Order Code IB94041
Issue Brief for Congress
Received through the CRS Web
Pakistan-U.S. Relations
Updated April 4, 2003
K. Alan Kronstadt
Foreign Affairs, Defense, and Trade Division
Congressional Research Service ˜ The Library of Congress

CONTENTS
SUMMARY
MOST RECENT DEVELOPMENTS
BACKGROUND AND ANALYSIS
Historical Background
Pakistan-India Rivalry
The China Factor
Pakistan Political Setting
Recent Developments
Background
Pakistan-U.S. Relations and Key Country Issues
Security
Nuclear Weapons and Missile Proliferation
U.S. Nonproliferation Efforts
Kashmir Dispute
Pakistan-U.S. Security Cooperation
Democratization and Human Rights
Democratization Efforts
Human Rights Problems
Economic Issues
Overview
Trade Issues
Narcotics
Terrorism
U.S. Aid and Congressional Action
CHRONOLOGY


IB94041
04-04-03
Pakistan-U.S. Relations
SUMMARY
Major areas of U.S. concern regarding
Separatist violence in the disputed Kash-
Pakistan include regional terrorism; weapons
mir region continues unabated. India blames
proliferation; the ongoing Kashmir dispute
Pakistan for the ongoing infiltration of Islamic
and Pakistan-India tensions; human rights
militants into Indian Kashmir, a charge
protection; and economic development. A
Islamabad denies. The United States received
U.S.-Pakistan relationship marked by distance
a June 2002 pledge from Islamabad that all
and discord was transformed by the Septem-
“cross-border terrorism” will be ended, and it
ber 2001 terrorist attacks on the United States
encourages a cease-fire along the Line of
and the ensuing enlistment of Pakistan as a
Control and renewed dialogue between
key ally in U.S.-led anti-terrorism efforts. Top
Islamabad and New Delhi.
U.S. officials regularly praise Pakistan for its
ongoing cooperation, although there exist
The United States considers a stable,
renewed doubts about Islamabad’s commit-
democratic, economically thriving Pakistan as
ment to core U.S. concerns in the region.
key to U.S. interests in South and Central
Asia. Democracy has faired poorly in Pakista-
A potential Pakistan-India nuclear arms
n; the country has endured three full-scale
race continues to be the focus of U.S.
military coups and military rule for half of its
nonproliferation efforts in South Asia.
existence. In October 1999, the government
Attention to this issue intensified following
of Prime Minister Sharif was ousted in an
nuclear tests by both countries in May 1998.
extra-constitutional coup led by Army Chief
South Asia is viewed by many analysts as an
Gen. Pervez Musharraf. Musharraf has since
arena for the possible use of such weapons, as
assumed the title of President, a move
both countries have deployed nuclear-capable
ostensibly legitimized by a controversial April
ballistic missiles and institutionalized nuclear
2002 referendum. The United States strongly
command structures. India and Pakistan have
urges the Musharraf government to restore the
fought three full-scale wars since 1947.
country to civilian democratic rule. National

elections held in October 2002 resulted in no
Close Pakistan-U.S. relations began in
clear majority party emerging but were
the mid-1950s as a security arrangement
marked by significant gains for a coalition of
growing from U.S. concerns about Soviet
Islamic parties. A civilian parliament and
expansionism and Pakistan’s fear of neigh-
Prime Minister Jamali were seated in Novem-
boring India. Cooperation peaked during the
ber 2002. Congress granted the President
1979-89 Soviet occupation of Afghanistan.
authority to waive coup-related sanctions on
Pakistan-U.S. Ties weakened following the
Pakistan through FY2003.
October 1990 cutoff of most U.S. assistance to
Pakistan, assistance suspended by then-
Pakistan continues to face serious prob-
President Bush under Section 620E(e) of the
lems, including a weak economy and domestic
Foreign Assistance Act (the Pressler Amend-
terrorism. Pakistan has received more than $1
ment). Further U.S. sanctions were imposed
billion in U.S. assistance since September
on Pakistan (and India) as a result of the
2001. For more detailed discussion, see CRS
nuclear tests. Nuclear-related sanctions on
Report RS21299, Pakistan’s Domestic Politi-
Pakistan and India have since been waived.
cal Developments, and CRS Report RL31624,
Pakistan-U.S. Anti-Terrorism Cooperation).
Congressional Research Service ˜ The Library of Congress

IB94041
04-04-03
MOST RECENT DEVELOPMENTS1
On March 1, in a “joint operation” involving U.S. and Pakistani security personnel,
Khalid Mohammed, alleged top Al Qaeda leader and mastermind of the September 2001
terrorists attacks on the United States, was arrested in Rawalpindi. Two major U.S. military
operations launched in March in Afghanistan near the Pakistan border are aimed at finding
other Al Qaeda and Taliban fugitives, perhaps including Osama bin Laden.

