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Now introducing our speaker, I would say first of all that a stable, secure, and economically secure Pakistan is of vital to the U.S. interest in Asia. We are very pleased to have the ambassador, Ambassador Karamat to discuss the current state and the future Pakistan and U.S.-Pakistani relations. The ambassador assumed his current post of Pakistan's ambassador to the United States in November 2004, Ambassador Karamat retired before that as chairman of the Joint Chiefs of Staff and Chief of the Army Staff in October 1998. His senior level assignments include serving in the role of Director of General Military Operation and Chief of General Staff, Ambassador Karamat has been Colonel, Commandant, and Colonel in the Chief, Colonel and Chief of the Pakistani Army Corps. He has also commanded troops in Saudi Arabia. Ambassador Karamat has served as a visiting fellow at Stanford University and the Brookings Institution in D.C. In addition he was apart of the United Nations study on Afghanistan and chairman of the Board of Governors of the Islamic Policy Research Institute. Ambassador Karamat is a graduate of the Pakistan National Defense College, its Command and General Staff College, the prestigious U.S. Army Command and Staff College in Fort Leavenworth, Kansas. He also holds a Masters Degree in international relations. Please join me in welcoming Ambassador Karamat to the podium this evening. Ambassador? Thank you very much for that generous introduction, sir. It's a great pleasure, really, a privilege to be here this evening and to be able to talk to you at the World Affairs Council. I'm very glad to be here and thank you for this opportunity to interact with you. If I look tired it's because this is the fourth talk today. And it's this young lady's fault, she runs my life. (And his audience has been at Berkeley---) You ask me to talk on the current state of Pakistan, how we see Pakistan's future, and the state of U.S./Pakistan relations today. Let me, you know, take the liberty of starting with the U.S./Pakistan relations and then go on to Pakistan and see where we are, and what I'd like to do when I'm doing that is not go into the historical and other details but just focus on the present ongoing, the current interaction between the United States and Pakistan, in which areas we are interacting, in which areas we are cooperating, and exactly what is happening today in the world relationship between the U.S. and Pakistan, because I come across different perceptions of this relationship, there's a perception that this is an expedient time-serving type of relationship, and just as the U.S. withdrew from Afghanistan after the collapse of the Soviet Union, the same thing's going to happen once the war on terror is over. But there's also another perception that the U.S. now has a very consistent policy for central Asian states, Afghanistan, Pakistan, and India that the U.S. is there for the long haul and this is really a strategic partnership between the U.S. and Pakistan that's going to endure. So I'll just talk about the relationship as it is, where we are, and I think you'll get insight into exactly what is going on, the scope, the depth, and the breadth of this relationship, and then when I talk of Pakistan today, I think you'll get a good overview of what it's all about, maybe have convergence of interests, where we have U.S. has concerns, and where the challenges in our future. Now, right now, in a few days from now, 26 to be exact, we are starting a high-level strategic dialogue between the United States and Pakistan. This was an agreement reached, something of course, for which we did a lot of homework, but there was an agreement reached during President Bush's recent visit to Pakistan, and in this strategic dialogue is going to start, it's a structured dialogue, and I think this dialogue is going to be a platform for a very comprehensive continuous, ongoing dialogue between the United States and Pakistan which will address each of these concerns, interests, and just review every aspect of the relationship, where we are moving with this, how can we further it, and improve it, and so on. So I think this is the step which is going to lead to a relationship of trust, not that it's not there right now, but it's just going to move things in a very positive direction in the future. So this is one thing which is ongoing and current. The other is an energy dialogue between the United States and Pakistan which has already begun, and the Secretary of Energy was in Pakistan last month, they had very comprehensive discussions and that's going to be followed by a delegation from Pakistan for the second session of this dialogue, and we'll see how it moves along, but the purpose is to look at Pakistan's present and future over the next 15 years, energy requirements, how those energy requirements are going to be met from different resources, what the shortfalls are going to be, and how those shortfalls are going to be met. We hope that this will take all energy resources into account when the discussions go further. Then, there's the economic and the trade relationship between the two countries, and while this is a long standing relationship, this is a big market for our exports, and Pakistan has been a market for U.S., a very large number of multinationals operating in Pakistan for several years now, but this is a relationship that we wanted to move along, move further, we thought that in our current environment where the focus is heavily on economic uplift, trade should become a powerful facet of the relationship between the U.S. and Pakistan, and I'm happy to say that we are in the concluding stages of a bilateral investment treaty between the U.S. and Pakistan. We were hoping as was the U.S. that this treaty would be signed during President Bush's visit to Pakistan but that didn't happen because there are experts on both sides who got stuck on one or two points, but