Monday, November 30, 2009


Contrary to what you hear about Obama warning Pakistan to act against LeT or Gordon Brown admonishing Pakistan for not capturing Osama bin Laden, hides the true face of the Anglo American Enterprise (AAE). Await for more dollars and goodies to fall into the laps of Pakistani Military in the coming week.

Pakistan is an indispensable country to AAE. And no one can deliver better than Musharraf - and that too in civilian attire. For the past few months, Musharraf has made UK his home and is being actively groomed to taken on the new task.

UNCONDITIONAL SUPPORT TO PAKISTAN (irrespective of terror attacks planned on India)

"UK Foreign Secretary Miliband lauded Pakistan’s role in the war against terror and its efforts to bring peace and stability to the region. He added Britain will continue providing unconditional support to Pakistan."

(More on this story over the week)

Wednesday, November 25, 2009



Brahma Chellany had this to say - and we need to ponder on this:
Would U.S. president have skipped first anniversary of 9/11 to be overseas, the way the Indian PM is observing the 26/11 anniversary abroad?

Tuesday, November 17, 2009

Omar Sheikh, Ilyas Kashmiri, David Headley, Zakiur Rahman Lakhvi, Bahaziq, 26/11, 9/11, LeT, ISI


The inter-connections are so intricate that it will become almost impossible to state where ISI ends and where global terrorism begins.

Lets start with one point – the Mumbai attacks and then work back as well as front from that point out and draw logical inferences along the way.

26/11 – One terrorist was caught alive that gave India the first real face of terror brewing in its own backyard and the enormous tentacles that it has spawned within India itself. Brigade 313 of Ilyas Kashmiri (which is itself a part of Al – Qaeda’s Laskhar al Zil) and Lashar e Taiba (LeT) were in control of the operations. Hafeez Saeed and Zakiur Rahman Lakhvi provided the boys, facilities and religious indoctrination. The training and strategy came mainly from Ilyas Kashmiri – former Pakistani SSG commando.

I can safely say that my blog was the first off the blocks when on 27/11 – the next day after 26/11 – broke the SSG connection to the Mumbai attacks. My first lines were : “This was a classic commando raid replete with beach landing et al. It had all the markings of a thorough Pakistani SSG trained operation – which makes it a Pakistani Army action.

It has been a well thought of strategy of Pakistan Army to embed the Taliban and terrorist organizations like Lashkar e Taiyyba, Jaish e Mohammad, Lashkar e Jahagvi with its own soldiers and commandos. These army recruits blend in with Taliban and terror organizations, deemed to have gone "native", maybe without the knowledge of Taliban / terror organizations who are just happy to have received high class "recruits".

Pakistan Army, through ISI, now draws back its own cadres from Taliban and these terror organizations for special operations around the globe. For Mumbai attacks, Lashkar e Taiyyba was chosen - but the actual foot soldiers were ex-army soldiers including SSG commandos (leading the charge) already embedded in these organizations - as well as a few battle hardened fidayeen terrorists. These LeT "terrorists" were given rigourous training by either current or ex-SSG commando trainers (sufficiently bearded to evade detect) who will probably be known as Gen Saab or Gen Mohd (aka John Doe)

(I did not know Ilyas Kashmiri would fit this to the T at that point)

New York Times on 19th October - at least a main stream US media now coming to terms with this factor - Pakistan military and its role in terrorism. "Ex-Military Officer in Pakistan Is Linked to 2 Chicago Terrorism Suspects"

People in the West have amnesia to article like these ones in Times Online:

1) Taliban leader killed by SAS was Pakistan officer

2) PAKISTAN is allowing Taliban fighters wounded in battles with British and other Nato forces in Afghanistan to be treated at safe houses.

Point 1: 26/11 was executed by Brigade 313 and LeT. At this stage we will not get into the detail that there were people behind Brigade 313 and LeT at this stage, rather stick to what is logical and already proven.

Fast forward to November 2009 – 12 months hence. Two Lashkar operatives are captured in US – David Coleman Headley (Daood Gilani) and Tahawwur Hussain Rana – both of Pakistani origin. The role played by the duo, specially David in spotting 26/11 targets is well documented. The handler of Headley was none other than Ilyas Kashmiri.

Pont 2: 26/11 spotter and conspirator was handled by Ilyas Kashmiri.

Step back in time to India winter 1994: As reported in Indian Express- In late 1994, a milkman knocked on the door of a Ghaziabad house. As the door opened, he noticed men with guns inside, but he still delivered the milk. He then tipped off the police who raided the place and rescued several foreign hostages being held by a group of terrorists, seeking the release of some arrested militant leaders including Maulana Masood Azhar. Azhar had been arrested in February that year.

When the police reached there, the commander of the terrorist group that called itself Al-Hadid — essentially it was a Harkat-ul Ansar-Harkat-ul Jihad-al-Islami operation — had just stepped out with his trusted lieutenant Omar Saeed Sheikh. The police confronted them as they returned and, in the gunbattle that ensued, Sheikh was injured and arrested but the commander escaped. He was none other than Ilyas Kashmiri

Point 3: Sh Omar Saeed – the 9/11 conspirator who allegedly wired money to Md Atta too was handled by Ilyas Kashmiri.

Omar Saeed Sheikh was imprisoned in India for kidnapping Westerners. While there, he met Aftab Ansari, another prisoner, an Indian gangster who was released from prison near the end of 1999. Saeed also met another prisoner named Asif Raza Khan, who was also released in 1999.

On being released at the Kandahar hostage exchange, Omar lived with Jaish e Md before going to an ISI safe house in Pakistan where he moved around with impunity. That he traveled to UK twice and was not detained is also open to questions about the complicity of UK intelligence with Omar Sheikh. In Pakistan, Omar works with Ijaz Shah, a former ISI official in charge of handling two militant groups; Lt. Gen. Mohammed Aziz Khan, former deputy chief of the ISI in charge of relations with Jaish-e-Mohammed; and Brigadier Abdullah, a former ISI officer. He is well known to other senior ISI officers.

(What is the role of Aziz Khan and Brigadier Abdullah in 26/11? Is he (Brigadier Abdullah) the Brigadier sahab - Qasav mentions?? )

In 2002, French author Bernard-Henri Levy was presented evidence by government officials in New Delhi, India, on Saeed Sheikh making repeated calls to ISI Director Lt. Gen. Mahmood Ahmed during the summer of 2000. Later, Levy got unofficial confirmation from sources in Washington regarding these calls that the information he was given in India was correct. He noted that someone in the United Arab Emirates using a variety of aliases sends Mohamed Atta slightly over $100,000 between June and September of this year and the timing of these phone calls and the money transfers may have been the source of news reports that Mahmood Ahmed ordered Saeed Sheikh to send $100,000 to Mohamed Atta.

Now just recall the names of two prisoners who befriended Omar – they were Aftab Ansari and Asif Reza Khan. Both played a crucial role to finance the 9/11 attacks in the USA.

Amir Reza Khan, commander of the Asif Reza Commando Force (ARCF), a little known group which was involved in the 2002 attack on the US consulate in Kolkata, West Bengal. Reza, like Rahman, is today in Pakistan. Amir Reza is wanted for the Partho Roy Burman abduction case (July 2001) in which a part of the ransom money, $100,000, was wired to the 9/11 leader Mohammad Atta via Aftab Ansari and Syed Omar Sheikh. The role of the then ISI Chief, Lt. General Mahmud, was also exposed in facilitating the money transfer. Reza is also involved in creating Indian Mujahideen (IM), the new terrorist group which carried a series of attacks in India in 2008.

The role of Ilyas Kashmiri is somehow MISSING from the 9/11 planning – there is no way his footprints will be missing. If anything – he could very well have MASTERMINDED the 9/11 together with ISI. (NOTE : Before 9/11 Pakistan was a bankrupt nation and going down, and after 9/11 it was lavished with money and is being continued to be feted. In inner circles, Al-Qaeda is known as Al-Faeda - faeda in URDU means BENEFIT)

Point 4: Ilyas Kashmiri’s point man Omar Saeed was neck deep in financing the 9/11 as was the Pakistan intelligence wing the ISI. What is defeaning by its silence – is the role of Ilyas Kashmiri in 9/11. It is a matter of time before someone unearths the all important link.