Violence in Kashmir continues unabated. On March 23, 24 Hindu villagers were shot
and killed by apparent Muslim extremists in Indian Kashmir. The next day, New Delhi
accused Pakistan of carrying out “cold-blooded murder” and said that Pakistani involvement
in the attack is “all too clear.” The United States and Britain issued a joint statement
condemning the attack as a “vicious and cowardly act” and urged the two neighbors to
declare an immediate cease-fire along the Kashmiri Line of Control.
On March 12, the Bush Administration declared that it had “carefully reviewed the facts
relating to the possible transfer of nuclear technology from Pakistan to North Korea, and
decided that they do not warrant the imposition of sanctions under applicable U.S. laws.”
Two days later, President Bush exercised his waiver authority under P.L.107-57 to remove
coup-related sanctions on FY2003 assistance to Pakistan. On March 24, the United States
imposed nonproliferation penalties on the Pakistani entity Khan Research Laboratories
(KRL) pursuant to Executive Order 12938, as amended. The two-year penalties ban all U.S.
trade with KRL for its having received missile technology from a North Korean entity.
As of early April, an Emergency Wartime Supplemental Appropriations Act is making
its way through Congress. Both the House and Senate are supporting the President’s request
for $200 million in additional security-related assistance to Pakistan for FY2003.
BACKGROUND AND ANALYSIS
Historical Background
The long and checkered Pakistan-U.S. relationship has its roots in the Cold War and
South Asia regional politics of the 1950s. U.S. concerns about Soviet expansionism and
Pakistan’s desire for security assistance against a perceived threat from India prompted the
two countries to negotiate a mutual defense assistance agreement in 1954. By the end of
1955, Pakistan had further aligned itself with the West by joining two regional defense pacts,
the South East Asia Treaty Organization and the Central Treaty Organization. As a result
of these alliances, and a 1959 U.S.-Pakistan cooperation agreement, Islamabad received $508
million in U.S. military assistance from 1953 to 1961. Total U.S. economic and military
assistance to Pakistan between 1947 and 2000 totaled nearly $11.8 billion.
Differing expectations of the security relationship have long bedeviled bilateral ties.
During the Indo-Pakistani wars of 1965 and 1971, the United States suspended military
assistance to both sides, resulting in a cooling of the Pakistan-U.S. relationship. In the
1 See chronology for details.
CRS-1

IB94041
04-04-03
mid-1970s, new strains arose over Pakistan’s apparent efforts to respond to India’s 1974
underground test of a nuclear device by seeking its own nuclear weapons capability. Limited
U.S. military aid was resumed in 1975, but was suspended again by the Carter
Administration in April 1979 in response to Pakistan’s covert construction of a uranium
enrichment facility. Following the Soviet invasion of Afghanistan in December 1979,
Pakistan was again viewed as a frontline state in the effort to block Soviet expansionism.
In September 1981, the Reagan Administration negotiated a $3.2 billion, 5-year economic
and military aid package with Islamabad. Pakistan became a key transit country for arms
supplies to the Afghan resistance, as well as a camp for some three million Afghan refugees,
many of whom have yet to return home.
Despite the renewal of U.S. aid and close security ties, many in Congress remained
concerned about Pakistan’s nuclear weapons program. Concern was based in part on
evidence of U.S. export control violations that suggested a crash Pakistani program to
acquire a nuclear capability. In 1985, Section 620E(e) (the “Pressler amendment”) was
added to the Foreign Assistance Act, requiring the President to certify to Congress that
Pakistan does not possess a nuclear explosive device during the fiscal year for which aid is
to be provided. This amendment represented a compromise between those in Congress who
thought that aid to Pakistan should be cut off because of evidence that it was continuing to
develop its nuclear option and those who favored continued support for Pakistan’s role in
opposing Soviet occupation of Afghanistan. A $4 billion, six-year aid package for Pakistan
was signed in 1986.
With Soviet withdrawal from Afghanistan beginning in May 1988, Pakistan’s nuclear
activities again came under closer U.S. scrutiny, and in October 1990 President Bush
suspended aid to Pakistan. Under the provisions of the Pressler amendment, most economic
and all military aid to Pakistan was stopped and deliveries of major military equipment
suspended. Narcotics assistance of $3-5 million annually was exempted from the aid cutoff.
In 1992, Congress partially relaxed the scope of the aid cutoff to allow for P.L.480 food
assistance and continuing support for nongovernmental organizations (NGOs).
One of the most serious results of the aid cutoff for Pakistan was the nondelivery of
some 71 F-16 fighter aircraft ordered by Pakistan in 1989. In December 1998, the United
States agreed to pay Pakistan $324.6 million from the Judgment Fund of the U.S. Treasury
– a fund used to settle legal disputes that involve the U.S. government – as well as provide
Pakistan with $140 million in goods, including agricultural commodities.
Pakistan-India Rivalry
Three wars – in 1947-48, 1965, and 1971 – and a constant state of military preparedness
on both sides of the border have marked the half-century of bitter rivalry between India and
Pakistan. The acrimonious nature of the partition of British India into two successor states
in 1947 and the continuing dispute over Kashmir have been major sources of tension. Both
Pakistan and India have built large defense establishments at the cost of economic and social
development. The Kashmir problem is rooted in claims by both countries to the former
princely state, divided since 1948 by a military line of control into the Indian state of Jammu
and Kashmir and Pakistan-held Azad (Free) Kashmir. India blames Pakistan for supporting
a violent separatist rebellion in the Muslim-dominated Kashmir Valley that has claimed more
CRS-2

