[sacw] sacw dispatch (Pakistan Special) 14 Oct.99

[Harsh Kapoor]

South Asia Citizens Web Dispatch (Pakistan Special)
14 October 1999
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Contains:
#1. Latest news from DAWN (http://dawn.com)
#2. Pakistan's military leader under pressure to restore democracy
#3. Where will Army take Pakistan?
#4. Asia's Nuclear Nightmare Is A Little Closer
#5. PAKISTAN: The general's heavy load
#6. Pakistani Coup Seen as Sign Of Waning U.S. Influence
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#1.
DAWN
14 October 1999
Latest News

SPECIAL INTERVIEW: Perceptions of a 'pro-army' think-tank Circles close
to the GHQ comprising of intellectuals, ex-military officers, former civil
servants and "pro-army " politicians, have began to coalesce into informal
think tanks to debate policy options open to the military and the
establishment in the post-Nawaz scenario.

A spokesperson from one of the more important of these think tanks in
Islamabad, who did not wish to be identified and who is sympathetic to the
recent move to oust Nawaz Sharif, was interviewed earlier today. [...]

Nawaz Sharif Resigns?: KARACHI, Oct 14 (16:30 PST) Unconfirmed reports
from sources close to the Prime Minister suggest that he has resigned from
office and is now in Lahore. Details as they become available. From: The
STAR monitoring desk.

Army seals Parliament Building amid rumors that President resigns:
Islamabad, Oct 14 (15:50 PST): The army today sealed off the Parliament
House and ordered all the staff out, according to eyewitnesses, as the
military leadership remained busy putting in place an alternative
government two days after the dismissal of Prime Minister Nawaz Sharif.

Soldiers were seen ordering the staff of the Parliament House out and
later locked the main entrance that also leads to the President's House.

The move came at noon amid rumors that President Rafiq Tarar, handpicked
by Sharif late 1998, had resigned. No civilian or army officials were
available to confirm or deny the reports. One of the houses of parliament
is scheduled to meet Friday.Observers said the seal-off might be aimed at
preventing the MPs from meeting. (DPA)

Wasim Sajjad the Chairman of the Senate who is now in the UK will be
returning to Pakistan on the first available flight. (APP)

PML demands right to elect new leader: ISLAMABAD, Oct 14, (15:50 PST): A
senior leader of ousted Pakistan Muslim League (PML) has demanded that the
party be allowed to elect a new parliamentary leader to run the country,
reports said Thursday. Arguing that parliament was still intact following
Tuesday's military coup, PML vice-president Ijazul Haq (son of Gen.Ziaul
Haq) said the party's MPs had a right to elect a new leader to replace
Sharif.

"Whosoever gets elected as PML parliamentary chief should be allowed to
run the country," Haq was quoted as saying by a local daily.

"I am not starting or joining the power race, but my demand is to put the
country on the right path," he said. Haq also openly criticised Sharif for
failing to consult his cabinet and party colleagues, especially over his
decision to dismiss army chief General Pervaiz Musharraf, which triggered
the military takeover.

Musharaff and his fellow coup leaders continued to hold discussions today,
as the whole of Pakistan awaited an announcement on their plans for a
future government. (AFP)

SBP imposes minimum margin restrictions on import L/C's: KARACHI, Oct.
14 (15:50 PST): According to a circular of the State Bank issued here
today, minimun import restrictions on L/C's, effective immediately, will be
10 % for industrial raw material, 20 % for machinery of all kinds and their
spareparts, and 35 % for all other goods.

The exception for minimum margin restriction has been given to: Crude
petroleum, Petroleum Products, Edible Oils all sorts, Pharmaceutical and
raw material thereof, Pesticides etc./Insecticides/Fertilizers, Seeds and
plants for sowing, Items imported against various schemes of temporary
import for exports e.g. NDND Scheme, Manufacturers in Bond Scheme etc,
Imports by the Federal and Provincial Governments and their attached
departments against specific cash allocation, Imports under Commodity
Loans/credits/aid, whether in the public or private sectors, Imports
against suppliers credit/loan registered with the State Bank of Pakistan/
Economic Affairs Division and Wheat. (APP)

Ehtesab Bench reissues non bailable arrest warrant for Benazir Bhutto:
RAWALPINDI, Oct 14, (14:40 PST) : Ehtesab Bench of Lahore High Court
(LHC)reissued non bailable arrest warrant for Benazir Bhutto due to her non
appearance before the court in Assets reference case. (APP)

Amnesty calls for return to democracy: ISLAMABAD, Oct 14 (14:40 PST):
Amnesty International said today that the military coup in Pakistan was a
result of a long slide in human rights abuses and a constant watering down
of the legal process in the country.

