KP and the USAID crisis…Barrister Dr Mohd Ali Saif

On January 20, following the US president’s Executive Order on Reevaluating and Realigning US Foreign Aid, all US-related government to government (G2G) development projects and activities have been suspended in Pakistan. Reportedly, projects worth over $845 million have been suspended throughout the country but it is Khyber Pakhtunkhwa that has suffered the most not necessarily due to the volume of funding but because of its history as a frontline region in the aftermath of the US invasion of Afghanistan.

For over two decades, starting with the US invasion of Afghanistan in 2001 till the withdrawal of troops in 2021, Khyber Pakhtunkhwa has been the victim of cross-border militancy that has not only left thousands dead but has also played havoc with the future of generations to come. With infrastructure destroyed and stagnant development due to persistent security issues, suspension of promised funds will have severe impact on the ongoing G2G development projects which include the Federally Administered Tribal Areas (Fata) infrastructure programme (FIP) and the Gomal Zam Dam Command Area Development Project (GZD-CADP).

Fortunately, the suspension of USAID comes at a time when certain components of the projects have been completed. However, crucial components still remain. Under the FIP, Phase 1 has successfully delivered critical infrastructure, including roads, bridges, energy facilities and water supply systems. A total of 495 kilometers of roads have been constructed across South Waziristan, North Waziristan and Khyber, along with 35 new bridges and three repaired tunnels in South Waziristan.

The Wana Grid Station has been upgraded, a 132KV transmission line spanning 45 kilometers has been installed from Gomal Zam Dam to Wana, and the Dhana Irrigation and Drinking Water Supply System has been completed, ensuring improved water access for local communities. The main purpose of the Dhana Irrigation and Drinking Water Supply System project is to harness seasonal runoff and provide additional water for irrigation to North Waziristan District. The project is providing water to locals and also conserving and recharging ground water tables. However, Phase II (2017 Sept 2025) of the FIP is still in progress and various components are at risk of being delayed. Under Phase II, USAID committed $91.66 million for the repair and rehabilitation of damaged infrastructure in [former] Fata.

Ongoing components that are at risk include the 132KW grid station at Jandola, 11KW Makeen & Tiarza Feeders, 132KV Pezu-Tank-Jandola Transmission Line, Loesam Nawapass Road, Ghiljo Dabori Road, Asil Targhaow Road, Bara Mastak Road, Jamrud Bypass Road and the rehabilitation of 47 schools and Civil Hospital Muzzafarkot.

Another significant casualty of the USAID suspension is the Gomal Zam Dam Command Area Development Project (GZD-CADP), designed to improve on-farm water management, enhance agriculture and livestock productivity, and promote value addition in agricultural and livestock products. The initiative has successfully established demonstration plots on farmers’ fields, provided farmers with essential inputs such as seeds, fertilizers, and pesticides, and distributed machinery, poultry packages and animal feed. HF and Jersey breed semen were also distributed to improve livestock quality as part of the artificial insemination programme.

Despite progress, the suspension has stalled vital aspects of the project. Out of 421 planned watercourses, only 271 have been completed, leaving 151 in limbo. While the USAID funding share of Rs1,062 million is still pending, the suspension funds has cast doubts on the successful completion of the remaining water courses. The uncertainty around fund disbursement is straining operational timelines, making it difficult to adhere to projected schedules. If the suspension continues, it could jeopardise the intended developmental impact of these projects, affecting infrastructure rehabilitation, agricultural productivity and rural livelihoods in the region.

The suspension of USAID activities has halted all ongoing projects, leading to potential claims for idle resource and demobilisation charges by contractors. UET consultants’ request for two months’ salary during suspension was denied, resulting in staff layoffs and potential delays upon resumption due to knowledge gaps. The sudden suspension also left contractors’ last running bills unpaid, causing unrest and embarrassment. Uninstalled materials and incomplete schemes, particularly in security-sensitive merged districts, face risks of damage and mismanagement. While the full consequences of the USAID suspension are still unfolding, implementing partners are struggling to sustain operations due to withdrawal of promised funds. And while the US continues to adopt a fluctuating stance in its foreign aid commitments, the Khyber Pakhtunkhwa government must explore sustainable, long-term partnerships with allies who share common regional interests.

Whether the suspension is lifted or not, one thing remains certain Khyber Pakhtunkhwa’s development trajectory has once again suffered due to US decisions. In 2001, the province bore the brunt of militant infiltration as a consequence of the American war in Afghanistan, and now, it faces yet another setback with the abrupt suspension of crucial development aid meant to rebuild a war-affected region.

Courtesy The News