The Trump administration’s first budget proposal presented before the Congress would convert some of the United States’ foreign military grants to loans, part of a larger effort to slash spending on diplomacy, aid and programmes abroad by more than 29 percent, the White House said on Monday. Although the document is more a “policy wish list” and less a set of concrete proposals at the moment, it does reveal the principles that the new administration will try to follow. For Pakistan – a large recipient of US aid – this putative policy change might cause problems.

But before the Pakistani government starts scrambling to re-balance its spending habits, it must be noted that this policy change might not come into effect at all. The budget proposal contains deep spending cuts at which even hard-line conservatives have balked at; as it stands, the proposal has been described as “dead on arrival” by many representatives of the governing Republican Party. Furthermore, many individuals have specifically criticised cuts to the State Department – the body through which foreign aid military deals are conducted – because it will lead to the curtailment of US ‘soft power’. As the $110 billion arms deal with Saudi Arabia shows, foreign aid, subsidised arms deals and grants are a key tool of US policy, and career diplomats and bureaucrats in the US have vowed to fight to maintain State Department funding.

However, it is also worth noting the volatility of the present US government; it has taken unpopular decisions which have gone against US foreign policy conventions and for a domestically embattled Donald Trump seeking to finance the tax cuts he promised on the campaign trail, spending cuts like these just might be implemented.

Pakistan – at one point, the third-largest recipient of US assistance; Washington gave Islamabad nearly $19 billion in aid between 2002 and 2010 and nearly $75 billion since 1951 – therefore needs to cautiously re-examine its economic model. Compared to the turn of the millennium, Pakistan’s economy is much more robust and less reliant of foreign grants, but a loss of a big income source would still shock the system. Even now, reports indicate the circular debt is creeping up and budget deficit increasing. How effective is our government’s ability to function independently of international largesse?

While such a scenario might never come to pass, the government would do well to prepare an answer for this question beforehand and plan for contingencies.