Islamabad, Nov. 15: Pakistan has acused America of pushing it closer to bankruptcy by witholding up to $1 billion (£675 million) in military contributions despite the country’s efforts to fight terrorism.

Pakistan’s crucial role in the US-led war on terror has not been reflected in American revenue transfers, financial adviser to the Prime Minister Shaukat Tarin told The Daily Telegraph.

Tarin, the de facto minister for the economy, said that a “significant” portion of the annual US payment for Pakistan’s counter-terrorism operations was overdue, causing additional strain on the country’s exchequer.

“There is a process of auditing and it is taking longer than it should,” he said. “There is a cost. We have 100,000 troops fighting this war. That takes hard cash. On top of that we are paying for a loss in investment because of the security situation.”

Approvals to release funds appeared to have been delayed by political sensitivities in the lead-up to the US presidential elections. Pakistan’s economic losses from domestic instability are believed to exceed $8 billion a year. America has paid Pakistan almost $10 billion in direct military “reimbursements” since 2002, mostly as part of what are termed Coalition Support Funds.

The subsidy pays for Pakistani military food, fuel, ammunition and maintenance but have come under scrutiny since last year when US military officials claimed that up to 70 per cent of the money was “misspent”.

Pakistan has barely enough foreign reserves to cover nine weeks of imports and is struggling to raise funds to avert a balance of payments crisis.

The country faces increasing lawlessness and insecurity as the military struggles to suppress a Taliban insurgency in North West Frontier Province and adjoining tribal areas. Potential donors will gather in Abu Dhabi on Monday under the banner of the “Friends of Pakistan”. A meeting of officials is not expected to result in loans being pledged, but it could pave the way for a ministerial meeting.