Partnership for Progress

Advancing a New Strategy for Prosperity and Stability in Pakistan and the Region

Report from Caroline Wadhams, Brian Katulis, Lawrence J. Korb, and Colin Cookman offers a new strategy for prosperity and stability in Pakistan and the region.

Pakistan faces internal instability and violence and is now a top national security concern. (AP/Milo Morenatti)
Pakistan faces internal instability and violence and is now a top national security concern. (AP/Milo Morenatti)

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Pakistan lies at the nexus of one the world’s most complicated geopolitical regions— one plagued by poverty, nuclear proliferation, and global terrorism. With a growing population of more than 165 million people, Pakistan is a vital link between South and Central Asia and the broader Middle East. Pakistan’s multiple internal challenges extend beyond its borders and have a wide-ranging impact on regional and global stability. Just as conditions in Afghanistan, India, Iran, and Central Asian countries affect Pakistan, events in Pakistan shape its neighbors.

There are positive signs and opportunities for Pakistan’s democracy and, ultimately, stability. In February 2008, a democratic transition occurred in Pakistan, ushering in a civilian government and leading to the resignation of military strongman Pervez Musharraf from the presidency. Despite a history of interference in the political process, the Pakistani military has intentionally provided space to Pakistani’s civilian leaders to find their footing since the election.

Pakistan will pose one of the greatest foreign policy challenges for the incoming Obama administration. How Pakistan addresses its militancy, weak governance, and economic dif- ficulties will directly influence the security of the United States and its people. The Obama administration must seize these opportunities and work with Pakistan, its friends, and neighbors to create a new strategy for enhancing security in Pakistan. But first U.S. policymakers must understand the key challenges facing Pakistan and the region, as well as the critical opportunities the Obama administration can leverage over the next four years.


The Obama administration, together with international partners, will need to assist Pakistan in tackling its growing insurgency, its weak governance, and its collapsing economy as part of a broader regional strategy for progress and stability. Pakistan today faces three fundamental challenges:

Growing internal violence and regional instability. A strengthening, multi-headed adaptive network of extremists comprised of the Taliban, Al Qaeda, and affiliated indigenous militant groups is escalating deadly attacks within Pakistan and Afghanistan. U.S. intelligence agencies have repeatedly issued warnings that some of these groups are using safe havens in Pakistan to facilitate and plan attacks around the world. Tensions in the neighborhood feed this insurgency. Pakistani fears of encirclement by India translate into continued support to some of these militant groups by elements of the Pakistani security establishment, who use these groups as a force multiplier to counterbalance India.

Failing governance. Pakistan’s civilian government remains weak following years of military rule, underinvestment in Pakistan’s governmental institutions, and dysfunctional political leadership. The Foreign Policy/Fund for Peace Failed States Index 2008 ranks Pakistan as one of the weakest countries worldwide—the ninth state most at risk of failure out of 177 countries. A dangerous disconnect exists between the needs of the Pakistani people and the ability or inclination of their leaders to provide for them.

Deteriorating economy. Pakistan’s economy is in a downward spiral. Inflation is at 25 percent, foreign reserves are plummeting, and the government is in danger of defaulting on its foreign debt. A spike in global food prices has hit Pakistanis especially hard, and the global financial crisis only threatens to exacerbate Pakistan’s economic woes. Pakistan is watching foreign investors flee, which only makes it more difficult to attract the foreign financial assistance the new government needs to stabilize and then grow the economy.

These challenges of militancy, weak governance, and economic insecurity feed upon each other in a dangerous cycle. The United States needs to make a shift from a reactive, transactional, short-term approach that is narrowly focused on bilateral efforts. Instead, a more proactive, long- term strategy should seek to advance stability and prosperity inside Pakistan through a multilateral, regional approach.


For decades, U.S. policy has pursued short-term stability in Pakistan at all costs, utilizing a self-defeating strategy of almost exclusive support to Pakistan’s military establishment and individual leaders. It has offered insufficient and inconsistent support to civilian institutions and programs that directly impact the lives of average Pakistanis. The reactive nature of U.S. engagement in Pakistan has reduced U.S. leverage and undermined the bilateral relationship between the two countries. The United States has suspended aid, imposed sanctions, and intermittently renewed contacts for decades, depending on the paramount strategic concerns at the time.


What’s worse, the United States has approached Pakistan in a vacuum, neglecting to recognize the regional nature of Pakistan’s challenges and the competing and sometimes contradictory roles played by numerous countries in Pakistan. In the seven years since the September 11th attacks, the Bush administration only deepened this policy approach. Tying its policy to President Musharraf, it overemphasized a conventional military approach, poured unaccountable and non-transparent funds into Pakistan’s military establishment, and did not work closely enough with other nations and organizations whose interests in Pakistan are as much at stake as ours. This approach has not served U.S. or Pakistani interests, nor is it aligned with U.S. values.


