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March 2007, Vol. 2, No. 3

Feature: The Future of Pakistan-U.S. Relations

Cheney and Mussarraf
Recent trips by high-level officials of the Bush administration, including Vice President Dick Cheney and Defense Secretary Robert Gates, have indicated that the pressure on Pakistan has been increased to reinvigorate its efforts in the war against Al Qaeda and Taliban. In this feature, we cover articles relating to what is looking like a revised U.S. strategy towards Pakistan, as well as Pakistani perspectives and responses. Even as demands to link U.S. assistance, including military, with Pakistan's efforts in the war on terror have gained momentum, some Pakistani leaders have called for cutting all ties with the U.S. in such a scenario. Both countries consider each other to be indispensable, but seeds of distrust might be sown on both sides through such public hard stances. Read more.


In this Issue:
  1. Feature: The Future of Pakistan-U.S. Relations

  2. Carnegie Events/Analysis: Indian Foreign Secretary Shivshankar Menon and U.S. Undersecretary Nicholas Burns; Conference on "A Rising Asia and the International System"

  3. Views from South Asia:
    INDIA:
    Foreign Policy and Domestic Politics
    : Samjhauta Express blasts; India-Pakistan relations; State elections; India's new regionalism; India-Bangladesh relations

    Economics and Energy: Union Budget 2007; inflation vs. growth; corporate earnings; stock markets and terrorism; Iran-India-Pakistan pipeline

    PAKISTAN: Pakistan-Afghanistan relations; Pakistan-Iran relations; General elections; counter-terrorism strategy

    BANGLADESH: Government crackdown on corruption;
    election timeline; economic reforms; Awami League and BNP; Muhammad Yunus' new political party; India-Bangladesh relations

    NEPAL: Federalism debate; Interim Constitution; Maoists vs. monarchy; governance issues

    SRI LANKA: Batticaloa attack; peace process, ceasefire agreement; Government-LTTE talks; human rights

  4. In-Depth Analysis:
    Politics: Terrorism and human rights; oil prices and fiscal deficit; BRICs report on India's growth potential; counter-insurgency strategies; India's Northeast; India-Africa ties

    Economics: Sources of growth in the Indian economy; India-China growth comparisons; Services-led industrialization in India; Knowledge Commission and higher education; calibrated monetary policy

  5. Additional Resources: Iran-India energy relations; refugees from PoK; Suicide Terrorism Quarterly Report; dialogue with NATO; IPCS monthly Strategic Review; maritime trade and security; National Water Scene; World Bank report on India and China; press briefings from Indian and Pakistani Ministries of Foreign Affairs, including the India-Bhutan Friendship Treaty


 

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Editor's Note

Though the blasts on the Samjhauta Express train, going from India to Pakistan, in February had raised concerns that the India-Pakistan peace process might get derailed yet again, Pakistani Foreign Minister Khasuri's decision to go ahead with his India trip the next day ensured that the two countries maintained a strong commitment to carrying the process forward. The first joint anti-terror mechanism talks also successfully took place between the two countries in the first week of March.

Meanwhile, the Democrats are attempting to force some re-thinking of U.S. foreign policy towards Pakistan. Vice President Cheney's trip to Pakistan received a lot of media coverage, in part because of the strong message he allegedly delivered to Musharraf, and in part due to the timing of the suicide blasts near the U.S. base in Baghram. In our Feature this month, we cover a wide array of views on how U.S. foreign policy towards Pakistan should be formulated, and whether playing hardball with Pakistan will yield the desired results for the U.S.

In Bangladesh, the caretaker government, backed by the army, cracked down on the corrupt top echelons, even arresting the son of former Prime Minister Khaleda Zia in the process. Significantly, Nobel Laureate Muhammad Yunus also entered the political fray, announcing the formation of a new political party. Sri Lanka remained mired in conflict—A plane carrying foreign dignitaries was allegedly targeted by LTTE militants. Nepal continued to debate ways of addressing its ethnic problems, especially in the Terai region, even as the Maoists worked hard to counter the monarchy's efforts to stay relevant in the political system.