IB94041
04-04-03
than 60,000 lives since 1989. Pakistan admits only to lending moral and political support
to the rebellion (for further discussion see below).
The China Factor
India and China fought a brief border war in 1962, and an oftentimes tense border
dispute remains unresolved. A strategic rivalry also exists between these two large nations.
Pakistan and China, on the other hand, have enjoyed a generally close and mutually
beneficial relationship over recent decades. Pakistan served as a link between Beijing and
Washington in 1971, as well as a bridge to the Muslim world for China during the 1980s.
China’s continuing role as a major arms supplier for Pakistan began in the 1960s, and
included helping to build a number of arms factories in Pakistan, as well as supplying
complete weapons systems. In 1990, China agreed to supply Pakistan with components for
M-11 surface-to-surface missiles, which brought warnings from the United States. Although
it is not a member of the Missile Technology Control Regime (MTCR), China repeatedly has
agreed to abide by the restrictions of the regime. In 1993, the United States determined that
China had transferred to Pakistan prohibited missile technology and imposed trade sanctions
on one Pakistani and 11 Chinese entities (government ministries and aerospace companies)
for 2 years. The U.S. intelligence community reportedly has evidence of PRC provision of
complete M-11 ballistic missiles to Pakistan. In 1996, leaked U.S. intelligence reports
alleged that in 1995 China sold ring magnets to Pakistan that could be used in enriching
uranium for nuclear weapons. Pakistan denied the reports (see CRS Report RL31555, China
and Proliferation of Weapons of Mass Destruction and Missiles: Policy Issues
).
Pakistan Political Setting
Recent Developments. Gen. Musharraf’s April 2002 assumption of the title of
President ostensibly was legitimized by a controversial referendum that many observers
claimed was marked by “excessive fraud and coercion.” In August, the Musharraf
government announced sweeping changes in the Pakistani constitution under a “Legal
Framework Order.” These changes provide the office of President and the armed forces
powers not previously available in the country’s constitutional history, including provisions
for Presidential dissolution of the National Assembly and appointment of the Army Chief
and provincial governors, among others. The United States expressed concerns that the
changes “could make it more difficult to build strong, democratic institutions in Pakistan.”
In October 2002, the country held its first national elections since 1997, thus fulfilling
in a limited fashion Musharraf’s promise to restore the National Assembly that was dissolved
in the wake of his extra-constitutional seizure of power in October 1999. Opposition parties
contesting the elections – along with Pakistani rights groups and European Union observers
– complained that the exercise was “deeply flawed” and that the military government’s pre-
poll machinations skewed the results. No party won a majority of parliamentary seats,
though a pro-Musharraf alliance won a plurality while a coalition of Islamist parties made
a surprisingly strong showing. Low turnout rates caused many to identify significant levels
of voter apathy affecting Pakistan’s electoral politics.
In an unexpected outcome of the October elections, the United Action Forum (known
as MMA in its Urdu-language acronym), a coalition of six Islamic parties, won 68 seats –
about 20% of the total – in the national assembly and now controls the provincial assembly
CRS-3

