Pakistan Reacts to US 'Arm-twisting' $300 Million ‘Aid’ Cut 

ISLAMABAD: Pakistan led by newly elected Prime Minister Imran Khan Sunday sent a loud and clear message to the United States that Islamabad wants to restore and improve the bilateral relations with Washington but only on mutual trust and self-respect.

Foreign Minister Shah Mehmood Qureshi outlined his governments position after the US military said it has made a final decision to cancel $300 million in 'aid' to Pakistan that had been suspended over Islamabad's perceived failure to take decisive action against militants, in a new blow to deteriorating ties.

"This is not aid. This is our money that we have spent in the fight against terrorism," the foreign minister insisted but stopped short of denouncing the US move.

"The $300 million was not any funding or aid for Pakistan. There is nothing new in this announcement. This amount belonged to Pakistan which we have spent from our own funds for a better Pakistan in the fight against terror. The US was supposed to reimburse this amount," Qureshi said.

The so-called Coalition Support Funds were part of a broader suspension in aid to Pakistan announced by President Donald Trump at the start of the year, when he accused Pakistan of rewarding past assistance with "nothing but lies & deceit."

Analysts here say the 'aid cut' to Pakistan has the clear potential of undermining the visit of Secretary of State Mike Pompeo to Pakistan on September 4.

Just three days before Pompeo, accompanied by Chairman, Joint Chiefs of Staff, General Joseph Dunford, hold talks with Pakistan new leadership on "action against common foes and terrorists" flies into Pakistan, the announcement to cancel the "aid" has been made. Obviously, it is aimed at this sojourn and a way to mount pressure on Pakistan to accept the American terms. Pakistan has always denied any militants are operating from its soil.

International relations expert Senator Mushahid Hussain said in a tweet that the American stoppage of $300 million Coalition Support Funds (CSF) undermines Pompeo's visit to Islamabad and is a sop to India as New Delhi seeks to solidify Indo-US front against Pakistan's best friend, China; earlier, $500 million CSF was stopped; all this is money owed to Pakistan by US and is not aid.

The News quoted former Foreign Minister Khurshid Mehmood Kasuri saying that the American decision was symptomatic of Trump administration's approach and policy. "If it was meant to arm-twist, browbeat and send a message to Pakistan, it is a very crude way."

He said the present administration has adopted similar strategies about Nato, Nafta with Canada, Far East etc. Maximum sanctions have been imposed on Iran and Russia, he said adding that whether the American decision was coincidental or intended, it could not succeed because both the US and Pakistan have equal interests in having peace in Afghanistan.

The CSF funds were part of a broader suspension in aid to Pakistan announced by President Trump at the start of the year, when he accused Pakistan of rewarding past assistance with "nothing but lies & deceit."US Defense Secretary Jim Mattis, in particular, had an opportunity to authorise $300 million in CSF funds through this summer--if he saw concrete Pakistani actions to go after insurgents. Mattis chose not to.

The Trump administration says Islamabad is granting safe haven to insurgents who are waging a 17-year-old war in neighboring Afghanistan, a charge Pakistan denies.

But US officials had held out the possibility that Pakistan could win back that support if it changed its behavior.

The Pentagon's decision showed that the United States, which has sought to change Pakistani behavior, is still increasing pressure on Pakistan's security apparatus. It also underscored that Islamabad has yet to deliver the kind of change sought by Washington.

"It is a calibrated, incremental ratcheting up of pressure on Pakistan," said Sameer Lalwani, co-director of the South Asia program at the Stimson Center think tank in Washington.

According to Kasuri while the Trump administration was building a strategic partnership with India, its relationship with Pakistan was "transactional", which could be polite. People in Pakistan, he said, will not like this arm-twisting, and added that the decision has come at a time when Pakistan is faced with dire financial crises.

Pakistan's foreign exchange reserves have plummeted over the past year and it will soon decide on whether to seek a bailout from the International Monetary Fund (IMF) or friendly nations such as China.

"They are squeezing them when they know that they're vulnerable and it is probably a signal about what to expect should Pakistan come to the IMF for a loan," Lalwani said.

The United States has the largest share of votes at the IMF. Khan, who once suggested he might order the shooting down of US drones if they entered Pakistani airspace, has opposed the United States' open-ended presence in Afghanistan.