Anirudh Suri
Editor, South Asian Perspectives

Feature
The Future of Pakistan-U.S. Relations
Bush and MussarrafOverview
Mark Mazetti questions just how delicately the U.S. should be treating Musharraf (International Herald Tribune, March 11, 2007). An earlier report by Mazetti and David Sanger had argued that President Bush had decided "to send an unusually tough message to Musharraf, warning him that the new Democrat-controlled Congress could cut aid to his country unless his forces become far more aggressive in hunting down operatives with al Qaeda" (New York Times, February 26, 2007, free registration required). In addition, Senate Democrats are even "threatening to withhold delivery of jet fighter planes to Pakistan if it does not intensify its campaign against terrorists to link the F-16 jets deal with greater cooperation" (Washington Post, March 8, 2007). Recently, Deputy Secretary of State John Negroponte had also been scathing in his attack on Pakistan and its Afghanistan policy. Clearly, the pressure is on. (Click here for earlier SAP coverage of this issue.)

Pakistani Response
This renewed pressure has attracted the support of certain quarters of the Pakistani polity. Benazir Bhutto, former Pakistani Prime Minister, now in exile in Dubai, points out that "for too long, the international perception has been that Musharraf's regime is the only thing standing between the West and nuclear-armed fundamentalists" and argues that "nothing could be further from the truth." (Washington Post, March 11, 2007). Some others have reacted with counter-threats. For example, Pakistan National Assembly's Defense Committee Chief Chaudhary Shujaat Hussain has declared that "Pakistan should curtail or completely stop its cooperation with the United States" if the proposed U.S. bill, designed to link U.S. aid to Pakistan's success in the war on terror, is passed into law (Peninsulaqatar.com, March 11, 2007).

Commenting on the fresh onslaught on Pakistan's efforts in the U.S. media, Khalid Hasan argues that "what is now in operation in Washington vis-à-vis Pakistan is the old good cop/bad cop act" where the "Congress will be used as the bad cop and the administration will act as the good cop." He also predicts that "the negative leaks to the media about Pakistan will continue" (Daily Times, March 4, 2007). Subhash Kapila argues that "it seems that strategic and ground realities have caught up with the United States and more so with Pakistan" and their relationship "is now being mutually questioned in both countries." He contends that "Pakistan is today strategically beleaguered and this has forced General Musharraf to recall Pakistan’s Ambassadors for consultation this week from U.S., U.K., China, India, Afghanistan and Iran" (SAAG Paper No. 2159, March 6, 2007).

Opinions on how Pakistan should respond vary. Shahid Javed Burki, while defending Pakistan's extraordinary assistance in the war on terror, argues that Pakistan must respond by making the U.S. understand "the social, cultural, political and economic dimensions of the lives of the people who inhabit the tribal belts on either side of the Afghanistan-Pakistan border" and how that influences Pakistan's ability to affect outcomes in the region (Dawn, March 9, 2007). Najmuddin A. Shaikh believes that the Pakistani response "must be governed by what we see to be in our national interest—national interest being defined more broadly than the protection of parochial or institutional interests" (Dawn, February 28, 2007).

Pakistan militaryAn editorial emphasizes that Pakistan "needs economic viability in such a way that it can reintegrate the tribes it has lost to the Taliban and Al Qaeda." It further argues that "the military in Pakistan must realize that the country needs to normalize its relations with India, not only to bring peace to the Durand Line but also to make it possible for Islamabad to arrange for the Iranian gas pipeline to pass through Balochistan and go to India" (Daily Times, February 9, 2007).

Shahid Javed Burki warns that if the U.S. does cut aid to Pakistan, there will be "difficult times ahead" for Pakistan economically, since "it has made little effort to provide a domestic base for the growth of the economy" (Dawn, February 27, 2007). Another editorial clearly states that "President Musharraf’s alleged ‘spoiler’ policy in Afghanistan is, in many ways, still India-driven" and therefore the U.S. should continue to push for better Pakistan-India relations. It also believes that Musharraf's eyes are set on the upcoming general elections, which explains why he is hesitant to mount daring offensive operations that might be unpopular with the electorate (Daily Times, March 10, 2007).

