The United States Senate has passed its draft of the National Defence Authorisation Bill, including a provision to set up a new fund to reimburse Pakistan for its efforts in the war against terrorism.

The Senate version authorised $800 million under a provision called the 'Pakistan Security Enhancement Authorisation', Dawn online reported today.

It also fenced $300m behind a similar Haqqani network provision that has existed in the annual defence authorisation acts since the fiscal year 2015. The proposal for Pakistan was passed as originally initiated.

This came a day after the Senate refused to recognise India as a "global strategic and defence partner" of the US after a key amendment necessary to modify its export control regulations could not be passed.

The US Senate, however, did pass a legislative amendment as part of the National Defence Authorization Act (NDAA) 2017 that proposes to bring defence sales with India at par with America's close allies and NATO members.

How does the money help Pakistan?

The proposed reimbursement mechanism for Pakistan replaces the Coalition Support Fund (CSF), which was used to reimburse both Afghanistan and Pakistan for their efforts to combat terrorism.

Pakistan has received a total of $3.1 billion since 2013 under the CSF. But this fund expires in the current financial year, ending in October.

While adopting the new provision, the Senate Armed Services Committee used the CSF model to restructure security support for Pakistan. But it focuses specifically on Pakistan's own security needs instead of tying it to a broader coalition.

In doing so, the new provision delinks Pakistan from Afghanistan, by recognising it as a country with its own strategic value for US interests.

In a report filed with the draft Defence Bill, the US Senate Armed Services Committee called Pakistan "a long-standing strategic partner" and stressed the need to continue a strong relationship with the country.

Both houses of the Congress have passed their versions of the Defence Bill. A conference committee of both houses will now be formed to develop a consensus draft.

The procedure can be completed by July, although past bills have been passed as late as November.

Besides, the Haqqani restriction, the bill requires Pakistan to keep open ground communication lines to Afghanistan for receiving reimbursements from this fund.

Another bill, passed by the House of Representatives last week, linked $450m from a total of $900m proposed for Pakistan to take action against the Haqqani network.