Carter offers $400 million; Zia turns it down

The offer

Within weeks of the Soviet invasion, the Carter administration moved to shore up Pakistan. Its offer, made in January 1980, totalled about $400 million: $200 million in credits for military equipment and $200 million in economic assistance, to be provided over roughly 18 months¹. The administration also declined Pakistan’s request for advanced fighter aircraft. Brzezinski’s visit to Islamabad in early February 1980, when he publicly reaffirmed the 1959 bilateral agreement, was part of the same effort to reassure Pakistan².

Pakistan’s response

The Pakistani reaction was cool from the start. On 17 January 1980 the foreign affairs adviser, Agha Shahi, gave the US embassy his government’s preliminary response. According to the embassy’s report, Pakistan appreciated Carter’s firm stand against the invasion, but its leaders were disappointed: $400 million was seen as inadequate given Pakistan’s military needs, including high-performance aircraft, and the $200 million in economic aid as insufficient while questions of debt rescheduling were pending³. Contemporary reports describe General Zia dismissing the offer as “peanuts”, a word that featured in American headlines when Pakistan formally declined the package in early March 1980^1,4. Zia and his advisers were reported to be seeking far larger sums, up to $2 billion, to rebuild the armed forces¹.

Zia’s reasoning, as Pakistani commentators have since described it, was that a small package would anger the Soviet Union without making Pakistan materially safer⁴. Pakistan was also wary of a US commitment that Congress might not honour, and of aid that came with conditions on its nuclear programme.

What followed

The rejection left the Carter administration uncertain how to proceed⁵. Contacts continued: Zia visited Washington in October 1980, when he was in the United States to address the UN General Assembly as spokesman of the Islamic Conference, and Carter told him of Americans’ admiration for Pakistan’s response to the Afghan refugee crisis^6,7. But no new package was agreed before Carter left office.

Why it mattered

Zia’s gamble paid off. The incoming Reagan administration offered a package eight times as large, together with F-16 aircraft. The episode set a pattern that would recur in the relationship: Pakistan, conscious of its value to Washington at moments of crisis, bargaining hard over the scale and terms of US assistance.