Regime Change?
Despite expected turbulence in relations in the days and months ahead, Tariq Fatemi concludes that "the rulers in Islamabad need have no worry" since the "Congress and the think-tanks may continue to speak of their desire to see genuine democracy in Pakistan, but the U.S. administration has no wish to weaken the current dispensation in Islamabad" (Dawn , February 17, 2007). At the same time, U.S. intelligence officials seem less worried about an Islamist takeover if Musharraf was to lose power, with recent reports indicating that the U.S. expects that “if something happened to Musharraf tomorrow, another general would step in.” It has been suggested that "based on the succession plan, the vice chief of the army, Gen. Ahsan Saleem Hyat, would take over as the leader of the army and Mohammedmian Soomro, an ex-banker, would become president" (New York Times, March 11, 2007).

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Carnegie Analysis/Events
Burns and MenonThe United States, India, and the World
In a discussion hosted by the Carnegie Endowment on February 22, 2007, India's Foreign Secretary Shivshankar Menon and Under Secretary of State for Political Affairs R. Nicholas Burns share their perspectives on how India and the United States view their interests in the emerging international system. Click there for the video or the transcript (PDF) of the event.

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  MathewsA Rising Asia and the International System
On February 1-2, 2007, the Carnegie Endowment, with the support of the French Ministry of Foreign Affairs, organized a conference on “A Rising Asia and the International System.” Diplomats and academics from seven different countries including China, France, Germany, India, Japan, United States, and United Kingdom, participated in the conference.


Views from South Asia
INDIA

~ Domestic Politics and Foreign Policy ~

IndiaIndia's New Regionalism
C. Rajamohan argues that unlike "previous bouts of regionalism," the present emphasis "on deepening regional integration is rooted in both political realism and economic pragmatism" (Himal Southasian, March 2007). In a similar vein, Kanak Mani Dixit posits that "as New Delhi seeks a place at the table of the global powers, it realizes the need to have a tidy home turf" (Himal Southasian, March 2007).

India-Bangladesh Relations
Imtiaz Ahmed analyzes various aspects of India-Bangladesh relations (Himal Southasian, March 2007), while Anand Kumar argues that the visit of the Indian Foreign Minister to Bangladesh gives fresh impetus to bilateral relations (SAAG Paper No. 2151, February 26, 2007).  C. Raja Mohan emphasizes the need for India to "find a balance between India's publicly expressed support to an early return of the democratic process in Dhaka and the importance of developing a working relationship with the caretaker government" (Indian Express, February 19, 2007).

India-China-Russia Relations
B. Raman argues that "the Chinese Government is trying to give its Navy a greater visibility, operability and rapid action capability in the Indian Ocean region than it enjoys now" and points out that "Gwadar, Hambantota and Sitwe form important components of its maritime security strategy" (Outlook India, March 6, 2007). He also points out that "from the point of view of power projection and the visibility of [India's] Navy, the region to the East of India is more important than the region to the West. From the point of view of our maritime security—particularly maritime counter-terrorism—the region to the West of [India] is more important than the region to the East" (SAAG Paper No. 2128, February 9, 2007).

Comparing the Indian and Chinese defense budgets, Manoj Joshi argues that "India’s inability to get its defense R&D off the ground and to mesh its civil and military industries for national defense needs is a major long-term infirmity" compared to "China’s steadily growing prowess in these areas" that "provides it with the potential of emerging as a superpower in its own right, sooner rather than later" (Hindustan Times, March 7, 2007).

