The diplomatically sensitive move — which the administration was ready to announce later Friday — rewards Pakistan for help in the war on terrorism but angers India, a U.S. ally and a fellow democracy.
Mr. Bush, who is spending holiday time at his Texas ranch, called Indian Prime Minister Manmohan Singh early Friday to tell him of the long-anticipated decision. The State Department planned to describe details of the sale later in the day.
Singh "conveyed to President Bush his great disappointment over the United States' decision," Sanjaya Baru, the prime minister's spokesman said. Singh said sales to Pakistan endanger security in the region, Baru said.
A senior U.S. official, speaking on condition of anonymity, linked the proposed sales of the planes, manufactured by Bethesda, Md.-based Lockheed Martin, directly to Musharraf's cooperation after the terror attacks on the United States on Sept. 11, 2001. This official maintained the sale would not upset the balance of power in the region.
"Musharraf made the strategic decision on Sept. 14, 2001 to stand with the United States," the official said, noting that the report of the independent Sept. 11 Commission recommended the United States make a long-term commitment to Pakistan. A five-year, $3 billion assistance program is under way, the official also noted.