Pakistan's invaluable asset
Last updated: April 24, 2009
April 23, 2009
In other emerging markets, the new, crowd-pleasing IMF has advocated counter-cyclical policies to combat the ill effects of global contraction. But Pakistan has committed itself to narrowing its fiscal deficit to 562 billion rupees ($7 billion), or 4.3% of GDP, by June. This target was set in October before the full horror of the world economic crisis had become apparent. Given the subsequent slowdown, the government’s revenue aims seem aspirational rather than feasible.
The danger was that the government would meet its target by cutting infrastructure spending, thereby undermining the country’s growth prospects. But Pakistan has one invaluable asset that is not quoted on its balance-sheet. It scares the rest of the world. Thus on April 17th a group of 31 countries, called the Friends of Pakistan, met in Tokyo and offered an extra $5.3 billion of friendliness over the next two years. Though the government is precarious enough to arrest the world’s attention, it is still—just—credible enough to earn its financial backing.
Source: The Economist
April 24, 2009
By JANE PERLEZ
Published: April 22, 2009
ISLAMABAD, Pakistan — Pushing deeper into Pakistan, Taliban militants have established effective control of a strategically important district just 70 miles from the capital, Islamabad, officials and residents said Wednesday.
. . .
“They are everywhere,” one resident of Daggar, Buner’s main city, said by telephone. “There is no resistance.”
The Taliban advance has been building for weeks, with the assistance of sympathizers and even a local government official who was appointed on the recommendation of the Taliban, the senior official said.
It also comes 10 days after the government of President Asif Ali Zardari agreed to the imposition of Islamic law, or Shariah, in Swat, as part of the deal with the Taliban.
A local politician, Jamsher Khan, said that people were initially determined to resist the Taliban in Buner, but that they were discouraged by the deal the government struck with the Taliban in Swat.
“We felt stronger as long we thought the government was with us,” he said by telephone, “but when the government showed weakness, we too stopped offering resistance to the Taliban.”
Source: The New York Times
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