The F-16/79 was offered before that by the Carter administration to everyone who wanted the F-16 outside the USA. Reagan administration approved the sale of regular F-16s to export countries. The F-20 was seen as the "other jet" to be sold by Northrop (US Government did not fund the project as opposed to the F-16 program) that Pakistan could have benefited from especially from the license production clause. 40 F-16s were coming in instead by two deals, and the small blunder came with them not ordering or pushing hard enough to acquire AIM-7 Sparrows for BVR capability. According 2-3 PAF Viper drivers I have spoken to.....if they ever had that capability they would have shot down close to 30 aircraft during the Soviet Afghan war as opposed to 8 (9 including the friendly kill).
Well those are the events I am aware of, regardless of US-Pakistan relationships, the F-16 was a great investment for PAF.