Fast forward to present: As reported in Observer Group research DECODING THE HEADLEY RANA CASE : Within days of the Rana-Headley arrests, the Bangladesh security agencies arrested three LeT operatives from Dhaka--Mufti Harun Izahar, son of Islami Oikya Jote (IOJ) leader Mufti Izaharul Islam, Shahidul Islam and Al Amin alias Saiful. All three had regular conversations with David Headley, LeT chief Hafiz Saeed and LeT’s Bangladesh coordinator, Sheikh Abdur Rehman.

Harun, who also ran an Islamic kindergarten school in Chittagong, said Hafiz Saeed spoke to him on the mobile and asked him to target the US embassy in Dhaka. He said Saeed spoke to him in Arabic and gave him specific instructions on how to carry out the attack. Harun had recently visited Pakistan. For the attack, Harun and his associates got 600,000 takas from LeT’s chief financial officer, Indian-born Saudi national Mahmoud Mohammad Ahmed Bahaziq. Bahaziq, who recruited Dawood Ibrahim and Azzam Ghauri to LeT, is a close associate of Hafiz Saeed. Ghauri was one of the first LeT commanders in India, and a partner of Abdul Karim Tunda, who became the operational commander of the terrorist group in Bangladesh. Ghauri was killed in an encounter in 2000.

Following the arrest of Harun and his two aides, the Bangladesh police arrested three more LeT operatives subsequently. The police suspect that there were at least 20 more, both Bangladeshi and Indian nationals, who could be involved in the foiled terrorist plot. Some of them are from Kerala and other South Indian states and work primarily in the textile sector.

Harun and his aides were not an independent LeT cell but only part of a larger network which was being strengthened for quite sometime. The first inkling of such a network, incidentally, came when two key LeT leaders were arrested in Bangladesh in July this year--Maulana Mohammad Mansur Ali alias Maulana Habibullah and Mufti Sheikh Obaidullah. Ali is a Afghan Jihad veteran. Both worked closely with HuJI in Bangladesh, training several Indian and Bangladeshi nationals in weapons and explosives.

Two intriguing links can be found in the dossier which project the trans-national nature of LeT’s expansion in Asia for the past several years. One is that both Habibullah and Obaidullah were arrested on the basis of information provided by two aides of Dawood Ibrahim, Zahid Sheikh and Dawood Merchant, arrested in Dhaka earlier. Sheikh said there were about 150-paid D-company men in Bangladesh and their associates included former ministers, senior police officials and top businessmen. LeT operations in Bangladesh, incidentally, draw large funding from some top businessmen dealing in pharmaceuticals.

Both Habibullah and Obaidullah drew a month salary of 7000 takas from Sheikh Abdur Rahman, LeT’s commander for Bangladesh based in Pakistan. Rahman has since been arrested in Pakistan but strangely enough, there is no word on it in the Pakistan media. Rahman had also bankrolled Maulana Harun who was working with David Headley to carry out terrorist attacks. Hardly any detail about Rahman is known. There are two Abdur Rahmans in the LeT hierarchy--one is Mufti Abdur Rahman Hafiz, one of the teachers at Muridke, and another is Abdur Rahman Makki, in charge of LeT’s external affairs, and brother-in-law of Hafiz Saeed. Makki, a fierce proponent of suicide terrorism, has been in charge of organising LeT’s networks in Asia and Europe.

Point 5: The top LeT financier in Saudi, Bahaziq is known to be a Saudi intelligence proxy who has embedded himself in the LeT and this relationship is used by the CIA. And Dick Cheney used Dawood Ibrahim’s connection in Paskitan to lavish the Afghan mujahideen that were close to Cheney’s sphere of influence. This role of the US with LeT is (albeit an arm of US intelligence) is most intriguing as well as disturbing. As is the connection of British intelligence with Omar Sheikh.

The curious case of Musharraf and death threats to him and also Musharraf and Osama.

Musharraf was a blue eyed boy of Gen Zia ul Haq who Islamized the Pakistan army was single handedly destroyed democratic institutions in the country. He favoured Musharraf as he was aware of his religious zeal and his connections to the Deoband school of Islam. Musharraf, who was asked by Zia-ul-Haq to control the situation, brutally suppressed the Shia revolt with the help of Osama bin Laden and his Sunni tribal hordes brought in from the NWFP.


SOUTH ASIA ANALYSIS reports: In its issue of May,1990, "Herald", the monthly journal of the "Dawn" group of publications of Karachi, wrote as follows: " In May,1988, low-intensity political rivalry and sectarian tension ignited into full-scale carnage as thousands of armed tribesmen from outside Gilgit district invaded Gilgit along the Karakoram Highway. Nobody stopped them. They destroyed crops and houses, lynched and burnt people to death in the villages around Gilgit town. The number of dead and injured was put in the hundreds. But numbers alone tell nothing of the savagery of the invading hordes and the chilling impact it has left on these peaceful valleys."

Gen. Musharraf started a policy of bringing in Punjabis and Pakhtoons from outside and settling them down in Gilgit and Baltistan in order to reduce the Kashmiri Shias to a minority in their traditional land and this is continuing till today.

Point 6: Musharraf and Bin Laden jointly undertook military operations to ethnically cleanse the Shias in Gilgit.

Ilyas Kashmiri who beheaded an Indian soldier was gifted Pakistan Rs 100,000 for this deed by none other than President Musharraf. READ: BRIGADE 313

Point 7. Musharraf paid bounty to Ilyas Kashmiri.

Yet, somewhere along the way both Ilyas Kashmiri and his protégé Omar Sheikh wanted to kill Musharraf. The plan to kill Musharraf was foiled, ostensibly once when RAW tipped Musharraf off. The plot of kill Kiyani was shot down by Al – Qaeda high command much to the consternation of Ilyas Kashmiri.

But what takes the cake is this: Long war journal reports - From prison, Omar called Musharraf on his personal cell phone in mid-November and threatened his life. "I am after you, get ready to die," Omar reportedly told Musharraf. The plan was to ambush Musharraf's convoy as he traveled between Army House in Rawalpindi and his farm outside of Islamabad or to blow up a bridge as he traveled to the airport.

The report also points out interestingly: Omar also phoned retired Major General Faisal Alavi, the former commander of Pakistan's Special Service Group, just days before he was killed on Nov. 22.

Point 8: Both Ilyas Kashmiri and Omar Sheikh turned against Musharraf. Perhaps the storming of the Lal Masjid was the last straw - but no doubt Musharraf was neck deep in with Al Qaeda.

Bottom line : The connection between Pakistan Army, ISI, LeT, Al Qaeda is very fused. The Taliban are the special ops regiment of Pakistan Army against any (so called) misadventure by Indian Army. CIA is deeply engaged with ISI in the opium trade and powerful people in both these agencies are making serious money in this global economic meltdown. India is hedging its bets and finds itself sandwiched in the Great Game rapidly unfolding in the Central Asian Regions.

The CIA and ISI used Taliban and Al Qaeda extensively to counter Russia in both central Asia and even in Europe. Now that part of US has fallen out with Al - Qaeda does not mean that Pakistan has to cut its strategic roots with Al-Qaeda and even the Taliban. This has to be understood.

The US (non-rogue CIA elements) has created a counter terrorism cell within the ISI. This cell is completely segregated from the ISI top hierarchy and works in closest of co-ordination with FBI & CIA. Whenever Taliban or Al-Qaeda detainees are questioned, the ISI officers have headphones and an IP camera which beams the images and audio to the FBI / CIA stations and also simultaneous translations (if need be). The questions of FBI / CIA authorities are simultaneously aired through the headphones of the local ISI interrogator. Such is the co-ordination that several top rung ISI officers and Army officials have deep reservations - and bang, comes the attack on ISI offices in Peshawar.

Musharraf is cooling his heels in UK – the same country that headquarters the Islamic Caliphate war mongers – Hizbut tahrir. In an earlier article showcasing the British role in promoting Islamic groups in its soil I wrote: "I have been saying it ad nauseum that Hizb ut Tahrir is a UK run agency – much like Dobermann Pinschers on a leash kept in an idyllic British countryside castle, about to be unleashed by their UK masters as and when deemed necessary. " READ: HIZB-UT TAHRIR PLOTS BLOODLESS COUP IN PAKISTAN - THE LARGER PICTURE AND THE BRITISH ROLE.

