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ISLAMABAD/WASHINGTON (Reuters) - Muhammad Farooq waits by his truck outside the Pakistani border town of Chaman, the main crossing into southern Afghanistan. He has driven several hundred kilometers from the port city of Karachi carrying supplies for NATO forces, along with a couple of dozen other tankers and trucks.
"We will start moving soon in a convoy," says Farooq. "We are regularly attacked in this area. We are attacked with sticks, stones and even fired upon."
Indeed, many of the trucks have dents and broken windows, from stones that have found their mark. "This is my third trip here," Farooq says, "and I have decided that this is the last time I'm coming here. It's not worth it."
Farooq's calculation of whether his journey is worth it is a reflection of the larger assessments going on in Islamabad and Washington, which have sharpened since Osama bin Laden was found hiding in plain sight in a garrison town near Islamabad.
Americans wonder if the billions of dollars in military aid they give Pakistan is being misspent or diverted to beef up Pakistan's military capabilities against India, or possibly even to bolster its nuclear weapons capabilities.
Pakistan's government and military believes it is paying a high price to fight America's war against al Qaeda and the Taliban. More than 30,000 Pakistanis have been killed in the decade since the September 11. 2001 attacks, including 5,000 soldiers, police and intelligence agents.
Pakistan, for its part, has received $20.7 billion worth of U.S. assistance over the past decade, about two-thirds of it military aid.
What is clear is that both sides feel short-changed by an alliance they forged 10 years ago that is rooted in battling Islamist militancy, but which has largely ignored starkly different strategic interests.
Pakistan is a nuclear-armed and politically volatile country that has fought three major wars with India and fought countless skirmishes. This rivalry largely defines its policy.
The United States has given Pakistan billions to flush out Taliban and al Qaeda militants along the Afghan border, but few doubt that Islamabad actually protects many of them, seeing them as collateral to ensure that it -- and not India -- has a key role in any settlement in Afghanistan.
Pakistan's preoccupation with its eastern front has led it to snap up weapons as a pace Western experts say may, within the decade, turn it into the world's fourth-largest arms purchaser after the United States, Russia and China.
Pakistan is also suspicious of the United States' ties with India and Washington's help for its nuclear program, a relationship it hopes to counter by cozying up to China.
All that makes for an alliance that is, at best, half-hearted and one in which aid money is diverted toward what Pakistan sees as its strategic interest.
"The U.S. wants to leave Afghanistan, and end terrorist threats, but Pakistan wants parity with India and domination over Afghanistan," Vali Nasr, a former State Department adviser on Afghanistan and Pakistan, wrote in the Financial Times.
"It is not easy to change the calculations of a nuclear power that harbours deep distrust of U.Sharbors. motives."
In the 2009-10 budget, official defense expenditures amounted to $4.45 billion out of a total national budget of $29 billion. In that same fiscal year, according to the Congressional Research Service, direct military-to-military transfers amounted to just over $1 billion, almost a quarter of Pakistan's military spending.
A big chunk of the military aid has been spent on weapons systems that appear to have little to do with fighting terrorists in the mountain wilderness, including 31 F-16 fighters, anti-tank missiles and launchers, fast patrol boats, and the refurbishment of a frigate.
Much of this equipment would, however, be of use on the eastern front where Indian and Pakistan forces have for decades been locked in a tense standoff over the disputed territory of Kashmir.
Former Pakistan President Pervez Musharraf, who joined the U.S.-led "war on terrorism" after the September 11 attacks had no qualms about admitting that.
"Whoever wishes to be angry, let them be angry," he once said in an interview. "We have to maintain our security."
The Americans have turned a blind eye.
"Back in even the 1980s when we were providing all kinds of assistance because they were helping us with the Soviet-Afghan war, did we sort of know that they were asking for weapons and systems that weren't necessarily for use in Afghanistan against Soviet troops? Yeah," said a senior U.S. official.
"But it's always a trade-off."
Some Congressional critics have raised the possibility that some of the aid might have been diverted to Pakistan's nuclear weapons program.
"Possibly some of our monies are being diverted to help them increase their missile launch activities for their nuclear weaponry," said Republican Senator Bob Corker, who along with colleagues received a closed-door briefing by CIA Director Leon Panetta about the bin Laden mission.