Legitimate partners in the government of Pakistan. For the first time in almost a decade, the United States and the world have partners in a democratically elected government of Pakistan. This government, while internally divided and weak, has greater legitimacy than previous governments because of the February 2008 elections, which most observ- ers deemed as a legitimate expression of the will of the Pakistani people. As a result, the current government—led by President Ali Asif Zardari and Prime Minister Yousaf Raza Gillani—has a greater potential for representing and mobilizing Pakistan’s population toward fighting militancy and strengthening its governmental institutions than the military dictatorship that preceded it. President Musharraf’s popularity was so low at the end of his presidency that all policies associated with him were discredited.

Increased international involvement and support. Pakistan has numerous allies in the region and the world beyond the United States that are assisting Pakistan in addressing the challenges outlined above. Key countries around the world understand that the stakes are high in Pakistan. The Friends of Pakistan Group, comprised of Britain, France, Germany, the United States, China, Saudi Arabia, the United Arab Emirates, Canada, Turkey, Japan, Australia, and Italy plus the United Nations and the European Union, is just one example of these efforts to support Pakistan’s democracy, economy, and security situation. Numerous other countries and international organizations including the World Bank and International Monetary Fund are attempting to provide financial assistance for Pakistan’s economy and military, implement programs, offer training, and provide additional support. There is a greater chance for progress and increased stability in Pakistan if these international efforts are coordinated and integrated with initiatives the Obama administration undertakes in Pakistan.

An engaged U.S. Congress. In the past year, Congress has taken important strides in moving U.S. policy in Pakistan in a new direction, and the new Congress that takes office in January will likely build on these actions. In the House of Representatives, the Oversight and Government Reform Subcommittee on National Security and the House Committee on Foreign Affairs have conducted regular hearings into U.S. aid programs and policy toward Pakistan. In the Senate, former Chairman Joseph Biden (D-DE) (now vice- president elect) and Ranking Member Richard Lugar (R-IN) of the Senate Foreign Relations Committee introduced the Enhanced Partnership with Pakistan Act of 2008, legislation that aims to broaden the U.S.- Pakistan relationship beyond military relations and to authorize $7.5 billion to Pakistan over five years for projects "intended to benefit the people of Pakistan," including "just and democratic governance, economic freedom, and investments in people, particularly women and children." This legislation lays the groundwork for a new strategy in which the United States seeks a partnership with the people of the Pakistan and not just a military expected to cooperate on American security aims.

The new Obama administration. The current distrust that the government of Pakistan and its people hold toward the Bush administration has undermined a cooperative Pakistan- U.S. relationship. Furthermore, the strains between the Bush administration and numerous other countries including our European allies have hurt our nation’s efforts to cooperate and coordinate on Pakistan. The Obama administration has the potential to mend the strained U.S.-Pakistan relationship and offers a fresh opportunity to reach out anew to other strategic players in the region and the world to coordinate international efforts on Pakistan.

A strengthened Pakistani civil society and media. Pakistan’s civil society, including a law- yer’s movement that led prominent efforts in favor of democracy over the past year and a thriving media, are increasingly calling Pakistan’s leaders to account and demanding action on behalf of the Pakistani people. These forces have the potential over time to influence their leadership to address their leading concerns, including unemployment and inad- equate education, as well as to demand a strengthening of civilian government institutions.


The United States needs to make a shift in its approach to Pakistan, recognizing both the importance of Pakistan to regional and international security, as well as the limitations of U.S. power. U.S. policy must recognize that the military component alone is insufficient to build stability and security in Pakistan. Military operations alone will not defeat Pakistan’s militant groups; addressing some of these groups will require a diverse approach, including strengthening governance and rule of law, creating economic opportunities, and exploring political negotiations.

Furthermore, Pakistan’s instability extends beyond the immediate threat of militancy in the country. Even if Al Qaeda were to be destroyed in Pakistan tomorrow, Pakistan would face other challenges to its stability including domestic militancy, fragile governance, regional tensions, and economic turmoil. The United States must integrate all the elements of American power to engage more deeply on these sources of instability. Since the Pakistani parliamentary elections in February 2008, the U.S. government has begun to make some changes in its policy toward Pakistan. It has shown support for the new civilian government and increased assistance to the Pakistani people through programs in education, economy, energy, health care, and more. However, these changes are not sufficient to meet the considerable challenges.

