Political and Internal Developments

Rumours that the PPP-led coalition government was seriously considering sacking the army and ISI chiefs were quashed by Prime Minister Yusuf Raza Gilani who said that he had himself asked the two generals to accept an extension in their service. He said that generals are not changed in the middle of a war, and called Gen Kayani a supporter of democracy.

The Prime Minister did however say that the government was quite cut up with the Defence Secretary who had been issued a show-cause notice to explain the affidavit he submitted in the Supreme Court in which he had said that the army and ISI were not under the operational control of the government.

Gilani’s remarks came after the Chaudhries of Gujrat – Shujaat Hussein and Pervez Elahi of PMLQ – played peacemaker between the army and the Prime Minister. The Chaudhry cousins were reportedly asked by the military brass to ask the government to not target the army in order to cool things down. The Army Chief also complained about Gilani’s tongue-in-cheek remark regarding Osama bin Laden’s presence in Abottabad. It was not just Kayani but also other political players like Punjab chief minister Shahbaz Sharif and Pakistan Tehrik-e-Insaaf (PTI) chief Imran Khan who criticised the Prime Minister for insinuating that the Army had something to do with Osama’s presence in Pakistan. Leader of Opposition in the National Assembly Chaudhry Nisar had even warned the government of ‘strong resisting’ any precipitate action against Kayani or the ISI chief Lt. Gen. Shuja Pasha. Interestingly, while Nisar complimented Kayani for staying away from politics, he refused to say the same for the ISI chief.

Despite efforts to effect some sort of a rapprochement between the PPP and the army, and reports that both sides are trying to avoid a headlong confrontation – the government is believed to be backing off from taking any action against the defence secretary as a CBM – the state of relations between the civilian government and the military establishment remain extremely strained. One example of this was Gen Kayani’s absence from the banquets hosted by both the President and the Prime Minister in honour of the visiting Chinese State Councillor Dai Bingguo. Another instance of the continuing sniping between the government and the military, especially on the memogate issue, came in the affidavit submitted by the Interior Secretary in the Supreme Court calling the controversial memo a ‘pack of lies’ and not only raising questions over the inordinate delay by Gen Ashfaq Kayani in reporting on the issue to the Prime Minister but also pointing to the violation of rules by the ISI chief who reported the matter not to the Prime Minister but to the army chief. The civil-military divide was also reflected in the fact that the Attorney General informed the Supreme Court that he was not representing the army and ISI chiefs.

More than Kayani, it is Pasha who appears to be in the cross-hairs of the civilians. Apart from Chaudhry Nisar and the Interior Secretary, one of the main protagonists in the memogate drama, Hussain Haqqani, has also been targeting Pasha in the Supreme Court. In his response to the reply filed by Pasha, Haqqani has cast doubts over the motives of the meeting between Mansoor Ijaz and Pasha and raised questions about the record of the meeting as well as the investigation done by Pasha in the ‘evidence’ presented to him by Ijaz. His lawyer Asma Jehangir went a couple of steps further and wanted a probe into the leaking of the memo as also on the question of whether or not there was a move to stage a coup in Pakistan. Asma Jehangir pointed out that after his meeting with Pasha, Ijaz wrote an article in which he alleged that Haqqani and President Asif Zardari knew about the Abottabad operation beforehand. She wanted to know Pasha’s views in this matter. Meanwhile, the Attorney General told the court that the memo was just a piece of paper and had no value. But the Supreme Court doesn't appear satisfied with the government’s explanation and has hinted at its interest in getting to the bottom of the whole affair. It also appears as though the memogate case could once again pit the judiciary against the government, what with the Chief Justice questioning the blanket immunity assumed by the President. According to the Chief Justice immunity can only be claimed from the court, thereby effectively making it a case by case affair, something that will almost certainly have a bearing in other cases being faced by President Zardari.

In his much anticipated speech on the occasion of the 4th death anniversary of Benazir Bhutto, President Asif Zardari took a dig at the Chief Justice by asking him what happened to Benazir’s case which was pending in the courts and did not receive the same attention of the judges as certain other cases. While steering clear of any reference to the memogate controversy, Zardari made it quite clear that he had no intention of throwing in the towel and quitting in face of the myriad crises confronting the regime. He played the Sindh card, albeit subtly, and derided efforts to impose ‘tailor-made democracies’. He took on the Americans frontally and declared that Pakistan wouldn’t participate in any ‘great game’, nor would it withdraw from any trade pact it found favourable (a clear reference to the gas pipeline deal with Iran). He spoke of new trade blocs in the region, including Russia, China and the Central Asian Republics in these, and patted his own back in the way he pushed for currency swap agreements with different countries. On domestic policy too, he claimed to have fulfilled 80% of the promises listed in the PPP manifesto and said that despite two major floods, there was no one hungry in Pakistan. This flies in the face of reports that nearly 70% of the population of the country is food insecure. He called upon the disaffected Baloch to lay down their arms and join the national mainstream and struggle for their rights within the federation.