The story gets murkier when one reads that UK smuggled opium out of China to make money, probably the same is being done by CIA in collusion with ISI and Dawood Ibrahim in Afghanistan. (READ: UK WAS THE BIGGEST DRUG RUNNER IN 19TH CENTURY)

That the biggest druglord in Afghanistan happens to be Hamid Karzai’s brother and is a CIA asset is a story known to all, but recently broken in mainstream New York Times too. (READ: BROTHER OF AFGHAN LEADER SAID TO BE PAID BY CIA)

The Indian Intelligence will tell you – they know it all. Great. So, what do you do with the knowledge – where is the action? A person like Headley can come in India, set up business, lay undetected for years, run the 26/11 ops out of Pakistan and then safely fly into his nest in Chicago.

If Indian intelligence had balls – I would have seen three incidents –

1) Omar Skeikh killed in UK when he visited his parents after the Kandahar hijack,
2) Dawood Ibrahim along with its inmates blown to smithereens in an apparent truck bombing – "supposedly" done by a rival gang in Karachi. and
3) Flooding Pakistan with fake Paksitani currency

And isn’t it intriguing that Indian intelligence officers had to turn their tails and return empty handed from the US – not even being given a peek at Headley and Rana? Guess, the US is using its old tricks to arm twist Pakistan to deliver more and keeping Indians off the duo is part of the bargain. However, this is just a short term solution. India will probably get to voice match Headley as one of the 26/11 voices from Pakistan.

Sunday, November 15, 2009


This is Kolkata where the police close down a police station out of fear. Spineless policing at its best.

The issue: The area happens to be Muslim dominated (now why is this no longer a surprise??). The police, in connivance with Corporation officials and politicians belonging to all (repeat all) political parties engaged in illegal construction in the area.

The decision to shut the gate was taken after Congress supporters laid siege to the police station to protest the crackdown on illegal constructions in the area. Forward Bloc and CPM supporters had raided the police station a week before that on the same issue.

The area is notorious for smuggling and there is a Fancy Market in this area that sells smuggled goods. And not surprisingly, almost all the sellers are Muslims !

But why is the police station closed and why are the police afraid to venture out? How will they protect the normal citizens if they themselves are afraid of the goons?

The issue is that due to diktat of courts the police had to take action against illegal construction in the area. Now, in the first place the police took money from the said people for helping them illegally construct – naturally political goons belonging to all the parties came and threatened the police. Incidentally all the political goons too were Muslims – again not a surprise. However, let me state one thing here – I am not blaming the Muslims here per se, but all the political parties.

If you sup with the devil, and expect the police to help us in times of need – well we will be in for a nasty surprise.

Instead of shutting the police station and hiding like cowards, the cops should go out and arrest these criminals-turned-promoters who enjoy the backing of political parties. Otherwise, how will we have confidence in them?” asked a teacher who lives in the locality.

Gora Chand Mondal, the director-general of buildings in the Calcutta Municipal Corporation, admitted that Ekbalpore was the hub of illegal construction. “Builders and land-owners seldom seek the CMC’s permission before starting work. Most of the buildings in the area are illegal.”

Local Forward Bloc leader Rehan Khan, one of those who had led the mob that gheraoed (encircle) Ekbalpore police station on November 1, blamed the cops for the spurt in illegal construction. “The police and corporation officials allowed illegal constructions in the first place. They earned their share of bribes by doing that and are now out to render people homeless,” he alleged.

Police commissioner Gautam Mohan Chakrabarti had transferred the former officer-in-charge of the police station and his deputy two months ago on the basis of complaints that they were allowing illegal constructions in the area.

Helplessness of the Police:

A senior officer of the Ekbalpore police station — comprising 68 constables, 26 homeguards, a sergeant, 23 assistant sub-inspectors, 11 sub-inspectors and two inspectors — described the builders’ lobby behind the recent incidents as “local versions of the Maoists”.

The mob that assembled here last Sunday demanded that we allow illegal construction in the area. They tried to force their way in and threatened to lock us up,” he said.

You don’t have to fear the ISI or Chinese or even the Maoists to destabilize India. You just have to look at our own low class Madhu Koda type politicians, corrupt nexus between the political parties, businessmen and police to wreck the fabric of this nation.

And before moving over from here, take another hard look at the closed doors of the police station – the sentinels of our city that are supposed to save us. Over 90% of the police force have out dated guns that don’t even fire and most of them have not had target practice in years.

Lest we forget: An honest and upright police officer DC (port) Mr Vinod Mehta was brutally trapped and murdered in this very area 21 years ago for taking on goons in this area and trying to disrupt their smuggling and anti-national activities. A man Idris Mian was captured who died in police custody but another key accused Moshin remained elusive for a long time.

Mohsin, a key accused in the murder of Deputy Commissioner (Port) of Kolkata police Vinod Mehta and a constable Mokhtar Ali in Metiabruz 21 years ago, revealed during interrogation that with help of ISI, he had in the past shuttled between India and Pakistan despite not possessing any travel document.


I am betting my bottom rupee – any teenager with a mock AK-47 can walk inside any of our police stations in India and see the police take cover that will make Indians proud in 100 meters dash !!! And you are wondering if 26/11 has taught us anything???

Monday, November 9, 2009


Seymour Hersh is a Pulitzer winning investigative journalist whose articles are books are taken very seriously by the intelligence as well security establishments across the world.

His article which appeared in The New Yorker today is certain to cause a flutter within the Pakistan Army. His article which I am presenting in details is aptly titled : DEFENDING THE ARSENAL - In an unstable Pakistan, can nuclear warheads be kept safe?


In the tumultuous days leading up to the Pakistan Army’s ground offensive in the tribal area of South Waziristan, which began on October 17th, the Pakistani Taliban attacked what should have been some of the country’s best-guarded targets. In the most brazen strike, ten gunmen penetrated the Army’s main headquarters, in Rawalpindi, instigating a twenty-two-hour standoff that left twenty-three dead and the military thoroughly embarrassed. The terrorists had been dressed in Army uniforms. There were also attacks on police installations in Peshawar and Lahore, and, once the offensive began, an Army general was shot dead by gunmen on motorcycles on the streets of Islamabad, the capital. The assassins clearly had advance knowledge of the general’s route, indicating that they had contacts and allies inside the security forces.

Pakistan has been a nuclear power for two decades, and has an estimated eighty to a hundred warheads, scattered in facilities around the country. The success of the latest attacks raised an obvious question: Are the bombs safe? Asked this question the day after the Rawalpindi raid, Secretary of State Hillary Clinton said, “We have confidence in the Pakistani government and the military’s control over nuclear weapons.” Clinton—whose own visit to Pakistan, two weeks later, would be disrupted by more terrorist bombs—added that, despite the attacks by the Taliban, “we see no evidence that they are going to take over the state.”

Clinton’s words sounded reassuring, and several current and former officials also said in interviews that the Pakistan Army was in full control of the nuclear arsenal. But the Taliban overrunning Islamabad is not the only, or even the greatest, concern. The principal fear is mutiny—that extremists inside the Pakistani military might stage a coup, take control of some nuclear assets, or even divert a warhead.

On April 29th, President Obama was asked at a news conference whether he could reassure the American people that Pakistan’s nuclear arsenal could be kept away from terrorists. Obama’s answer remains the clearest delineation of the Administration’s public posture. He was, he said, “gravely concerned” about the fragility of the civilian government of President Asif Ali Zardari. “Their biggest threat right now comes internally,” Obama said. “We have huge . . . national-security interests in making sure that Pakistan is stable and that you don’t end up having a nuclear-armed militant state.” The United States, he said, could “make sure that Pakistan’s nuclear arsenal is secure—primarily, initially, because the Pakistan Army, I think, recognizes the hazards of those weapons’ falling into the wrong hands.”

The questioner, Chuck Todd, of NBC, began asking whether the American military could, if necessary, move in and secure Pakistan’s bombs. Obama did not let Todd finish. “I’m not going to engage in hypotheticals of that sort,” he said. “I feel confident that the nuclear arsenal will remain out of militant hands. O.K.?”