"So, you know, I think this is a major reset button for us, time for us to really look at this relationship in a serious way," he told CNN in an interview.
The convoys that carry non-lethal supplies for the U.S.-led war in landlocked Afghanistan, through crossings in Chaman in southern Pakistan and Khyber Pass in the north, are just one factor in the calculus.
Pakistani lawmakers, angry over the U.S. raid that killed bin Laden have warned that Pakistan may cut the supply lines if the United States continues to launch missile strikes against Islamist militants on their soil.
A NATO helicopter incursion into Pakistani territory on Tuesday will likely increase such calls. A 10-day shutdown followed last year after similar incursions.
Their counterparts in the U.S. Congress have threatened to cut the $3 billion in annual military and economic aid to Islamabad if it turns out Pakistani authorities knew that the al Qaeda leader was holed up for year in a villa just 50 km (30 miles) from the capital.
Several senior U.S. Senate Democrats this week urged the Obama administration not to disburse any more security aid to Pakistan until it is sure Islamabad is not letting al Qaeda and other militant groups operate there.
U.S.-Pakistani relations have long been called a marriage of convenience but, since the killing of bin Laden, there have been increasingly strident calls in both nations for a divorce.
But blowing up the relationship, and the aid that comes with it, is an option the United States and Pakistan can ill-afford, because the stakes are so high.
Nasr, the former senior State Department advisor, said the United States should now "hug" Pakistan more closer than ever, and suggested Washington actually offer more assistance in exchange for a genuine agreement from Pakistan to change course.
"The conventional wisdom says Washington's policy of engagement has been a failure, and argues for a return to the distrustful approach that dominated American policy during the early 2000s. This would be a serious mistake," he said.
It has been widely assumed that some of the aid money is being diverted to well-connected pockets.
A 2008 study by the U.S. Government Accounting Office found a number of abuses in money spent under the Coalition Support Funds (CSF) that reimburse countries for their spending in the battle against terrorism.
They included $200 million for air defense radar equipment when the insurgents do not have air forces, and $30 million for roads and $15 million for bunkers that were not actually built.
The navy received more than $19,000 per vehicle each month just to maintain and operate a fleet of 20 passenger vehicles.
Between 2004 and 2007, Pakistan billed the U.S. government $200 a month per soldier in food costs -- it fluctuated between $500 and $800 for sailors. That's between 2.5 and 9.6 times Pakistan's per-capita annual income, which was just over $1,000 in 2009.
When the Office of Defense Representative-Pakistan (ODRP) began to more rigorously verify the Pakistani claims after that 2008 GAO report, the percentage of claims that were rejected doubled in six months to 6 percent and then more than tripled to 22 percent in the next six-month period.
For example, in the first two quarters of fiscal year 2010, Pakistan submitted claims of $531 million and $530 million. The United States paid out $263 million and $326 million.
"We certainly get claims that we have questions about," a U.S. official in Islamabad told Reuters. The official asked for anonymity to speak candidly about the relationship.
Another senior U.S. official dryly added: "In this part of the world, in many parts of the world, there's always a tendency to pad the contracts."
The more rigorous accounting and slower disbursement has added another irritant to the uneasy partnership. Pakistan is at pains to point out that much of the money it gets is not really aid but a reimbursement of expenses it incurs in fighting the U.S.-led war on terrorism.
Pakistan's Army spokesman Major General Athar Abbas said the military gets reimbursed for things like fuel, maintenance of equipment and vehicles, and maintaining soldiers in the field.
He said the money goes first to the finance ministry, then the Defense ministry before it is allocated to the military.
Pakistan is one of the top recipients of U.S. aid along with Egypt and Israel, but it has not bought America much popularity. Opinion surveys show an overwhelming majority of the Pakistani public holds an unfavorable view of their ostensible ally.
So, is U.S. aid to Pakistan really worthwhile? Officials say only time can tell.
"In the long run, in the historic perspective, will we be able to say it was worth it? Or will historians be able to say that?" mused the senior U.S. official. "I really don't know at this point."
Additional reporting by Rebecca Conway in Islamabad, David Alexander and Missy Ryan in Washington and Faisal Aziz in Quetta; Editing by Bill Tarrant and Miral Fahmy