Commentary: Suspension of United States Aid to Pakistan

Issues Meriting Consideration

The United States policy to Pakistan remains an enigma and has moved through ups and downs. 2018 began with a tweet from the President that the ‘United States has foolishly given Pakistan more than 33 billion dollars in aid over the last 15 years and they have given nothing but lies and deceit’. Further, Pakistan has been a safe haven to terrorists whom the US hunt in Afghanistan.

The tweet was certainly not an empty threat. On 04 January 2018, the State Department announced that the US was freezing most military aid to Pakistan. It is important to note that there is no clarity in the word ‘most’. Besides, the US Government has declined to specify the exact amount of funds it will cut off. However, it is assessed that the suspension could freeze up to $ 1.3 billion in aid. It is obvious that it has angered Pakistan whose Foreign Minister told the Wall Street Journal on 05 January that Pakistan has been turned into a whipping boy to distract from American failures in Afghanistan. He also implied that the move could end co-operation on issues like sharing of intelligence, and that Pakistan is an ally of the US but this is not the way allies behave.

Likely Effects - Will Pakistan Change?

On 04 January 2018, the Washington Post came out with an article on this issue and brought out that the aid cuts won’t make Pakistan change. Indeed, Pakistan would not be impacted as its skin has grown thick from rhetorical bashing. Pakistan survives in the belief that after the US’ grand standing is done and over, it will turn back to Pakistan for mopping up its half finished task in Afghanistan. Holding up financial aid is just a push not being made into a shove. The requirement is surgical uprooting of terrorist systems inside Pakistan. This is not the first time that American aid has been scaled back. In 2011, the Obama Administration suspended $ 800 million of military aid two months after the US Navy Seals took out Osama Bin Laden in Pakistan. Further in 2015, $ 300 million of Pentagon’s Coalition Support Funds were made conditional on Pakistan acting against the Haqqani Network terrorist group in Afghanistan. The Inter-Services Intelligence (ISI) has long been accused of patronising and protecting the Group. It is unfortunate that none has worked. As per the former Pakistan Ambassador to the US, Hussain Haqqani, the only way it would impact Pakistan is if US uses unilateral action including Unmanned Combat Aerial Vehicles (UCAV) to target Afghan Taliban safe havens in Quetta and other locations. Aid cuts by themselves are ineffectual.

The US still depends on Pakistan heavily for logistics support to troops based in landlocked Afghanistan. The other alternatives of a Northern route through Central Asia or the air route are inconvenient and prohibitively expensive. Accordingly, no change is visualised in Pakistan’s approach to the issues raised by US.

Reality Check

It is important to carry out a reality check of what the cutting of US Aid would imply to Pakistan. Economically, the effect would be marginal. Experts, when contacted, stated Pakistan’s GDP is currently about $ 305 billion. The estimated impact of the measure would be 1.27 percent. Pakistan’s fiscal position has improved with fiscal deficit being around 4.3 percent.

Pakistan Armed Forces currently depend more on China for bulk of their military equipment. They also have a large portion of US and European equipment whose spares and ancillary facilities can be obtained from Saudi Arabia, other Gulf countries and Turkey. Its missile system is assisted by China and North Korea. Its nuclear programme is assisted by China when it is the only Muslim country in the World with nuclear weapons.

Options for Pakistan

There are two likely options for Pakistan:-

• Option A. Be patient and wait for the US to continue business as usual;
• Option B. Depend more on China for greater financial and military aid. Additionally, to turn to Saudi Arabia, other Gulf countries and Turkey for military spares and maintenance, including extracting replacement of defective equipment.

The China Factor

As per the Washington Post, cutting of US Aid to Pakistan would make Pakistan move closer into China’s embrace. Right after the said tweet, Pakistan’s Central Bank gave the green light for using the Yuan (Remnibi) as a currency for bilateral trade with China. China brings in more than $ 60 billion into Pakistan in investment and infrastructure, prompting the question whether Pakistan is turning into a province of China.

The US has considered the geo-strategic location of Pakistan and has optimised it for furthering her strategic interests. Pakistan is an ally of both the US and China, a position which no country in the world enjoys. Accordingly, India should expect no change in Pakistan’s attitude in continuing with terrorist activities in India and Afghanistan.

China would assist Pakistan financially and militarily to continue playing its role as a surrogate state that ensures that the pot keeps boiling in India and Pakistan.

(Views expressed are of the author and do not necessarily reflect the views of the VIF)