Obama did not say so, but current and former officials said in interviews in Washington and Pakistan that his Administration has been negotiating highly sensitive understandings with the Pakistani military. These would allow specially trained American units to provide added security for the Pakistani arsenal in case of a crisis. At the same time, the Pakistani military would be given money to equip and train Pakistani soldiers and to improve their housing and facilities—goals that General Ashfaq Parvez Kayani, the chief of the Pakistan Army, has long desired. In June, Congress approved a four-hundred-million-dollar request for what the Administration called the Pakistan Counterinsurgency Capability Fund, providing immediate assistance to the Pakistan Army for equipment, training, and “renovation and construction.”

The secrecy surrounding the understandings was important because there is growing antipathy toward America in Pakistan, as well as a history of distrust. Many Pakistanis believe that America’s true goal is not to keep their weapons safe but to diminish or destroy the Pakistani nuclear complex. The arsenal is a source of great pride among Pakistanis, who view the weapons as symbols of their nation’s status and as an essential deterrent against an attack by India. (India’s first nuclear test took place in 1974, Pakistan’s in 1998.)

A senior Pakistani official who has close ties to Zardari exploded with anger during an interview when the subject turned to the American demands for more information about the arsenal. After the September 11th attacks, he said, there had been an understanding between the Bush Administration and then President Pervez Musharraf “over what Pakistan had and did not have.” Today, he said, “you’d like control of our day-to-day deployment. But why should we give it to you? Even if there was a military coup d’état in Pakistan, no one is going to give up total control of our nuclear weapons. Never. Why are you not afraid of India’s nuclear weapons?” the official asked. “Because India is your friend, and the longtime policies of America and India converge. Between you and the Indians, you will fuck us in every way. The truth is that our weapons are less of a problem for the Obama Administration than finding a respectable way out of Afghanistan.”

The ongoing consultation on nuclear security between Washington and Islamabad intensified after the announcement in March of President Obama’s so-called Af-Pak policy, which called upon the Pakistan Army to take more aggressive action against Taliban enclaves inside Pakistan. I was told that the understandings on nuclear cooperation benefitted from the increasingly close relationship between Admiral Michael Mullen, the chairman of the Joint Chiefs of Staff, and General Kayani, his counterpart, although the C.I.A. and the Departments of Defense, State, and Energy have also been involved. (All three departments declined to comment for this article. The national-security council and the C.I.A. denied that there were any agreements in place.)

In response to a series of questions, Admiral Mullen acknowledged that he and Kayani were, in his spokesman’s words, “very close.” The spokesman said that Mullen is deeply involved in day-to-day Pakistani developments and “is almost an action officer for all things Pakistan.” But he denied that he and Kayani, or their staffs, had reached an understanding about the availability of American forces in case of mutiny or a terrorist threat to a nuclear facility. “To my knowledge, we have no military units, special forces or otherwise, involved in such an assignment,” Mullen said through his spokesman. The spokesman added that Mullen had not seen any evidence of growing fundamentalism inside the Pakistani military. In a news conference on May 4th, however, Mullen responded to a query about growing radicalism in Pakistan by saying that “what has clearly happened over the [past] twelve months is the continual decline, gradual decline, in security.” The Admiral also spoke openly about the increased cooperation on nuclear security between the United States and Pakistan: “I know what we’ve done over the last three years, specifically to both invest, assist, and I’ve watched them improve their security fairly dramatically. . . . I’ve looked at this, you know, as hard as I can, over a period of time.” Seventeen days later, he told the Senate Foreign Relations Committee, “We have invested a significant amount of resources through the Department of Energy in the last several years” to help Pakistan improve the controls on its arsenal. “They still have to improve them,” he said.

In interviews in Pakistan, I obtained confirmation that there were continuing conversations with the United States on nuclear-security plans—as well as evidence that the Pakistani leadership put much less weight on them than the Americans did. In some cases, Pakistani officials spoke of the talks principally as a means of placating anxious American politicians. “You needed it,” a senior Pakistani official, who said that he had been briefed on the nuclear issue, told me. His tone was caustic. “We have twenty thousand people working in the nuclear-weapons industry in Pakistan, and here is this American view that Pakistan is bound to fail.” The official added, “The Americans are saying, ‘We want to help protect your weapons.’ We say, ‘Fine. Tell us what you can do for us.’ It’s part of a quid pro quo. You say, also, ‘Come clean on the nuclear program and we’ll insure that India doesn’t put pressure on it.’ So we say, ‘O.K.’ ”

But, the Pakistani official said, “both sides are lying to each other.” The information that the Pakistanis handed over was not as complete as the Americans believed. “We haven’t told you anything that you don’t know,” he said. The Americans didn’t realize that Pakistan would never cede control of its arsenal: “If you try to take the weapons away, you will fail.”

High-level cooperation between Islamabad and Washington on the Pakistani nuclear arsenal began at least eight years ago. Former President Musharraf, when I interviewed him in London recently, acknowledged that his government had held extensive discussions with the Bush Administration after the September 11th attacks, and had given State Department nonproliferation experts insight into the command and control of the Pakistani arsenal and its on-site safety and security procedures. Musharraf also confirmed that Pakistan had constructed a huge tunnel system for the transport and storage of nuclear weaponry. “The tunnels are so deep that a nuclear attack will not touch them,” Musharraf told me, with obvious pride. The tunnels would make it impossible for the American intelligence community—“Big Uncle,” as a Pakistani nuclear-weapons expert called it—to monitor the movements of nuclear components by satellite.

Safeguards have been built into the system. Pakistani nuclear doctrine calls for the warheads (containing an enriched radioactive core) and their triggers (sophisticated devices containing highly explosive lenses, detonators, and krytrons) to be stored separately from each other and from their delivery devices (missiles or aircraft). The goal is to insure that no one can launch a warhead—in the heat of a showdown with India, for example—without pausing to put it together. Final authority to order a nuclear strike requires consensus within Pakistan’s ten-member National Command Authority, with the chairman—by statute, President Zardari—casting the deciding vote.

But the safeguards meant to keep a confrontation with India from escalating too quickly could make the arsenal more vulnerable to terrorists. Nuclear-security experts have war-gamed the process and concluded that the triggers and other elements are most exposed when they are being moved and reassembled—at those moments there would be fewer barriers between an outside group and the bomb. A consultant to the intelligence community said that in one war-gamed scenario disaffected members of the Pakistani military could instigate a terrorist attack inside India, and that the ensuing crisis would give them “a chance to pick up bombs and triggers—in the name of protecting the assets from extremists.”

The triggers are a key element in American contingency plans. An American former senior intelligence official said that a team that has trained for years to remove or dismantle parts of the Pakistani arsenal has now been augmented by a unit of the Joint Special Operations Command (JSOC), the élite counterterrorism group. He added that the unit, which had earlier focussed on the warheads’ cores, has begun to concentrate on evacuating the triggers, which have no radioactive material and are thus much easier to handle.

“The Pakistanis gave us a virtual look at the number of warheads, some of their locations, and their command-and-control system,” the former senior intelligence official told me. “We saw their target list and their mobilization plans. We got their security plans, so we could augment them in case of a breach of security,” he said. “We’re there to help the Pakistanis, but we’re also there to extend our own axis of security to their nuclear stockpile.” The detailed American planning even includes an estimate of how many nuclear triggers could be placed inside a C-17 cargo plane, the former official said, and where the triggers could be sequestered. Admiral Mullen, asked about increased American insight into the arsenal, said, through his spokesman, “I am not aware of our receipt of any such information.” (A senior military officer added that the information, if it had been conveyed, would most likely “have gone to another government agency.”)

A spokesman for the Pakistani military said, in an official denial, “Pakistan neither needs any American unit for enhancing the security for its arsenal nor would accept it.” The spokesman added that the Pakistani military “has been providing protection to U.S. troops in a situation of crisis”—a reference to Pakistan’s role in the war on terror—“and hence is quite capable to deal with any untoward situation.”

Early this summer, a consultant to the Department of Defense said, a highly classified military and civil-emergency response team was put on alert after receiving an urgent report from American intelligence officials indicating that a Pakistani nuclear component had gone astray. The team, which operates clandestinely and includes terrorism and nonproliferation experts from the intelligence community, the Pentagon, the F.B.I., and the D.O.E., is under standing orders to deploy from Andrews Air Force Base, in Maryland, within four hours of an alert. When the report turned out to be a false alarm, the mission was aborted, the consultant said. By the time the team got the message, it was already in Dubai.

