The United States has paused all foreign assistance to Pakistan, impacting multiple critical projects across various sectors. This decision, rooted in an executive order by President Donald Trump, aims to realign foreign aid with U.S. foreign policy objectives.
Trump’s Executive Order
President Trump, in his second term, issued an executive order directing a reassessment of U.S. foreign assistance programs. The order emphasizes ensuring that every dollar spent aligns with U.S. interests, focusing on safety, strength, and prosperity. Secretary of State Marco Rubio reiterated this stance, stressing the need to justify aid expenditure.
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According to a State Department cable, all existing programs funded through the State Department and USAID have been paused, with a 90-day review period to decide their future. This sweeping suspension excludes emergency food aid and support for key allies like Israel and Egypt.
Energy and Economic Growth
Five energy projects, such as the Power Sector Improvement Activity and Clean Energy Loan Portfolio Guarantee Program, have been halted. Similarly, four economic growth initiatives, including the Investment Promotion Activity and Pakistan Private Investment Initiative, are now on hold.
Agriculture and Cultural Preservation
In the agriculture sector, two major projects set to conclude in 2025—Water Management for Enhanced Productivity and Pakistan Agriculture Programmes-II—have been affected. The suspension also pauses the Ambassadors Fund for Cultural Preservation (AFCP), a flagship program for heritage protection.
Education and Health
Four education projects, including Improving Girls Education Activity and Higher Education System Strengthening Activity, have been disrupted. In health, initiatives such as the Integrated Health Systems Strengthening and Service Delivery project and the Tuberculosis Local Organisation Network have been paused.
Governance and Human Rights
The decision impacts 11 governance programs, including Building Peace in Pakistan and Community Resilience Activity-North. These initiatives focus on democratic processes, governance, and human rights.
Broader Context
The United States is the world’s largest aid donor, having disbursed $72 billion in 2023. However, the suspension of aid to Pakistan risks delaying billions in critical life-saving assistance, with fears that some projects may never resume. Former USAID official Jeremy Konyndyk warned of severe consequences, describing the move as a “wrecking ball” to foreign aid programs.
The White House has defended the suspension, claiming that foreign aid often destabilizes world peace by promoting conflicting values. It emphasized that future aid allocations would prioritize measurable returns for the American people.
Impact on Pakistan
The pause in aid comes at a challenging time for Pakistan, already grappling with economic instability. Several development projects crucial to governance, infrastructure, and public welfare now face uncertainty.
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While the U.S. maintains that the suspension is temporary, fears persist that the 90-day review could result in permanent cuts or significant reductions. This uncertainty raises concerns about the future of U.S.-Pakistan relations and the broader implications for international development.