The Bush administration has concluded it is not legally required to cut or suspend hundreds of millions of dollars in aid to Pakistan despite President Pervez Musharraf's imposition of a state of emergency and a crackdown on the opposition and independent media.
U.S. assistance to the key anti-terrorism and nuclear armed ally - which has totaled nearly $10 billion since 2001 - is governed by legislative requirements that could trigger automatic aid cutoffs, but all are covered by locked-in presidential waivers, said officials familiar with a government-wide review.
Those waivers exempt Pakistan from aid restrictions. They do not need to be renewed until Congress approves the budget for the current fiscal year that began Oct. 1 and requests $845 million for Pakistan, the officials said, citing preliminary findings from the review that began this week.
The initial findings do not mean aid to Pakistan will never be cut, only that there is currently no statutory reason to do so, the officials said. They spoke on condition of anonymity because the review is not yet finalized. It was not immediately clear Friday when it would be complete.
The review comes as congressional pressure mounts on the administration to respond to the situation, which took an ominous turn Friday when Pakistani authorities placed opposition leader Benazir Bhutto under house arrest and barred her supporters from staging a mass demonstration against Musharraf's emergency rule.
Rep. Nita Lowey, D-N.Y., who chairs the panel that oversees State and foreign operations spending, said unless there was an "immediate halt" to Musharraf's crackdown, Congress would inevitably step in to restrict U.S. aid to Pakistan and she called for the suspension of cash transfers to the government.
"Failure to take these steps immediately is sure to come at a steep cost," said Lowey.
As it has done since the crisis erupted last Saturday, the White House urged Musharraf "quickly to return constitutional order," adding a new appeal for the release of Bhutto and other detainees believed to number in the thousands and asking all parties to refrain from violence.
"All parties in Pakistan agree that free and fair elections are the best way out of the current situation there," Gordon Johndroe, a National Security Council spokesman, said in Texas where President Bush is spending the weekend. "Free and fair elections require lifting of the state of emergency. We therefore continue to call for an early end to that state of emergency and the release of political party members and peaceful protesters who have been detained."
Defense Secretary Robert Gates voiced concern that the political turmoil there will undermine the Pakistani army's fight against terrorism.
"The concern I have is that the longer the internal problems continue, the more distracted the Pakistani army and security services will be in terms of the internal situation rather than focusing on the terrorist threat in the frontier area," he told reporters Friday as he returned from Asia.
To date, the Pentagon has said the unrest has had no effect on U.S. military operations. But Gates' comments underscored the administration's nervousness, even as it voices support for Musharraf as an ally in the war on terror.
Musharraf yielded somewhat to U.S. pressure on Thursday and said Pakistan would hold parliamentary election by mid-February - a month later than originally planned. But he has still shown no sign of relinquishing his military post as chief of the army - another key demand of opposition leaders and the Bush administration.
Bush has been obligated by law since 2002 to issue waivers for most assistance to Pakistan, declaring that direct payments to Islamabad are in the U.S. national interest because they promote the transition to democratic rule.
The officials familiar with the aid review conceded Musharraf's recent actions are at odds with the process of democratization but noted that unless Congress enacts new legislation or passes the new budget, the existing waivers continue to apply.
Deputy Secretary of State John Negroponte spoke to the administration's position in congressional testimony Wednesday.
"Our judgment at the moment is that there is nothing that is automatically triggered by the current situation, that everything is covered at the moment by appropriate waivers," he said.
On Thursday, State Department spokesman Sean McCormack addressed the waiver-budget connection. "Because of the fact that you do not yet have new legislation appropriating funds, some of those waivers carry over," he told reporters. "I think, actually, all of the waivers carry over."
In addition to the Pakistan-specific waivers imposed by Congress, U.S. foreign aid in general is also covered by legislation that forces the suspension of non-humanitarian assistance in the event a democratically elected government is toppled through unconstitutional means.
Although that requirement was triggered when Musharraf came to power in a 1999 coup d'etat, and some aid was cut, administration lawyers contend the current state of emergency and suspension of the constitution does not meet that legal standard, the officials said.
"Basically, you can't stage a coup against yourself," said one. ( AP )