In an actual crisis, would the Pakistanis give an American team direct access to their arsenal? An adviser to the Pentagon on counterinsurgency said that some analysts suspected that the Pakistani military had taken steps to move elements of the nuclear arsenal “out of the count”—to shift them to a storage facility known only to a very few—as a hedge against mutiny or an American or Indian effort to seize them. “If you thought your American ally was telling your enemy where the weapons were, you’d do the same thing,” the adviser said.

Let me say this about our nuclear deterrent,” President Zardari told me, when asked about any recent understandings between Pakistan and the United States. “We give comfort to each other, and the comfort level is good, because everybody respects everybody’s integrity. We’re all big boys.”

Zardari and I met twice, first in his office, in the grand but isolated Presidential compound in Islamabad, and then, a few days later, alone over dinner in his personal quarters. Zardari, who became President after the assassination, in December, 2007, of his charismatic wife, former Prime Minister Benazir Bhutto, spent nearly eleven years in jail on corruption charges. He is widely known in Pakistan as Mr. Ten Per Cent, a reference to the commissions he allegedly took on government contracts when Bhutto was in power, and is seen by many Pakistanis as little more than a crook who has grown too close to America; his approval ratings are in the teens. He is chatty but guarded, proud but defensive, and, like many Pakistanis, convinced that the United States will always favor India. Over dinner, he spoke of his suspicions regarding his wife’s death. He said that, despite rumors to the contrary, he would complete his five-year term.

Zardari spoke with derision about what he depicted as America’s obsession with the vulnerability of his nation’s nuclear arsenal. “In your country, you feel that you have to hold the fort for us,” he said. “The American people want a lot of answers for the errors of the past, and it’s very easy to spread fear. Our Army officers are not crazy, like the Taliban. They’re British-trained. Why would they slip up on nuclear security? A mutiny would never happen in Pakistan. It’s a fear being spread by the few who seek to scare the many.”

Zardari offered some advice to Barack Obama: instead of fretting about nuclear security in Pakistan, his Administration should deal with the military disparity between Pakistan and India, which has a much larger army. “You should help us get conventional weapons,” he said. “It’s a balance-of-power issue.”

In May, Zardari, at the urging of the United States, approved a major offensive against the Taliban, sending thirty thousand troops into the Swat Valley, which lies a hundred miles northwest of Islamabad. “The enemy that we were fighting in Swat was made up of twenty per cent thieves and thugs and eighty per cent with the same mind-set as the Taliban,” Zardari said. He depicted the operation as a complete success, but added that his government was not “ready” to kill all the Taliban. His long-term solution, Zardari said, was to provide new business opportunities in Swat and turn the Taliban into entrepreneurs. “Money is the best incentive,” he said. “They can be rented.”

Zardari’s view of the Swat offensive was striking, given that many Pakistanis had been angered by the excessive use of force and the ensuing refugee crisis. The lives of about two million people were torn apart, and, during a summer in which temperatures soared to a hundred and twenty degrees, hundreds of thousands of civilians were crowded into government-run tent cities. Idris Khattak, a former student radical who now works with Amnesty International, said in Peshawar that residents had described nights of heavy, indiscriminate bombing and shelling, followed in the morning by Army sweeps. The villagers, and not the Taliban, had been hit the hardest. “People told us that the bombing the night before was a signal for the Taliban to get out,” he said.

Zardari did not dispute that there were difficulties in the refugee camps—the heat, the lack of facilities. But he insisted that the fault lay with the civilians, who, he said, had been far too tolerant of the Taliban. The suffering could serve a useful purpose: after a summer in the tents, the citizens of Swat might have learned a lesson and would not “let the Taliban back into their cities.”

Rahimullah Yusufzai, an eminent Pakistani journalist, who has twice interviewed Osama bin Laden, had a different explanation for the conditions that led to the offensive. “The Taliban were initially trying to win public support in Swat by delivering justice and peace,” Yusufzai said. “But when they got into power they went crazy and became brutal. Many are from the lowest ranks of society, and they began killing and terrorizing their opponents. The people were afraid.”

The turmoil did not end with the Army’s invasion. “Most of the people who were in the refugee camps told us that the Army was equally bad. There was so much killing,” Yusufzai said. The government had placed limits on reporters who tried to enter the Swat Valley during the attack, but afterward Yusufzai and his colleagues were able to interview officers. “They told us they hated what they were doing—‘We were trained to fight Indians.’ ” But that changed when they sustained heavy losses, especially of junior officers. “They were killing everybody after their colleagues were killed—just like the Americans with their Predator missiles,” Yusufzai said. “What the Army did not understand, and what the Americans don’t understand, is that by demolishing the house of a suspected Taliban or their supporters you are making an enemy of the whole family.” What looked like a tactical victory could turn out to be a strategic failure.

The Obama Administration has had difficulty coming to terms with how unhappy many Pakistanis are with the United States. Secretary of State Clinton, during her three-day “good-will visit” to Pakistan, late last month, seemed taken aback by the angry and, at times, provocative criticism of American policies that dominated many of her public appearances, and responded defensively.

Last year, the Washington Times ran an article about the Pressler Amendment, a 1985 law cutting off most military aid to Pakistan as long as it continued its nuclear program. The measure didn’t stop Pakistan from getting the bomb, or from buying certain weapons, but it did reduce the number of Pakistani officers who were permitted to train with American units. The article quoted Major General John Custer as saying, “The older military leaders love us. They understand American culture and they know we are not the enemy.” The General’s assessment provoked a barrage of e-mail among American officers with experience in Pakistan, and a former member of a Special Forces unit provided me with copies. “The fact that a two-star would make a statement [like] that . . . is at best naïve and actually pure bullshit,” a senior Special Forces officer on duty in Pakistan wrote.

He went on: I have met and interacted with the entire military staff from General Kayani on down and all the general officers on their joint staff and in all the services, and I haven’t spoken to one that “loves us”—whatever that means. In fact, I have read most of the TS [top secret] assessments of all their General Officers and I haven’t read one that comes close to their “loving” us. They play us for everything they can get, and we trip over ourselves trying to give them everything they ask for, and cannot pay for.

Some military men who know Pakistan well believe that, whatever the officer corps’s personal views, the Pakistan Army remains reliable. “They cannot be described as pro-American, but this doesn’t mean they don’t know which side their bread is buttered on,” Brian Cloughley, who served six years as Australia’s defense attaché to Pakistan and is now a contributor to Jane’s Sentinel, told me. “The chance of mutiny is slim. Were this to happen, there would be the most severe reaction” by special security units in the Pakistani military, Cloughley said. “But worry feeds irrationality, and the international consequences could be dire.”

The recollections of Bush Administration officials who dealt with Pakistan in the first round of nuclear consultations after September 11th do not inspire confidence. The Americans’ main contact was Lieutenant General Khalid Kidwai, the head of Pakistan’s Strategic Plans Division, the agency that is responsible for nuclear strategy and operations and for the physical security of the weapons complex. At first, a former high-level Bush Administration official told me, Kidwai was reassuring; his professionalism increased their faith in the soundness of Pakistan’s nuclear doctrine and its fail-safe procedures. The Army was controlled by Punjabis who, the Americans thought, “did not put up with Pashtuns,” as the former Bush Administration official put it. (The Taliban are mostly Pashtun.) But by the time the official left, at the beginning of George W. Bush’s second term, he had a much darker assessment: “They don’t trust us and they will not tell you the truth.”

No American, for example, was permitted access to A. Q. Khan, the metallurgist and so-called father of the Pakistani atomic bomb, who traded crucial nuclear-weapons components on the international black market. Musharraf placed him under house arrest in early 2004, claiming to have been shocked to learn of Khan’s dealings. At the time, it was widely understood that those activities had been sanctioned by Pakistan’s Inter-Services Intelligence (I.S.I.). Khan was freed in February, although there are restrictions on his travel. (In an interview last year, Kidwai told David Sanger, for his book “The Inheritance,” that “our security systems are foolproof,” thanks to technical controls; Sanger noted that Bush Administration officials were “not as confident in private as they sound in public.”)

A former State Department official who worked on nuclear issues with Pakistan after September 11th said that he’d come to understand that the Pakistanis “believe that any information we get from them would be shared with others—perhaps even the Indians. To know the command-and-control processes of their nuclear weapons is one thing. To know where the weapons actually are is another thing.”