Satyajit Mohanty believes that the recently concluded trilateral forum meeting between India, Russia, and China represented a positive step forward in a relationship driven by compelling political and strategic calculations and rational economic decisions (IPCS Article No. 2227, March 2, 2007). Rajiv Sikri believes that "the burgeoning trilateral consultations and cooperation constitute the most serious and credible endeavor to craft a multi-polar world" and therefore, "must have made the U.S. sit up and notice" (SAAG Paper No. 2152, February 26, 2007). Vikram Sood believes that China and Russia have set in motion the geopolitical tectonic plates, and "the recent Russia-China-India meeting in New Delhi of the three Foreign Ministers, therefore, assumes a heightened significance" (Hindustan Times, February 27, 2007).
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Samjhauta ExpressSamjhauta Express Blasts and India-Pakistan Relations
Prem Shankar Jha
argues that the Samjhauta Express blasts have established beyond a doubt that the Pakistani state was not behind these attacks, and that the "the long expected jehadi assault on the Pakistani State may have begun." He recommends that India and Pakistan must "shed their visceral distrust of each other and use their influence with Afghanistan’s various factions to bring all contenders, including the Taliban, to the conference table—preferably one chaired by President Hamid Karzai" (Hindustan Times, February 22, 2007).

In a separate article, he argues that "given the visceral distrust that the intelligence agencies of India and Pakistan feel towards each other, the first meeting of the joint anti-terror mechanism has gone better than one could have hoped for." He further warns that "the window of opportunity for settling the Kashmir dispute" is closing because "Pakistan is facing new threats to its stability and territorial integrity that could make it lose interest in a Kashmir settlement, if they develop further" (Hindustan Times, March 8, 2007).

K. Shankar Bajpai laments "the appalling inadequacies of New Delhi’s instruments for dealing with its challenges, and the even more frightening inadequacies of Islamabad for dealing with the Frankenstein of terrorism it created" (Hindustan Times, February 25, 2007).

C. Raja Mohan contends that an "Indo-Pak breakthrough is within reach" and recommends that Indian Prime Minister Manmohan Singh could make an "early visit to Pakistan and use it to accelerate the back channel negotiations on J&K and pressurize the two bureaucracies to deliver on the long overdue normalization of bilateral relations" (Indian Express, February 19, 2007).

Brahma Chellaney argues that "Prime Minister Manmohan Singh’s surprise embrace of military-ruled Pakistan as a fellow victim of and joint partner against terror puts India out of sync" with the international community which is mounting pressure "over [Musharraf's] unwillingness or incapacity to crack down on terrorist radicals in his midst." He urges India "to side with the Pakistani people and their democratic aspirations, not with a dictatorship that already has a lot of blood of innocent victims on its hands through a relentless proxy war" (Hindustan Times, March 5, 2007).

B. Raman believes that "the USA is not yet prepared to dump Musharraf" but "at the same time, it dreads the dangers of a defeat in Afghanistan if it continues to persist with him." He suggests that India should take a ringside seat and watch—and avoid putting all the eggs in the Musharraf basket" (Outlook India, March 12, 2007).



~ Domestic Politics ~

voterState Elections
Swaminathan Aiyar
analyzes the results of the elections in Punjab and Uttarkhand and outlines the major lessons they hold "for the big event of the year, the assembly elections in Uttar Pradesh, India’s largest state, in April-May" (Economic Times, February 28, 2007).

Harish Khare argues that "the setback in the Assembly elections provides an opportunity for the UPA and its partners to rediscover the political usefulness of a working convergence" (Hindu, February 28, 2007).

Manini Chatterjee suggests that the party should look within and draw lessons from the time "when party leaders—from Indira Gandhi down to district level functionaries—met hundreds of party workers on a daily basis, kept alive communication channels with dissidents and adversaries, and translated government policies and slogans to reap benefit for the party" (Indian Express, February 28, 2007). Pankaj Vohra believes that "the inability of the [Congress] party to outwit Mulayam Singh Yadav even during his weakest moment clearly shows that there is no political management and those entrusted with the task of handling such sensitive affairs continue to let the Congress president down repeatedly" (Hindustan Times, February 25, 2007).


~ Economics and Energy ~

ChidambaramUnion Budget 2007
For special coverage of the Union Budget 2007 in the Hindustan Times, including an interview with Finance Minister P. Chidambaram, please click here.