Amnesty joined the international call for elections and a quick return to
democracy, but added that in light of the rights abuses that have taken
place in Pakistan in the past more than that was needed. "It is not enough
to call for respect for the constitution to be restored when the
constitution itself has been grossly distorted over time. Similarly, a call
for the restoration of the rule of law is meaningless when the law itself
has become flawed and does not ensure the enjoyment of all rights to all,
without discrimination," the statement said.

Amnesty also voiced concern that in the confusion surrounding the coup,
and because the military has not announced what its post-coup plans are,
there may be further human rights violations. The atmosphere so far has
been very calm with no protests or violence reported, but newspapers
reported on Thursday that more than 400 members of Sharif's Pakistan Muslim
League party were put on an "exit control" list, banning them from leaving
the country, as were 20 journalists.

Amnesty also called for the release of Sharif, who along with some of his
cabinet members is in the military's "protective custody". "The military
leadership must guarantee the life and physical integrity of members of the
dismissed government...and release them immediately," it said. (Reuters)

KSE Stocks down 8%: KARACHI, Oct 14, (13:00 PST): Pakistan share prices
tumbled 8.0 percent today as the stock market opened for the first time
after the army toppled prime minister Nawaz Sharif and seized power. The
Karachi Stock Exchange-100 index fell 101 points to 1,155.95 an hour after
the start of trading.

"The market really got a jolt," a trader said, relating the sharp drop to
Tuesday's army takeover. He expected the market to fall 100 to 125 points
today. The stock exchange was closed Wednesday following the central State
Bank of Pakistan's decision to suspend all financial transactions for a day
in the wake of the military coup, amid fears of a panic run on banks.(AFP)

Forex trading by dealers suspended for a week: KARACHI, Oct 14, (12:20
PST): The State bank on Thursday suspended trading in foreign exchange for
a week, moving to prevent a possible flight of hard currency after the army
takeover. "Authorised money changers are accordingly directed to keep their
business places closed for business and not to conduct any foreign exchange
transaction upto October 20," the State Bank of Pakistan said in a
statment.The central bank had declared Wednesday a bank holiday to prevent
a run on bank deposits. Pakistan's foreign exchange reserves are estimated
at 1.4 billion dollars, enough for only three weeks of imports. On Tuesday,
the Pakistani rupee was officially valued at 54.40 to a dollar, but it was
quoted at 60 to a dollar on the unofficial market. (AFP)

Nawaz shifted to new location: ISLAMABAD, Oct 14, (12:20 PST): Deposed
premier Nawaz Sharif, being held under house arrest, has been transferred
to a new location by army authorities, military sources said today. Sharif,
initially detained at the prime minister's official residence in Islamabad
after the army seized power on Tuesday, was moved the following day to a
location near the capital, they said. His son, Hasan Sharif, a student in
Britain, told the BBC's Newsnight programme he had been told his father was
taken to a guest house near Islamabad airport. Speaking from Islamabad,
military spokesman Brigadier Rashid Qureshi said that Sharif was safe and
well "in what we call preventative detention."