IB94041
04-04-03
in the North West Frontier Province (NWFP) and leads the coalition ruling the Baluchistan
assembly. These provinces are Pashtun-majority regions that border Afghanistan and where
important U.S. anti-terror operations are ongoing. This result has led to concerns that a
major shift in Pakistan’s foreign policy may be in the offing, most especially with growing
anti-American sentiments and renewed indications of the “Talibanization” of western border
regions.
In November 2002, after more than five weeks of intensive maneuvering and several
delays, the new National Assembly chose Musharraf supporter and former Baluchistan Chief
Minister Mir Zafarullah Jamali to serve as Pakistan’s Prime Minster. Jamali’s coalition later
won a required vote of confidence. February 2003 senate elections gave the PML-Q-led
coalition a simple majority in that 100-seat body. Most analysts believe that the current pro-
Musharraf coalition, while fragile and potentially unstable, likely will mean continuity in
Islamabad’s economic and foreign policy orientations.
Background. Military regimes have ruled Pakistan for more than half of its 55 years
of existence, interspersed with periods of generally weak civilian governance. After 1988,
Pakistan had democratically elected governments, and the army appeared to have moved
from its traditional role of “kingmaker” to one of power broker or referee. During the past
decade, Benazir Bhutto and Nawaz Sharif each served twice as prime minister. Bhutto was
elected prime minister in October 1988, following the death of military ruler Mohammad
Zia-ul Haq in a plane crash. Gen. Zia had led a coup in 1977 deposing Bhutto’s father, PM
Zulfiqar Ali Bhutto, who was later executed. Despite the restoration of democratic process
to Pakistan, the succeeding years were marred by political instability, economic problems,
and ethnic and sectarian violence. In August 1990, President Ishaq Khan dismissed Bhutto
for alleged corruption and inability to maintain law and order. The president’s power to
dismiss the prime minister derived from Eighth Amendment provisions of the Pakistan
constitution, which dated from the era of Zia’s presidency.
Elections held in October 1990 brought to power Nawaz Sharif, who himself was ousted
in 1993 under the Eighth Amendment provisions. Ensuing elections returned Bhutto and the
PPP to power. The new Bhutto government faced even more serious economic problems
and, according to some observers, performance also was hampered by the reemergence of
Bhutto’s husband, Asif Ali Zardari, in a decisionmaking role. In November 1996, President
Farooq Leghari dismissed the Bhutto government for corruption and nepotism.
Nawaz Sharif’s PML won a landslide victory in the February 1997 parliamentary
elections, which were judged by international observers to be generally free and fair. Sharif
moved quickly to consolidate his power by curtailing the powers of the President and the
judiciary. In April 1997, the Parliament passed the Thirteenth Amendment to the
constitution, removing the President’s Eighth Amendment powers to dismiss the government
and to appoint armed forces chiefs and provincial governors. After replacing the chief
Justice of the Supreme Court and seeing the resignation of President Leghari – and with the
PML in control of parliament – Sharif emerged as one of Pakistan’s strongest elected leaders
since independence. Critics accused him of further consolidating his power by intimidating
the opposition and the press. In April 1999, a two-judge Bench of the Lahore High Court
convicted former PM Bhutto and her husband of corruption and sentenced them each to 5
years in prison, fined them $8.6 million, and disqualified them from holding public office.
Bhutto was out of the country at the time.
CRS-4

IB94041
04-04-03
Pakistan-U.S. Relations and Key Country Issues
U.S. policy interests in Pakistan encompass a wide range of issues, including nuclear
weapons and missile proliferation; South Asian regional stability; democratization and
human rights; economic reform and market opening; and efforts to counter terrorism and
narcotics traffic. These concerns have been affected by several key developments in recent
years, including the cutoff of U.S. aid to Pakistan in 1990, 1998, and 1999 over nuclear and
democracy issues; a worsening Pakistan-India relationship over Kashmir since 1989 and a
continuing bilateral nuclear standoff; Pakistan’s halting attempts to develop a stable
democratic government and strong economy; and, most recently, the September 2001
terrorist attacks against the United States.
On September 13, 2001, President Musharraf – under strong U.S. diplomatic pressure
– offered President Bush Pakistan’s “unstinted cooperation in the fight against terrorism.”
Because of its shared border with Afghanistan and former close ties with the Taliban,
Pakistan is considered key to U.S.-led efforts to combat terrorism in the region. The Taliban
and Osama bin Laden enjoy strong support among a substantial percentage of the Pakistan
population, who share not only conservative Islamic views but also ethnic and cultural ties
with Afghanistan. A major issue facing the Administration is how to make use of Pakistan’s
support – including for military operations in Afghanistan – without seriously destabilizing
an already fragile, nuclear-armed state.
In an effort to shore up the Musharraf government, sanctions relating to Pakistan’s
1998 nuclear tests and 1999 military coup were waived in the autumn of 2001. In October
2001, large amount of U.S. aid began flowing into Pakistan. Direct assistance programs
include aid for health, education, food, democracy promotion, child labor elimination,
counter-narcotics, border security and law enforcement, as well as trade preference benefits.
The United States also has supported grant, loan, and debt rescheduling programs for
Pakistan by the various international financial institutions, including the World Bank,
International Monetary Fund, and Asian Development Bank.
In September 2002, President Bush met with President Musharraf in New York City,
after both leaders had addressed the U.N. General Assembly. The U.S. President reportedly
urged his Pakistani counterpart to ensure that his government take all necessary steps to end
the movement of militants into Indian-controlled Kashmir, and also to ensure that the country
remain on the path to full democracy.
Security
Nuclear Weapons and Missile Proliferation. U.S. policy analysts consider the
apparent arms race between India and Pakistan as posing perhaps the most likely prospect
for the future use of nuclear weapons. In May 1998, India conducted five underground
nuclear tests, breaking a 24-year, self-imposed moratorium on such testing. Despite U.S. and
world efforts to dissuade it, Pakistan quickly followed, claiming five tests of its own before
month’s end. The tests created a global storm of criticism, and represented a serious setback
for two decades of U.S. nuclear nonproliferation efforts in South Asia. India currently is
believed to have enough fissile material for 75-100 nuclear weapons; Pakistan is thought to
have approximately half that number. Both countries have aircraft capable of delivering
CRS-5

