Pakistan president says India never a threat: report

ISLAMABAD, Oct 6, 2008 (AFP) - Pakistani President Asif Ali Zardari said in an interview that arch-enemy India had never been a threat to his country and that Islamic militant groups in Indian-controlled Kashmir were "terrorists."

Zardari also indicated to the Wall Street Journal that there was an "understanding" with the United States over US missile strikes on Al-Qaeda and Taliban targets in Pakistan's troubled tribal areas.

His views on India appear to run counter to that of Pakistan's powerful military, which has regarded its nuclear-armed neighbour as an existential threat since the creation of the two countries after independence in 1947.

"India has never been a threat to Pakistan," Zardari, who as the widower of Benazir Bhutto came to power in September after the new civilian government ousted President Pervez Musharraf, said in the interview...>

http://ca.news.yahoo.com/s/afp/081006/world/pakistan_india_kashmir_politics_3

Security fears as Pakistan veers towards bankruptcy

PAKISTAN'S foreign exchange reserves are so low it can only afford one month of imports and faces bankruptcy. Officially, the central bank holds $US8.1 billion ($10.9 billion) of foreign currency, but if forward liabilities are included, the real reserves may be only $US3 billion - enough to buy about 30 days' of imports such as oil and food. Nine months ago, the nation had $16 billion in the coffers.

The Government is engulfed by crises left by Pervez Musharraf, the military ruler who quit the presidency in August. High oil prices have combined with corruption and mismanagement to damage the economy. Given the country's standing as a front-line state in the US-led war on terrorism, the economic crisis has profound consequences. Pakistan faces worsening security as the army clashes with militants on Afghan border. The economic crisis has placed the future of the civilian Government in doubt. The President, Asif Ali Zardari, has faced numerous but unproven allegations of corruption dating from the two governments led by Benazir Bhutto, his wife, who was assassinated last December. The Wall Street Journal said Pakistan's economic woes were "at least in part, a crisis of confidence in him".

While Shaukat Aziz, Mr Musharraf's prime minister, often likened Pakistan to a "tiger economy", the former government left it on the brink of ruin. The Pakistan rupee has lost more than 21 per cent of its value this year and inflation is running at 25 per cent. The rise in world prices has driven up Pakistan's food and oil bill by a third in a year. Efforts to defer payment for 100,000 barrels of oil supplied every day by Saudi Arabia have yet to yield results, while the Government has failed to raise loans on favourable terms from "friendly countries". Mr Zardari told The Wall Street Journal Pakistan needed a bail-out worth $US100 billion. "If I can't pay my own oil bill, how am I going to increase my police?" he asked. "The oil companies are asking me to pay $US135 of oil and at the same time they want me to keep the world peaceful and Pakistan peaceful."

Ratings agency Standard and Poor's, has given Pakistan's sovereign debt a grade of "CCC +", a few notches above default. It said Pakistan may be unable to cover $US3 billion in debt payments. Mr Zardari is expected to ask for a international rescue package at a meeting in Abu Dhabi next month.
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Corrupt bankrupt govt teetering on the brink of financial collapse, U.S. military incursions on its border, large periphery of tribal areas impenetrable to modern modes of civil authority, or even military authority, an
unknown number of nuclear weapons --what else could go wrong?


THE ‘TALIBANIZATION’ OF PAKISTAN’S BIGGEST CITY