Hardline general loses power in Pakistani crisis

The Telegraph
ISSUE 1925
Friday 1 September 2000

By Ahmed Rashid in Lahore

FACED with international diplomatic isolation and a financial crisis, Gen Pervaiz Musharraf, Pakistan's military leader, has reshuffled the ruling junta, removing a key hardline general from day-to-day decision making.

Lt-Gen Aziz Khan, chief of general staff and the number two man in the army, who has been guiding the 10-month-old military regime's foreign, economic and political policies, has been sent to Lahore as corps commander.

Gen Aziz, who is revered by Pakistani and Kashmiri Islamic fundamentalist parties, was considered to be the architect of last year's seizure by Kashmiri guerrillas of the Kargil heights in Indian Kashmir, which led to six weeks of bitter fighting between India and Pakistan. He is also credited with devising Pakistan's policy of support for the Taliban regime in Afghanistan.

Four other lieutenant-generals are being reshuffled and four are being created, giving Gen Musharraf greater scope to bring in his own men at the top of the army. Although the reshuffle was predetermined by the normal retirement of four generals, the timing of the move is highly significant.

It comes five days before Gen Musharraf goes to America to meet world leaders at the United Nations. America and other Western countries are highly critical of the army's reluctance to moderate its hardline foreign policy towards India and Afghanistan and its refusal to sign the Comprehensive Test Ban Treaty. In the region, Pakistan faces almost total isolation over its support for the Taliban.

A diplomat in Islamabad said: "Aziz's removal from day-to-day policy making is a very important signal, especially to the Americans. Musharraf is signalling that he is his own man and now there may be a chance of seeing a more moderate foreign policy and swifter moves to restoring democracy."

That may be overly optimistic, but Gen Musharraf also faces mounting domestic criticism that he has moved from his modernising, liberal agenda, articulated when he seized power, towards a more Islamicist stance.

By shaking up the core group of officers who make up the ruling junta and helped him to stage the coup against Nawaz Sharif, the former prime minister, last October, he seems to be asserting his own authority.

Another reason for the reshuffle is the country's precarious financial situation. The State Bank of Pakistan says it has foreign exchange reserves of $1.1 billion (£760 million). But Western embassies and donor agencies say that they are only $600 million, equivalent to three weeks of imports.

The International Monetary Fund refused approval for a $2.5 billion loan, production has stalled and exports have slumped. The loss of business confidence has led to a flight of capital. Industrialists are selling factories and homes and visa applications from people wanting to settle abroad have risen sharply.