IB94041
04-04-03
nuclear bombs. India’s military has inducted short- and intermediate-range ballistic missiles,
while Pakistan itself possesses short- and medium-range missiles (allegedly acquired from
China and North Korea). All are assumed to be capable of delivering small nuclear warheads
over significant distances.
Press reports continue to suggest that Pakistan assisted Pyongyang’s covert nuclear
weapons program by providing North Korea with uranium enrichment materials and
technologies beginning in the mid-1990s and as recently as July 2002. It was also suggested
that Iran’s nuclear weapons program has benefitted from Pakistani assistance. If such
assistance is confirmed by President Bush, all non-humanitarian U.S. aid to Pakistan may be
suspended, although the President has the authority to waive any sanctions that he determines
would jeopardize U.S. national security. Islamabad adamantly rejects as “baseless” such
reports, and Secretary of State Powell has been assured that no such transfers are occurring.
Proliferation in South Asia may be part of a chain of rivalries – India seeking to achieve
deterrence against China, and Pakistan seeking to gain an “equalizer” against a larger and
conventionally stronger India. India began its nuclear program in the mid-1960s, after its
1962 defeat in a short border war with China and China’s first nuclear test in 1964. Despite
a 1993 Sino-Indian troop reduction agreement and some easing of tensions, both nations
continue to deploy forces along their border. Pakistan’s nuclear program was prompted by
India’s 1974 nuclear test and by Pakistan’s defeat by India in the 1971 war and consequent
loss of East Pakistan, now independent Bangladesh.
Since the September 2001 terrorist attacks on the United States, U.S. and Pakistani
officials have held talks on improving security and installing new safeguards on Pakistan’s
nuclear weapons and nuclear power plants. Fears that Pakistan could become destabilized
by the U.S. anti-terrorism war efforts in Afghanistan have heightened U.S. nuclear
proliferation concerns in South Asia (see CRS Report RS21237, Indian and Pakistani
Nuclear Weapons Status
, and CRS Report RL30623, Nuclear Weapons and Ballistic Missile
Proliferation in India and Pakistan
).
U.S. Nonproliferation Efforts. In May 1998, following the South Asian nuclear
tests, President Clinton imposed full restrictions on non-humanitarian economic and military
aid to both India and Pakistan as mandated under Section 102 of the Arms Export Control
Act (AECA). In November 1998, the U.S. Department of Commerce published a list of
more than 300 Indian and Pakistani government agencies and companies suspected of
working on nuclear, missile, and other weapons programs. Any U.S. exports to these entities
required a Commerce Department license, and most license requests reportedly were denied.
In some respects, Pakistan was less affected by the sanctions than was India, since most U.S.
assistance to Pakistan had been cut off in 1990. At the same time, Pakistan’s much smaller
and more fragile economy was more vulnerable to the negative effects of aid restrictions.
During the latter years of the Clinton administration, the United States set forth five
nonproliferation “benchmarks” for India and Pakistan, including the following: halt further
nuclear testing and sign and ratify the Comprehensive Test Ban Treaty (CTBT); halt fissile
material production and pursue Fissile Material Control Treaty negotiations; refrain from
deploying nuclear weapons and testing ballistic missiles; restrict any and all exportation of
nuclear materials or technologies; and take steps to reduce bilateral tensions, especially on
the issue of Kashmir. The results of U.S. efforts have been mixed, at best: Neither India nor
CRS-6

