Monitoring Desk
Move to give Islamabad greater visibility over US-funded NGO projects; mechanism marks shift in handling of some American development assistance
ISLAMABAD: The United States is set to route grants and other assistance for private Pakistani non-governmental organisations (NGOs) through the Economic Affairs Division (EAD), according to Pakistani officials familiar with the arrangement, giving Islamabad greater visibility over projects financed with US assistance.
Officials said Pakistan had been seeking the change for around one and a half years and that the Trump administration has now agreed to the proposed mechanism.
Under the new arrangement, US grants for Pakistani NGOs would be processed through the EAD instead of being channelled to recipients with comparatively limited government involvement, according to the officials.
The development represents a change in the handling of some US-funded civil-society programmes in Pakistan and is expected to provide the government with greater information about the organisations receiving assistance, the locations where projects are implemented, the activities being financed and the utilisation of funds.
The EAD is responsible for negotiating, programming and monitoring external economic assistance received by Pakistan from foreign governments and international organisations. The division also maintains an NGO framework dealing with foreign contributions and operates an online portal for NGOs seeking approval for foreign-funded projects.
Greater government visibility over NGO funding
The proposed mechanism is significant because foreign assistance to civil-society organisations can be channelled through different arrangements, including government-to-government mechanisms and arrangements under which international donors directly finance implementing organisations.
Pakistani officials said the EAD previously did not have the same level of visibility over US grants provided directly to Pakistani NGOs. Routing such assistance through the division would allow authorities to maintain greater oversight of the projects being funded and the organisations implementing them.
The EAD has already established procedures for dealing with foreign contributions received by Pakistani NGOs. Its framework provides for online applications, consultations with relevant stakeholders and monitoring of foreign-funded activities.
The reported shift comes against the backdrop of a broader restructuring of US foreign assistance under President Donald Trump, which has affected the way American development assistance is administered internationally.
US foreign-assistance data shows that Pakistan had $195.77 million in US foreign-assistance obligations across all US government agencies and programmes in fiscal year 2025. The data categorises 98 percent of the reported assistance as economic and two percent as military assistance.
$445.6m five-year US development agreement
A major framework for US development assistance to Pakistan is the five-year Development Objectives Assistance Agreement (DOAG), signed between the Government of Pakistan and USAID in June 2023.
Under the agreement, USAID committed $445.6 million in grants over five years. According to the EAD, the agreement covers climate-resilient economic growth, inclusive and accountable democratic governance, and health and education, with implementation to be coordinated with the Government of Pakistan.
The agreement was signed 13 years after the previous Pakistan Enhanced Partnership Agreement of 2010. The EAD said at the time that the new arrangement was intended to strengthen transparency and accountability and increase the involvement of Pakistani organisations in implementation.
The reported NGO funding arrangement would therefore provide an additional channel for government visibility over projects falling within the broader US development assistance relationship with Pakistan.
Impact on civil-society programmes
Pakistani officials said a significant portion of US assistance to NGOs has historically supported programmes in areas including education, healthcare, civic participation and election-related advocacy, particularly in Khyber Pakhtunkhwa and Balochistan.
Officials said three existing US-funded projects are currently being supported, including merit- and need-based scholarship programmes, and are expected to continue until December 2026.
The new arrangement is not expected to mean that all US assistance to Pakistan will be channelled through the EAD. Rather, according to the Pakistani officials, the change specifically concerns grants and other assistance provided to private Pakistani NGOs.
The shift would place the EAD in a more prominent role in tracking foreign-funded NGO activities and could strengthen the government’s access to information on project financing, implementation and utilisation of funds.
The development also comes as the EAD continues to publish information on foreign economic assistance and maintain procedures for monitoring external funding received by Pakistani organisations.