The U.S. will contribute to a trust fund to help Yemen as it expands aid beyond counter-terrorism against Al-Qaeda to include aid for economic, social and political development, U.S. Secretary of State Hillary Clinton said on Tuesday.

Clinton was in the capital of Sana'a on Tuesday as part of five-day visit to the Arabian Peninsula where she said the U.S. has rebalanced its aid to support the Friends of Yemen group of nations that seeks to promote economic development in the country.

The next Friends of Yemen will be sometime in the next couple of months. It'll be hosted by Saudi Arabia and...including an idea of having a trust fund for Yemen, which the United States is committed to contribute to, Clinton told reporters ahead of a meeting with Yemeni President Ali Abdullah Saleh.

The U.S. has been increasingly boosting its military aid to Yemen. While the U.S. gave Yemen $155 million in aid in 2010, it is proposing to Congress to boost that past $200 million, according to reports citing U.S. officials

The State Department says Al-Qaeda in the Arabian Peninsula (AQAP) is actively engaged in terrorist activities in Yemen and other Gulf countries. In October, the department issued a travel warning for Americans to defer to non-essential travel to the country.

Terrorist attacks have been blamed for injuries to Yemeni security agents in October of last year, a 2009 attempt to bomb a jet en route to Detroit from Amsterdam on Christmas day, and suicide attack targeting a British ambassador in April of 2010. In 2008, explosions outside the U.S. embassy in Sana'a were attributed to terrorism.

Clinton noted Tuesday that the U.S. is one of a number of countries giving aid to Yemen, with funds primarily coming from Saudi Arabia and Qatar, along with European nations such as the UK and Germany.

Clinton said the U.S. was to some extent, a late comer in terms of the amount of aid it was willing to commit to Yemen adding that we're trying to manage in a time of increasing need and decreasing budgetary resources.

Clinton said she would be promoting fair, legitimate and inclusive participation by the president and opposition on how to hold parliamentary elections. She would raise questions about Saleh's move to remove presidential term limits, Clinton said.

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