By Missy Ryan
WASHINGTON (Reuters) - Osama bin Laden's death has reopened a high-stakes debate in Washington over the U.S. role in South Asia, where 100,000 troops are fighting a costly war in Afghanistan next door to a fragile, nuclear-armed and suspicious Pakistan.
President Barack Obama's aides are divided between a "hug them" or "hit them" approach to dealing with Pakistan, where anger at the May 2 raid that killed bin Laden on Pakistani soil is matched in Washington by angry new questions about Islamabad's ties to militants.
In Afghanistan, just weeks before an initial U.S. troop withdrawal is scheduled to begin, violence has hit its highest level since the war began a decade ago. Support is growing for the less troop-heavy approach advocated by Vice President Joe Biden during Obama's first regional strategy review in 2009.
"We are at a significant inflection point regarding our future strategy," said retired Lieutenant General David Barno, who was a senior commander in Afghanistan from 2003 to 2005 and is now a fellow at the Center for a New American Security, a think tank seen as close to the Obama administration.
The commando raid that killed bin Laden epitomized the kind of small, targeted strikes on militants which some officials support for Afghanistan. It has emboldened those U.S. officials who argued against the Pentagon's broader, costlier counter-insurgency strategy that prevailed in 2009 and produced Obama's surge of 30,000 troops.
The "counter-terrorism" camp would prefer a faster withdrawal of the 100,000 U.S. troops in Afghanistan, with surgical strikes on insurgents anchoring the remainder of the U.S. effort and an accelerated transition to Afghan control.
Counter-insurgency, by contrast, calls for larger numbers of foreign troops staying to protect Afghans, isolate insurgents and build up the central and local governments.
"There is no question that bin Laden's death has changed the whole debate around U.S. policy toward Afghanistan and is giving more political space to skeptics, critics and opponents of the war," said Caroline Wadhams, a security analyst at the Center for American Progress.
"It gives the administration more political cover to undertake a significant withdrawal in July."
Biden will likely square off against advocates of a longer, bigger U.S. presence that would retain a more explicit focus on the counter-insurgency model that many military commanders credit with turning around the war in Iraq.
That camp is headed by General David Petraeus, the influential Afghanistan commander who is closely linked to the success of counter-insurgency doctrine. Advocates of that policy will likely argue that a precipitous exit would jeopardize gains U.S. troops have made in claiming parts of southern Afghanistan and even weaken chances of a settlement with the Taliban.
Biden "is sure to press his case, but Petraeus will have a big say," said Bruce Riedel, a former CIA official who advised the Obama administration in its 2009 review.
Petraeus, whom Obama has nominated to head the CIA, is expected to make his recommendations about the speed and nature of the initial withdrawal in coming weeks.
Biden held a small private dinner last week on Afghanistan-Pakistan issues. Attendees included former deputy secretary of state Richard Armitage and Pulitzer prize-winning author Steve Coll.
SUBTLE SHIFT EXPECTED
Obama, seeking to end a costly, unpopular war as he looks toward his 2012 re-election bid, may have been more inclined toward a speedy withdrawal even before bin Laden's death.
"Now, CT (counter-terrorism) is much more validated in the president's mind and he has more political capital to resist Pentagon calls for fully resourced counter-insurgency," a former U.S. official said on condition of anonymity.
Vali Nasr, who until last month was a senior State Department adviser for the region, said, "the military will push back, but the logic for a fully resourced counter-insurgency strategy isn't as strong as it was before."
Some worry about the wisdom of an accelerated withdrawal. The Afghan government remains dangerously weak. In some parts of the Taliban's southern stronghold there are signs the troop surge may have even turned some Afghans away from the West.
"A decision to accelerate the drawdown would have to be made in a way to ensure the Taliban simply didn't take it as a signal to hunker down and run out the clock," said Barno, who is preparing new recommendations for U.S. regional policy.
In the end, there may be a subtle tilt toward a counter-terrorism approach, but officials are likely to settle on a strategy similar to the current model, in which U.S. soldiers have combined efforts to win over local communities with an increased number of special forces strikes against insurgents.
"Our goal is to end the war in Afghanistan, bring our troops home, leave behind enough capability to conduct CT operations and to sustain necessary support to the (local forces) and Afghan state," a senior U.S. official said.
"That's eventually going to look an awful lot like the CT or 'CT plus' concepts from before. It remains a major, long-term U.S. commitment," he said on condition of anonymity.
PAKISTAN, FRIEND OR FOE?
If the Obama administration lacks easy choices in Afghanistan, the dilemma is even more acute in Pakistan. Even before bin Laden's death, bilateral ties had reached a low point over Pakistan's arrest of a CIA contractor and mounting U.S. drone strikes in Pakistan's western regions.
The government of President Asif Ali Zardari, along with Pakistan's even more powerful military leaders, has denied any prior knowledge of bin Laden's whereabouts.
But some lawmakers are calling for a radical shift in U.S. policy on Pakistan as officials brace themselves for possible revelations about Pakistani complicity in data seized from bin Laden's compound.
Daniel Markey, a former State Department official who is now a senior fellow at the Council on Foreign Relations, said the post-bin Laden debate about Pakistan had divided the administration into two camps.
The first wants to smooth things over with Pakistan, resisting calls on Capitol Hill to curtail aid and treading carefully around Pakistani concerns about violation of its sovereignty in U.S. drone strikes or CIA activity.
The second camp argues that Washington needs to seize the moment as officials in Islamabad reel from the embarrassing revelation, pushing its newfound leverage to extract agreement for concrete actions against militants, for example.
"The U.S. must remain steadfast in demanding answers from Pakistan's leaders and must not allow them to turn the tables," former CIA analyst and State Department official Lisa Curtis wrote this month.
Administration officials are privately considering giving Pakistan a more narrow list of requests in hopes of boiling down U.S. priorities for Islamabad and prompting the government to take actions it has shunned in the past.
Pressure is mounting within the administration to declare a new policy on Pakistan, and quickly. "Bin Laden was a victory, and you want to take advantage of that victory," Markey said.
(Additional reporting and editing by Warren Strobel)