The Obama administration will cut hundreds of millions of dollars in aid to Egypt to register displeasure over the military's pace of restoring democracy following the ouster of President Mohammed Morsi.
The U.S. provides $1.5 billion in annual aid to Egypt. The State Department did not provide a dollar amount of the aid being cut.
State Department spokeswoman Jen Psaki says the United States will withhold delivery of certain large-scale military systems as well as cash assistance to the Egyptian government until "credible progress" is made toward an inclusive government set up through free and fair elections.
Some analysts and Egyptian said the move could backfire.