they're working through that, and it is, I'm optimistic that we will be able to conclude this treaty soon, and the other breakthrough that we've had is the U.S. agreement with us on setting up what are being called "reconstruction opportunity zones" in selected areas along the border with Afghanistan. These are basically meant as a long term measure to get infrastructure into the area, to provide employment opportunities in the area, and to have some kind of Afghan import into those industries, and then from the U.S. side, the offer is that products produced in industry in those reconstruction opportunity zones would come into the U.S. market on preferential tariff arrangements. So this is a great boost for us, besides this, because of this relationship with the U.S. we have several ongoing World Bank-funded projects in Pakistan. We've just bought Boeing triple 7 aircraft, there's a business council under the chamber of commerce which is a very active council promoting business and trust between the two countries, so this is an area where we have good movement and I think we're doing well. There are several other initiatives which will possibly start next month or the month after that, but over the next two months, these have to do with the corporation and projects in the science and technology area, and in the social sector health, education, and governance, and housing and governance capacity. I'm very confident that these are going to take off and move deeper and deeper into capacity building in Pakistan's, especially in the social sector. Many of these things, if they start happening, are really the best long-term measure in the war against terrorism, because they just take away the whole, the package that terrorist recruiters offer to people who are idle or who lack education or employment opportunities where a lot is happening, and while on this sector I might also mention that we had enormous support from the United States in the, in last October's earthquake in, in all areas, it caused massive support from here, from Congress, from the administration, from the businesspeople, from many, many NGO's working here and it was in the rescue phase, the relief phase, and now it's continuing in the reconstruction and rehabilitation phase in Pakistan, so I'd like to thank you for this wonderful support for us. The other ongoing current dialogue or initiative between the U.S. and Pakistan is a tripartite commission. Afghanistan, Pakistan, and the United States. And we had a high-level meeting last month. It's now an institutionalized process, and this reviews and coordinates intelligence operations and any administrative hiccups that are there in the war on terror in Afghanistan, and it's going extremely well. Again, I must say that the U.S. has been very very supportive in helping us build a response capacity in the Afghan border area. We had a capacity to deal with the weapons and drugs smugglers and illegal crossers, but this was a different ball game now, you were up against people with sophisticated communications, money, and with the (word unclear) and so on, and we just had to develop the capacity to be, to respond against all actionable intelligence which we got, and I'm happy to say that this is now there, and you must have read about the spectacular successes we've been having periodically in those areas, and specifically the one area between Pakistan and Afghanistan which is figuring a lot in the news, and which has become a sort of sanctuary for terrorists on the run, is the Waziristan area between Pakistan and Afghanistan, it's a border area, it's a remote area, it's a mountainous area, extremely difficult, it's inhabited by tribes who have linkages across the border in Afghanistan, and if you were to meet one of them and they didn't tell you whether it was Afghanistan or Pakistan, you couldn't make out because they're exactly the same language, culture, and so on, so it is an area where we've had to operate and it's an area which has been contained by our forces but it's still an area where we need to take action and we are doing so. The, if I may just explain that a bit further, because it's so current and so much is happening there, and for us it's so important, as it is, for the U.S., this area basically has a spill over from southern Afghanistan. Southern Afghanistan, in my view, is the sort of center of gravity for whatever is happening in Afghanistan. There's a very deep, deep hostility between Southern Afghanistan and the rulers who are from Northern Afghanistan, and it dates back to past linkages. Northern Afghanistan heavily supported by the central Asian states and very close to the Soviet Union, when the Soviet Union was in charge of Afghanistan and Afghanistan was more or less a satellite of the Soviet Union, those linkages endure. It's the same with Iranian influence in the eastern part of Afghanistan which again has linkages with the northern Afghanistan. And even in the case of India, because India had a very close relationship with the Soviet Union in the past, they have more linkages with the Northern Alliance which is ruling Pakistan. Now, President Karzai and his government have of course made enormous efforts to broad base the government and to bring to an end this hostility which is from the South, and the U.S. is working for that, the Afghan government is working for that, and we want to work with them in that to stabilize Afghanistan, not bring about and not so divide, but have more balanced input into all the capacity building that is going on in Afghanistan. Adding to the problem is of course that drugs and weapons mafias who are able to operate in parts of Afghanistan which are still not totally under government control, and who still have warlord and mafias operating there, drugs are a very big problem there, it's turned out to be one of the biggest opium producing countries in the world, so the drug situation from our point of view is also serious, because that feeds