its objectives for either country (see, for example, S. Akbar Zaidi, “Who Benefits From U.S. Aid to Pakistan?”
Carnegie Endowment for International Peace Policy Outlook, September 21, 2011).
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• Partner with local civil society organizations to improve input from aid
beneficiaries, local citizen watchdog groups, and impacted populations through
the life of a program.
• Enhance in-country aid coordination with like-minded bilateral donors.
• Help fill the Pakistan government’s most critical expertise gaps at the federal and
provincial levels—but with “payback” conditions for beneficiaries.
• Make vocational skills training the main U.S. contribution to education in
Pakistan.
• Create mechanisms to mobilize resources from and tap technical and
management skills of the Pakistani diaspora in the United States and elsewhere
for new ventures in Pakistan.
• Do not substitute bilateral trade, as valuable as it is, for aid, as some Americans
and Pakistanis have proposed. Pakistan needs both development and growth.
• Be aware of issues on which U.S. pressure might be counterproductive to
development objectives; keep expectations modest; and be patient in our
approach.111
In 2012, another nongovernmental working group sent a letter to the State Department with three
specific recommendations for improving the effectiveness of U.S. aid to Pakistan: (1) expand
market access for Pakistani goods while dropping plans to establish ROZs; (2) task the U.S.
Overseas Private Investment Corporation with establishing a new facility for small business
lending in Pakistan; and (3) publically signal U.S. support for the proposed Diamer-Bhasha dam
project.112
Other Aid Issues
Several other concerns regarding the effectiveness and long-term results of U.S. aid in Pakistan
are noted and being addressed by USAID, including
• Pakistan’s vulnerability to natural disasters such as earthquakes and floods
creates emergencies and causes development aid to be reprogrammed to meet
recurring critical needs. USAID supports surface water management and dam
projects to mitigate flooding.
• Environmental concerns. Some development projects, such as certain sections of
roads, dams, etc., are prone to producing adverse environmental impacts that may
solve one problem but create others. Assessments may be required before certain
projects are begun.

111 “Aiding Without Abetting: Making U.S. Civilian Assistance to Pakistan Work for Both Sides,” Woodrow Wilson
International Center for Scholars, 2011, at http://www.wilsoncenter.org/sites/default/files/
WWC%20Pakistan%20Aiding%20Without%20Abetting.pdf.
112 See the January 6, 2012, Center for Global Development letter at http://www.cgdev.org/content/publications/detail/
1425847.
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• A high turnover rate with the leadership in the Pakistani government’s
agricultural sector disrupts projects and has led to requirements to ensure
continuity of key personnel.
• Limited institutional capacity in Pakistan, especially in the FATA, KPk, and
Baluchistan, to implement aid projects or deliver aid can result in lost resources,
theft, and a general inability to manage large amounts of funding. USAID is
supporting technical advisors and units within government ministries, providing
training in accounting and auditing for greater transparency and accountability.
USAID also collaborates with Pakistan on a fraud reporting hotline and
education program.113
Conclusions
Major upheavals in U.S.-Pakistan relations in 2011 caused the already troubled bilateral
relationship to further sour. Following NATO’s November 2011 border incursion, bilateral ties
have largely been put “on hold” by Islamabad as the Pakistani Parliament completes a
comprehensive review of ties, a review that is expected to call for stringent new restrictions and
conditions on future engagement. Several measures within the defense authorization and foreign
affairs appropriations bills (H.R. 4310, H.R. 5857, and S. 3241) to restrict U.S. aid to Pakistan in
2013 are winding their way through the 112th Congress, reflecting Members’ ongoing concerns.
Nevertheless, many U.S. government and independent analysts continue to assert that U.S.
strategic interests are inextricably linked with a stable Pakistan that can effectively rule all of its
territory, assist the United States with efforts to stabilize Afghanistan, as well as with the fight
against terrorism, and contribute to the stability in the region. While there exist numerous
concerns about whether Pakistan can be accountable in how it uses U.S. aid and whether it will
pursue needed reforms, these observers emphasize the importance of maintaining a close bilateral
engagement, with an eye toward encouraging and facilitating Pakistani democratization. Given
the current budgetary constraints facing the United States and the recent strained relationship,
some in the 112th Congress question the return on such large investments in Pakistan, among the
largest recipients of U.S. aid. Lawmakers will continue to seek the right balance between U.S. aid
expenditures to promote U.S. national security interests in Pakistan and the region versus belt-
tightening budget cuts to foreign aid programs and accountability measures to address the lack of
trust between the two governments.