The military sources also said two senior army officers had been arrested
on disciplinary charges following the ouster of the Sharif-led government.
They were Lieutenant General Tariq Pervaiz, who had been retired just
before Tuesday's army takeover, and Brigader Javed Iqbal Malik, who had
been military secretary to the ousted prime minister. Another officer,
Lieutenant General Khawja Ziauddin, the man Sharif tried to appoint as the
new army chief before the coup, has already been arrested. (AFP)

State Bank withdraws back to back remittances facility: KARACHI, Oct. 14,
(12:20 PST): State Bank of Pakistan, today withdrew the facility of
back-to-back remittances and release of foreign currency against surrender
of an equivalent amount of foreign currency, till further orders. Through a
circular, SBP said, " accordingly, paragraph 19 of Chapter XVI and
paragraph 41 of Chapter XVII of the Foreign Exchange Manual, as amended
from time to time, are deleted". The bank also requested the authorized
Dealers to ensure strict compliance of these instructions. (APP)

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#2.
Boston Globe
14 October 1999

Pakistan's military leader under pressure to restore democracy
By Kathy Gannon, Associated Press, 10/14/99 08:49

ISLAMABAD, Pakistan (AP) With the country firmly in his control,
Pakistan's military chief was reportedly seeking a way to restore
constitutional democracy, a presidential spokesman said today.

In a possibly ominous sign, however, troops sealed off the parliament
building, throwing out staffers and a few lawmakers, a day before the
legislature was scheduled to meet.

Since Tuesday's army coup ousted Prime Minister Nawaz Sharif, Gen.
Pervaiz Musharraf has been sequestered in meetings with politicians, past
and present, including conservative President Rafiq Tarar.

Tarar's spokesman, Irfan Siddiqi, said Musharraf is looking to restore
civilian rule an effort the president supports. In Pakistan, the
presidency is a largely symbolic post.

''The rehabilitation of the democratic process as soon as possible is a
goal shared by both men,'' he told The Associated Press.

Before the coup, parliament had been slated to meet on Friday.

Soldiers today asked staffers and the few legislators who had returned
to their offices to leave the building. The troops then closed the
building.

''They just told us to leave,'' and provided no explanation, said one
worker who refused to give his name. Soldiers had closed down parliament
the night of the coup but had later allowed workers back in.

Pakistan's stock market, reopening for the first time since the coup,
plunged today, and authorities ordered tight restrictions on foreign
currency transactions.

Musharraf has not made any public statements since his televised address
to the nation early Wednesday morning.

According to political analysts in Pakistan, Musharraf could call early
elections; change the prime minister, but keep Parliament intact; induct a
national coalition government of politicians from Pakistan's many political
parties; create a civil administration of technocrats and retired
politicians; or run the country himself.

The army has ruled Pakistan for 25 of its 52 years, although the country
has had a fragile democracy for 11 years.

International demand has been building for a quick return to democracy.

In Washington, Secretary of State Madeleine Albright said the coup
created a ''level of uncertainty'' in South Asia. She said U.S. officials
were trying to persuade Pakistan's military leaders to restore democratic
government.

''A military takeover of this kind ... does make it difficult to
continue business as usual,'' she said.

U.N. Secretary-General Kofi Annan urged the army to restore civilian
rule quickly.

The International Monetary Fund, which last year negotiated a $1.6
billion loan to Pakistan, announced an immediate cutoff until democracy is
restored.

Economists say Pakistan's battered economy can ill-afford further delays
in international funding. Its foreign reserves are roughly $1.5 billion,
enough to cover only two months of imports, in a nation heavily dependent
on foreign shipments of even its staples, such as cooking oil.

Tuesday's swift coup sparked by Sharif's attempt to fire Musharraf
capped months of growing army resentment against the premier for backing
away from the fight over Kashmir, a territory claimed by both India and
Pakistan. President Clinton pressured Sharif into convincing Islamic
fighters to pull back, reportedly outraging and humiliating army leaders.

India and Pakistan have fought three wars in 52 years, and both
conducted nuclear tests last year.

Washington played down concerns about the coup's affect on Pakistan's
nuclear program, since it has always been under the military's control.

India put its soldiers on alert following the coup, a move the army
spokesman in Pakistan called ''ridiculous'' and a ploy to raise
international concerns.

''India's action was totally absurd ... putting its forces on alert ...
as if Pakistan is going to precipitate a war,'' Brig. Rashid Quereshi told
The Associated Press.

Many in both countries believe Musharraf orchestrated the incursion this
spring of Islamic militants into the Indian section of Kashmir. That
incursion led to months of bloody fighting with Indian troops.

The fighting which India says also involved Pakistani troops wrecked
fledgling negotiations between the two countries and many feared it would
spiral into full-fledged war.

