Last year, after the United States Congress passed the Kerry-Lugar Bill, and after a series of visits to the region, special envoy Richard Holbrooke, who personally signs every contract concerning projects in Pakistan, began doing something markedly different.
In a massive overhaul of the aid regime that grants money to development projects, Holbrooke began rejecting all projects that used American contractors with the directive that aid projects in Pakistan should use Pakistani contractors and organisations.
This move is likely to have a significant effect on the nature and leadership of development projects slated to be initiated in Pakistan in the upcoming months as money from the Kerry-Lugar law begins to be disbursed.
Holbrooke’s move has gone almost unnoticed in Pakistan; but has drawn severe criticism in the United States. Newspaper reports cited officials within the US State Department as being divided over the issue. According to an unclassified memo published by USA Today last October; senior officials in USAID think that Richard Holbrooke’s move will “seriously compromise” US efforts to stabilise the region.
The confidential memo, written by a senior economist in the USAID details several programmes that Holbrooke has rejected because they do not use Pakistani contractors. Specifically, they include the USAID/Pakistan Economic Growth (EG) portfolio that included projects for energy efficiency and four interrelated private-sector development projects for jobs, firms, entrepreneurs and trade. The memo, which is addressed to the director of policy and planning at the State Department, describes these and other projects as ideally designed to meet the USAID requirements of reporting, monitoring and transparency.
C. Stuart Calliston, the author of the memo and USAID veteran, writes that the new direction of aid that insists on using local implementers instead of Americans will “suspend US strategic objectives for months and even years” and will not have the financial transparency expected of USAID projects”
Despite these objections raised by USAID operatives, this redirection marks a drastic change in the course of American aid to be disbursed in Pakistan. Since last year both Secretary of State Hillary Clinton and Richard Holbrooke have insisted that aid projects be given to Pakistani implementers so that much of the consulting fee that absorbs a large chunk of aid dollars is eliminated and Pakistan can actually get a larger share of the income.
This also marks a radical shift from the trend of aid disbursements for development that was followed in both Iraq and Afghanistan. In both cases aid dollars pumped into the country came with American workers and consultants ensuring that a large amount of aid dollars were actually producing American jobs with American firms profiting from postwar reconstruction more than any others in the world.
In addition, the influx of American workers in both Afghanistan and Iraq led to the emergence of a cadre of subordinate local workers who worked for foreign aid contractors but had little say in the design or implementation of projects despite their superior knowledge of local needs and contexts.
It could simply have been the memory of such misappropriations of aid in Iraq and Afghanistan that motivated the reconfiguration of the aid regime towards Pakistan but it is more likely that it had to do with the actual data showing how badly existing projects in the area were doing.
One audit completed in Jan 2010 by the United States Office of the Inspector General on an existing $46m project that was to increase the capacity of governance in the tribal areas found that “little progress” had been made. Even after 22 months of the 36-month programme had passed and $15.5m of the total $46m had actually been disbursed many of the projects coined by the designers of the programme failed to garner local support. As a result, even as the term for the programme ran out its ability to bring respite to a desperate region remained minimal.
While the politics of aid have been an extremely charged issue in Pakistan and aid has been roundly criticised as an inherent attack on Pakistani sovereignty; this recalibration of how aid is utilised by special envoy Holbrooke is commendable for several reasons.
First, it attempts to remove the imperialist taint in assistance when it is visibly handed out in ways and forms deemed appropriate by the benevolence of the granter rather than the needs of the recipient. When aid projects are conjured up by Washington and designed by policymakers who may never have visited the country in question, they have scant chance of success.
The result of such experiments is often shipments of faucets to where there is no running water, computers for schools without blackboards and blankets for communities living in hot regions. In addition, the emphasis on transparency and accountability, undoubtedly a crucial component of ensuring financial accountability, is designed in a manner that proves burdensome and is unaccommodating of the realities on the ground.
While it is true that corruption and the misuse of aid money is a persistent problem in any developing country, it is also true as study after study has shown that when resources are disbursed and apportioned by communities that have a stake in the projects being worked on there is a significant chance of success.
The economists and development workers of USAID may be imbued with the noblest of intentions when it comes to projects in Pakistan but they cannot escape the politics of aid-giving and the inherently subordinate position of aid recipients when they are not leading the projects affecting their own communities. When a project is headed by an American consulting firm, the giving and taking of aid creates an inescapable set of power relations where local Pakistanis are always the lackeys. The consequence is a constant and inescapable repetition of the cycle of enslavement where Americans always know best. In charting a course for American aid without USAID; Richard Holbrooke may well have signalled the beginning of a new chapter for development in Pakistan.
The writer is a US-based attorney teaching constitutional history and political philosophy.
Mohammed Abbasi 