113 Inspectors General of the Departments of State, Defense, and USAID, “Quarterly Progress and Oversight Report on
the Civilian Assistance Program in Pakistan,” December 31, 2010, pp. 33, 34.
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Appendix A. History of U.S. Aid to Pakistan
Figure A-1. U.S. Aid in Current and Constant Dollars


Source: U.S. Overseas Loans and Grants (Greenbook), U.S. Agency for International Development, The
Department of State’s Congressional Budget Justifications, FY2002-FY2012, and CRS calculations.
Notes: Figures 1948-2000 = obligations; 2001-2010=appropriations. (a) 1962 Peak aid. Pakistan aligned with
West; signed two defense pacts. (b) 1981 Reagan administration negotiated five year $3.2 million security
economic aid package with Pakistan. (c) 1985 Pressler Amendment, Reagan and George H. W. Bush certified
Pakistan to get aid until 1990. (d) 1989 - Soviet Army withdrew from Afghanistan. George H. W. Bush suspended
aid in 1990 because of Pakistan’s nuclear activities. Aid lowest in 1990s. (e) Post 9/11 aid to Pakistan.
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Appendix B. Current Year Request
Figure B-1.FY2013 Budget Request for Aid to Pakistan
PCF/PCCF, 35.90%
ESF, 41.70%
NADR, 0.90%
INCLE, 5.60%
FMF, 15.70%
IMET, 0.20%

Source: The Department of State Congressional Budget Justification, FY2013 and CRS calculations.
Notes: Includes only aid from the State-Foreign Operations Appropriation Request. Defense Department funds
for FY2013 are not yet available. ESF=Economic Support Fund; FMF=Foreign Military Financing;
IMET=International Military Education and Training; INCLE=International Narcotics Control and Law
Enforcement; NADR=Nonproliferation, Anti-terrorism, Demining, and Related Programs; and
PCF/PCCF=Pakistan Counterinsurgency Fund/Pakistan Counterinsurgency Capability Fund.
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Appendix C. Major Donor Bilateral Development
Assistance to Pakistan, CY2010

Figure C-1.Official Development Assistance to Pakistan, by Donor
(In millions of U.S. $ and percentages)

Source: Organization for Economic and Development Cooperation, OECD/DAC International Development
Statistics Online, prepared by USAID Economic Analysis and Data Services, April 10, 2012.
Notes: In addition to bilateral development assistance, in 2010 Pakistan received $1.2 billion from multilateral
agencies, including the World Bank’s International Development Association—$430 million, European Union
Institutions—$270 million, and the Asian Development Fund—$290 million.
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Appendix D. Principles and Purposes of the
Enhanced Partnership with Pakistan Act of 2009

Principles:
1. Pakistan is a critical friend and ally to the United States and share goals of
combating terrorism, firmly establishing democracy and rule of law , and
promoting social and economic development in Pakistan;
2. U.S. aid to Pakistan is to supplement, not replace, Pakistan’s own efforts;
3. The United States requires a balanced, countrywide strategy that provides aid
throughout the country;
4. The United States supports Pakistan’s struggle against extremism and recognizes
its sacrifices in this regard;
5. The United States intends to work with the Government of Pakistan
• to build mutual trust by strengthening mutual security, stability, and
prosperity of both countries;
• to support the people of Pakistan and democracy there, including
strengthening its parliament, judicial system, and rule of law in all provinces;
• to promote sustainable long-term development and infrastructure projects,
including healthcare, education, water management, and energy programs;
• to ensure all people of Pakistan have access to public education;
• to support curricula and quality of schools throughout Pakistan;
• to encourage public-private partnerships in Pakistan top support
development;
• to expand people-to-people engagement between the United States and
Pakistan;
• to encourage capacity to measure program success and increase
accountability;
• to help Pakistan improve its counterterrorism financing and anti-money
laundering;
• to strengthen Pakistan’s counterinsurgency/counterterrorism strategy to
prevent any territory of Pakistan from becoming a base for terrorist attacks;
• to aid in Pakistan’s efforts to strengthen law enforcement and national
defense forces under civilian leadership;
• to have full cooperation on counterproliferation of nuclear weapons;
• to assist Pakistan in gaining control and addressing threats in all its areas and
along its border; and
• to explore ways to consult with the Pakistani-American community.
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Purposes of Democratic, Economic, and Development Assistance:
1. To support democratic institutions in Pakistan to strengthen civilian rule and
long-term stability;
2. to support Pakistan’s efforts to expand rule of law, build capacity, transparency,
and trust in government, and promote internationally recognized human rights;
3. to support economic freedom and economic development in Pakistan such as
investments in water resource management systems, expansion of agricultural
and rural development (i.e., farm-to-market roads), and investments in energy;
4. to invest in people, particularly in women and children, regarding education,
public health, civil society organizations, and to support refugees; and
5. to strengthen public diplomacy to counter extremism.
Purposes of Security Assistance:
1. To support Pakistan’s paramount national security need to fight and win the
ongoing counterinsurgency within its borders;
2. to work with the Pakistani government to improve Pakistan’s border security and
control and help prevent any Pakistani territory from being used as a base or
conduit for terrorist attacks in Pakistan, or elsewhere;
3. to work in close cooperation with the Pakistani government to coordinate action
against extremist and terrorist targets; and
4. to help strengthen the institutions of democratic governance and promote control
of military institutions by a democratically elected civilian government.

Author Contact Information

Susan B. Epstein
K. Alan Kronstadt
Specialist in Foreign Policy
Specialist in South Asian Affairs
sepstein@crs.loc.gov, 7-6678
akronstadt@crs.loc.gov, 7-5415

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