The former State Department official cited the large Pakistan Air Force base outside Sargodha, west of Lahore, where many of Pakistan’s nuclear-capable F-16s are thought to be stationed. “Is there a nuke ready to go at Sargodha?” the former official asked. “If there is, and Sargodha is the size of Andrews Air Force Base, would we know where to go? Are the warheads stored in Bunker X?” Ignorance could be dangerous. “If our people don’t know where to go and we suddenly show up at a base, there will be a lot of people shooting at them,” he said. “And even if the Pakistanis may have told us that the triggers will be at Bunker X, is it true?”

In the July/August issue of Arms Control Today, Rolf Mowatt-Larssen, who recently retired after three years as the Department of Energy’s director of intelligence and counter-intelligence, preceded by two decades at the C.I.A., wrote vividly about the “lethal proximity between terrorists, extremists, and nuclear weapons insiders” in Pakistan. “Insiders have facilitated terrorist attacks. Suicide bombings have occurred at air force bases that reportedly serve as nuclear weapons storage sites. It is difficult to ignore such trends,” Mowatt-Larssen wrote. “Purely in actuarial terms, there is a strong possibility that bad apples in the nuclear establishment are willing to cooperate with outsiders for personal gain or out of sympathy for their cause. Nowhere in the world is this threat greater than in Pakistan. . . . Anything that helps upgrade Pakistan’s nuclear security is an investment” in America’s security.

Leslie H. Gelb, a president emeritus of the Council on Foreign Relations, said, “I don’t think there’s any kind of an agreement we can count on. The Pakistanis have learned how to deal with us, and they understand that if they don’t tell us what we want to hear we’ll cut off their goodies.” Gelb added, “In all these years, the C.I.A. never built up assets, but it talks as if there were ‘access.’ I don’t know if Obama understands that the Agency doesn’t know what it’s talking about.”

The former high-level Bush Administration official was just as blunt. “If a Pakistani general is talking to you about nuclear issues, and his lips are moving, he’s lying,” he said. “The Pakistanis wouldn’t share their secrets with anybody, and certainly not with a country that, from their point of view, used them like a Dixie cup and then threw them away.”

Sultan Amir Tarar, known to many as Colonel Imam, is the archetype of the disillusioned Pakistani officer. Tarar spent eighteen years with the I.S.I. in Afghanistan, most of them as an undercover operative. In the mujahideen war against the Soviet Union, in the eighties, he worked closely with C.I.A. agents, and liked the experience. “They were honest and thoughtful and provided the finest equipment,” Tarar said during an interview in Rawalpindi. He spoke with pride of shaking hands with Robert Gates in Afghanistan in 1985. Gates, now the Secretary of Defense, was then a senior C.I.A. official. “I’ve heard all about you,” Gates said, according to Tarar. “Good or bad?” “Oh, my. All good,” Gates replied. Tarar’s view changed after the Russians withdrew and, in his opinion, “the Americans abandoned us.” When I asked if he’d seen “Charlie Wilson’s War,” the movie depicting that abandonment and a Texas congressman’s futile efforts to change the policy, Tarar laughed and said, “I’ve seen Charlie Wilson. I didn’t need to see the movie.”

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Tarar, who retired in 1995 and has a son in the Army, believed—as did many Pakistani military men—that the American campaign to draw Pakistan deeper into the war against the Taliban would backfire. “The Americans are trying to rent out their war to us,” he said. If the Obama Administration persists, “there will be an uprising here, and this corrupt government will collapse. Every Pakistani will then be his own nuclear bomb—a suicide bomber,” Tarar said. “The longer the war goes on, the longer it will spill over in the tribal territories, and it will lead to a revolutionary stage. People there will flee to the big cities like Lahore and Islamabad.

Tarar believed that the Obama Administration had to negotiate with the Afghan Taliban, even if that meant direct talks with Mullah Omar, the Taliban leader. Tarar knew Mullah Omar well. “Omar trained as a young man in my camp in 1985,” he told me. “He was physically fit and mission-oriented—a very honest man who was a practicing Muslim. Nothing beyond that. He was a Talib—a student, and not a mullah. But people respected him. Today, among all the Afghan leaders, Omar has the biggest audience, and this is the right time for you to talk to him.”

Speaking to Tarar and other officers gave a glimpse of the acrimony at the top of the Pakistani government, which has complicated the nuclear equation. Tarar spoke bitterly about the position that General Kayani found himself in, carrying out the “corrupt” policies of the Americans and of Zardari, while Pakistan’s soldiers “were fighting gallantly in Swat against their own people.”

A $7.5-billion American aid package, approved by Congress in September, was, to the surprise of many in Washington, controversial in Pakistan, because it contained provisions seen as strengthening Zardari at the expense of the military. Shaheen Sehbai, a senior editor of the newspaper International, said that Zardari’s “problem is that he’s besieged domestically on all sides, and he thinks only the Americans can save him,” and, as a result, “he’ll open his pants for them.” Sehbai noted that Kayani’s term as Army chief ends in the fall of 2010. If Zardari tried to replace him before then, Kayani’s colleagues would not accept his choice, and there could be “a generals’ coup,” Sehbai said. “America should worry more about the structure and organization of the Army—and keep it intact.”

Lieutenant General Hamid Gul was the director general of the I.S.I. in the late eighties and worked with the C.I.A. in Afghanistan. Gul, who is retired, is a devout Muslim and had been accused by the Bush Administration of having ties to the Taliban and Al Qaeda—allegations he has denied. “What would happen if, in a crisis, you tried to get—or did not get—our nuclear triggers? What happens then?” Gul asked when we met. “You will have us as an enemy, with the Chinese and Russians behind us.”

If Pakistani officers had given any assurances about the nuclear arsenal, Gul said, “they are cheating you and they would be right to do so. We should not be aiding and abetting Americans.”

Persuading the Pakistan Army to concentrate on fighting the Taliban, and not India, is crucial to the Obama Administration’s plans for the region. There has been enmity between India and Pakistan since 1947, when Britain’s withdrawal led to the partition of the subcontinent. The state of Kashmir, which was three-quarters Muslim but acceded to Hindu-majority India, has been in dispute ever since, and India and Pakistan have twice gone to war over the territory. Through the years, the Pakistan Army and the I.S.I. have relied on Pakistan-based jihadist groups, most notably Lashkar-e-Taiba and Jaish-e-Mohammed, to carry out a guerrilla war against the Indians in Kashmir. Many in the Pakistani military consider the groups to be an important strategic reserve.

A retired senior Pakistani intelligence officer, who worked with his C.I.A. counterparts to track down Khalid Sheikh Mohammed, said that he was deeply troubled by the prospect of Pakistan ceding any control over its nuclear deterrent. “Suppose the jihadis strike at India again—another attack on the parliament. India will tell the United States to stay out of it, and ‘We’ll sort it out on our own,’ ” he said. “Then there would be a ground attack into Pakistan. As we begin to react, the Americans will be interested in protecting our nuclear assets, and urge us not to go nuclear—‘Let the Indians attack and do not respond!’ They would urge us instead to find those responsible for the attack on India. Our nuclear arsenal was supposed to be our savior, but we would end up protecting it. It doesn’t protect us,” he said.

“My belief today is that it’s better to have the Americans as an enemy rather than as a friend, because you cannot be trusted,” the former officer concluded. “The only good thing the United States did for us was to look the other way about an atomic bomb when it suited the United States to do so.”

Pakistan’s fears about the United States cooperating with India are not irrational. Last year, Congress approved a controversial agreement that enabled India to purchase nuclear fuel and technology from the United States without joining the Non-Proliferation Treaty, making India the only non-signatory to the N.P.T. permitted to do so. Concern about the Pakistani arsenal has since led to greater cooperation between the United States and India in missile defense; the training of the Indian Air Force to use bunker-busting bombs; and “the collection of intelligence on the Pakistani nuclear arsenal,” according to the consultant to the intelligence community. (The Pentagon declined to comment.)

I flew to New Delhi after my stay in Pakistan and met with two senior officials from the Research and Analysis Wing, India’s national intelligence agency. (Of course, as in Pakistan, no allegation about the other side should be taken at face value.) “Our worries are about the nuclear weapons in Pakistan,” one of the officials said. “Not because we are worried about the mullahs taking over the country; we’re worried about those senior officers in the Pakistan Army who are Caliphates”—believers in a fundamentalist pan-Islamic state. “We know some of them and we have names,” he said. “We’ve been watching colonels who are now brigadiers. These are the guys who could blackmail the whole world”—that is, by seizing a nuclear weapon.

