ISLAMABAD: The closure of the United States Agency for International Development (USAID) has cast uncertainty over critical development projects across South Asia, affecting critical sectors such as education, healthcare, infrastructure, and governance.
Due to funding cuts, amounting to hundreds of millions of dollars, Pakistan, Bangladesh, India, and Afghanistan—the recipients of USAID grants in the region—are struggling to continue several key initiatives that have long supported local communities.
In South Asia, Afghanistan is the largest USAID recipient with grants in 2023 of over US$1.13 billion, followed by Bangladesh at US$552 million and Pakistan receiving around US$279 million. India received $202 million during the same year, according to the USAID website.
Pakistan received $38.28 million in US grant disbursements from July to November, compared to the budgeted $20.87 million for 2024-25. However, the closure of the USAID has put projects worth millions of dollars into jeopardy.
He added that there is an uncertainty about USAID-funded scholarships, as many students are already at universities, mostly abroad, “but we will do everything possible to secure their future.”
Due to the suspension of USAID, higher education development programmes in Pakistan will be affected, but USAID is not the donor for the majority of HEC projects.” – HEC Executive Director Zia Ul Qayyum.
As per the website of HEC, “This program is closed for new scholarship intake.”
USAID-funded higher education scholarships have been there since 2004, and the programme’s phase II started in 2013 and was to be concluded in 2026. The first phase of the programme started in 2004 with cumulative funding of US$10.63 million and supported over 1,800 students at 11 universities.
The second phase, 2013 to 2026, with a total funding of US$23 million covered 3,000 scholarships—50 per cent of which were reserved for female students.
USAID-funded higher education projects in South Asia covered scholarships, including those for women, capacity-building for the higher education sector generally in Pakistan, as well as more specific projects such as a university project to boost agricultural efficiency and sustainable energy in Bangladesh and a university partnership for disaster-resilient infrastructure in India.
An official of the Ministry of Finance tells this scribe that 39 USAID-supported have now halted, including eight budgeted ones—those reflected in Pakistan’s fiscal year budget—while the rest outside the budget—grants which were directly released to organisations.
This decision will undoubtedly have a highly negative impact, particularly in a country like Pakistan, where numerous programmes across various sectors relied on USAID funding.” – Muhammad Dittal Kalhoro.
They have a total funding value of approximately US$845 million including crucial healthcare projects, he says, requesting anonymity.
USAID has also been supporting basic education programmes, including the Pakistan Reading Program and the Sindh Basic Education Program.
According to a Khyber Pakhtunkhwa government official, USAID has funded the reconstruction of hundreds of schools, including a large number in areas affected by militancy in Khyber-Pakhtunkhwa. “And now reconstruction work has been stopped at once,” he added.
An official of the Economic Affairs Division tells WE News English that the suspension of USAID funding has affected the US$19 million Higher Education Systems Strengthening Activity (HESSA) in Pakistan. The project is for technical assistance to improve the capacity of Pakistan’s higher education institutions and systems for developing employable graduates.
Launched in 2021, with on-the-ground implementation starting in 2022, this five-year project was awarded to the University of Utah in the US, with HEC and several Pakistan universities as partners.
The Economic Affairs Division official further said that USAID has a history of supporting Pakistan’s higher education, including the construction and equipping of 17 faculty of education buildings for which it provided US$47.5 million in 2015. “These buildings now serve over 5,000 students and 200 faculty members every year.”
USAID also funded the construction and equipping of centres of advanced studies in energy, water, and agriculture at various universities in Pakistan.
Suspension of US funding to higher education projects in Pakistan has disrupted many useful initiatives that were helping our universities.” – Prof. Iqrar Ahmad Khan.
Many academics describe the suspension as unfortunate and negative for higher education, but some say it is time to get rid of foreign aid and become more self-reliant.
Analysts in Pakistan believe the resumption of USAID funding for higher education and other development initiatives is unlikely as USAID’s very existence is in danger.
“This should help us become self-reliant,” says Prof Qaisar Abbas, vice-chancellor of the University of Sargodha.
