The Trump administration may withhold $225 million in government aid to Pakistan over frustration with the country's handling of terror groups within its borders.
According to the report, senior administration officials met this month to decide what to do about the money, and American officials said a final decision could be made in the coming weeks.
The US had considered Pakistan an ally in its fight against terrorism ever since the September 11 terrorist attacks on the twin towers of the World Trade Centre in NY in 2011.
Trump ratcheted up the pressure previous year when he announced his Afghan strategy that called out Pakistan for harboring Afghan Taliban insurgents warning it would have to end. "No more!" Trump said in a tweet.
The President last August demanded Pakistan "change immediately" its practice of giving safe haven to terror groups including the Taliban, which have assaulted US forces based in neighboring Afghanistan.
"The United States has foolishly given Pakistan more than 33 billion dollars in aid over the last 15 years, and they have given us nothing but lies & deceit, thinking of our leaders as fools". "We don't need your aid, our sacrifices should be acknowledged".
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Pakistani troops confronted Haqqani militants as they ferried the family across the tribal lands of northwest Pakistan.
There was no immediate reaction in Kabul and New Delhi which have repeatedly accused Islamabad of harbouring and arming terrorists ranged against the two countries. "We make massive payments every year to Pakistan", he said.
Trump who returned to the White House from Mar-a-Lago in Florida where he spent his Christmas and New Year vacation did not respond to shouted questions from reporters on "what is your plan on Pakistan?"
In May 2016, Pakistan had summoned the U.S. ambassador to express its reservations over a drone strike inside its territory that reportedly killed Afghan Taliban chief Mullah Akhtar Mansoor.
A State Department official said Pakistan's actions will ultimately determine the course of "security assistance in the future".