The Indian intelligence official went on, “Do we know if the Americans have that intelligence? This is not in the scheme of the way you Americans look at things—‘Kayani is a great guy! Let’s have a drink and smoke a cigar with him and his buddies.’ Some of the men we are watching have notions of leading an Islamic army.”


In an interview the next afternoon, an Indian official who has dealt diplomatically with Pakistan for years said, “Pakistan is in trouble, and it’s worrisome to us because an unstable Pakistan is the worst thing we can have.” But he wasn’t sure what America could do. “They like us better in Pakistan than you Americans,” he said. “I can tell you that in a public-opinion poll we, India, will beat you.”

India and Pakistan, he added, have had back-channel talks for years in an effort to resolve the dispute over Kashmir, but “Pakistan wants talks for the sake of talks, and it does not carry out the agreements already reached.” (In late October, Manmohan Singh, the Indian Prime Minister, publicly renewed an offer of talks, but tied it to a request that Pakistan crack down on terrorism; Pakistan’s official response was to welcome the overture.)

The Indian official, like his counterparts in Pakistan, believed that Americans did not appreciate what his government had done for them. “Why did the Pakistanis remove two divisions from the border with us?” He was referring to the shifting of Pakistani forces, at the request of the United States, to better engage the Taliban. “It means they have confidence that we will not take advantage of the situation. We deserve a pat on the back for this.” Instead, the official said, with a shrug, “you are too concerned with your relationship with Pakistan.”

Pervez Musharraf lives in unpretentious exile with his wife in an apartment in London, near Hyde Park. Officials who had dealt with him cautioned that, along with his many faults, he had a disarmingly open manner. At the beginning of our talk, I asked him why, on a visit to Washington in late January, he had not met with any senior Obama Administration officials. “I did not ask for a meeting because I was afraid of being told no,” he said. At another point, Musharraf, dressed casually in slacks and a sports shirt, said that he had been troubled by the American-controlled Predator drone attacks on targets inside Pakistan, which began in 2005. “I said to the Americans, ‘Give us the Predators.’ It was refused. I told the Americans, ‘Then just say publicly that you’re giving them to us. You keep on firing them but put Pakistan Air Force markings on them.’ That, too, was denied.”

Musharraf, who was forced out of office in August, 2008, under threat of impeachment, did not spare his successor. “Asif Zardari is a criminal and a fraud,” Musharraf told me. “He’ll do anything to save himself. He’s not a patriot and he’s got no love for Pakistan. He’s a third-rater.”

Musharraf said that he and General Kayani, who had been his nominee for Chief of Army Staff, were still in telephone contact. Musharraf came to power in a military coup in 1999, and remained in uniform until near the end of his Presidency. He said that he didn’t think the Army was capable of mutiny—not the Army he knew. “There are people with fundamentalist ideas in the Army, but I don’t think there is any possibility of these people getting organized and doing an uprising. These ‘fundos’ were disliked and not popular.”

He added, “Muslims think highly of Obama, and he should use his acceptability—even with the Taliban—and try to deal with them politically.”

Musharraf spoke of two prior attempts to create a fundamentalist uprising in the Army. In both cases, he said, the officers involved were arrested and prosecuted. “I created the strategic force that controls all the strategic assets—eighteen to twenty thousand strong. They are monitored for character and for potential fundamentalism,” he said. He acknowledged, however, that things had changed since he’d left office. “People have become alarmed because of the Taliban and what they have done,” he said. “Everyone is now alarmed.”

The rise in militancy is a sensitive subject, and many inside Pakistan insist that American fears, and the implied threat to the nuclear arsenal, are overwrought. Amélie Blom, a political sociologist at Lahore University of Management Sciences, noted that the Army continues to support an unpopular President. “The survival of the coalition government shows that the present Army leadership has an interest in making it work,” she said in an e-mail.

Others are less sure. “Nuclear weapons are only as safe as the people who handle them,” Pervez Hoodbhoy, an eminent nuclear physicist in Pakistan, said in a talk last summer at a Nation and Lawyers Committee on Nuclear Policy forum in New York. For more than two decades, Hoodbhoy said, “the Pakistan Army has been recruiting on the basis of faithfulness to Islam. As a consequence, there is now a different character present among Army officers and ordinary soldiers. There are half a dozen scenarios that one can imagine.” There was no proof either that the most dire scenarios would be realized or that the arsenal was safe, he said.

The current offensive in South Waziristan marked a significant success for the Obama Administration, which had urged Zardari to take greater control of the tribal areas. There was a risk, too—that the fighting would further radicalize Pakistan. Last week, another Pakistan Army general was the victim of a drive-by assassination attempt, as he was leaving his home in Islamabad. Since the Waziristan operation was announced, more than three hundred people have been killed in a dozen terrorist attacks. “If we push too hard there, we could trigger a social revolution,” the Special Forces adviser said. “We are playing into Al Qaeda’s deep game here. If we blow it, Al Qaeda could come in and scoop up a nuke or two.” He added, “The Pakistani military knows that if there’s any kind of instability there will be a traffic jam to seize their nukes.” More escalation in Pakistan, he said, “will take us to the brink.”

During my stay in Pakistan—my first in five years—there were undeniable signs that militancy and the influence of fundamentalist Islam had grown. In the past, military officers, politicians, and journalists routinely served Johnnie Walker Black during our talks, and drank it themselves. This time, even the most senior retired Army generals offered only juice or tea, even in their own homes. Officials and journalists said that soldiers and middle-level officers were increasingly attracted to the preaching of Zaid Hamid, who joined the mujahideen and fought for nine years in Afghanistan. On CDs and on television, Hamid exhorts soldiers to think of themselves as Muslims first and Pakistanis second. He claims that terrorist attacks in Mumbai last year were staged by India and Western Zionists, aided by the Mossad. Another proselytizer, Dr. Israr Ahmed, writes a column in the Urdu press in which he depicts the Holocaust as “divine punishment,” and advocates the extermination of the Jews. He, too, is said to be popular with the officer corps.


A senior Obama Administration official brought up Hizb ut-Tahrir, a Sunni organization whose goal is to establish the Caliphate. “They’ve penetrated the Pakistani military and now have cells in the Army,” he said. (The Pakistan Army denies this.) In one case, according to the official, Hizb ut-Tahrir had recruited members of a junior officer group, from the most élite Pakistani military academy, who had been sent to England for additional training.

“Where do these guys get socialized and exposed to Islamic evangelism and the fundamentalism narrative?” the Obama Administration official asked. “In services every Friday for Army officers, and at corps and unit meetings where they are addressed by senior commanders and clerics.”

Wednesday, November 4, 2009


The IMF on Monday announced the sale of 200 metric tons of gold to the RBI. The total sales proceeds are equivalent to US$ 6.7 billion at an average gold price of $ 1045 per ounce.

India's gold trauma occurred in the summer of 1991, when faced with dwindling foreign exchange reserves and a possibility of a default on payments, the government hocked 47 tons of gold to the Bank of England and 20 tons of gold to the Union Bank of Switzerland to raise $ 600 million.

The move helped tide over the balance of payment crisis, and also kick-started the reforms process when the next Prime Minister, Narasimha Rao, appointed Dr Manmohan Singh as the finance minister (Dr Singh is India's current Prime Minister)

That was then. This is now. Lurking behind this purchase is the unease about the future of dollar. India’s finance minister Pranab Mukherjee said, "It doesn't mean we don't prefer the dollar any more or like gold any better."

Therein lies the ultimate truth – if you are able to read between the lines.

Of India's current foreign exchange reserves of nearly $285 billion, foreign currency assets account for more than 90% ($268.3 billion), followed by gold ($10.3 billion), IMF's Special Drawing Rights ($5.2 billion) and a reserve position in the IMF of $1.59 billion.

While India's current gold holdings, accounting for just 3.7% of assets, are said to be historically low, buying 200 tons in addition to the 358 tons it already holds is expected to bump up the gold reserves to more than 6%. The dash to gold is prompted by the unsteady dollar and countries such as China, Russia and Brazil have already gone this route.