What invited most interest was Zardari’s naming of his youngest daughter, Asifa, as the flagbearer of the party who will carry on where her mother left off. Equally interesting was way he heaped praise on Prime Minister Gilani. That Gilani was being heaped with encomiums even as the Aitzaz Ahsan was being accorded the pride of the place at the rally was seen as many analysts as a possible sign of some major political change in the near future. There is speculation that Prime Minister Gilani might soon be replaced by Aitzaz. Fuelling this speculation is Gilani’s constant remarks that he doesn't care if he no longer remains the Prime Minister. According to some reports, Gilani’s removal is being demanded by the army because of his failure to provide good governance. Other reports claim that Aitzaz is being feted to prevent him from joining the PTI.

It is not only the PPP, but also the PMLN which is feeling the heat of the massive support that Imran Khan is attracting all across the country. The PMLN suffered a grievous blow last week after one of the tallest leaders in the party, Javed Hashmi, joined the PTI. Hashmi’s exit is expected to severely weaken the PMLN in South Punjab where it never had very strong support. While Hashmi had developed differences with the Sharifs ever since they returned to Pakistan and had more or less been sidelined in the decision making process in the PMLN, his exit has served as a rude wake-up call for the party leadership which has been rattled by reports that many other big names could desert the party in the coming days and join Imran Khan. While Shahbaz Sharif has dismissed the swelling ranks of PTI by saying that most of those joining Imran were cronies of Gen Musharraf (JUIF chief Maulana Fazlur Rehman has called them ‘political nomads’), the exodus has forced the PMLN to suddenly put in motion the long delayed reorganisation of the party in the provinces. And in a significant move, the PMLN has bifurcated the party organisation in Punjab and formed a separate wing for South Punjab, thereby replicating what the PPP had done just a few weeks back. This could well give a fillip to the demand for creating a new province in South Punjab.

After the success of his Lahore rally, Imran stunned everyone by organising one of the largest rallies ever in Karachi. Until now, only the MQM was considered capable of organising a mammoth rally in Karachi and the political grapevine is that the hidden hand of MQM was partly responsible for the massive crowd turnout – estimates range from 2.5 lakhs to 4 lakhs – in Imran’s rally. As evidence, it is being pointed out that while Imran had something to say on everything, he kept a studied silence on the situation in Karachi. Given that not too long back he had threatened to file a case against Altaf Hussein in London and has been highly critical of the MQM brand of politics, his silence on MQM was quite eloquent. Speaking to journalists after the rally, Imran said that the MQM was not an enemy and added that he needed to take on the bigger fish before he took on the MQM which he saw as a useful potential ally since it won almost 90% of the seats in Karachi.

At the rally, Imran declared that he wanted to see Pakistan as an ‘Islamic welfare state’ which followed the vision of Jinnah and Iqbal and provided free education, health and justice to the citizens. Promising a meritocracy, he said that the first priority of his government would be to end corruption within 90 days. He sought the forgiveness of the Baloch who he said had been treated like East Pakistan as a colony and promised to give a special status to the province. He revealed his Islamist leanings by declaring that no law will be made against the Quran and Sunnah. After the rally he said that if Pakistan withdrew from the war on terror, radicalism and extremism would fade away on their own.

While much of the media attention was focussed on the PTI rally in Karachi, there were other huge rallies organised by other political forces. The PPP rally in Larkana is estimated to be as big, if not bigger, than the PTI rally in Karachi. The ANP too organised an impressive show in Charsadda and Swat. And the Jamaat Islami put up a fairly strong show in Lahore in which the party Emir Munawwar Hasan launched a campaign for enforcing Shariah in the country, which he said was the only way to get rid of ‘American slavery’. Hasan blamed the CIA and MOSSAD for terror attacks inside Pakistan (including the assault on PNS Mehran) and exulted over the ‘crushing defeat’ that the Taliban had imposed in the US and NATO forces. The Jamaat Islami has also started the process of tying up with other political parties like PMLN, PTI and JUIF and is exploring the possibility of reviving the MMA. However, there are reports that the tough negotiating stance adopted by the Jamaat Islami on revival of MMA – it is demanding that JUI completely sever all links with PPP and agrees to give 50% of the tickets in Khyber Pakhtunkhwa and other provinces – that is acting as a stumbling block.