Narendar Pani contends that "the wordage provided to agriculture in Chidambaram’s budget speech reflects, hopefully, an official recognition that the crisis in this sector can no longer be ignored" but laments that "Chidambaram’s focus on expert panel reports on specific elements of the agrarian crisis, such as futures markets, may even suggest the absence of a consistent overall view of the challenges in agriculture" (Economic Times, March 9, 2007). In a similar vein, M.S. Swaminathan suggests that there is no strategy for "agricultural renewal" and that India needs "a movement like the one that triggered the green revolution of the 1960s" (Hindu, March 1, 2007).

Nirvikar Singh suggests that "as India’s economy and polity have matured, the annual budget exercise has become less significant as a shaper of policy" and that the budget should only be assessed in light of the prime objective of increasing "the inclusiveness of India’s growth, while continuing to accelerate that growth towards double digits" (Financial Express, March 1, 2007). He also argues that to sustain India's high economic growth, "paradoxically, the Centre needs to lead decentralization, and develop institutional reforms as the missing link between spending to outcomes" (Financial Express, March 9, 2007).

Inflation vs. Growth
The debate over inflation vs. growth has become even more pertinent in India with the ruling UPA's poor showing in recent assembly polls. Swaminathan Aiyar contends that 9 percent growth with 7 percent inflation is better than 6 percent growth with 4 percent inflation, and outlines the reasons why he thinks so (Economic Times, February 14, 2007). Mythili Bhusnurnath counters his argument and posits that "high inflation, even if accompanied by high growth, is simply not sustainable over time, both politically and economically" (Economic Times, February 19, 2007). Narendar Pani argues that "the revival of an old conflict between the larger farmers’ preference for high prices and those in urban and rural areas who are net losers from inflation comes at a politically inconvenient time" when farmers, feeling that they have been excluded from the benefits of liberalization, might again focus their discontent on the forcible takeover of their land for SEZs and similar issues (Economic Times, February 23, 2007).

Corporate Earnings and Stock Markets

In a debate over whether corporate earnings are slowing down, Rashesh Shah argues that the Indian corporate sector's "heady growth seems to be slowing down. It is usually not possible for the corporate sector to continue to grow at 25 percent while GDP is growing at 15 percent in nominal terms. The slowdown in growth in the future will be due to rising interest costs, fresh capacities coming up, rising wages, and a global slowdown." On the other hand, Mahesh Vyas contends that "the current growth derives its strength from an organic business cycle revival" as "domestic demand has risen and has fueled a rise in investments with it." Moreover, he believes that "this cycle is well poised to continue in the coming year" and that the current "resurgence in corporate performance is far more sustainable than the one we witnessed earlier" (Business Standard, March 7, 2007).

gaurd
Stock Markets and Terrorism
B. Raman
analyzes the ways in which terrorists might operate in or manipulate India's stock markets (SAAG Paper No. 2137, February 14, 2007), while Sucheta Dalal speculates what National Security Advisor, M.K. Narayan, might have meant when he said during a speech in Munich that "stock exchanges in Mumbai and Chennai have, on occasion, reported that fictitious or notional companies were engaging in stock-market operations" and that "some of these companies were later traced to terrorist outfits” (Financial Express, February 19, 2007).

Energy

Ashish Kumar Sen
warns that "if eventually signed into law, legislation introduced by a top Democratic Congressman that would sanction any country, including India, which finalizes energy deals with Iran, could create a stumbling block for the India-Iran gas pipeline" (Outlook India, March 9, 2007).



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PAKISTAN
Pakistan-Iran MeetingB. Raman analyzes the plight of U.S.-Pakistan-Iran relations, in light of statements by the Iranians in the aftermath of the bombings in Zahedan, criticizing "Pakistan for becoming the backyard for terrorists infiltrating Iranian soil" (SAAG Paper No. 2149, February 24, 2007). Writing on the same issue, M.K. Bhadrakumar points towards other Iranian statements that provide some interesting insights into U.S. foreign policy in the region (World News Trust, February 25, 2007). A report in the Telegraph also alleges that "in a move that reflects Washington's growing concern with the failure of diplomatic initiatives, CIA officials are understood to be helping opposition militias among the numerous ethnic minority groups clustered in Iran's border regions" (Telegraph, February 25, 2007).

