Pakistan has Given Reverse Aid to the US Worth $5.1 billion Since 2006: ECONOMISTAN Economic Analysis Think Tank

"It is about time to relive those times and do away with the archaic bureaucratic practices of management that the British have endowed to the lands they have ruled..."

Much hue and cry has been made out of the Aid US has given to Pakistan over the years. However, all this Aid amounts to pittance when we realize that US has given Pakistan over a period of 60 years only $8.9 billion dollars in economic assistance. This amount is less than even the remittances that Pakistanis would send this year which would amount to a little more than $9 billion dollars. The military aid that the US has given to Pakistan over the past 62 years amounts to $14.7 billion, which includes $5 billion dollars which were given to Pakistan during the Zia years to drive the Soviets back from Afghanistan thus signaling the end of the Cold War. In short, Pakistan won the war for the US for just $5 billion which speaks volumes about the efficiency and determination of Pakistan Armed Forces.

This $5 billion not only covered the cost of arming and training Afghan fighters and the supply of stinger missiles which were instrumental in bringing down Russian air power but also helicopters and other weapons and fuel needed to defeat the Soviets. It was a war in which many Pakistani fighter pilots also laid down their lives in an effort to drive the Russians away from Afghanistan.
The US basically used Pakistan to win its war against Russia and dubbed the Foreign Direct Investment or Military Expense in this Cold War as US Aid. Paying another country to fight its own war should not be called as Aid but wages for fighting the war. Again during so the called “War on Terror”, the US has enrolled its old and forgotten partner to do all the work for it and given Pakistan a little more than $ 9 billion as Coalition Support Funds (or “Military Aid”) to win the war.

A major portion of these Coalition Support Funds however, also includes the cost of fuel that Pakistan supplies to the US forces based in Afghanistan. In effect the US calls the money it gives to Pakistan for the fuel that the US itself uses in Afghanistan as “Military Aid”rather than “Military Expense”. There are also reports that Pakistan is supplying the fuel to the US below cost. The Coalition Support Funds and Security Assistance almost entirely are composed of fuel plus the military hardware costs that the US has supplied to Pakistan. Given below is a complete breakdown of the so called “Military Aid” since 911 to Pakistan,

“Military Aid” to Pakistan since 911
Coalition Support Funds	$5.6 b
Security Assistance	$1.8 b
Budget Support	$1.6 b
Development	$0.9 b

The US is using US companies and contractors to channel this so called “Aid” which is used to support US companies presently operating in Pakistan against Chinese firms along with the construction of infrastructure projects like the building and expansion of the one billion dollar US embassy in Pakistan. Under the same token if Pakistan spends some money from its exchequer to build part of its embassy in the US, would that also be termed as Pakistan’s aid to the US? or for that matter if Pakistan purchased any military hardware from the US would it be termed as Pakistan’s aid to America? Under the current US definition of “aid” it would. If so then it would not be wrong to say that Pakistan has given the US aid worth $5.1 billion since 2006 because of the money it spent for the purchase of F-16s from the US. Well the logic behind the Kerry-Lugar bill is the same. This so called aid is not really aid at all instead it is US Foreign Direct Investment in Pakistan to accomplish its nefarious designs such as expansion of US military infrastructure in Pakistan through use of private military contractors and blacklisted companies like Black Water and stationing of US marines and hardware in Pakistan through overt and covert means.

The funny thing is that this so called US Aid is spread over many years comes with harsh conditions. The US just playing with terminologies and fooling the people of Pakistan into thinking that the money US is using in supporting US companies in Pakistan and building its own embassy is aid. It is about time for Pakistan to wake up and aggressively address the issues of the sovereignty in Pakistan and excessive US interference in Pakistan’s internal affairs in the garb of this so called aid. Pakistan would also be well served to reject this so called aid and closely scrutinize all of this “Foreign Direct Investment” from the US which it calls aid to Pakistan. Pakistan should require the US to give a detailed list of each and every item that is purchased through this money in Pakistan and which US companies, contractors and concerns are the beneficiaries of the so called “aid”.

Thanks to the billions of dollars that overseas Pakistanis have sent to Pakistan just this year($ 9 billion), the current account deficit of the current financial year for Pakistan has reduced to a mere $462 million dollars which bodes well for Pakistan. Pakistan’s stock market is also in recovery mode and rose by 2.4% to 9,374 points since Sept 24. It is about time Pakistan reconsidered its partnership with the US and called the US military aid or foreign direct investment in Pakistan “US military expense” and the US economic assistance to Pakistan over the last 62 years of $ 8.9 billion dollars what it is, a “Pittance”.

Saad Sarwar Muhammad has a BS in Computer Science from the University of Central Oklahoma, USA and an MBA (Finance) from the Indiana University of Pennsylvania, USA. He writes on issues related to the world economy with special emphasis on Pakistan, US and China. Other areas of interest include information technology, politics and religion. He is currently working as an Assistant Professor in Information Technology and E-commerce as a Cluster Head at NUST Business School(NBS), Islamabad, Pakistan.