The location of Pakistan's ousted prime minister was unclear today.
Newspapers reported Sharif had been sent ''to an unknown destination.''
Official sources however told the independent news agency News Network
International that Sharif had been taken to his hometown, Lahore.

In the days prior to Sharif's firing of Musharraf there were daily
newspaper reports that he had asked the army chief to resign so the prime
minister could put his own ally, Gen. Zia Uddin, in the job.

English language newspapers today reported that several pro-Sharif
military officials had been arrested and would be tried in a military
court.

Throughout Pakistan, people took the coup in stride and few longed for
quick elections.

''There should be no elections before accountability,'' said Abdul
Rashid, a lawyer in Lahore.

The Karachi 100-Share Index plunged 8 percent in early trading today
because of panic selling by investors. It recovered some lost ground by
midday.

Meanwhile, Pakistan's growing isolation continued.

The Commonwealth a grouping of former British colonies said it might
suspend Pakistan's membership, a move last taken in 1995 against Nigeria.
The European Union also said it would postpone a new trade deal with
Pakistan for the time being.
___________________________
#3.
Christian Science Monitor
Thursday, October 14, 1999

Where will Army take Pakistan?
World leaders plead for the restoration of democracy, as the region
anticipates the military's plans for governing.
Robert Marquand
Staff writer of The Christian Science Monitor

BOMBAY

In India, and in other nations, the wait is on to see the direction and
complexion of Pakistan's new regime led for now by Army chief Gen. Pervaiz
Musharraf.

Tuesday's surprisingly calm coup is the fourth in Pakistan's short history
and introduces a large element of uncertainty between two nations that now
have nuclear weapons. India's military is on high alert - again. And even
recent rhetorical overtures for peace between India and Pakistan are
dashed.

A former commando, General Musharraf reportedly orchestrated this past
summer's battle between the two nations in the high mountains of Kashmir.

"For now, Musharraf is going to be known in India as the guy who brought us
Kargil," says E. Sridharan, an analyst at the Institute for the Advanced
Study of India in New Delhi.

Musharraf is treading a fine line. He has not yet called for new elections,
which the Constitution requires within three months. But, unlike previous
military coups, neither did the Army put the country under harsh martial
law. By dismissing all four Pakistani state governments, Musharraf has
shown that the military is not looking for a quick change, but is opting
for a complete reform of the Pakistani system.

Musharraf does not want to appear as a hard-liner and thus isolate Pakistan
further. Yet savvy Pakistanis know that Washington does not want an
unstable Pakistani nuclear state to disintegrate further.
"For [Musharraf] to have his finger on the nuclear button worries me to no
end," says Sumit Ganguly, an Indian-American visiting fellow at the Center
for International Security and Cooperation at Stanford University in Palo
Alto, Calif.

Mr. Ganguly goes on to say that Musharraf was "brought up" by Gen. Mohammed
Zia-ul-Haq, who took power through a military coup in 1977. He was a
militant and considered by some to be a Muslim fundamentalist. Some experts
say that now, in addition to the possibility of increased Pakistani
aggression in the disputed Kashmir region, Musharraf's take-over could
strengthen Islamic fundamentalism in Pakistan, and its support of the
Taliban in Afghanistan.

The danger in the region, experts say, is that while India and Pakistan
know full well the consequences of war, especially since they are
modernizing their militaries, there is always a less rational temptation to
use each other as an excuse to divert attention from domestic problems.

Gaining control of the long-disputed territory of Kashmir, for example, is
a central aim of Pakistani policy - more than most outsiders understand.

The main aim of Pakistan's gamble this spring by starting the "Kargil war"
- which eventually led to Tuesday's coup - was to internationalize the
emotional issue of Kashmir. Pakistani leaders wanted international
attention and intervention on behalf of their claims for Kashmir.

That inconclusive war became a jumble of miscalculations on the part of
both Mr. Sharif and the Pakistani military. For many reasons, Sharif lost
face, both at home and abroad, and was unable even to secure the backing of
ally China. It was an embarrassment for the Pakistani military as well. In
hindsight, the Pakistani military felt it could internationalize Kashmir
through a conventional war since the new nuclear status of the two states
would provide a threat that India would not want to test.