Tariq Fatemi argues that Pakistan's decision to call foreign ministers of major Muslim powers to Islamabad was a commendable initiative but excluding Iran has created misgivings about Pakistan's intentions and therefore, it is "absolutely essential that Pakistan make it clear, at this stage, that there is no way that it can permit its land, water or air space to be used by the U.S. against Iran, a friend and tested ally" (Dawn, March 3, 2007).

Hasan Askari Rizvi, in a series of articles, examines issues related to governance and law and order (Daily Times, February 18, 2007), election and political change (Daily Times, February 11, 2007), and the missing links in Pakistan's counter-terrorism strategy (Daily Times, March 4, 2007).

Najmuddin A. Shaikh argues that the Samjhauta Express carnage has made India-Pakistan cooperation in countering terrorism even more compelling. He further posits that Pakistan will also have to tackle its domestic situation by addressing economic and political grievances as well as cutting off domestic and foreign funding for the forces that perpetrate terrorist attacks on Pakistani soil as well (Dawn, February 21, 2007). In another article, he recommends that "the proposal for the Reconstruction Opportunity Zones [in the tribal areas] must be pursued more vigorously, and in anticipation of the setting up of industries in the region local youth must be given vocational training either in new centres in the region or in existing ones in settled districts" (Dawn, March 7, 2007).

An editorial argues that "for Pakistan, egging on the Taliban to secure itself against the day when the NATO-ISAF forces leave Afghanistan—even the NATO politicians are not sure if they will stay after 2007—will ultimately be more dangerous than normalizing with India and thus defusing the challenge of its flanking move." It further warns that "if the Taliban win they will simply do away with the Durand Line—they now have large chunks of Pakistani territory swearing allegiance to them. Therefore Pakistan is threatened with a changing of the map that is far more ‘terminal’ than the trouble in Balochistan" (Daily Times, February 16, 2007).

B. Raman contends that the "neo-Taliban" has launched its own efforts "to pre-empt the NATO's planned pre-emptive strike" by launching their spring offensive "not from Pakistani territory as anticipated by the NATO forces, but from behind their back in Afghan territory" (SAAG Paper No. 2140, February 18, 2007).


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BANGLADESH
HasinaMd. Anisur Rahman argues that it is important to incorporate economic reforms alongside the political changes that are currently underway as failing to do so would fail to realize "the great potential the nation has to be another ‘Asian Tiger’" (Daily Star, March 5, 2007).

Moazzem Hossain asks why the Awami League has not taken "full advantage of BNP's present day disintegration nationally and locally." He argues that failing to do so is a mistake and strongly urges the party to seize this opportunity to resolve inner-party problems and prepare the country's return to the polls (Daily Star, March 1, 2007).

Sayed Kamaluddin addresses the changes that occurred in tandem with the change of government in Bangladesh, and stresses the need for both political parties, the BNP and the Awami League, to re-address the needs of the polity (New Age, March 1, 2007).

Muhammad Nurul Huda states that although Bangladesh is currently without a representative government, its people are willing to take the necessary steps to establish a solid democratic foundation as "they want to be delivered from the cumulative tyranny of pseudo-democrats" (Daily Star, March 3, 2007).

A new political alternative was added to the mix last month when Nobel laureate Professor Muhammad Yunus announced his formation of a new political party, "Nagorik Shakti" or "citizen power" (Daily Star, February 23, 2007).


India-Bangladesh relations
Kazi Anwarul Masud states that part of the solution to the bilateral problem lies within Bangladesh. He argues that in order for the two countries relations to progress, it is crucial for Bangladesh to move to "the right side of international law in resolution of bilateral disputes, and to be sensitive to New Delhi's security concerns" (Daily Star, February 25, 2007). Syed Muazzem Ali argues that although the relationship between the two countries has always been complex, the recent visit by Indian External Affairs Minister Pranab Mukherjee, may hint at a "new phase in Bangladesh-India ties" (Daily Star, February 27, 2007).