“Pakistan’s HEC has performed remarkably well with indigenous financial and human resources. If USAID abandons higher education support programmes in Pakistan, these must be taken over by our own government and completed,” he suggests.
Asked about the impact of USAID’s closure on higher education in Pakistan, former vice-chancellor of the University of Agriculture Faisalabad, Prof. Iqrar Ahmad Khan said “suspension of US funding to higher education projects in Pakistan has disrupted many useful initiatives that were helping our universities.”
The USAID-funded scholarship programme has helped hundreds of deserving students, and these projects led to joint research and promoted collaborations between Pakistani and American universities, Prof Khan says, adding that the stakeholders must recognise the critical role of USAID projects worldwide and work towards their immediate resumption.
Other than education and infrastructure projects, the non-governmental development sector is also badly affected by the USAID suspension. Among others, minorities’ projects being carried out by non-governmental organisations are also hanging in balance and most of them have been simply stopped.
Christian Daily International has reported that the National Endowment for Democracy (NED) was funding at least 22 organisations in Pakistan working in areas such as democracy, education, and minority rights advocacy.
A US-based newspaper, the Minority Leadership Development’s, (MLD) initiative at the Center for Social Justice (CSJ) in Lahore, which was financially supported by the National Endowment for Democracy (NED), sacked at least 10 employees “until further notice” following President Donald Trump’s unexpected decision to pause all foreign aid and cut funding for organisations such as the USAID. Christians True Spirit (CTS), another non-governmental organisation, has also been affected by Trump’s decision to block funds.
“Several CTS projects, including legal aid to vulnerable groups, healthcare, and education that were being carried out with the financial support of the American government will likely be shelved for an indefinite period due to this funding pause,” the paper quotes Katherine Sapna, executive director of CTS.
“Suspension of crucial programmes, especially in healthcare, will put the lives of millions at risk,” she warns. “We are in panic mode! Our church donors are also very concerned, and though they have assured us they will try to fill in the funding gap, we are not sure yet how we will navigate through this crisis,” she says.
Several CTS projects, including legal aid to vulnerable groups, healthcare, and education that were being carried out with the financial support of the American government will likely be shelved for an indefinite period due to this funding pause.” – Katherine Sapna.
Muhammad Dittal Kalhoro—executive director of the Sindh Rural Support Organization, one of USAID’s implementing partners in Sindh province—says his organization was forced to shut down all three of its US-sponsored health initiatives—two of which were in full swing, while the third had barely begun.
“This decision will undoubtedly have a highly negative impact, particularly in a country like Pakistan, where numerous programmes across various sectors relied on USAID funding,” Kalhoro says.
He adds that the suspension affects not only healthcare but also humanitarian assistance, refugee support, nutrition, education, energy, trade, economic growth, infrastructure, and climate change efforts.
“We are among dozens of organisations that have already started firing or suspending employees since the end of January,” he says.
According to media reports, Trump’s cuts have suspended $845 million in funding for USAID projects in Pakistan. Among the most significant suspended projects is the Integrated Health Systems Strengthening and Service Delivery Integrated Health System Program—a $86 million initiative aimed at improving Pakistan’s healthcare infrastructure.
The Global Health Supply Chain Program, valued at $52 million, was designed to ensure the availability of essential medical supplies. In education, the Merit and Needs-Based Scholarship Program, worth $30.7 million, was set to support underprivileged students pursuing higher education.
The Inclusive Democratic Processes and Governance—a $15 million initiative—was intended to enhance democratic governance and transparency.
The suspension has also affected development efforts in Pakistan’s recently merged tribal areas. The Merged Areas Governance Program for former Federally Administered Tribal Areas, valued at $40.7 million, was improving governance and administrative systems.
Additionally, the Building Peace in Pakistan programme, worth $9 million, aimed at fostering religious, ethnic, and political harmony, has been put on hold.
The freeze has also halted the Pakistan Private Investment Initiative programme, worth $43.5 million, which was focused on generating employment opportunities.