Yet instead of creating sympathy for Pakistan on Kashmir, the UN Security
Council condemned the cross-border adventure by Pakistan - one that
Pakistani leaders at first pretended ignorance.

Then, after Sharif visited President Clinton on July 4, the mujahideen
fighters and Pakistani regulars, who had occupied the top of the Kashmir
mountains, were asked to withdraw without being able to declare victory -
even though they occupied the heights for months, and humiliated the Indian
Army for much of the fight.

"The lesson from Kargil and the coup is the historic folly of nuclear
adventurism," says Praful Bidwai, a disarmament expert in New Delhi.

Then there is Afghanistan. The position of the new Pakistani regime is of
intense interest in the region. Sharif played a double game with his
northern neighbor. He continued to build up the orthodox Taliban regime in
Kabul through the Pakistani Inter Services Intelligence agency, hoping to
create a strategic proxy state.

At the same time, the Clinton administration pressured him to crack down on
the Taliban, to end terrorist training camps in Afghanistan, and to somehow
deliver Osama bin Laden - suspected of instigating the US Embassy bombings
in 1998 - in return for needed loans and aid.

Sharif was frustrated on both fronts. He was unpopular in Kabul for his
arm-twisting and was portrayed in Pakistan as a Washington stooge for his
position on Mr. bin Laden, and for withdrawing from Kargil - seen as a holy
war by Islamists.

Afghanistan remains highly important to Saudi Arabia and the United Arab
Emirates, the only other two states to recognize the Taliban regime in
Kabul.

It is also significant to the government of Iran, which supports the
anti-Taliban Northern Alliance forces that still occupy the northwest
corner of Afghanistan. Saudi Arabia and the UAE have long been seen as
supporting Pakistan's presence in Afghanistan - as a check on Iran.

Justin Brown contributed to this report from Washington
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#4.
The Independent
14 October 1999
International News

ASIA'S NUCLEAR NIGHTMARE IS A LITTLE CLOSER

A NUCLEAR exchange between India and Pakistan would result in 17 million
immediate deaths in Pakistan and 30 to 35 million in India, according to a
study by the University of Illinois

Tuesday night's military takeover in Pakistan raised the question of
whether such a scenario is now closer to becoming a reality. Yesterday the
experts were downplaying any such fears: Pakistan's nuclear weapons were
already firmly in the control of the military before the coup, they pointed
out and in that respect nothing has changed

But complacency may be premature. From the point of view both of nuclear
proliferation and of the risk of starting a nuclear war, Pakistan under
military rule will be a greater menace than it was before. Pakistan is a
nuclear power on the verge of bankruptcy. Unless General Pervez
Musharrafappeases world opinion by promising a speedy return to democratic
rule, overseas aid will dry up and Pakistan will be compelled to do
whatever is necessary to earn dollars.

As US Senator Daniel Moynihan said on Tuesday (before the coup), "Pakistan
is not a stable country [and it is] an impoverished country. That country
will be selling nuclear weapons to the Middle East." A Saudi prince, he
pointed out, was recently given a tour of Pakistan's nuclear facilities

Equally serious is the fear of what Islamic hardliners could do if they
took charge. General Musharraf is, as Benazir Bhutto put it on Tuesday,
"not a cleric", but there are plenty in his army who are fundamentalist
Muslims. After years of fraternisation with the likes of Afghanistan's
Taliban, many have a rooted conviction that Pakistan must wage jihad (holy
war) against infidel India

In a study of war and Islam entitled The Quranic Concept of War, Brigadier
S K Malik, who served under Pakistan's last dictator, General Zia ul- Haq,
said terror is central to the Islamic conduct of modern war. "Terror struck
into the hearts of the enemy is not only a means, it is the end in itself,"
he wrote. "Once a condition of terror in the opponent's heart is obtained,
hardly anything is left to be achieved..."

An officer interviewed by Professor Stephen P Cohen and quoted in his book
The Pakistan Army endorsed this view. "Nuclear weapons are modern terror
weapons and Islam enjoins us to strike terror into the heart of the enemy,"
he said.

PAKISTAN AND THE GENERALS

March 1956
Iskander Mirza becomes first president.

