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Books on Pakistan
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Update No: 011 - (21/12/06)
Friends in the making?
The ongoing dispute between Pakistan and Afghanistan over the alleged
Pakistani support for the insurgency in Afghanistan has demonstrated that
Pakistan remains a key ally to the United States and that the Bush
Administration is not ready to put Pakistan under serious pressure in order to
have it secure the border with Afghanistan. The Afghans are now deluding
themselves that the planned 'Peace Jirgas' to be held in Afghanistan and
Pakistan will turn the situation in their favour and that Pakistan's acceptance
of the Jirga concept equals an admission from the Pakistani side that that
country is somewhat at fault. In reality, after the announcement of the Jirgas,
Pakistani officials have been as bold as ever in their statements concerning the
insurgency in Afghanistan. The Pakistani Foreign Minister told NATO
representatives in private meetings that they should accept defeat in
Afghanistan and start negotiating with the Taleban. General Orakzai, governor of
the NWFP, openly says that the Taleban are the genuine representatives of the
Afghan people. When President Karzai of Afghanistan launched the idea of
organising Peace Jirgas (assemblies) on both sides of the Afghan-Pakistan border
at the end of the summer to resolve the outstanding issues between the two
countries and received President Bush's endorsement, President Musharraf felt
compelled to agree. However, the Pakistanis have been slow in organising their
Jirga and have issued no clear statement of what the composition of such Jirga
will be. The pro-Afghan nationalist parties of the NWFP seem bound to be
excluded, however.
However, in the long term the alliance with the US may somehow weaken, as India
is stepping up its relations with Washington. In December, the Bush
Administration reconfirmed that there will be no extension to Pakistan of its
nuclear deal with India, which remains a unique case. Pakistan's attempts to
retaliate seem to be leading nowhere. When in December Pakistan announced a
tariff reduction of five percentage points on imports of almost 5,000 items as
part of the South-Asian Free Trade Agreement, it made clear that India was
excluded from the reduction until the 'Kashmir issue' will have been resolved.
India will raise a complaint to SAFTA over the discrimination.
Opposition already starts to fragment?
During December some turmoil surfaced in the opposition ranks, hitherto
seemingly united in their opposition to Musharraf and on the tactics to adopt to
challenge him. The leader of a small opposition party, Pakistan Tehreek Insaf,
has announced a plan to launch a campaign against Musharraf in coordination with
Nawaz Sharif's party and Jamaat-i Islami, but apparently not the PPP, whose
representatives have even declared to be unaware of any such plan. Moreover, the
opposition parties' efforts to include the MMA in the general anti-Musharraf
movement have so far failed.
Nonetheless, relations between the MMA and Musharraf are not at their best ever.
Even if Prime Minister Aziz praised the MMA for its refusal to align with the
other opposition parties, he stated clearly that there will be no electoral
alliance with them. Moreover, the MMA leaders resent Musharraf's anti-extremist
rhetoric, which is clearly aimed at them.
More promotions for Pakistan's economic management
In December Standard&Poor confirmed its foreign currency, local currency
and sovereign ratings for Pakistan, but revised the outlook on local currency
slightly upwards, following the government's efforts to rely more on longer-term
local currency bonds to finance its fiscal gap. The overall ratings remain
modest and within the 'B' range, due to the lacklustre progress in expanding the
tax base, which is the main cause of the high government debt to revenue rate.
The Pakistani press also continues to report positive economic developments,
although this might also be due in part to a reluctance to criticise government
performance. Remittances from abroad are growing very fast this year, with an
increase of 24.3% over the previous year. Over US$2 billion were sent to
Pakistan so far in 2006-7, with an obvious positive impact on the economy.
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