* USAID chief says aid crucial as U.S. troops withdraw
* US has spent billions of dollars in Afghanistan since 2002
* Republicans look to rein in huge deficits, debt
By Missy Ryan
KABUL, Feb 13 (Reuters) - Congressional plans to slash U.S. foreign assistance, including multibillion-dollar aid to Afghanistan, risk undermining the Obama administration&${esc.hash}39;s bid to leave behind a stable nation when it withdraws its troops.
Rajiv Shah, a doctor and administrator of the U.S. Agency for International Development (USAID), said pledges from some leading lawmakers to cut funding for his agency, a prime target in Republican belt-tightening plans, would undermine the U.S. fight in Afghanistan and ultimately jeopardise U.S. security.
"In order to have a transition strategy, for our troops to be able to exit, and for us to be able to see gains in stability and governance and development be durable and sustainable, if USAID&${esc.hash}39;s resources are cut back ... that will both be costly to American taxpayers and it will be tremendously unwise," Shah told Reuters.
"Worse than all that, it will put our people&${esc.hash}39;s lives at risk. Now would be a terrible time to scale that back."
Shah spoke on a recent visit to Afghanistan, where he met Afghan leaders and visited U.S.-funded aid projects. Military commanders are racing to show results on the battlefield before they start to send some troops home later this year.
Despite record violence in 2010, U.S. President Barack Obama and other Western leaders hope a tenacious Taliban insurgency can be turned back in 2011 as foreign troops seek to put an unsteady Afghan military in the lead by the end of 2014.
Shah, 37, said USAID had struggled in the past to hold its aid contractors accountable, but said it had made big strides in maternal health, sending Afghan girls to school, increasing wheat yields and making tentative steps to expand farm exports.
Back in Washington, Shah will be making the case on Capitol Hill that the vacuum to be left by the U.S. troop drawdown makes it all the more important to have a robust package from USAID, the biggest backer of aid activities in Afghanistan.
Yet he will face a test in convincing some Republicans, who took control of the U.S. House of Representatives last month and are vowing to slash aid programmes they see as expensive, inefficient and vulnerable to waste and fraud.
The new Congress, seized by fears about a ballooning national debt yet unwilling to cut funding for military operations, will also examine cutting overall civilian assistance and training -- not just from USAID -- for Afghanistan that has already cost the United States some ${esc.dollar}56 billion.
Ileana Ros-Lehtinen, the influential Republican chair of the House Foreign Affairs Committee, has vowed to cut "fat" from the State Department and foreign aid budgets and to rein in programmes she said can perpetuate corrupt governments.
AS TROOPS LEAVE, WILL AID WORKERS?
USAID has spent at least ${esc.dollar}12 billion on aid to Afghanistan since the Taliban government was toppled in 2001, still a modest sum in comparison to U.S. military spending.
Funding peaked in 2010, when Washington sent hundreds of aid workers and civilians to Afghanistan in a "civilian surge", an essential element in Obama&${esc.hash}39;s bid to turn around a flagging war.
USAID has requested around ${esc.dollar}2.5 billion for Afghanistan in 2011, but that budget has not yet been approved.
Even if Congress does not make dramatic cuts, aid groups like Oxfam are worried assistance will fall off suddenly as foreign troops go home, as it did in Iraq and Kosovo, leaving desperately poor Afghanistan in the lurch.
"The gains made are in danger of slipping away due to insecurity and efforts by the international community starting to run out of steam," said Shannon Scribner, a policy adviser at Oxfam America.
Noam Unger, an aid expert at the Brookings Institution in Washington, expects USAID&${esc.hash}39;s budget to be reduced but said "frontline" nations like Afghanistan, where U.S. officials see vital security interests, would be spared the brunt of the cuts.
"The bigger concern may be that cuts to USAID and the State Department could serve to undercut the larger role they need to play ... burdening our troops with civilian tasks and creeping missions in Afghanistan, Pakistan and elsewhere," Unger said.
Critics have faulted the U.S. military for bungling efforts to use aid activities -- building schools or paving roads for example -- as a counter-insurgency tool in Afghanistan and Iraq.
USAID, too, has faced fire from U.S. government watchdogs, mostly over its use over the last decade of expensive contractors who have at times been accused of fraud or even funnelling U.S. money to pay off insurgents.
Unger said Shah had taken steps to improve oversight and reduce reliance on contractors.
A senior USAID official, speaking on condition of anonymity, said despite such threats the agency was planning for three years of high funding -- in 2010-12 -- for Afghanistan linked to Obama&${esc.hash}39;s orders to increase civilian aid dramatically.
After that, USAID funding would be expected to decline to levels more in line with what USAID would normally provide to a country of Afghanistan&${esc.hash}39;s size and needs. "It&${esc.hash}39;s not sustainable. A surge is a surge," the official said. (Editing by Paul Tait and Ron Popeski) (If you have a query or comment about this story, send an e-mail to news.feedback.asia@thomsonreuters.com)
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