Amidst the political tussle, the country is confronting a massive energy crunch. According to the report of the State Bank of Pakistan, the country has used up around 50% of its gas reserves and is expected to run out of gas in another 20 years. Last week, energy riots broke out in Rawalpindi and Islamabad. While the gas outages have affected homes (no heating, no cooking gas), its impact has also been felt on the transport sector with CNG stations running out of gas. Worse still has been the impact on trade and industry. Pakistan's textile centre, Faisalabad, ground to a halt because of gas shortages. Exploiting the situation are political parties, especially the PMLN, which are trying to hijack the rising public anger to gain political advantage. The government meanwhile is pushing ahead with the Iran-Pakistan gas pipeline project and last week selected a consortium led by IBIC of China and comprising the Habib Bank to arrange financing for the project. But in a classic case of one step forward and one step back, National Bank of Pakistan and OGDC have distanced themselves from the project because of the sanctions that they will attract from the US and other Western nations.

Foreign Relations / Foreign Policy

There are reports that Afghanistan has threatened to scrap the Joint Commission with Pakistan to hold talks with the Taliban because of non-cooperation by Pakistan in the investigation of the assassination of former Afghan president Burhanuddin Rabbani. Meanwhile, the chief of ANP, Asfandyar Wali, has claimed that Rabbani’s assassin went from an Afghan refugee camp in Balochistan. Saying that the authorities were in touch with the Taliban based in FATA, Asfandyar expressed readiness to talk with Pakistani Taliban who are driven by ideology and not by a political agenda!

Top Chinese diplomat and State Councillor Dai Bingguo visited Pakistan last week. After the visit, the Chinese foreign office spokesman said that China will, regardless of the changes in the international situation, continue to develop strategic relations with Pakistan. During the visit, the two countries signed the following 6 agreements:

1. Supplementary Agreement on Extension of Five Year Development Programme on Trade and Economic Co-operation;
2. Inter-Governmental Framework Agreement on Additional Financing for Improvement of KKH ($90 million);
3. Three year Currency Swap Agreement for 10 billion Chinese yuan and 140 billion Pakistani rupees;
4. Concessional Loan Agreement on Additional Financing for Improvement of KKH ($90 million) ;
5. Loan Agreement on Provision of $259 million Preferential Buyer's Credit for KKH (Karakorum Highway) Realignment;
6. Loan Agreement on Export Credit Facility of $464 million for Power Plant between Guddu Power Company and EXIM Bank of China.

According to reports in the Pakistani press, the Chinese rejected Pakistan's proposals for dealing in Pakistani currency and also refused to buy Pakistani treasury bills with the swap money. Meanwhile, it has been reported that China has so far not released any of the funds promised under a $ 448 million loan for the construction of the Neelum-Jhelum hydropower plant in Pakistan occupied Kashmir.

The Pentagon report of the inquiry into the incident of firing by NATO choppers on Pakistani posts in the Salala area of Mohmand agency killing 24 Pakistan army soldiers was released last week. The report has blamed the incident on inadequate coordination” and “incorrect” map information provided by NATO to Pakistani authorities for the incident. Holding both sides responsible – the Pakistanis have been blamed for firing first – the inquiry report has said that it was not an intentional or deliberate action. The Americans have assured Pakistan of taking corrective steps being taken to ensure that such incidents would not be repeated. Pakistan has however rejected the report calling it ‘short on facts’. The spokesman of the Pakistan army has said that the report won’t be helpful in normalising relations between the US and Pakistan. The fact that the Americans refused to offer a formal apology for the incident has also ‘surprised’ the Pakistanis and they have angrily rejected any compensation with the spokesman saying that ‘it is not in our military culture to take money for a fallen soldier...we will take care of our own’.

The Americans offered to send the Centcom chief, Gen James Mattis to Pakistan to discuss the report with Gen Kayani, but the Pakistanis refused to accept the visit forcing Mattis to ‘postpone’ his visit. Despite the rebuff, Mattis called for better border coordination and building up of more trust for this to happen. He also expressed the need for “full disclosure of all border area facilities and installations” between the two armies. The Pakistanis are however sticking to their blockade of NATO supply lines. What is more, Pakistan's defence minister has said that even if the supply lines open, Pakistan will henceforth charge top dollar for allowing transit facilities.

Relations with India

Officials from India and Pakistan held the sixth round of discussions on nuclear and conventional CBMs in Islamabad last week. The two sides agreed to recommend extend by five years the Agreement on Reducing the Risk from Accidents Relating to Nuclear Weapons. There are also reports that similar extension will be recommended for the Agreement on Pre-Notification of Flight Testing of Ballistic Missiles. The two sides also agreed to explore possibilities for additional mutually acceptable CBMs. The Pakistani proposal for a Strategic Nuclear Restraint Regime did not find any acceptance from the Indians. Both sides are reported to have ‘exchanged notes on their security concepts and nuclear doctrines’. In the realm of conventional CBMs, the Pakistanis proposed the deployment of artillery and mortars at least 30 kms from the LoC. There were also discussions on CBMs initiated earlier, including those regarding the hotline between the DGMOs, Indian Coast Guards and Pakistani Maritime Security Agency and the agreement to prevent airspace violations.