October 1958
Martial law: Mirza appoints General Ayub Khan chief martial law
administrator.

October 1958
Ayub Khan appointed PM. Fires Mirza, takes over as president.

March 1969
Riots, strikes force Ayub Khan's surrender to army chief Yayha Khan.

December 1970
Yayha Khan permits elections. Pakistan People's Party of Zulfikar Ali
Bhutto elected. Yahya Khan resigns.

July 1977
Unrest ends in bloodless coup by army chief General Mohammad Zia ul-Haq,
who later assumes presidency.

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#5.
=46inancial Times
14 October 1999
World News / Asia-Pacific

PAKISTAN: The general's heavy load

The coup was a simple, bloodless affair. Now Pakistan's military must win
international support and prove it can solve the country's social and
economic problems, says Farhan Bokhari

After a gap of 22 years, the Pakistani military is openly back in politics.
Among the problems it confronts are a crippled economy, with foreign
reserves enough to cover less than two months' worth of imports; a
population of 138m scarred by poverty, the heroin trade and sectarian
violence between Shia and Sunni Moslems; and only the most precarious of
truces with India over the disputed territory of Kashmir.

The question therefore is why the armed forces would risk making a bad
situation worse by staging a coup. Judging by the response in Washington
and other western capitals, Pakistan is in danger of becoming a pariah
state. The International Monetary Fund, under pressure from the US, could
delay or even cancel this month's $280m instalment of a $1.6bn loan, while
a military regime in Islamabad will almost certainly face western economic
sanctions.

These considerations are likely to determine the next moves of General
Parvaiz Musharraf, Pakistan's military chief, who deposed Nawaz Sharif, the
prime minister, rather than be sacked by him.

The coup on Tuesday lasted less than three hours. Troops secured strategic
buildings across the country, and placed Mr Sharif and his senior allies
under house arrest.

There was no civilian resistance: the deep unpopularity of Mr Sharif's two
and a half year old government ensured that the coup was an orderly,
bloodless affair. In Karachi, the southern port city, residents celebrated
the change in regime by exchanging traditional mithai sweets.

The international reaction has been far less sanguine. India, in
particular, is likely to remain apprehensive until Gen Musharraf gives a
clear indication of how he will handle regional security issues and whether
he intends to introduce martial law or hand over power to a new civilian
administration.

In his first speech to the nation, Gen Musharraf warned that "no outside
forces" should try to take advantage of the "prevailing situation in
Pakistan".

"We shall preserve the integrity and sovereignty of our country to the
last drop of blood," he said.

Pakistani military officers, however, say the general's words should not
be interpreted as a threat towards India. "We are willing to consider ways
of peacefully resolving our bilateral disputes, but that should not be
taken as a sign of weakness," said one. The disagreement with Mr Sharif,
the officer said, was not over his decision to withdraw Pakistani forces
from the Kargil sector in Kashmir after almost two months of fighting this
summer. "We did not disagree with the fact that a final settlement was
made. Our reservation was only the way that Sharif accepted the retreat in
a humiliating manner."

Neither is Pakistan likely to become more of a nuclear maverick than it
has been in the past. The military takeover makes little difference to
Pakistan's nuclear programme, which has been under military control since
its inception in the mid-1970s.

Nevertheless, the coup is likely to set back western efforts to get
Pakistan to sign a Nuclear Test Ban treaty. Analysts said it would also be
difficult to restart bilateral negotiations between India and Pakistan over
regional security issues until there was a formal government in Islamabad.
Gen Musharraf and Atal Bihari Vajpayee, the Indian prime minister, were
unlikely to meet in the near future, the analysts added.

Will Gen Musharraf risk international censure to establish a military
government? The early indications are that the military has no wish to turn
back the clock more than 20 years, when it ruled Pakistan with an iron fist.

Indeed, Gen Musharraf appears eager to canvass support for his decision to
topple the Sharif administration. So far, neither the general nor any of
his senior commanders have used the term "martial law" to describe the
takeover.

There is a fine distinction between staging a coup and imposing martial
law. The absence of the latter suggests that Gen Musharraf could be
planning to install a technocratic, civilian regime in the hope of making
it acceptable to the west.

