Trump Admin to give 'loan' to Pak instead of military grant

The recently proposed Trump administration's budget would convert some of the United States' foreign military aide to some countries, including Pakistan, to loans, to slash spending on diplomacy, aid and programmes abroad by more than 29 per cent.

According to a report appearing in the Express Tribune, Director of the White House Office of Management and Budget Mick Mulvaney said in a briefing that aid to Pakistan would be reduced, though he did not give concrete details.

"We do change a couple of the foreign military programmes from direct grants to loans. Our argument was instead of . giving somebody USD100 million, we could give them a smaller number worth of loan guarantees and they could actually buy more stuff," said Mulvaney.

US military assistance to partners and allies reached USD 13.5 billion in 2015, or 28 per cent of all US foreign aid spending that year, according to the Congressional Research Service.

Most grants through the Foreign Military Financing [FMF] programme go to Pakistan Israel, Egypt, Jordan and Iraq.

Last year, the US assistance to Pakistan under the State Department budget was USD 534 million, which included USD 225 million towards foreign military funding.

The cuts to programmes under the State Department are in part meant to fund an increase in military spending. The White House budget documents showed total defense spending for the 2018 fiscal year at $603 billion, about 3 per cent higher than President Barack Obama's proposed 2018 fiscal year defense budget.

Military aid to Israel and Egypt, two close U.S. allies in the Middle East, will remain unchanged, Mulvaney said.