Leaked US diplomatic cables revealed that hundreds of millions of dollars in American military aid to Pakistan earmarked for fighting Islamist militants was not used for the desired purpose, but diverted to the government's coffers.
According to a report by The Guardian, Pakistan's army chief General Ashfaq Kayani said the money, including USD 26 million for barbed wire and USD 70 million to defend against non-existent Taliban warplanes, had been diverted into the Islamabad government's coffers.
"The relationship is one of co-dependency we grudgingly admit," the embassy noted in February 2009.
"Pakistan knows the US cannot afford to walk away; the US knows Pakistan cannot survive without our support."
The British daily, which was based on US embassy cables leaked by WikiLeaks, said that dozens of cables from the Islamabad embassy portray US officials dangling billions in aid, offering sophisticated weapons and pushing to provide counter-insurgency training for Pakistan's "1940s" army.
General Kayani reportedly worried that his army was seen as a force "for hire", and chafed at demands for greater transparency and punishes American diplomats for allegedly siding with arch-rival India.
US payments for the war against the Taliban and al-Qaeda in Pakistan's tribal belt have reportedly exceeded USD 7.5 billion since 2002.
In December 2007 US diplomats reported multiple instances where "funds have been diverted and reimbursed claims figures have been seriously inflated".
When the payments slowed in January 2009 Kayani spoke candidly about the matter with General David Petraeus, a cable reported.
Most of the military funds had been diverted to the federal government, he said.
The newspaper reported that angry about the US favouring India and worried Washington wanted to increase the power of Pakistan's civilian leaders, the "military and intelligence establishment" was quietly punishing the Islamabad embassy, one frank dispatch in February 2010 noted.
The military had delayed visas for diplomats, blocked import permits for armoured vehicles, "sabotaged" a security contract and was "stopping and detaining embassy vehicles".
"Engagement with the Pakistani military has been frustrating," one dispatch said.
"Transparency is often nonexistent. Offers of assistance go unanswered or are overruled at headquarters, even as Pakistan's maintenance and training are inadequate."
US Vice-President Joe Biden described relations with Pakistan as "transactional" and "based on mutual distrust".
"While the army remains fixated on India as Pakistan's mortal enemy, the common man is just as likely to point to America," one of the cables said.