"The military appears to realise that its biggest challenge now is to form
a new government which can be justified within the confines of the
constitution," says Lieutenant General (retired) Talat Masood, a respected
defence analyst. "The big question is how you get domestic and
international acceptability for that regime."

Gen Musharraf's task will be easier if he can persuade the international
community that Mr Sharif's government was swiftly becoming a dictatorship
in all but name. During Mr Sharif's 31-month rule, the prime minister
accumulated substantial personal power. His notorious "accountability cell"
- an anti-corruption investigation agency set up by Mr Sharif and
accountable only to him - was used to persecute political opponents.
Journalists were subject to official harassment.

Mr Sharif's decision to appoint Ghaus Ali Shah, a ruthless political ally,
as the de facto governor of the southern province of Sindh also proved
deeply unpopular. Mr Shah was disliked for having ordered a police
crackdown on at least two opposition rallies in the city of Karachi.

In addition, opponents charge that Mr Sharif was an incompetent economic
administrator. Foreign investment under his government fell to $376m in the
year to June, from $600m a year before. Tax revenues did not improve and
the economy was in recession.

Mr Sharif's refusal to allow tax inspectors to crack down on evaders
emboldened the country's small businesses to rebel against new taxes. In
September, the government retreated from plans to impose a 15 per cent
general sales tax after businessmen staged a one-day strike.

"The retreat was surprising, mainly because nobody expected it to happen
so quickly. It spoke volumes about a government which lacked
determination," a senior civil servant recalls.

Pakistan's investment outlook has been further harmed by growing numbers
of killings in sectarian violence involving Shia and Sunni Moslems. In the
past three weeks, at least 30 people, mostly Shias, have been killed in hit
and run attacks.

Analysts therefore say that the success of the new government in
comforting its friends in Pakistan and abroad would be driven by its
ability to begin tackling faltering reforms.

"It is obvious that under Nawaz Sharif, Pakistan had become unstable
because his policies had aggravated domestic disorder and economic
uncertainty," says Maleeha Lodhi, a former Pakistani ambassador to the US
and now editor of The News, an English-language daily. "If this change
improves these two issues, it could improve stability for Pakistan and also
improve the image of the new government."

Gen Musharraf's first priority, therefore, will be to dress his coup with
a semblance of legitimacy. Yesterday he was said to be consulting legal
experts on the final details of a plan to install a new government.
Officers close to the general say the new administration would be
"technocratic" in nature, with a mandate to resume stalled economic reforms.

If the general succeeds in installing a regime of respected civilians with
a clear mandate to undertake economic reforms, it is just possible that the
new administration would find favour at the World Bank and the IMF, two of
Pakistan's most important lenders.

However, there is no guarantee that the general's plan will succeed. The
economic legacy of Gen Zia ul Haq, Pakistan's former military ruler, was
disastrous. A new "technocratic" regime will have to move quickly to
establish its efficiency and legitimacy.

___________________________
#6.
Washington Post
14 October 1999

Pakistani Coup Seen as Sign Of Waning U.S. Influence
Military and Economic Sanctions Have Backfired, Analysts Say

By John Lancaster
Washington Post Staff Writer
Thursday, October 14, 1999; Page A20

Tuesday's military coup in Pakistan reflects the steady erosion of
American influence on Islamabad, once a trusted Cold War ally whose
officers trained in Kansas while their leaders were feted at the White
House and on Capitol Hill.

Throughout the 1980s, Washington worked hand-in-glove with Pakistan, a
staging area for the CIA-backed holy warriors who drove the Soviet Union
from Afghanistan. More recently, however, the relationship has cooled, a
consequence of shifting strategic priorities and Washington's decision to
punish Pakistan for its nuclear program by severing most military and
economic ties between the two countries.

Some analysts and lawmakers, in fact, cite the bloodless coup led by Gen.
Pervaiz Musharraf, the army chief of staff, as evidence that U.S. sanctions
against Pakistan have backfired--depriving Washington of its ability to
shape events when it matters most. In recent weeks, the United States
issued public and private warnings to the Pakistani military--including a
personal phone call to Musharraf from Marine Gen. Anthony Zinni, chief of
the U.S. Central Command--in an unsuccessful effort to forestall the army
takeover.

