Cutting military and economic assistance to a country in crisis is generally seen as a failure of foreign policy. Such imperial hubris can lead to a miscalculation of national interests and leave a power vacuum. In February 1947, however, when Britain announced it could no longer support Greek nationalist forces against the communists, the United States was ready to step in, fearing a communist takeover. The mutual concern of the United States and Britain to contain communism made it possible for the Attlee government to step aside and for Truman to move in. Today, another such confluence of interests exists in Pakistan: China and the United States have a vested interest in containing violent Islamic extremism.

With the recent killing of Osama Bin Laden and the uncertainty of Pakistan’s role, some U.S. lawmakers are questioning the wisdom of continuing the multibillion dollar civilian and military aid program to Islamabad. Amidst a struggling economy, high unemployment and global commitments, should the United States cut its aid and let China fill the void?

This may seem counter to U.S. national interests, but the main objectives of Washington’s presence in in South Asia are denying terrorists a safe haven in Afghanistan and preventing Pakistan’s nuclear weapons from falling into the hands of extremists. With Osama bin Laden dead and the withdrawal from Afghanistan in sight, Pakistan is bound to play a diminishing role in U.S. strategy; its importance for China is growing.

The U.S.-Pakistan relationship is fraught on virtually every level. Of the approximately $22 billion in American aid to Pakistan since 2001, most of it supported the domineering Pakistani military, which invested it (counter to U.S. demands) into military equipment aimed at deterring India. In an attempt to counter this, the Kerry-Lugar Act—a $7.5 billion aid package passed by the U.S. Congress in 2009—stipulated that the military must be subordinate to the civilian government. This infuriated the Pakistani public, seen as it was as an infringement on Pakistani sovereignty. The United States undermines its own efforts by focusing most of its diplomatic energies on Pakistan’s military and its Chief of Army Staff, Asfaq Kayani, rather than on the weak civilian Zardari government. As Manreet Singh, Indian MP and chief editor of the monthly Defense and Security Alert, states: “The major obstacle in the United States’ dealings with Pakistan is that it focuses on persons rather than institutions and by doing so is undermining the democratic institutions in Pakistan.”

On the strategic geopolitical level, the situation is even worse. After spending billions of dollars in aid, if the United States succeeds in stabilizing Pakistan and Afghanistan, it will play into China’s hand; for decades Beijing has quietly fostered a special partnership with Islamabad—an “all weather friend” in the words of Pakistan’s government.

China’s activity in Pakistan has increased noticeably in the last couple of years. In 2007, Chinese investment in Pakistan hovered around $4 billion. In December 2010, Pakistani Prime Minister Syed Yusuf Raza Gilani and Chinese Premier Wen Jiabao signed deals worth around $25 billion. China also provided millions of dollars in aid for the victims of the recent floods and for reconstruction projects. In July 2010, both countries held their third joint military exercises focused on counterterrorism. While the exercise was little more than a PR tactic, China is genuinely worried about the potential destabilizing influence of Pakistani militants on its own Muslim minority in Xinjiang.

China is also one of Pakistan’s main weapons suppliers—around 70 percent of Pakistan’s battle tanks are of Chinese origin. Back in 1990, the PRC allowed Pakistan to test its first nuclear device in Lop Nor. China even footed the bill for transporting the Nodong and Taepodong missiles purchased by Pakistan from North Korea after the United States refused to deliver F-16 fighter jets and the Pakistani Army had to seek other means of transporting its nuclear weapons.

All of this is in China’s self-interest. By geographically controlling the Western gateways of China, Pakistan could serve as an alternative route for its critical energy supply, which is bottlenecked in the Straits of Malacca (65 percent of Chinese energy imports—mostly crude oil—run through the strait). Beijing is heavily investing in a railroad from the port of Gwadar—constructed with Chinese money and strategically located on the Makran coast—to the Karakoram pass leading into the Chinese autonomous region of Xinjiang. This is part of what some US commentators have dubbed China’s “string-of-pearls” strategy, a strategy aimed at building strategic partnerships and securing ports and airfields from the South China Sea through the Strait of Malacca and across the Indian Ocean to the Arabian Gulf to protect its energy supply routes. The mouth of the Persian Gulf is only 350 km from the nearest Pakistani port. A permanently based Chinese naval squadron in the port of Gwadar increases China’s ability to project power into the Indian Ocean and the Arabian Sea.

The key question: If the United States decides to scale back spending on Pakistan, will China increase its aid correspondingly? Pakistan is confronting a major financial crisis. In the last two decades, it has twice come to the brink of financial collapse—once in 1990 and then again in 2008. It was saved only by massive infusions from the United States, Europe, Saudi Arabia, the IMF and China. Blatantly poor management by the Musharaf and Bhutto administrations has been compounded by the global financial downturn. There is insufficient electrical power to meet the country’s needs, and major cities experience periodic outages and blackouts. Food prices have escalated, as have the costs for the large amounts of oil that the country must import.

Chinese influence in the years to come, however, will in no way approach the level of U.S. involvement, and whether Beijing’s support will ever match that of Washington is questionable—at least in the short term. Chinese aid is in general quieter and more subtle with fewer conditions attached. While China is interested in combating terrorism and calming its Muslim minorities, the Chinese military traditionally has not played an important role in Chinese diplomacy. Deploying Chinese troops abroad is still a very alien subject to decision makers in Beijing, and the capabilities of the Chinese Armed Forces in counterinsurgency and police training have been largely untested and can in no way compare to those of the United States military. But this is all subject to change.

Most observers are certain that Chinese influence will increase in Pakistan in the near future. The shock of the Pressler Amendment—US sanctions imposed on Pakistan and quasi-abandonment of the country after the Soviet withdrawal in the 1990s—still sits deep in Pakistan’s consciousness. In response to the killing of Osama Bin Laden, General Kayani announced that Pakistan will reevaluate military and intelligence cooperation should Pakistan’s sovereignty be violated again. The future of US-Pakistan relations remains uncertain at best.

Prime Minister Attlee’s announcement in February 1947 to abandon the Greek nationalists and cede its Raj to India, amidst the worst British snowfall of the twentieth century, marked the beginning of the end of Britain’s postwar global power status and induced the birth of modern Pakistan. While the United States’ presence in Pakistan is in no way comparable to the British situation in India or Greece in 1947, U.S. policy makers should bear in mind that strategic disengagement is meant to preserve rather than diminish national power. In the case of Pakistan, China might be eager to fill the vacuum should the United States decide to trim down its efforts, something that would serve the U.S. national interest well in the long term.