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The U.S. war on terrorism has given new impetus to U.S. aid to Asia. In addition to the goals of alleviating poverty, encouraging democratic social and political forces, fostering economic growth and stability, and cultivating bilateral relations in Asia, since September 2001, the United States has redoubled its efforts in fighting terrorism in parts of the region. This report discusses changing U.S. aid programs for 16 East Asian and South Asian countries. Before September 2001, U.S. development and security-related economic assistance to East Asia and South Asia was projected to rise about 8% and 6.5%, respectively, in FY 2002 over FY 2001. After the war on terrorism began, the United States promised increases of 17% and 250% to East Asia and South Asia, respectively. In South Asia, Pakistan and India have become 'front line' states in the U.S. campaign against terrorism. Pakistan will receive an estimated $610 million in Economic Support Funds (ESF) in FY 2002. For FY 2003, the State Department has requested $200 million in ESF for Pakistan and $25 million in ESF for India (compared to an estimated $7 million in ESF for India in FY 2002). The Bush Administration has also significantly raised military assistance to the Philippines, as part of an expansion of U.S. anti-terrorism efforts in Southeast Asia. In FY 2002, the Philippines will receive 80% of all Foreign Military Financing (FMF) assistance to East Asia.