U.S. seeks $2 billion in military aid for Pakistan

WASHINGTON (Reuters) - The United States announced $2 billion in military aid for Pakistan on Friday as the two countries sought to dispel doubts about Islamabad's commitment to uprooting Islamist insurgents from safe havens on its soil.

"The United States has no stronger partner when it comes to counterterrorism efforts against the extremists who threaten us both than Pakistan," Secretary of State Hillary Clinton said.

The five-year military aid package, which must be approved by Congress, would complement $7.5 billion in civilian assistance already cleared by U.S. lawmakers.

Pakistani Foreign Minister Shah Mehmood Qureshi rejected naysayers who argue that Islamabad's heart is not in the fight against the insurgents.

"Prophets of doom are back in business, painting doomsday scenarios about our alliance," he said. "They are dead wrong."

Announcement of the military assistance, for the years 2012 to 2016, came at the formal opening of the third round of the U.S.-Pakistan Strategic Dialogue, a series of talks to expand relations beyond the fight against Islamist insurgents.

Clinton said 13 working groups focusing on issues from water to energy had agreed on plans to immunize 90 percent of Pakistani schoolchildren, improve electricity supplies and help farming families get back on their feet after devastating floods in August.

But looming over the talks is the nine-year-old war in Afghanistan and the fight against al Qaeda and other Islamist extremist groups along the Afghanistan-Pakistan border that have strained relations between Islamabad and Washington.

The Obama administration has pointedly pressed Pakistan for more aggressive action against safe havens in North Waziristan, saying in a recent report to Congress that Pakistani forces had avoided direct contact with al Qaeda and related militants, in part for political reasons.

CARROTS, STICKS AND APOLOGIES

Stepped up attacks in the region by U.S. drone aircraft have aggravated public opinion in Pakistan and relations deteriorated after a cross-border helicopter incursion killed two Pakistani border guards.

The incident prompted Pakistan to close a border crossing near the Khyber Pass to NATO supply convoys for 10 days until apologies were made by U.S. and NATO officials.

U.S. Defense Secretary Robert Gates apologized again for the incident when he met Pakistani army chief General Ashfaq Kayani earlier this week.

But U.S. officials continue to press Pakistan for more action and express growing concerns about the possibility of an attack on U.S. soil plotted by Pakistan-based groups, similar to the failed bombing in New York's Times Square this year.

Clinton told officials at the plenary session of the strategic dialogue on Friday that the two sides had "productive discussions" this week about "our work together to combat terrorism and eliminate violent extremism and the organizations that promote it that are operating in Pakistan."

"These groups threaten the security first and foremost of the people of Pakistan, of neighbors, of the United States and indeed of the world," Clinton said.

Pakistani officials raised their own concerns, saying increasing violence in disputed Kashmir threatened the stability of the region.

Qureshi urged U.S. President Barack Obama to press India for a solution in Kashmir, a Muslim majority region claimed by Pakistan and India that has been rocked by violent clashes following protests against Indian rule.

"President Obama has always understood the importance of a Kashmir solution. His coming visit to the region is the time to begin to redeem the pledge," Qureshi said.

Obama is due to visit India in early November.

(Editing by John O'Callaghan)