the weapons smugglers and terrorists whoever they may be, would like a destabilized, fluid environment in which they can operate. They wouldn't like the area to settle, so they have input into this. We are concerned because this has a blowback into our areas along the border, and I said we're having a problem in Waziristan which is mostly aliens seeking sanctuary there, but we also have a problem with our other province bordering Afghanistan that is a very big area, a province of Baluchistan, which has a coast along the Arabian Sea, a long land border with Iran, and a long land border with Afghanistan, so it's an area were are going to be concerned with , and we do not want that area to be destabilized, and to become another sort of haven for people interested in destabilizing, so there's still a very large segment of our military, and in our cortex paramilitary and political forces have been committed to these two areas to bring them under control. Yet another area is the defense consultant (word unclear) between the United States and Pakistan. This meets periodically. The next meeting is from the 1st to the 4th of May in Washington, and this is where the bilateral defense relationship is discussed in terms of training, exchanges, weapons and a defense equipment procurement from our side, and we just a few days ago given or advised a requirement of F-16 aircraft from the United States, and the last area that I want to cover in this U.S.-Pakistan relationship is the India-Pakistan relationship because we see the United States as a behind-the-scenes facilitator for normalization of relations between India and Pakistan. They have political leverage in the area, and with their new and consistent policies on separate tracks for India and Pakistan, they can help a lot in bringing this situation to a favorable point. There is the recent United States-India agreement for the transfer of nuclear technology for India, it's being discussed in Congress, it's being discussed in the media, there are various views on that, there is a very strong nonproliferation lobby here which is very active on this issue, we have of course a geographic proximity to India, we have our concerns and we have interests which during our discussions with the United States we have conveyed to them we've had a hearing and we are discussing those. There is the problem of a past proliferation episode in Pakistan which created what I can call a trust deficit between the U.S. and Pakistan in this particular area, but since that episode several things have happened. One is the total cooperation in that area with the United States, there is the aspect of total disclosure of all information that we've obtained on the global proliferation network, and more importantly, several steps taken within the country on legislative controls on exports, a national commodity and many of the measures which are not going to make sure that it can never happen again and that assets, more importantly, that assets are totally secured. So in this area, too, we hope to lay a new track in fact, we've started with all these steps laying a new track in this whole area, and we just hope that down the line there will be a recognition of what we are doing There is a travel advisory on Pakistan which hurts, and it hurts business and academics from traveling because they're not allowed to travel to Pakistan or discouraged from traveling to Pakistan. We hope that we will be able to create an internal security environment where there can be a determination that there's no problem of traveling but I must say that in spite of that we've had a constant flow of delegations from the United States to Pakistan. We are sending one or two congressional delegations almost every month to Pakistan and to see for themselves the situation. The students have been going, we just had a group of business administration students from Stanford University who visited, and we also had a group of young political leaders who were in Pakistan, so I think when they see things firsthand, and they get a better idea of the environment than they ever could from the, some of the TV images that are shown because the media... Bad things are good news for the media, and good news doesn't figure there, so there's a lot to see, and we've had business delegations going. So there's so much on the relationship between the U.S. and Pakistan and let me very briefly talk about Pakistan today and hopefully also cover its future. The one consistent and successful thing in Pakistan that's happened over the last six years is a very comprehensive reform taking place in Pakistan according to a planned consistent policy. These reforms have been in all sectors, and the first generation reforms have been completed and we are moving into second generation reforms in this area now. The biggest success has been in the economic area, and I'd like to tell you that there's been a complete transformation of the economic scene in Pakistan. It's received international recognition that this in fact is the case. Newsweek, the last one, did a story on these economic reforms, the Wall Street Journal has done one today on these economic reforms. Credit ratings have gone up, we are getting a lot of investors coming to Pakistan, the stock exchanges are performing extremely well, the foreign exchange reserves are up, exports are up, imports are up, and one very big success story is the privatization in Pakistan, we've had enormous response for the whole privatization process, and right now I think 85 percent of the banking sector is already in private hands, as is most of the telecommunication, the sector. There are massive infrastructure projects planned, a deep water port coming up on the Baluchistan coast, about 70 miles from the Iranian border of Jabihar. Communication infrastructure for overland transit to Afghanistan and Central Asia, there's a road network coming up, railways are being, so very big infrastructure projects are there. Overall