Addressing Pakistan’s instability will not be easy. Pakistan presents an exceptionally difficult strategic challenge. A deep tension exists between the short-term challenge of confronting terrorism emanating from the borderlands and the long-term challenge of strengthening Pakistan’s governance structures and economy (or between tactical counterterrorism strikes and an enduring counterinsurgency approach). Short-term measures such as military strikes to increase pressure on Al Qaeda and the Taliban may undermine the credibility and effectiveness of Pakistan’s civilian leadership. The United States will need to find the proper balance of responding to the urgent security threat without undermining broader goals.

The United States must recognize the limitations of direct U.S. influence in Pakistan and continue moving toward a multilateral approach, with Pakistan as a full partner. At this point in time, Pakistani perceptions of the United States are so dismal that efforts to pursue change in Pakistan with the United States in the lead may automatically discredit the effort. The United States needs to work with Pakistan’s neighbors, other global powers, and international organizations such as the World Bank, IMF, and the United Nations in order to assist Pakistan over the long term.

End Goals

The new U.S. administration, with Congress and the international community, should strive to help Pakistan accomplish the following goals in the next decade.

  • Weaken Al Qaeda, the Taliban, and affiliated militant groups so that they no longer threaten stability in Pakistan, Afghanistan, India, the broader region, the United States or the world.
  • Secure borders between Pakistan and its neighbors, with all border disputes including Kashmir and the Durand Line (the disputed boundary between Afghanistan and Pakistan), either resolved or in a credible process for resolution.
  • Foster a stable internal political system that is based on the inclusive participation of all Pakistani citizens, civilian oversight of key security and intelligence agencies, and governing authorities that respect basic human rights.
  • Create an economy that is growing, integrating with the global economy, and providing for the needs of its citizens.

With these goals in mind, the recommendations detailed in the body of this report include the following key steps:

Implement policies that recognize the regional dimension of Pakistan’s security challenge. Afghanistan, India, and Pakistan are inextricably linked, and U.S. policy must be formulated accordingly. The situation in Afghanistan is directly affected by instability along Pakistan’s western borders, and longstanding Pakistan-India tensions have affected the Pakistani military’s strategic calculus in curtailing militancy within Pakistan. For too long, the United States has pursued disconnected Afghanistan, Pakistan, and India policies, rather than create a coordinated regional strategy. Any regional approach must address Pakistan’s security concerns with India, specifically related to Kashmir and Afghanistan. These regional challenges will require a fundamentally different U.S. approach that eliminates the bureaucratic separation in Washington between diplomacy, development, intelligence, and military activities in Islamabad, Kabul, and New Delhi.

Organize integrated international support to assist Pakistan. A coordinated inter- national effort should occur with major donors, countries, and organizations, and the United States in an actively supportive role. The multiple policy challenges that Pakistan faces—security threats from militant groups, governance failures, and major economic difficulties—require a concerted and organized international supporting effort. Pakistanis’ suspicions of the United States mean that multilateral approaches will work more effectively than bilateral ones. This process began with the meeting of a Friends of Pakistan group in September 2008 at the 64th session of the U.N. General Assembly, whose partners include China, Saudi Arabia, the United Arab Emirates, and the World Bank—all of which have strong economic and security links with Pakistan, and growing leverage. Their expertise, manpower, and financial resources can complement the efforts of Pakistan’s leaders and the United States. The United States in particular should consult more closely with China on its Pakistan policy, since both countries share a common interest in a stable, secure, and economically viable Pakistan. China has its own concerns regarding regional Islamist militant groups and could play a more constructive role in addressing these issues in Pakistan, as it has in negotiations on the Korean peninsula.

Broaden and deepen the strategic relationship between the United States and Pakistan. A fundamental strategic shift in U.S. policy on Pakistan should occur away from a narrow focus on military and intelligence cooperation. Pakistan’s problems will not be solved by military means alone. Long-term stability in Pakistan depends not only on curtailing extremism and militancy in Pakistan, but on strengthening Pakistan’s economy and democracy and on reducing tensions between Pakistan and its neighbors. U.S. military approaches must be integrated into a wider political strategy for the region. The U.S. government should engage with leaders of Pakistan’s civilian institutions and civil society in addition to its military establishment. Integrating the full range of U.S. and other countries’ powers—diplomatic, economic, and political—the United States should quietly and carefully expand U.S.-Pakistan partnerships on a broad set of issues, including intelligence cooperation, economic development, energy, education assistance, and more. The Obama administration should embark on a strategic dialogue with Pakistan that sets common goals for the two countries, building on the major non-NATO ally status it has already achieved. These goals should include both tactical counterterrorism and longer- term counterinsurgency objectives and should specifically engage Pakistan’s security concerns that are often at variance with ours.

