By Steve Holland

WASHINGTON (Reuters) - U.S. President Barack Obama quietly signed a $7.5 billion aid bill for Pakistan on Thursday that drew criticism in the nuclear-armed South Asian country because of conditions linked to the assistance.

Obama signed the bill behind closed doors at the White House without a public ceremony before leaving on a trip to New Orleans. The law provides $7.5 billion in nonmilitary aid to Pakistan over five years.

Pakistan's military had complained because the legislation ties some funds to fighting militants and is seen by critics as violating sovereignty.

The United States is the biggest aid donor to Pakistan and needs its help in hunting al Qaeda leaders and stopping Islamist militants from crossing the border into Afghanistan to fight U.S.-led forces there.

The aid is designed to fund projects in Pakistan that include schools and roads, agricultural development, energy generation, water resource management and the judicial system.

The funding must still be allotted by Congress and the law must be renewed each year. The White House must certify that "reasonable progress" is being made to meet the objectives of the aid and give lists of recipients to Congress.

ALLAYING CONCERNS

The Obama administration and U.S. lawmakers spent most of this week trying to allay the concerns in Pakistan. Shah Mehmood Qureshi, Pakistan's foreign minister, said on Wednesday he was optimistic he had won the assurances needed from Washington to help calm the debate at home.

This came after Democratic Senator John Kerry, an author of the bill, issued a statement stressing that the legislation did not seek to impinge on Pakistan's sovereignty or "micromanage any aspect of Pakistan's military or civilian operations."

U.S. lawmakers, while sympathetic to delicate Pakistani politics, made clear conditions attached to the aid could not be eased.

White House spokesman Robert Gibbs. in a statement announcing the law had been signed, said it was the "tangible manifestation of broad support for Pakistan in the U.S."

Gibbs said Obama wants to engage Pakistan on the basis of a strategic partnership "grounded in support for Pakistan's democratic institutions and the Pakistani people."

"This act formalizes that partnership, based on a shared commitment to improving the living conditions of the people of Pakistan through sustainable economic development, strengthening democracy and the rule of law, and combating the extremism that threatens Pakistan and the United States."

Militants have recently launched a string of attacks in the Pakistani heartland, including a daring raid by the Taliban on the army headquarters in Rawalpindi. More than 100 people have been killed in a week of violence.

"This shows once again that the militants in Pakistan threaten both Pakistan and the United States," White House spokesman Bill Burton said.