Harun ur Rashid discusses the idiosyncrasies of the relationship between India and Bangladesh, to explain why a stable relationship is necessary for the health of both countries (Daily Star, February 28, 2007). J.K. Sinha provides a historical context for the recent political developments in Bangladesh and points out that the success of a new government is equally important for India since "what happens there has a direct impact on the security and the stability of India’s eastern and northeastern states" (Hindustan Times, February 14, 2007).


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NEPAL
PrachandaB. B. Deoja presents a case for the implementation of federalism in Nepal and painstakingly explains what steps are necessary to ensure that it will be a successful system (NepalNews.com, February 27, 2007). In response to the continued debate on whether to introduce federalism in Nepal, Professor Hari Bansh Jha argues that "at this juncture, the Government Talk team and the agitating parties should be provided technical details on issues related to separation of political and economic powers between the centre and state under the broader framework of federal system" (NepalNews.com, February 13, 2007).

Andrew Arato analyses the intricacies of the Interim Constitution and suggests ways to address its failures (NepalNews.com, February 26, 2007).

Prakash C. Ghimire discusses the merits of different systems of governance and points out that although it is important to carefully make a decision, it is crucial that this action be taken soon as the time for a ‘win-win situation’ is running out (NepalNews.com, February 23, 2007).

In a recent statement, Maoist Chairman Prachanda argued "that the interim parliament should declare [itself a] republic right away to pre-empt regression by the royalists and reactionaries" (NepalNews.com, February 23, 2007).



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SRI LANKA
RajapaksaJehan Perera believes that "it is unfortunate that the government’s military gains have been accompanied by political regression" (Daily Mirror, March 6, 2007). In another article, he argues that the dismissal of three senior ministers by President Mahinda Rajapaksa "is likely to reinforce the belief in many people of the President’s ability and willingness to dispose of any opposition to him, if necessary," but warns that "the dismissals have also raised questions about the stability of the government and the about the prospects of a snap general election" (Daily Mirror, February 13, 2007).

Writing on the occasion of the fifth anniversary of the Ceasefire Agreement (CFA), N. Sathiya Moorthy argues that while "the LTTE cannot escape the blame for putting the peace process in jeopardy," "the Sri Lankan government too cannot escape a share in the blame for the CFA's seeming failure in the past year (Daily Mirror, February 26, 2007). In another article, he argues that "the close shave that some foreign diplomats had while landing by helicopter in Batticaloa the other day should be indicative of the ground situation, including those in the neighborhood of those re-captured by the armed forces in the past months" (Daily Mirror, March 5, 2007).

K. Godage counters Ambassador Julian Wilson's call for talks between the Sri Lankan government and the LTTE, arguing that talks in the past have always been in vain, and recommends that "if the political will is present and the international community honestly wishes to see a settlement of this problem, and they are opposed to the establishment of any form of a separate state in this country, then they should demand that the LTTE gives up its goal of Eelam and surrender arms to the custody of the UN" (Daily Mirror, March 5, 2007).

Ahilan Kadirgamar argues that "the absence of State effort to put in place human rights mechanisms has aggravated the war in Sri Lanka" and that "for matters to improve, Colombo must rein in State-linked violations" (Hindustan Times, March 8, 2007).


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In-Depth Analysis
Economics
Barry Bosworth, Susan Collins and Arvind Virmani identify the "sources of growth in the Indian economy" (Brookings preliminary paper prepared for the Indian Policy Forum) while in another paper, Barry Bosworth and Susan Collins examine the factors accounting for growth in India and China (Paper presented at the annual conference of The Tokyo Club Foundation for Global Studies).

An Observer Research Foundation policy brief examines what falling oil prices mean for India's fiscal deficit (ORF Policy Brief #8, February 2007).

Tushar Poddar and Eva Yi examine India's rising growth potential and suggest that "India’s influence on the world economy will be bigger and quicker than implied in our previously published BRICs research" (Goldman Sachs Global Economics Paper No. 152, January 22, 2007).

