Unresolved dispute over reopening of Nato supply routes.
Pakistan is keen to keep US as its partner
The US withdrew negotiators from Pakistan after months-long negotiations reached an impasse. The deadlock, which was supposed to have been resolved ahead of the Nato meeting in Chicago in May, could have lasting and negative repercussions for the two countries' relations, analysts said.
Neither side has forsworn diplomatic efforts to resolve the issue, and officials from both countries said negotiations would likely restart.
"We are talking to each other," Hina Rabbani Khar, Pakistan's foreign affairs minister, said yesterday before meeting William Hague, Britain's foreign secretary. "We have good sense that the US is a partner … [I] hope we both will be able to move forward on that. I don't want to be pessimistic about it at all."
In Washington, however, the state department spokesperson Victoria Nuland said on Monday the American negotiating team would return to Islamabad only "when we think we can make some progress".
US negotiators were reportedly pulled back on Sunday after Pakistan's army chief, General Ashfaq Kayani, last week refused to meet senior Pentagon official Peter Lavoy, who had travelled to Pakistan to try to resolve the issue.
Ms Nuland also said that the administration stood by statements made by Leon Panetta, the US secretary of defence, who last week said the US was "running out of patience" with Pakistan.
Pakistan closed the border crossing in November after Nato helicopters attacked a Pakistani army border post in Salala, killing 24 soldiers. Since then, Nato has had to move supplies into Afghanistan via the more difficult and expensive northern route through Central Asian states.
Pakistan is demanding a full apology as well as increased toll fees from the US to reopen the supply route. A Pentagon investigation found that the Salala bombing had been a mistake, but a diplomatic way to convey US regret over the incident has so far proven elusive.
The US administration is understood to have been close to offering an apology before an April 16 attack in Kabul that targeted international institutions, including the US Embassy.
That attack was blamed on the Pakistan-based Haqqanni network that the US has long insisted Islamabad is not doing enough to contain. Mitt Romney, the Republican presidential candidate, has criticised Barack Obama, the US president, for "apologising for America", which has constrained US diplomatic options.
Offering a full apology during an election year would be "extraordinarily difficult", said Marvin Weinbaum, of the Middle East Institute, a Washington-based think tank.
It is equally hard to accept anything less in Pakistan, he added, where anti-American sentiment is at a new high,
"In Pakistan they've been beating the drums of the importance of their honour and sovereignty," said Mr Weinbaum, referring to Pakistani unhappiness not just with the Salala bombing but over the unilateral US raid the killed Osama bin Laden last year and repeated US drone attacks over Pakistani territory that have resulted in hundreds of civilian casualties.
In the past, diplomacy would have settled all such issues "rather easily", said Mr Weinbaum, who served as Afghanistan and Pakistan analyst for the US state department between 1999 and 2003. Today, however, "this is taking place in a context in which the climate of opinion in both countries is such that it limits policy makers".
If left to fester, this could have serious consequences for US-Pakistan relations and the wider region. There are elements in both countries - particular in the two militaries - that are prepared to do without the other, said Mr Weinbaum.
But the US cannot walk away from the region like it did in 1989, Mr Weinbaum said. Pakistan's role in Afghanistan remains crucial. The US is committed to another decade in Afghanistan after the scheduled withdrawal of Nato troops in 2014. Moreover, Pakistan's shaky stability and the security of its nuclear arsenal is too important to the US and other regional actors.
"Pakistan has its own insurgency. It's dangerous because of the potential here for Jihadis succeeding in both [Afghanistan and Pakistan], nuclear weapons and peace between Pakistan and India."