Washington is hardly without influence in Pakistan. In July, after an
extraordinary personal appeal from President Clinton, Prime Minister Nawaz
Sharif ordered Musharraf to withdraw Pakistani forces from the Kargil
region of Kashmir. Musharraf reluctantly complied, defusing an escalating
military confrontation with India.

But many policymakers see a larger lesson in Sharif's ouster. "I think the
United States should have been far more engaged during the past 10 years,
and if we had been, then we would have been in a far better position today
than we are," said Sen. Sam Brownback (R-Kan.), chairman of the Senate
=46oreign Relations subcommittee on Near Eastern and South Asian affairs, wh=
o
like many farm state lawmakers is also concerned about the effect of trade
sanctions on U.S. commodity exports.

Administration officials concede the point, noting that Clinton had asked
Congress for--and, before the coup, appeared set to receive--the authority
to permanently waive the sanctions imposed on India and Pakistan after
their back-to-back nuclear tests last year.

"The decade of . . . sanctions has steadily reduced our influence, both in
terms of having officers trained in the United States and in terms of
confidence and trust in the United States by the Pakistani people," a
senior administration official said. "One of the things we'd been trying to
do with Sharif over the last year was to try to rebuild some of those ties."

But the coup may actually increase Pakistan's isolation: On Tuesday, Rep.
Benjamin A. Gilman (R-N.Y.), chairman of the House International Relations
Committee, said Congress should rethink its decision to grant Clinton the
authority to waive restrictions on military relations with Pakistan. At the
International Monetary Fund, meanwhile, officials said they were taking a
second look at a $1.5 billion loan to Pakistan approved in 1997.

Administration officials said yesterday that they have had no direct
contact with Musharraf, and they reiterated pleas for the restoration of
democracy. "What we hope very much is there is a return to a constitutional
system in Pakistan and that we are able to continue the work that we have
been doing to deflect the conflict, to talk again about solving the Kashmir
problem peacefully," Secretary of State Madeleine K. Albright said after
delivering a speech at the University of Maine.

Military ties have defined the U.S.-Pakistan relationship since the 1950s.
=46rances Gary Powers, the U-2 pilot shot down over the Soviet Union in 1960=
,
took off from a base in the northern city of Peshawar.

But there have been rough patches before. Pakistan's pursuit of nuclear
weapons, for example, triggered the first set of sanctions in the late
1970s. But the Soviet invasion of Afghanistan invested the relationship
with a new strategic rationale. The United States trained hundreds of
Pakistani officers and sold the country advanced weaponry, including F-16
fighters.

With the end of the Cold War, U.S. officials could no longer ignore
Pakistan's nuclear ambitions and, in 1990, imposed sweeping sanctions under
legislation named for former senator Larry Pressler. Arms sales
stopped--the United States canceled the delivery of 60 additional F-16s
that Pakistan had already paid for--and so did military training.

Although Washington maintained cordial relations with Sharif's
predecessor, Benazir Bhutto, administration officials and some lawmakers
contend that the severing of military ties had the unintended effect of
weakening U.S. influence over Pakistan's most important institution. The
erosion of that influence, moreover, occurred at a time of mounting U.S.
concern about Islamic extremists in the Pakistani armed forces and evidence
of drug trafficking by some officers.

U.S. officials tried to rebuild that influence by, among other actions,
releasing funds last year that Pakistan had paid for the undelivered
fighter jets. But other developments seemed to work against their efforts.

Several officials noted that Musharraf's predecessor as chief of staff,
Gen. Jehangir Karamat, who was dismissed last year by Sharif, received
military training at Fort Leavenworth, Kan., and had a close relationship
with Gen. Joseph Ralston, vice chairman of the Joint Chiefs of Staff.
Musharraf, by contrast, trained in Britain and is relatively unknown here.

"We've lost basically a generation of Pakistani officers," a U.S. military
officer said.
=A9 Copyright 1999 The Washington Post Company
________________________________________

South Asia Citizens Web Dispatch is an informal, independent &
non-profit citizens wire service run by South Asia Citizens Web
(http://www.mnet.fr/aiindex) since1996.