Nirvikar Singh identifies the prospects and challenges for the services-led industrialization in India (Working Paper No. 290, Stanford Center for International Development, November 2006).

The EPW Research Foundation
emphasizes the need for a calibrated policy in interest rates and credit, and argues that "the indirect measures taken by the central bank to control inflation have led to a situation where banks are pushing up rates on both deposits and loans, more on the latter than on the former, ending in a widening of the spread" (Economic and Political Weekly, February 24, 2007).

Counterinsurgency
Durga Madhab (John) Mitra "analyzes the susceptibility of third-world countries to insurgency and develops a theoretical perspective to illuminate some of the factors contributing to insurgency in these countries" using Indian counterinsurgency strategies as a model (Strategic Studies Institute, February 2007).

M.S. Prabhakara attempts to present the real agenda of the various separatist projects that are at work in the northeast region of India. Though the discussion is essentially about the working of such projects in Assam, the general principles outlined are applicable, with suitable modifications, to other separatist movements in the region as well (Economic and Political Weekly, March 3, 2007).

Higher Education
Jandhyala B.G. Tilak argues that there are a number of serious problems with the recommendations of the National Knowledge Commission in the field of higher education and claims that "many are not based on any analysis and are without supporting evidence. critiques some important observations of the Commission" (Economic and Political Weekly, February 24, 2007).

India-Africa Ties
Farah Arbab examines India's growing ties with Africa and also identifies the concerns they raise for Pakistan (Strategic Studies, XXVI Winter 2006 No. 4, International Strategic Studies Institute, Pakistan)

Burma
Thant Myint-U suggests ways of reframing the "Burma question" and argues that "it is important that Burma’s well-wishers better understand the country’s complex history and complicated present, and use creative and sensible ways of negotiating with its military establishment" (Himal Southasian, February 2007).


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Additional Resources
Reports:

• Iran-India Energy Relations: Strategic Dimensions (IPCS Seminar Report, February 23, 2007).

• The Forgotten People of Jammu and Kashmir: 'Refugees' from PoK- An Interview with Mr. Rajiv Chunni, Chairman of the SOS, an organization of PoK 'refugees' settled in J&K (IPCS Article No. 2182, January 8, 2007).

• I-Post Quarterly, A Quarterly Report on Suicide Terrorism (IPCS, Vol. 3, No. 3 & 4, July-December 2006).

• Global Security Challenges: A Dialogue with NATO (IPCS Conference Report, January 24, 2007).

• IPCS Strategic Review, South Asia in February 2007 (IPCS, No. 20, March 2007).

• "Maritime Trade and Security: Striking the Right Balance" (ORF Seminar, January 11-12, 2007).

• "The National Water Scene" (ORF Discourse, Vol. 2, No. 2, February 2007).

• "Dancing with Giants: China, India, and the Global Economy" (The World Bank and Institute of Policy Studies (Singapore), January 2007).

Pakistan Ministry of Foreign Affairs: Transcripts of Press Briefings

Indian Ministry of External Affairs Documents:
    • India-Bhutan Friendship Treaty (PDF)
    • Briefing by Official Spokesperson on the visit of the Chinese Foreign Minister and the Trilateral Meeting between the Foreign Ministers of India, Russia and China, February 13, 2007 (PDF) 
    • Joint Press Interaction by External Affairs Minister Pranab Mukherjee and Minister of Foreign Affairs of Pakistan Khurshid Mehmood Kasuri, February 21, 2007  (PDF) 
    • On the first meeting of the India-Pakistan Anti-Terrorism Mechanism held in Islamabad, February 22, 2007 (PDF) 
    • Transcript of the Press Conference by Foreign Secretary Shivshankar Menon at the Embassy of India, Washington, D.C., February 23, 2007 (PDF) 

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  Editorial Staff

Editor:
Anirudh Suri, junior fellow, South Asia Program, Carnegie Endowment

Associates:
Gretchen Smith, program assistant, South Asia Program, Carnegie Endowment

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