IB94041
04-04-03
Pakistan are signatories to the Nuclear Nonproliferation Treaty or the CTBT. India has
consistently rejected both treaties as discriminatory, calling instead for a global nuclear
disarmament regime. Pakistan traditionally has maintained that it will sign the NPT and
CTBT only when India does so. Aside from security concerns, the governments of both
countries are faced with the prestige factor attached to their nuclear programs (see CRS
Report RS20995, India and Pakistan: Current U.S. Economic Sanctions, and CRS Report
RL31589, Nuclear Threat Reduction Measures for India and Pakistan).
Kashmir Dispute. Bilateral relations between Pakistan and India remain deadlocked
on the issue of Kashmiri sovereignty. The prospects for India-Pakistan detente suffered a
severe setback in mid-1999, when the two countries teetered on the brink of their fourth full-
scale war, once again in Kashmir. In the worst fighting since 1971, Indian soldiers sought
to dislodge some 700 Pakistan-supported infiltrators who were occupying fortified positions
along mountain ridges on the Indian side of the line of control (LOC) near Kargil. Following
a meeting between then Pakistan PM Sharif and President Clinton in Washington on July 4,
1999, the infiltrators withdrew across the LOC.
Tensions between India and Pakistan remained extremely high in the wake of the Kargil
conflict, which cost more than 1,100 lives. Throughout 2000-2002, intermittent cross-border
firing and shelling has caused scores of both military and civilian deaths. New Delhi
accuses Pakistan of sponsoring the movement of “terrorists” into Indian Kashmir; Islamabad
accuses India of human rights violations there. The United States strongly urged India and
Pakistan to create the proper climate for peace, respect the LOC, reject violence, and return
to the Lahore peace process. A six-month-long unilateral cease-fire and halt to offensive
military operations in Kashmir was undertaken by India in 2000-2001, and the Pakistani
government responded by announcing that its forces deployed along the LOC in Kashmir
would observe “maximum restraint.” Kashmir’s main militant groups, however, rejected the
cease-fire as a fraud and continued to carry out attacks on military personnel and government
installations. As security forces conducted counter-operations, deaths of Kashmiri civilians,
militants, and Indian security forces continued to rise.
In May 2001, the Indian government announced that it was ending its unilateral cease-
fire in Kashmir but that Prime Minister Vajpayee would invite President Musharraf to India
for talks. A July summit meeting between Musharraf and Vajpayee in Agra failed to produce
a joint communique, reportedly as a result of pressure from hardliners on both sides. Major
stumbling blocks were India’s refusal to acknowledge the “centrality of Kashmir” to future
talks and Pakistan’s objection to references to “cross-border terrorism.” In October 2001,
U.S. Secretary of State Colin Powell visited Pakistan and India in an effort partly aimed at
easing the escalating tensions over Kashmir. Yet a terrorist attack on the Jammu and
Kashmir state assembly during the same month was followed by a December 2001 terrorist
attack on the Indian Parliament in New Delhi. Both incidents were blamed on Pakistan-
based militant groups. The Indian government responded by mobilizing hundreds of
thousands of troops to forward stations along the Pakistan-India frontier and threatening war
unless Islamabad put an end to all cross-border infiltrations of Islamic militants. Under
significant international diplomatic pressure and the threat of India’s use of possibly massive
force, President Musharraf in January 2002 vowed to end the presence of terrorist entities on
Pakistani soil and upwards of 2,000 radicals were jailed (many of these have since been
released).
CRS-7

