Friday, October 17, 2008

Is it 2006?

From the News
Chaudhry Nisar [leader of the opposition in the Pakistani Parliament] made it clear that it was not Pakistan’s war but was imposed on us. “The people gave us a mandate for change but so far the same old policies were being pursued.”
Snark aside, the article shows how the government of Pakistan is between a rock and a hard place. The economy is on the verge of collapse and very dependent on US aid. The foreign exchange reserves are at a record low - just enough for a month and a half of imports. There has been a massive flight of capital and in this time of tight credit the government has been unable to float bonds needed for its own functioning. In this environment the US has enormous leverage and the government cannot afford to ignore US desires. It was US backing that resulted in pledges of 4 billion dollars from international donors to help stave of bankruptcy - for now. On the other hand as evident from this report there is also enormous pressure from the people not to go along with the US demands. If the government could somehow reduce the economic hardships of the people it could ignore their wishes as far as collaborating with the US was concerned. This was what allowed Musharraf to stay in power. However, given the dire situation of the global economy it is not likely that the economic condition of the people will change for the better any time soon. So, I would look for signs of Zardari and his buddies preparing their various villas in Britain and the US for occupancy.

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