The US Defense Department has made a final decision to cancel $300 million (the Coalition Support Funds) in aid to Pakistan. The official reason is Islamabad’s failure to take decisive action against the militants who are waging war in Afghanistan: the Haqqani network and the Afghan Taliban. The move is subject to approval by Congress. It was announced mere days before Secretary of State Mike Pompeo is due to visit Pakistan to meet Imran Khan, the country’s new prime minister. It also took place right on the heels of Iranian Foreign Minister Javad Zarif’s visit to Pakistan, where the leadership expressed support for Iran and the nuclear deal the US abandoned. One is reminded of President Trump’s Aug. 7 tweet warning that “[a]nyone doing business with Iran will NOT be doing business with the United States.”
The announced decision is part of a broader suspension that was proclaimed at the beginning of the year. “The United States has foolishly given Pakistan more than 33 billion dollars in aid over the last 15 years, and they have given us nothing but lies & deceit,” President Trump tweeted on January 1, 2018. “They give safe haven to the terrorists we hunt in Afghanistan, with little help. No more!” The statement was followed by announcement that Secretary Jim Mattis was authorized to grant $300 million in CSF funds over the summer if he saw a change of attitude in Islamabad. He didn’t.
The US has started to suspend its training and educational programs for Pakistani officers. No funds have been provided for the coming academic year. US military institutions, including the National Defense University in Washington DC, the US Army’s War College in Carlisle, Pennsylvania, the US Naval War College, the Naval Staff College, and other courses they offered, including cybersecurity studies, eliminated the 66 slots they had reserved for cadets from Pakistan. It’s rather symbolic that Moscow and Islamabad signed an agreement on August 7 to train Pakistani military personnel in Russia.
With that country’s foreign-exchange reserves plummeting, PM Imran Khan will have to decide whether his government will seek a bailout from the International Monetary Fund (IMF), where the United States controls more votes than any other member. The alternative would be to turn to China, Russia, and other friendly nations. After the victory of the Pakistan Tehreek-e-Insaf (PTI) party in the 2018 general elections, China agreed to grant a $2 billion loan to Islamabad. On July 30, US Secretary of State Mike Pompeo warned that any potential IMF bailout for Pakistan’s new government must not include funds to pay off the country’s Chinese lenders. Pakistan is pinning its hopes on the China-Pakistan Economic Corridor (CPEC) project.
Russia and Pakistan marked the 70th anniversary of their diplomatic relations on May 1, 2018. That relationship has seen its ups and downs, but today it has risen to a new historic high.
Moscow and Islamabad see eye-to-eye on the prospects for ending the conflict in Afghanistan. Pakistan has endorsed the Russian-brokered peace talks that exclude the United States but include the Taliban. Pakistan strongly supports Russia’s Syria policy. Islamabad’s membership in the Shanghai Cooperation Organization (SCO) opens up new prospects for cooperation. Russian President Vladimir Putin has put forward a proposal to create a more extensive Eurasian partnership based on the Eurasian Economic Union (EEU), which would involve China, India, Pakistan, Iran, and those from the Community of Independent States (CIS) that are willing to join. Islamabad is also interested in signing a free-trade agreement with the Russian-led Eurasian Economic Union (EEU).
Pakistan has shown its interest in buying military hardware from Russia, has participated in Russian war games, and has also attended Army exhibitions. In September 2016, Russia and Pakistan held their first-ever joint military exercise. It’s been held yearly ever since. Pakistan’s Chief of Army Staff General Javed Bajwa paid his first visit to Russia in April of this year. In late July, the two countries signed a naval cooperation agreement during the visit of Pakistan's Vice Chief of the Naval Staff Vice Admiral Kaleem Shaukat to Russia. The Pakistani military plans to purchase Su-35 fighter jets and T-90 tanks from Russia.
Russia is involved in many economic projects, such as the Karachi Steel Mill and Gudhu Power Plants. In 2015, Russia and Pakistan signed a contract to build a 1,100-kilometer gas pipeline from Karachi to Lahore (the North-South pipeline) with a capacity of 12.4 billion cubic meters per annum — the largest economic deal ($1.7 billion) between the two countries since the USSR built the Pakistan Steel Mills in the 1970s. Delayed several times because of tariff disputes, it will be set in motion this year by a Russian company called RT - Global Resource.
Pakistan has already invited the Russian Federation to join the $1.16 billion Central Asia-South Asia power project or CASA-1000, which will allow for the export of surplus hydroelectricity from Tajikistan and Kyrgyzstan to Pakistan and Afghanistan. In 2017, Pakistan’s government gave the go-ahead for the initiation of an agreement with Russia to construct a 600MW Natural Gas Combined Cycle (NGCC) power plant in Jamshoro, Sindh.
US-Pakistani relations are evidently at a low ebb but every coin has two sides. This is prompting Islamabad to diversify its foreign relationships. There are other partners with a lot to offer that could make that country stronger and much less vulnerable to outside pressure.