IB94041
04-04-03
Despite the Pakistani pledge, infiltrations into Indian-held Kashmir continued, and a
May 2002 terrorist attack on an Indian army base at Kaluchak killed 34, most of them women
and children. This event again brought Pakistan and India to the brink of full-scale war, and
caused Islamabad to recall army troops from both patrol operations along the Pakistan-
Afghanistan border as well as from international peacekeeping operations. Pakistan also
tested three ballistic missiles in late-May 2002, sending an implicit message to India that it
would employ nuclear weapons in a conflict.
A flurry of intensive diplomatic missions to South Asia appears to have reduced
tensions during the summer of 2002 and prevented the outbreak of war. Numerous top U.S.
diplomats were involved in this effort. As of March 2003, both Pakistan and India reportedly
have redeployed troops to their peacetime barracks. The latter months of 2002 saw an
apparent reduction of militant infiltration across the line of control, though such movements
appear to been increasing with the spring thaw and may be taking place with the active
support of Pakistani security services. The U.S. government continues to strenuously urge
the two countries to renew a bilateral dialogue that has been moribund since the summer of
2001. New Delhi refuses to engage such dialogue until it is satisfied that Pakistan has ended
all militant infiltration into its Jammu and Kashmir state (for further reading, see CRS Report
RS20277, Recent Developments in Kashmir and U.S. Concerns, and RL31587, Kashmiri
Separatists: Origins, Competing Ideologies, and Prospects for Resolution of the Conflict
).
Pakistan-U.S. Security Cooperation. The close U.S.- Pakistan security ties of the
cold war era – which had come to near halt after the 1990 aid cutoff – appear to be in the
process of restoration as a result of Pakistan’s role in U.S.-led anti-terrorism campaign. In
the spring of 2002, U.S. military and law enforcement personnel reportedly began engaging
in direct, low-profile efforts to assist Pakistani security forces in tracking and apprehending
fugitive Al Qaeda and Taliban fighters on Pakistani territory. Press reports indicate that
Pakistan has remanded to U.S. custody nearly 500 such fugitives to date.
In July 2002, Congress was notified of two Foreign Military Sales arrangements with
Pakistan reportedly worth $230 million. Under the deals, Pakistan is to receive 7 used C-
130E transport aircraft (one being for spare parts) and six Aerostat surveillance radars.
These mark the first notable arms sales to Pakistan in more than a decade and are intended
to bolster Islamabad’s counterterrorism capabilities. Islamabad continues to seek U.S.
weapons and technology, especially in an effort to bolster its air forces. Several Members
of Congress are reported to be supportive of these efforts. A revived high-level U.S.-
Pakistan defense consultative group – moribund for the past 5 years – met in late-September
2002 and included high-level discussions of military cooperation, security assistance, and
anti-terrorism. The two countries also have planned regular joint military exercises (see CRS
Report RL31624, Pakistan-U.S. Anti-Terrorism Cooperation).
Democratization and Human Rights
Democratization Efforts. There had been hopes that national elections in October
2002 would reverse Pakistan’s historic trend toward unstable governance and military
interference in democratic institutions. Such hopes were eroded by the passage of a number
of highly restrictive election laws – including those that prevented the country’s two leading
civilian politicians from participating – as well as President Musharraf’s unilateral
imposition of major constitutional amendments in August 2002. While praising Pakistan’s
CRS-8

IB94041
04-04-03
recent electoral exercises as moves in the right direction, the United States has expressed
concern that these seemingly nondemocratic developments may make the realization of true
democracy in Pakistan more elusive (see CRS Report RS21299, Pakistan’s Domestic
Political Developments
).
Human Rights Problems. The U.S. State Department, in its Pakistan Country
Report on Human Rights Practices, 2002 (issued March 2003), determined that the
Islamabad government’s record on human rights remains “poor.” Along with concerns about
anti-democratic practices, the United States identifies “acute” corruption, extrajudicial
killings, lack of judicial independence, “extremely poor” prison conditions, and increased
violence against Christians as serious problems. Police have abused and raped citizens with
apparent impunity. Improvement in some areas is noted, however, particularly with press
freedoms and governmental efforts to curb religious extremism.
The Human Rights Commission of Pakistan, Amnesty International, and Human Rights
Watch have issued reports critical of Pakistan’s lack of political freedoms and of the
country’s perceived abuses of the rights of women and minorities. Discrimination against
women is widespread, and traditional constraints – cultural, legal, and spousal – have kept
women in a subordinate position in society. “Honor killings” continue to occur throughout
the country. The adult literacy rate for men in Pakistan is more than 50%, while half as many
women are literate. Religious minorities – mainly Christians and Ahmadi Muslims –
reportedly are subjected to discriminatory laws and social intolerance. Blasphemy laws,
instituted under the Zia regime and strengthened in 1991, carry a mandatory death penalty
for blaspheming the Prophet or his family. Blasphemy charges reportedly are commonly
brought as a result of personal or religious vendettas. Anti-Christian and anti-Western
violence, which peaked in the summer of 2002, has cost scores of lives. In 2003, Islamist
lawmakers in the NWFP have launched efforts to impose harsh penalties under Sharia, such
as amputating the hands of thieves and stoning adulterers.
Economic Issues
Overview. Pakistan is a poor country with great extremes in the distribution of wealth.
The long-term economic outlook for Pakistan continues to be rather bleak, given a low
national savings rate (10%) and high labor force growth rates (2.4%) in a country that
remains highly dependent on foreign lending and the importation of basic commodities
(public debt is equal to more than 86% of GDP). In the middle-term, greater political
stability following October 2002 elections could brighten the outlook by providing President
Musharraf with a political base for the further pursuit of economic reform, but conflict with
India is an ever-present risk. In the short-run, substantial fiscal deficits and the still urgent
dependency on external aid donations counterbalance a major overhaul of the tax collection
system and were notable gains in the Karachi Stock Exchange, the world’s best performer
in 2002. Per capita GDP is $425 (or $2,000 when accounting for purchasing power parity).
Output from both the industrial and service sectors grew in 2002, but the agricultural
sector’s output has been weak and significantly slowed growth overall (in part due to severe
drought). Agricultural labor accounts for nearly half of the country’s work force. Pakistan’s
real GDP for the fiscal year ending June 2002 grew by some 3.6% over FY2001 (but 4.5%
for the calendar year). An industrial sector recovery and the end of a 3-year drought have
CRS-9

