US daily New York Times recently reported that the US government had decided to limit its relations with Pakistan by reducing its annual aid and abandoning its policy of broader cooperation with Islamabad vis-à-vis Afghanistan and the fight against terrorism.

On Pakistan's part, it rejected the US Army's inquiry report about last month's NATO strikes near Afghan border that killed 24 Pakistani soldiers. Pakistan called it an act of aggression and demanded and apology from the US. The US and NATO expressed their regret over the attacks but no formal apology was issued to Pakistan.

In retaliation to the NATO attacks, Pakistan blocked NATO aid containers from entering Afghanistan and ordered United States to vacate Shamsi airbase, which was reportedly being used to carry out drone strikes against the militants in Pakistan's recalcitrant northwest.

No immediate solution

Pakistani experts believe it is unlikely US-Pakistani ties will improve in 2012.

Dr. Naeem Ahmed, professor of International Relations at the University of Karachi, believes that not only will there be no immediate improvement in US-Pak relations, but that, on the contrary, they could "deteriorate further," as "the two countries have not taken any steps to repair damaged ties."

Yet Ahmed believes Islamabad cannot afford a protracted confrontation with US. "I don't know what financial alternatives Islamabad has other than relying on US aid," he told Deutsche Welle. "Politically, it is becoming more difficult for the government with every growing day to go back to 'pre-Abbottabad' levels."

But a Pakistan researcher from Balochistan, who spoke with Deutsche Welle on condition of anonymity, says "Pakistan is US' 'client-state,'" and the rift claims are "a mere gimmick."

"Pakistan does what it is assigned by the US. Pakistan performs the task and the US reimburses the costs of operations and services. Therefore, to say that Islamabad can 'rebel' against its master is ridiculous," says the researcher, who claims he has received several death threats for speaking out against Pakistani officials.

Bin Laden's death: a turning point

The major rift between US and Pakistan took place in May when American Special Forces unilaterally raided a compound in the Pakistani city of Abbottabad and killed former al Qaeda head Osama bin Laden, who had been hiding in the garrison town for at least six years. Although the Pakistani government hailed the assassination of bin Laden, it expressed its displeasure over the violation of its territorial sovereignty by US forces.

Despite repeated calls from the Republicans and various senators, US President Barack Obama did not sever all ties with Islamabad over the allegations that the Pakistan Army and its spy agency, the Inter-Services Agency, ISI, was protecting bin Laden.

"We must not forget that Pakistan Army is not a monolith. Despite the fact that it is a very organized institution, the middle cadres of the armed forces are very unhappy wit the way the US is undermining Pakistan's sovereignty and operating unilaterally inside Pakistan," Ahmed explains.

Ahmed says the bin Laden assassination "sent shock waves to the lower and middle-rank soldiers."

Rifts between CIA and ISI

The first major sign of deteriorating ties between Washington and Islamabad emerged when in February an undercover CIA agent Raymond Davis shot dead two Pakistani nationals in Lahore. According to Pakistani experts, David's arrest in Pakistan was the first public manifestation of serious tensions between ISI and the CIA.

Although David was later released by a Pakistani court after family members of the two dead men received "blood money" and pardoned Davis, the Pakistani government asked the CIA to reduce its personnel in Pakistan and to cut down its operations drastically.

Clash of interests in Afghanistan

The US is already winding-up its operations in Afghanistan after a decade-long war against Islamist militants. NATO troops are scheduled to withdraw from war-torn Afghanistan in 2014.

US officials have repeatedly demanded that Islamabad must act against the militant Haqqani group, whom it accuses of launching attacks in Afghanistan from Pakistani territories. Western countries accuse ISI of backing the Haqqanis and some other groups of the Taliban to counter-balance India's influence in Afghanistan after NATO troops leave. Experts are of the view that Islamabad is not ready to abort its "covert support" to the Taliban, and this is causing serious problems for Washington, which needs a respectable and safe-exit from Kabul.

"Pakistan wants to see a bigger role for the Taliban in Afghanistan," Ahmed explains. "Washington and Kabul also want to take Taliban on board, and there are reports that they are already conducting secret talks with some of their factions, but they want to exclude Pakistan from these negotiations. That is not going down well with Islamabad. That, in my opinion, is the biggest hurdle in US-Pakistani relations."

Pakistani experts are also of the view that no government in Kabul can function smoothly without Islamabad's support.

As put by Pakistani journalist Nasir Tufail: "As we saw in the past, Pakistan can support insurgency in Afghanistan if its interests are not fulfilled. That doesn't augur well for Afghanistan."

Author: Shamil Shams
Editor: Sarah Berning