In Pakistan, U.S. Aid Agency’s Efforts Produce Dubious Results

By SABA IMTIAZ

The ads are a staple of Pakistani television: footage of water gushing through dams, farmers standing in green fields, a girl using a computer. At the end, the red, white and blue logo of an aid organization flashes on the screen with its slogan, “from the American people.”

The organization behind the Urdu-language ads, the United States Agency for International Development, or U.S.A.I.D., has been operating in Pakistan for more than a decade, disbursing billions of dollars. But critics say the aid has had minimal impact on the ground.

Critics accuse the agency of taking on projects with little consideration for local priorities and being over-reliant on American contractors with little development experience. At the same time, they say, much of the aid money goes toward administrative costs, and large amounts have been siphoned off by Pakistani subcontractors who fail to complete work or return raw material.

A recent lawsuit against the agency highlighted the challenges and image problem it faces in a country where American aid is often viewed with suspicion, and countries like China have been making inroads with their own programs. The case, filed in Peshawar, in northern Pakistan, by three lawyers seeking the payment of legal fees from the aid agency, accused it of abandoning the recovery of United States taxpayer money from a former contractor.

Documents and correspondence filed by the lawyers lay bare the money and equipment that went to waste in a project in Pakistan’s insurgency-hit tribal areas. One subcontractor finished only two of 12 irrigation channels he was supposed to build. Another did not return more than $27,000 worth of construction material to U.S.A.I.D., and demanded nearly $30,000 in rental charges for equipment, though there was no proof of any machinery on site.

Nadeem UL Haque, the former deputy chairman of the Planning Commission, a government agency that oversees development projects, said U.S.A.I.D. had become an “aid-outsourcing agency” and that funds largely flowed back to American contractors instead of to communities.

Despite the widespread criticism about its effectiveness, some experts also acknowledge that the agency has been the victim of anti-Americanism in Pakistan and has failed to promote some of its successes.

“I would not say it’s been a failure — they’ve invested money in energy and education — but because of anti-Americanism and their own inability to effectively communicate, this hasn’t been seen,” said Raza Rumi, a fellow at the National Endowment for Democracy in Washington, who has worked in Pakistan’s development sector. “They’ve spent so much money in F.A.T.A.,” he added, referring to the Federally Administered Tribal Areas of northwest Pakistan. “The reality is no one actually knows the result.”

Officials with the United States Agency for International Development declined repeated requests for comment.

The agency’s recent troubles are just the latest in a series of high-profile missteps for American aid efforts in Pakistan.

An Islamist group that received funding from the State Department to hold an anti-Taliban demonstration also went on to lead rallies in support of a man who assassinated the governor of Punjab Province in 2011.

In 2012, the agency cut funding to a Pakistani theater group producing a local version of “Sesame Street” over irregularities in procurements and asked it to return $1.6 million it had been paid. The theater group did not repay the funds or return equipment worth approximately $900,000, according to a report by the agency’s Office of Inspector General.

And in March 2015, an internal audit by the agency of a $102.7 million municipal services program in the province of Khyber Pakhtunkhwa found that the provincial government had worked in only one city of the three districts for which it was granted funds, and had only carried out a handful of activities there.

The report noted that while funds had been issued to contractors, “The lack of significant progress indicates that the capacity-building efforts may not be sufficient in quality, quantity, or discipline to accomplish the goals set forth by the program.”

Development aid, which is dwarfed by the military aid that the United States provides Pakistan, has long been a contentious issue between the two countries but has been growing in recent years.

In 2009, Congress authorized $7.5 billion in nonmilitary aid to Pakistan over five years. But stipulations related to civilian control over the military infuriated the Pakistani military, which said the legislation interfered with national security. Many Pakistanis view any aid initiatives of the United States with suspicion.

“There is also this deep-seated suspicion that this aid — whatever the objectives — are kind of subject to the U.S. foreign policy’s short-term goals,” said Mr. Rumi of the National Endowment of Democracy.

But, he said, the development agency could also be faulted for its bureaucratic inefficiency and for not having prioritized assistance effectively, as well as its emphasis on hiring contractors from the United States. “A lot of money which is allocated or spent goes back to the contractors,” he said, adding that other international aid agencies worked more directly with provincial governments.

Another challenge for the United States is that its aid programs are often overshadowed by those of other donors like China, which disburses funds without many of the conditions demanded by Western agencies like U.S.A.I.D.

“The Chinese do not get into the whole idea of improving a country’s systems and governance and how it functions,” Mr. Rumi said. “They are very clear: ‘Do whatever you want — we’ll build this road, highway or nuclear plant.’” Western governments, he said, instead appear to feel that it is their “moral responsibility” to improve governance and accountability.

Critics like Mr. Haque say the American aid agency and other foreign donors are themselves not transparent about their own work.

“When I was at the Planning Commission I asked them to present their programs to us and they resented it,” Mr. Haque said. “If I’m planning, I need to know what they’re doing.”

China also sets itself apart by building high-visibility infrastructure projects such as a recently announced $46 billion investment in Pakistan for energy and infrastructure projects, unlike U.S.A.I.D., which often focuses on less-prominent programs like training and expanding the capacity of government institutions.

The development agency’s project at the center of the lawsuit in Peshawar was a $300 million initiative to create jobs and build roads in insurgency-torn districts in the tribal areas. One of the contractors on the project, Academy for Educational Development, a now-defunct American nonprofit organization, was accused in 2009 of submitting false claims and failing to inform U.S.A.I.D. that it was aware that its subcontractors were overcharging U.S.A.I.D., potentially by millions of dollars. U.S.A.I.D. suspended Academy for Educational Development from United States government contracts and reached a settlement that involved the repayment of more than $5 million.

Academy for Educational Development was also awarded at least $300,000 after a drawn-out arbitration process with its Pakistani subcontractors — money that should have been returned to U.S.A.I.D. The Pakistani lawyers who filed the suit said that the aid agency had made no attempt to recover the money.

The agency’s reluctance to pursue the subcontractors for the money may stem from a desire to avoid the Pakistani legal system, where cases are often plagued with delays and allegations of corruption. But for many Pakistanis, the case is another puzzling instance of wastefulness. “This is U.S. taxpayer money,” Sanaullah Khan, one of the lawyers, said. “Why is U.S.A.I.D. walking away from an ongoing legal process?”