Isobel Coleman

Democracy in Development

Coleman maps the intersections between political reform, economic growth, and U.S. policy in the developing world.

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Revisiting the Pakistani Aid Conundrum

by Isobel Coleman
July 15, 2011

A soldier takes up position on top of an Army base camp next to a Pakistan flag in Tora Warai, a town in Kurram Agency, during a military trip organised for media along the Pakistan-Afghanistan border, July 11, 2011 (Courtesy Reuters).

Late last week reports emerged that the United States was canceling or suspending some $800 million in aid to the Pakistani military. Relations between the two countries have been extremely tense since the U.S. raid that killed Osama bin Laden in May. But this is only the latest rough patch in a partnership long dogged by concerns that Pakistan’s military and intelligence establishment is playing a double game—accepting American support and promising to fight terrorism while maintaining links with groups responsible for attacks. Clearly the Obama administration is trying to send Pakistan’s generals a message by withholding some of the money and equipment they want.

The case for reducing U.S. aid to the Pakistani security establishment is compelling, and it keeps becoming more so. Pakistan’s main intelligence agency, the ISI, has been linked to the horrific killing in late May of Syed Saleem Shahzad, a journalist who reported on Islamic militancy. A Human Rights Watch statement chronicles threats Shahzad said he received from the ISI, and it reports that he “was in intelligence agency custody” after disappearing from Islamabad on May 29. His body was found shortly after with “17 lacerated wounds delivered by a blunt instrument, a ruptured liver, and two broken ribs,” according to a New York Times article. Last week Adm. Mike Mullen, the top American military officer, suggested that he believed Pakistan’s government signed off on Shahzad’s death. “I have not seen anything to disabuse the report that the government knew about this,” he said.

The question is whether withholding military assistance is likely to make Pakistan alter its calculus, which sees the Taliban and other militant groups as a useful means of exerting influence in Afghanistan and pressure on India. My view, as I argued in an earlier blog post and CFR Expert Roundup on aid to Pakistan, is that nothing the United States does will change Islamabad’s outlook. My colleague Dan Markey, a CFR South Asia expert, weighed in on this point more recently in a First Take. “Alone,” he wrote, “cutting U.S. military assistance will not force Pakistan to reassess its strategic posture. Pakistan’s generals probably benefit from the assistance more than they claim, but they can also do without it.” So there is no reason to hope that cutting aid will produce a sudden realignment, but neither is there any reason to keep aid flowing at full force.

Instead, the United States should change the mix of its support for Pakistan: less military and more civilian. According to a Congressional Research Service (CRS) report, some two-thirds of U.S. assistance from fiscal year 2002 to fiscal year 2010 ($13.3 billion) went to security, with only about one-third ($6.5 billion) for economic development. Fortunately, the Obama administration seems to be heading in the right direction: in its fiscal year 2012 budget request, about 46 percent of funds is for economic assistance and 54 percent for security, according to CRS. Of the $1.36 billion requested for economic aid, $929 million would be used to boost economic growth through assistance in such areas as trade and investment, infrastructure, agriculture, and private sector competitiveness. Another sizable piece, $265 million, has been requested for the “Investing in People” category, which includes aid for health and education. But this is down from the $608 million allocated in fiscal year 2010. Education—especially girls’ education—should be a far bigger priority because of the economic and societal dividends it can pay.

The frustration in Washington with Islamabad’s behavior is bubbling up at the same time as the U.S. budget faces serious cuts. It is tempting to write off Pakistan as a hopeless case. But while withholding some military aid is healthy, gutting economic development assistance would be disastrous. Pakistan is a nuclear-armed country menaced by militants and facing a demographic explosion: its population, now more than 173 million, will increase to nearly 275 million by 2050, according to the latest middle-ground UN projection. (If fertility remains constant instead of declining as the UN expects,  the mid-century total will be 379 million.) Its health and education indicators are abysmal. And with its weak government and economy, Pakistan is clearly unable to address its challenges on its own. Civilian assistance to help prevent the country from imploding remains a necessary investment, even as the U.S. government wisely rethinks its relationship with Pakistan’s generals and spies.

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