growth has been 8.4 percent, which is quite high, very high in fact. The banking sector is robust, regulations have come and in the future we see and we are getting U.S. support on this, we see Pakistan as the hub for energy flows from Central Asia, Afghanistan, Pakistan, India, if possible from Iran, Pakistan, India, and from the Gulf States, particularly Qatar, across the sea and into Pakistan and India, enormous energy requirement, and we see trade flows from our ports, over land, through Afghanistan into Central Asia again, so there is a future there for us, and then you can see that with our commitment to this kind of economy, to sustain this growth, why it is important to have bilaterally a very good relationship with a stable Afghanistan and a good relationship with our neighbor to the East, India, because unless that happens, this economic thrust is not going to be sustained. The other issue I'd like to talk about which gets discussed a lot is the democracy issue in Pakistan, and the perception there is that perhaps we are not moving fast enough and comprehensively enough towards full and sustainable democracy ins Pakistan. We've had problems in this area, but there is an elected government right now, military-backed elected government, we are moving into elections in 2007, but what is important about these next elections is that they are going to take place in an environment totally different from previous environments. This time, we hope that this government will have completed its tenure of five years when the elections are taking place in 2007. We've also had all kinds of restrictions on the media. This time, we have a totally free media. In fact, a media which is really free. And then, it's taking place in an environment where there's been an economic turnaround, and there's economic situation has improved. We are also in the second phase of local government, second elections have been held and a system is getting established as far as local government is concerned for the first time, so there are a lot of things that are different from our previous environment, and we'd like to think of this as a watershed elections where we'll really be able to move towards a stable democracy, it's our hope, and I think it's the military institutions which, for various reasons is the strongest institution in Pakistan which has put its institutional and structural strength behind this transition, and we are really hopeful. I might also add that this is also a period where there's been a big push for human resource development in Pakistan, a re-vamping of the education sector, some progress in the health sector, and generally a transitional trend in society. So this is a situation which is good for us and we hope that it will move on a very positive track in the future. We do have a problem with internal security, as I told you. It's frankly, there is not violence in Pakistani society. It's not inherently a violent society. It's... Various activities within the society that create violence, and these phenomena have come in for various reasons, suicide bombers bombing sectarian, we can discuss the reasons for that, I know what the reasons are, but this is violence because of this, it's, I would say that your society is a very violent society, you have weapons, you love weapons, there's so many things happening here that it is, there's violence in the society, there's not in ours, it's not, compared to yours, a docile society, but it's a very rough neighborhood in which we are, and there are many violent events which take place, or specific events triggered by specific influences. So that is, that creates an internal security situation for us which we are battling because again, a stable internal security situation is absolutely vital for our economic and trade issues, and all the other reforms that we are putting in Then, I talked about the bilateral relations that we want to foster, and the other comment I get is on public opinion in Pakistan, and why if there is such a good relationship with the U.S and the U.S. is so strongly supportive of Pakistan's capacity building in various sectors, including government, health, social education, why is there negative public opinion in Pakistan about the United States? There is no clash of values because we've been with the United States for all of our existing 60 years, so this is not another planet for us, we are quite familiar with the U.S., with your values, there is no culture clash there, everything is happily moving along, Coca-Cola, Pepsi Cola, KFC, McDonalds, there's no problem of any kind whatsoever. I think you shouldn't just isolate Pakistan when you're talking of public opinion, but look at this in the context of the overall Islam versus West relationship, look at it in terms of some of the things happening within the Islamic world, the presence of the U.S., the kind of actions that the U.S. has been forced to undertake in that part of the world, and how they're playing out, and I think that at some point in time, whether it's in Iraq, or whether that's in Afghanistan or Pakistan, parts of Pakistan, we will have to move for a battle for hearts and minds, and I think more than anything else, what we've seen is that military power no matter how overwhelmingly superior, ultimately faces limits unless in tandem you have this battle for the hearts and minds, which is starting and should progress further, but I would say that the silent majority in Pakistan, because the progressive liberal people are always silent, they never get up on the streets and jump and do things, they just wait for good things to happen, and they are overwhelmingly in favor of the U.S.-Pakistan relationship, and they know how significant this relationship is, how important it is, and how much it is doing for us, and how much our future is linked to it. Finally, let me just say that Pakistan has been repositioned in terms of its external policy, and we have a situation or a view on Iran,