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Pakistan Defence and Security Report Q4 2011
Business Monitor International, Oct 2011, Pages: 96
Pakistan and the US continue to deal with the fall-out of the killing of Osama bin Laden with claims that Pakistan has allowed Chinese officials to inspect the remains of an advanced US helicopter that crashed during the raid. Speaking in August, US defense secretary Leon Panetta refused to comment on those reports and made plain his country’s dilemma in dealing with Pakistan, saying it had no choice but to maintain close relations. Panetta, however, accused Pakistan of having ‘relationships’ with the Haqqani network of militants based in western Pakistan. The State Department, meanwhile, put sanctions on another Haqqani network commander.
Pakistan defence minister Ahmad Mukhtar has been wooing a US congressional delegation to Islamabad saying his government was committed to confronting terrorism and urging the release of further funds by the US to buy military equipment.
Procurement, however, is still facing fall-out from the June release of an auditor’s report accusing the army of wasting billions of rupees and making unnecessary purchase.
Violence continued in the western part of the country, including the deadly June bomb blast in Peshawar and an attack by militants Upper Dir district but much attention has been turned to Karachi where ongoing violence is a cause for much concern. The Pakistan army in September called for an end to the killings following an earlier suggestion by the country’s military chief that forces were prepared to play a more direct role in the city.
In more optimistic news, there were tentative signs that Baloch insurgents may be willing to negotiate with the government about the possibility of joining the federal framework. In August, politicians from India and Pakistan met in New Delhi to restart the India-Pakistan Parliamentarians Dialogue, seven months since the first session in Islamabad.
The Pakistani and Indian Foreign Ministers met from 23-25 June in Islamabad in the first official talks since the 2008 Mumbai terrorist attacks. Although there were few concrete results from the meeting the parties agreed to hold further talks. US drone strikes continue and remain a significant point of tension between the two countries. In September 2011, a non-UN-sanctioned US drone attack killed at least seven people and wounded several others in Pakistan’s northwestern tribal region. We expect manufacturing activity to recover in the current fiscal year following the lull in FY2010/11 (July-June). The broader economy is set to recover to 3.8% real GDP growth (from 2.4%) this fiscal year.
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