Approach Pakistan’s military establishment in ways that support good governance and economic development. The United States should continue to strengthen relations with Pakistan’s military and intelligence agencies, but do so in a way that does not undermine civilian control and political reform in Pakistan. The United States should support and interact with the Pakistani military establishment with policies that encourage Pakistani civilian oversight. This means engaging with its military as a component of the government as a whole rather than as an autonomous institution, allocating more funding through the government of Pakistan and not the Pakistani military, and meeting Pakistani military officials while keeping Pakistani civilian leadership informed or present. U.S. funding to Pakistan’s military should be targeted toward specific shared objectives, and tied to performance, such as good faith efforts by the Pakistani military to crack down on militant groups in Pakistan, and to stop cross-border attacks into Afghanistan.

Support democratic transition in Pakistan without picking favored candidates or political parties. The United States should support broader political reform in Pakistan, along with economic development programs and efforts to enhance security. The 2008 parliamentary elections represented an opportunity for Pakistan to give voice to the Pakistani people in how their society is governed. Yet the return of electoral democracy adds a new element of uncertainty to the continuity of leadership in Pakistan. At times Pakistani leaders may voice opposition to American policies, but the United States should resist the urge to circumvent them now and in the future. The upcoming local elections in 2009 represent another opportunity to support Pakistan’s democratic transition, and the United States should expand efforts to support civil society organizations, assist all political parties, and encourage electoral reform to ensure that these elections meet their potential for providing an open and fair debate on key policy questions and allowing for the legitimate expression of the will of the people.

Enhance transparency and accountability of U.S. funds. The United States must demand more transparency over its funding and tie its assistance to specific, agreed- upon objectives, such as good faith efforts by the Pakistani military to crack down on militant groups in Pakistan, and to stop cross-border attacks into Afghanistan. For too long, U.S. aid to Pakistan’s military has been characterized by its lack of accountability, transparency, and shortsightedness. Despite distributing more than $11 billion since 2001 to Pakistan, the United States has not demanded transparency or an accounting of its funding.7 (See Appendix for a breakdown of overt U.S. funding.) The U.S. Government Accountability Office, the investigative arm of Congress, found in June 2008 that there had been insufficient oversight over U.S. Coalition Support Funds to Pakistan, a fund to reimburse Pakistan for its counterterrorism activities (and also the fund through which the majority of U.S. monies were allocated). Furthermore, U.S. assistance continued to flow directly to the Pakistani military despite evidence that it was not aggressively attacking insurgent elements in the Federally Administered Tribal Areas and that linkages continued to exist between the military establishment, especially its intelligence agency—the ISI—and militant groups.

Reform U.S. national security institutions. The United States must strengthen the other tools in its foreign policy toolbox outside of the military, including the State Department and the U.S. Agency for International Development. U.S. civilian institutions currently do not have the resources, expertise, or implementing capacity necessary for conflict resolution and state-building. As Secretary of Defense Robert Gates has pointed out, "There is a need for a dramatic increase in spending on the civilian instruments of national security—diplomacy, strategic communications, foreign assistance, civic action, and economic reconstruction and development." Foreign aid must be reformed, and the U.S. foreign policy apparatus needs to organize itself more regionally, so that its country policies are not stove-piped. The United States will also need to coordinate its own National Security Council process more effectively, so that DoD, State, USAID, Treasury, and other agencies are complementing each other’s efforts.

Be long term and proactive. U.S. engagement in Pakistan has been inconsistent, transactional, and reactive for decades. The United States has suspended aid, imposed sanctions, and then intermittently renewed contacts, depending on paramount strategic concerns at the time. The United States must create a long term plan to partner with Pakistan, understanding its challenges will not be resolved in the short-term. Even if Osama bin Laden were captured tomorrow in Pakistan, challenges to its stability and the region’s would remain. Making this strategic shift may finally assist Pakistan in confronting its biggest challenges of insecurity, failed governance, and economic difficulties. Inaction is not an option. Pakistan’s current instability threatens its people, its neighbors, the United States, and the world. The Obama administration must seize the opportunities outlined in this paper and implement a dramatic strategic shift in U.S. policy. In the pages that follow, we will detail each of these sources of instability and then provide recommendations for the Obama administration to consider. We believe the comprehensive, proactive strategy outlined in this paper will strengthen the fundamental building blocks of stability and progress in Pakistan, which in turn will help make the United States more secure. 

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Caroline Wadhams

Senior Fellow

 (Brian Katulis)

Brian Katulis

Former Senior Fellow

Lawrence J. Korb

Senior Fellow

Colin Cookman

Policy Analyst