Last week, Pakistani President Asif Zardari made headlines with his admission that Pakistan created and nurtured militant groups to be used as strategic assets before 9/11. Some analysts interpreted the announcement as tacit acknowledgment of Pakistan's role in arming Kashmiri militants, and as a step toward talks with India. Others point out that Zardari did not mention India and was trying to link past mistakes to the threat that militants pose today, in an effort to consolidate public opinion in favor of continued action against the Taliban.
In Sri Lanka, Tamils displaced during the war against the LTTE have still not returned to their villages in the North. The government says it continues to look for LTTE members among the displaced and has not finished removing mines from Tamil villages. The Sri Lankan government also scored a public relations victory with recent media reports supporting the government's assertions that living conditions in the camps are good.
This is my last issue of South Asian Perspectives and it has been a genuine pleasure sharing with you expert analysis and opinions from across South Asia. Many thanks to Mary Kate Aylward and the Carnegie communications team, whose help makes this publication possible. Special thanks to all you perceptive readers—your regular feedback keeps us on our toes. SAP will return in the fall under its new editor, Aroop Mukharji.
Moving Towards Detente?
India and Pakistan's prime ministers are set to meet this week, on the sidelines of the Non-Aligned Movement summit in Egypt. Many in Pakistan expect India to reopen the composite dialogue framework, stalled since the Mumbai attacks. Signaling a potential thaw in relations, Prime Minister Singh disclosed that India's envoy in Pakistan recently met with Shuja Pasha
, the chief of Pakistan 's Inter-services Intelligence agency. The ISI is often accused of supporting anti-India terrorist groups, and Pakistan had refused to send the ISI chief to meet Indian officials after the Mumbai attacks. Following Singh's statements, Pakistan 's interior minister announced that trials will begin next week of LeT members arrested by Pakistani authorities after the Mumbai attacks.
The Daily Times
writes that the trials of LeT members implicated in the Mumbai attacks will silence those in India who argue that Pakistan is deliberately delaying its investigation and will challenge those in Pakistan who dismiss the allegations that Pakistani groups played a role in the attacks.
emphasizes that if talks between the two countries are to be meaningful, Pakistan must shut down the Taliban as well as militant groups acting against India.
After the successful Swat operation the Pakistani Army's popularity has soared. Nirupama Subramanian
writes that the army's ascendance could reduce the scope of engagement between India and Pakistan because of the army's traditional suspicion of India.
condemns Pakistan's use of militants to fight India in Kashmir and its support of the Taliban to maintain its influence in Afghanistan. Those past policy choices impede the defeat of the militants today.
points out that President Zardari did not specifically acknowledge using Punjabi terrorists against India in Kashmir. Zardari's disclosure is meant to justify continued action against the Taliban threat to Pakistan by highlighting the dangerous consequences of allowing militant groups to grow.
questions CNN's interpretation of the interview, arguing that even if Pakistan could broker talks, it would not reveal its role in negotiations until a very late stage in the process.
India's Budget - Populist or Popular?
India's finance minister, Pranab Mukherjee, presented the annual budget on July 6. The centerpiece is a 144% increase in the National Rural Employment Guarantee Scheme, a program guaranteeing 100 days of annual work to rural Indians. While many commentators welcomed the increase in social spending, the stock markets plunged
as financial analysts bemoaned the absence of structural economic reforms and the expected increase in the deficit.
Before releasing the budget, the government raised the market's hopes by promising to sell $5 billion worth of government assets in public companies this year. The market crashed because the budget made no mention of future sales of government assets, concludes the Hindu
challenges the government's claim that a fiscal deficit can easily be reduced in the long run after a temporary stimulus. New expenditures in social programs, like the increase in the Rural Employment Guarantee program, are irreversible and future tax revenues will not increase substantially, making it difficult to reduce the deficit.
Contrary to conventional wisdom, there is no political cost to announcing economic reforms, argues the Indian Express
. Indians now recognize that economic reforms initiated in 1991 dramatically improved standards of living.
