- US has been frustrated by Pakistan's unwillingness to act against terror groups.
- However, this is not the first time the Pentagon has decided not to make military reimbursements.
- Last year, the Pentagon withheld $300 million in reimbursements.
As a result of the notification by the defence secretary to Congress, the Department of Defence has reprogrammed remaining Coalition Support Funds, which is $350 million, to other accounts, defence department spokesman Adam Stump said.
The US decision comes as President Donald Trump's administration is exploring potentially hardening its approach toward Pakistan to crack down on militants launching strikes in neighboring Afghanistan.
"This decision does not prejudge the conclusions of the White House review of South Asia strategy, which is still ongoing," Stump said.
Haqqani network
Pakistan-based Haqqani network is blamed for a number of high-profile attacks on US and Western interests in war-torn Afghanistan.
The terror group is also blamed for several deadly attacks against Indian interests in Afghanistan, including the 2008 bombing of the Indian mission in Kabul that killed 58 people.
The group is believed to be based in the unruly tribal regions of Pakistan, near the porous border with Afghanistan.
This is for the second consecutive year that the US defence secretary has refused to certify to Congress, as mandated under National Defence Authorisation Act (NDAA), that Pakistan has taken satisfactory action against the Haqqani network.
Mattis's predecessor Ashton Carter was the first US defence secretary to refuse that certification.
"The funds ($350 million) could not be released to the government of Pakistan at this time because the secretary could not certify that Pakistan has taken sufficient action against the Haqqani Network as per the requirement in the FY 2016 NDAA," Stump said.
"Pakistan has been reimbursed $550 million of the $900 million the country was authorised in FY16 CSF. With the secretary's decision, there is no additional FY16 CSF available to Pakistan. The secretary decided to request reprogramming of the funds to retain the ability to use those funds for other requirements," he said.
As part of the regular Defence Department budgetary process, the FY16 CSF money allotted for Pakistan needed to be released or reprogrammed prior to the expiration of the funding, Stump said.
"We continue to be encouraged by Pakistan's operations in North Waziristan and elsewhere in the FATA. Pakistan's efforts have reduced the ability of some militant groups to use North Waziristan and the FATA as a safe haven for terrorism," he said.
However, the Taliban and the Haqqani Network continue to operate in other locations in Pakistan, Stump said, two days after the State Department in a report to the Congress had listed Pakistan as one of the countries having terrorist safe havens.
"In our discussions with Pakistani officials, we continue to stress that it is in the interest of Pakistan to eliminate all safe havens and reduce the operational capacity of all militant organisations that pose a threat to the US and Pakistani interests as well as regional stability," he said.