Washington has long complained that Pakistan provides a safe haven to militant groups, including the Afghan Taliban, Haqqani Network and Al Qaeda, allowing them to carry out cross-border attacks in Afghanistan.
"So, if our friends in Pakistan want to talk about a way out of that or want to talk about ways to strengthen their economy and deal with that, I am sure we would be open to that in trying to work with Pakistan - bilaterally or through global institutions - to try to get them on a better path", he said.
"And to make very clear what we have to do, all of our nations, in meeting our common foe, the terrorists", Secretary of Defense Jim Mattis said on August 28.
"Pakistan has much to gain from partnering with [this effort] in Afghanistan", the president said during a speech last August.
"Pakistan takes exception to the factually incorrect statement issued by U.S. State Department" on the phone call, a Foreign Ministry spokesman said on Twitter.
Washington sent its first clear message to Islamabad last week when US Secretary of State Michael Pompeo telephoned Prime Minister Imran Khan and asked the latter to take "decisive action against all terrorists operating in Pakistan".
The US has been pushing Pakistan to crack down on militant safe havens in the country, and had suspended hundreds of millions of dollars in security assistance to Islamabad at the beginning of the year.
The move earlier this summer reflects the Trump administration's dissatisfaction with Pakistan's commitment to assisting the USA strategy for pressuring the Taliban, whose leaders use Pakistan as a sanctuary.
The announcement came weeks after Pakistan's new prime minister Imran Khan took office amid concerns he would remain tolerant of terror groups including the Taliban and the notorious Haqqani network. The Pentagon now says it has made a decision to cut off Coalition Support Funds that reimburse Pakistan for its efforts at combating terrorism. At the time, the administration said Pakistan could receive the funds if it showed it was serious about clamping down on terrorist groups.
The US$300 million suspension notably coincides with growing economic troubles in Pakistan, marked by dwindling reserves and spiraling debts that some suggest could result in economic collapse without a massive and prompt infusion of funds.
Talking about how the Pakistani government will press the United States officials, including Pompeo and top USA military officer General Joseph Dunford who are scheduled to visit Islamabad on September 5, he said, "We will sit and discuss this with him [Pompeo]". Analysts note that the USA maintains the largest share of votes at the International Monetary Fund and so would have a strong voice on the terms and conditions of any bailout. But in its fresh decision, the United States has chose to totally end all sort of financial support to Pakistan military.
The move, which needs to be approved by US Congress, is part of a broader suspension announced in January.
President Donald Trump has previously accused Pakistan of deceiving the United States while receiving billions of dollars. "The US should understand Pakistan's position", she said.
"We are not interested in a failed Pakistan by any stretch of the imagination".
Many of Pakistan's top military commanders participated in the program, which also proved to be a useful back channel for American diplomats - a total of 66 Pakistani officers were due to be involved this year.