New G8 Rules on Nuclear Trade Threaten India
On July 8, the G8 pledged to curb transfers of enrichment and reprocessing technology to countries that have not signed the Nuclear Non-Proliferation Treaty (NPT). The conditions, if imposed, would invalidate India’s exemption granted by the Nuclear Suppliers’ Group (NSG) that allowed its member states to engage in full civil nuclear trade with India despite the fact that is not a signatory to the NPT.
argues that the United States pushed for the G8 ban as a result of its frustration over losing business to Russia and France. The NSG's blanket exemption disadvantaged U.S. vendors subject to domestic conditions on civil nuclear trade.
The G8 statement is part of the United States' push for disarmament, but the continued importance of nuclear weapons in the strategic doctrines of nuclear powers makes disarmament unlikely, observes Pratap Bhanu Mehta.
India should not sign any nonproliferation treaty that fails to include a provision making the agreement null and void if nuclear states do not fulfill their obligations, he concludes.
Pranab Mukherjee, Minister of External Affairs when India received the NSG exemption last year, said that India is not concerned
because the G8 is not the relevant forum to discuss nuclear trade with India.
Air India Bailout
India's state-run airline, Air India, is facing the worst financial crisis in its history, and has requested a $900 million bailout package. Airline experts point to unprofitable routes, overstaffed flights and overpaid pilots
as key reasons for its losses. The government recommended wholesale changes in the airline's business model as a condition for its bailout.
The Hindustan Times
writes that Air India's (AI) financial troubles were compounded by a poorly implemented merger with Indian Airlines in a year. An oversight board should review the merger and AI's future plans.
In an interview with Vinay Kumar, Praful Patel
, India's civil aviation minister, defended AI's merger and said that the government will bail out the airline only if it adapts to the market by offering low-cost domestic flights.
Sri Lankan Tamils Still in Camps
Two months after its war against the Tamil Tigers ended, Sri Lanka refuses to let Tamils displaced by the war leave transitional refugee camps. The government argues that the camps need to be searched for Tamil Tiger holdouts and that villages need to be de-mined before Tamils can return home. Meanwhile, President Rajapakse announced that the government will unveil a solution to the issue of Tamil autonomy only after the national elections, reflecting the government's desire not to take politically risky decisions before then.
The government should release low-risk Tamils who have families they can live with until their villages are de-mined, writes Jehan Perera
. The government needs to build confidence with Tamils even if the larger political question of Tamil autonomy remains unsettled.
After visiting Sri Lanka 's Vavuniya camp, N. Ram
observes that conditions in the refugee camps are much better than the Western media often reports.
writes that Sri Lanka 's victory against the LTTE provides no lessons for the West. Sri Lanka killed innocent civilians, murdered its journalists, and received aid from China when Western aid was discontinued out of protest from the government's fighting methods.
Bangladesh to Begin War Crimes Trials
The Bangladesh government has announced that it will soon begin trials to investigate war crimes
allegedly committed during its 1971 war of liberation with Pakistan. Pro-Pakistan paramilitary forces allegedly committed atrocities against the nationalists led by Prime Minister Sheikh Hasina's father, Mujibur Rehman.
On July 9, the parliament in Bangladesh changed its laws to bring them in line with international standards governing war crime trials and to preempt the charge that the tribunals are motivated by revenge rather than justice. In a letter to Prime Minister Hasina, Human Rights Watch urged her to have only civilian judges conduct the trials, not use the death penalty, and ensure the protection of witnesses and victims testifying to the tribunal.
and Naeem Mohaiemen
emphasize that the war crimes trials must be legally watertight. If the trials passed by parliament are not governed by the genocide provisions used in international tribunals, future,appeals courts could overturn the tribunal's rulings.
New Nepal Government Presents Its Budget
On July 13, Surendra Pandey, the finance minister of Nepal , submitted the new government's first budget. While many economists welcome the emphasis on infrastructure development, some have questioned the policy of continuing social welfare
programs without first evaluating their effectiveness.
highlights the government's focus on building roads in the budget. The government's aim is to generate revenue through tolls on north-south roads that would link India and China.
The Taliban have developed a coherent leadership, sophisticated propaganda operation and national reach that have put the International Coalition on the defensive, marginalized the local Afghan government, and given the Taliban control of the South and East. Gilles Dorronsoro explains that the Coalition should prioritize securing Kabul and the North where the Taliban are still weak but making alarming progress.
CARNEGIE EVENTS & ANALYSIS