India is the world's largest private gold consumer, but the government's holding of gold as an asset is modest. Even so, the latest purchase puts it at Number 10 among the list of top 10 gold-holders in the world. The above graph was true before the purchase, where India does not figure in the top 10.

Gold holding is divided up into two parts. The first is government holding – largely held by Central Banks (in India it will be the Reserve Bank of India = RBI) and IMF. The second is private holding.

When it says that India has now come in the top 10 countries holding gold at 10th spot, it is only talking about Central Banks (CBs). Hence, in the above graph where India did not find a space, India today comes in at No. 10 in that spot.

The rationale of CB holding gold is well know and tying currency to gold has been debated till death from Bretton Woods days and we will not digress here on this issue.

The larger issue is of the total gold in circulation in this world what % are with CBs + IMF (institutional holdings) and what % are in private hands.

And the astonishing answer is this - Ownership of world gold:

* CBs of differnt countries and IMF: 8.65 % of world gold stock
* Private hands (worldwide): 91.35% of world gold stock.

Essentially India’s RBI buying gold and putting in top 10 dealt with the fact that all of the central banks (CBs) of the world + IMF only hold 8.65% of gold that is available in the world.

Over 91% of world’s gold is in private hands (with people all across the globe). And guess which country is number one in his regard – far above the rest of countries.

It is our very own INDIA - with approximately 30,000 tons.

Gold absorption into private hoards for the 20-year period from 1950 through 1970 was of the same order of magnitude as the entire U.S. gold reserve at its peak in 1949, the largest gold concentration ever in history: just short of $ 25 billion. It was followed by the greatest dissipation of gold ever. This private absorption of gold is unprecedented, both as to its magnitude and its speed. The total amount of gold absorption for the entire 56-year period 1950-2007 was approximately $ 90,000m, an amount greater than all the gold produced in history before 1950.

Fifty percent of all the gold in existence has been produced since 1960.

Output from Western mines plus Russian gold sales before the collapse of the Soviet Union (approximate quantities in gold dollars at $35/Troy oz.):

1950-51: $ 2,000m; 1952-65: $ 21,000m; 1966-68: $ 3,400m; 1969-2006: $ 77,500m.

Absorption into private hoards from mine output, gold pool sales plus US/IMF/central bank gold auctions (approximate quantities in gold dollars at $35/Troy oz.):

1950-51: $ 100m; 1952-65: $ 9,000m; 1966-68: $ 3,200m; 1969-2006: $ 80,000m.

Look at another graph – the slush funds country wise that is parked in Switzerland. Here too India is far ahead, leaps and bounds over other countries. My article on this was: India has US 1.4 TRILLION in slush funds parked abroad - time to bring it back.

Bottom line, India’s central bank is catching up where India’s private citizens have been prudent enough to do over centuries. Even the Chinese seem to have taken a keen interest in India’s internal appetite for gold. China mining is reporting: Gold Rush: India to mine 20,000 tons gold reserves.

For an exceptional analysis: read this article - Indian Gold Reserves. Forgotten History! New Opportunity?

The above article portrays India’s love affair with Gold started 2000 years ago and how countries at that time too wanted to short change and cheat India. Since we do not always heed history and its lessons – we must read and know why “history repeats itself."

Sample from the above article: "For much of the last 2000 years of recorded history, India has been the largest buyer of gold. Roman historian, Pliny, lamented some 1800 years ago, how India, the sink of precious metals, was draining Rome of gold – an appellation that resonates even today. To “manage” this drain of gold, Romans started cheating the Indians. They reduced the gold content in coins. Septimus Severus, (193 AD-211) further debased the currency. Indians just stopped accepting the debased coin – and demanded payment in pure gold."

This point is stressed in A Short History of International Currencies by Christopher Weber : "India was the first foreign country to stop accepting the denarius and insisted on payment in pure gold. And then the rest of the world followed. This blow to Roman trade translated into a huge decline in Roman living standards. Imports became beyond the reach of any but the very wealthy.

When India started to insist on gold, the Romans began to cheat again. They issued “gold” coins that had up to 50% base metal. But this fooled no one for very long, and soon India and the rest of the Asian world stopped accepting these
. "

The US Dollar – a very sharp and short look.

The US Central Bank (CB) reportedly has 8,117 tonnes of US gold which the Treasury says are in “Deep Storage”. A most unusual and evasive categorization of gold! There are doubts regarding CB gold. Do they have what they say they have? Is there any gold at all left in US gold reserves?

This is a very real fear about the worth of the paper dollar – which is being printed at even greater speeds by the US Federal Reserve, creating a cash surplus and feeding another asset bubble. The gold to back the dollar is gone.

Robert Fisk writing in Independent states: In the most profound financial change in recent Middle East history, Gulf Arabs are planning – along with China, Russia, Japan and France – to end dollar dealings for oil, moving instead to a basket of currencies including the Japanese yen and Chinese yuan, the euro, gold and a new, unified currency planned for nations in the Gulf Co-operation Council, including Saudi Arabia, Abu Dhabi, Kuwait and Qatar.

Secret meetings have already been held by finance ministers and central bank governors in Russia, China, Japan and Brazil to work on the scheme, which will mean that oil will no longer be priced in dollars.

The plans, confirmed to The Independent by both Gulf Arab and Chinese banking sources in Hong Kong, may help to explain the sudden rise in gold prices, but it also augurs an extraordinary transition from dollar markets within nine years.

"The Russians will eventually bring in the rouble to the basket of currencies," a prominent Hong Kong broker told The Independent. "The Brits are stuck in the middle and will come into the euro. They have no choice because they won't be able to use the US dollar."

Iran announced late last month that its foreign currency reserves would henceforth be held in euros rather than dollars. Bankers remember, of course, what happened to the last Middle East oil producer to sell its oil in euros rather than dollars. A few months after Saddam Hussein trumpeted his decision, the Americans and British invaded Iraq.

Nouriel Roubini, the eminent economics professor and visionary at NYU, correctly predicted the US economic meltdown. Now comes his latest salvo : Mother of all carry trades faces an inevitable bust.

In this article which appeared in Financial Times on Nov 1, Roubini is saying that the Fed policy of printing dollar incessantly and keeping rates on hold has given excess liquidity in the market which in turn has helped purchased risky assets abroad thus pushing up their prices. The real cost of borrowing is in the range of - 20% (negative) and returns are 30% on the risky assets, making real returns in excess of 50 to 70% (if you add back the negative cost of borrowing).

However, the negative cost of borrowing will move to zero cost of borrowing, knowing off a cool 20% from real return. At this time, people will short dollars to cover their positions and sell the assets (which were risky in the first place) thus triggering off the final round of the meltdown game.
For a more elaborate and better understanding, please read the whole article.




CAVEAT: One of the replies from Anon deserves mention here. He has pointed out that it can be near "impossible" to know if the gold bars are pure gold or tungsten coated. The article : FAKE FEARS OVER ETHOPIA's GOLD should be an important lesson for all of us. Another interesting take out is Tungsten coated gold which makes it near impossible to tell the difference. Tungsten actually weighs the right amount. Interestingly, the density of tungsten is virtually the same (to three decimal places) as the density of gold.

ARTICLE: A top-of-the-line fake gold bar should match the color, surface hardness, density, chemical, and nuclear properties of gold perfectly. To do this, you could could start with a tungsten slug about 1/8-inch smaller in each dimension than the gold bar you want, then cast a 1/16-inch layer of real pure gold all around it. This bar would feel right in the hand, it would have a dead ring when knocked as gold should, it would test right chemically, it would weigh *exactly* the right amount, and though I don't know this for sure, I think it would also pass an x-ray fluorescence scan, the 1/16" layer of pure gold being enough to stop the x-rays from reaching any tungsten. You'd pretty much have to drill it to find out it's fake. (Unless, of course, central bank gold inspectors are wise to this trick and have developed a test for it: Something involving speed of sound say, or more powerful x-rays, or perhaps neutron activation analysis. If bars like this are actually a common problem, you certainly could devise a quick, non-destructive test for them, and for all I know, they have. Except, apparently, in Ethiopia.) Such a top-quality fake London good delivery bar would cost about $50,000 to produce because it's got a lot of real gold in it, but you'd still make a nice profit considering that a real one is worth closer to $400,000.