Soon after Eisenhower’s visit to Pakistan and the continuation of the aid program as well as the initiation of the USAID program for Pakistan, the economic relations saw a dramatic change; as in the Indo-Pak wars of both 1965 and 1971, the United States denied financial assistance to Pakistan by imposing economic sanctions contrary to Pakistani aspirations. Soon after the wars, aid sanctions were lifted by the United States in 1975, only to be re-sanctioned in 1979 following apprehensions of a Pakistani Nuclear Weapons Program; but this was again contradicted as aid was released for Pakistan in 1980, totaling a sum of $3.2 billion in military assistance against the Soviet intervention in Afghanistan.
Again this was brought to a halt through the Pressler Amendment of 1985, where aid to Pakistan was restricted on grounds of the Nuclear Weapons Program initiated by Pakistan; but NGOs and other humanitarian based reliefs were not denied monetary assistance. The 1998 atomic weapons tests resulted in another set of sanctions; the USAID program released $140 million for agricultural development in Pakistan. The September 11, 2001 attacks on the World Trade Center and Pakistan’s support assurances to counter terrorism saw another round of economic leverages.
The $3 billion outstanding debt of Pakistan was debated at Paris Club, the United States released $350 million for civil and $512 million for military assistance to Pakistan. The Bush administration, in 2003, announced a 5 year package for Pakistan totaling $3 billion, and after the October 2005 earthquake in Pakistan, it received $510 million for relief efforts. The Obama administration, in 2008, released a $7.5 billion package for Pakistan, and the more recent National Defense Authorization Act, 2011, following a lot of diplomatic deadlocking, had turned the tides once more.
The conclusion from the above mentioned dissection of a historical overview of the Pak-US economic relations reveals that it is mostly driven by ‘need and want’, and that release and sanctioning of the economic assistance to Pakistan is based on ascertainment of the best fulfillment of the American interests. Strangely enough, Pakistan in this relationship has the least say in matters pertaining to financial assistance. The United States of America follows perfectly the Rational Actor Model as the entire aid and assistance program, right from its initiation, has been driven in accordance to requirements.
The pattern is clear: the funds were released against Pakistan joining SEATO and CENTO to contain the Soviet Union, denied against the Indo-Pak wars, then released against the Soviet-Afghan war to be denied by Pakistani nuclear Weapons Project, and then again released for the Pakistani support regarding the September 11 attacks and more recently denied for want of more cooperation by Pakistan. This implies that whenever the United States had her national interests to fulfill, the funds were allowed and when Pakistan’s interests collided with the American aspirations, the same were denied.
In terms of application of the Pluralistic and the Elitist Model, a very vivid demonstration was observed during the Pressler Amendment when economic assistance to Pakistan was sanctioned – Pakistan still received a small amount of assistance in terms of military packages, as the Soviet-Afghan war was still underway and providing military assistance was deemed necessary. Similar events also reveal the utilization of the Bureaucratic Politics Model, as the American Bureaucratic structure regulated all economic funding in strict accordance to the requirement presented by Pakistan and ratification of the same in positive pursuance of the American national interest in the region projected through Pakistan.