IB94041
04-04-03
some foreseeing even more robust growth ahead, with predictions putting the FY2003
growth rate at around 4.5%.
The Pakistani government had stabilized the country’s external debt at $36.3 billion by
the end of 2002. The country’s total liquid reserves grew to $10.2 billion by mid-March
2003 – an all-time high and an increase of more than $8 billion since October 1999. In
December 2001, the Paris Club of creditor nations agreed to reschedule $12.5 billion in
repayments on Pakistan’s external debt – one-third of the country’s total burden. Foreign
remittances for 2001 exceeded $1.6 billion – nearly twice the amount in 2000. Inflation,
below 4%, is at the lowest level in three decades, largely as a result of weak consumer
demand. Interest on public debt and defense spending together consume 70% of total
revenues, thus squeezing out development expenditure, including social spending.
Many analysts believe that Pakistan’s resources and comparatively well-developed
entrepreneurial skills may hold promise for more rapid economic growth and development
in coming years. This is particularly true for Pakistan’s textile industry, which accounts for
60% of Pakistan’s exports. Analysts point to the pressing need to broaden the country’s tax
base in order to provide increased revenue for investment in improved infrastructure, health,
and education, all prerequisites for economic development. Only 1.4% of Pakistanis
currently pay income taxes. Agricultural income has not been taxed in the past, largely
because of the domination of parliament and the provincial assemblies by wealthy landlords.
Attempts at economic reform historically have floundered due to political instability.
The Musharraf government has had some modest successes in effecting economic reform.
As of February 2003, the Islamabad appears to be maintaining general continuity in its
economic policies since the previous year’s elections, and the recent seating of a pro-
Musharraf ruling coalition in the Parliament has added to analysts’ confidence that reforms
will remain on track. Moreover, participation in the post-September 2001 anti-terror
coalition had the effect of easing somewhat Islamabad’s severe national debt situation, with
many countries, including the United States, boosting bilateral assistance efforts and large
amounts of external aid flowing into the country.
A June 2002 IMF report stated that Pakistan is making progress toward stated
macroeconomic objectives. It notes particular successes in the areas of tax administration,
fiscal transparency, and privatization. An October 2002 World Bank report commended
Pakistan for bringing about macroeconomic stability and implementing wide-ranging
structural reforms to spur economic growth, while also noting that the country’s poverty
levels are both high and static. A November 2002 IMF report identifies a “worrisome trend
of declining growth” linked in part to “a turbulent domestic and regional political
environment.” A December 2002 World Bank report claims that “Pakistan’s economic
revival program is beginning to produce good results,” but also notes numerous problems
that seem to require further implementation of structural reforms.
Trade Issues. Pakistan’s primary exports are cotton, textiles and apparel, rice, and
leather products. During 2002, total U.S. imports from Pakistan were worth about $2.3
billion, a slight increase over the previous year. Nearly 90% of this value came from the
purchase of textiles, clothing, and related articles. U.S. exports to Pakistan during 2002 were
worth $694 million, a major increase of 28% over 2001. The U.S. trade deficit with Pakistan
has been approximately $1.7 billion for each of the past three years.
CRS-10

IB94041
04-04-03
Legislation in the 107th Congress included S.1675 to authorize the President to reduce
or suspend duties on Pakistani textiles (the bill was not voted upon). During a February 2003
visit to the United States, the Pakistani foreign minister requested greater access to U.S.
markets as a means of reducing poverty and thus also the forces of extremism in Pakistan.
He made a direct link between poverty and the continued existence of Islamic schools
(madrassas) that are implicated in teaching militant anti-American values. Several
nongovernmental Western analysts have made similar arguments.
According to the report of the U.S. Trade Representative for 2002, Pakistan has made
progress in reducing import tariff schedules, though a number of trade barriers remain. Some
items are either restricted or banned from importation for reasons related to religion, national
security, luxury consumption, or protection of local industries. The U.S. pharmaceutical
industry believes that Pakistan maintains discriminatory practices that impede U.S.
manufacturer profitability, while several U.S. companies have complained about Pakistani
violations of their intellectual property rights. The International Intellectual Property
Alliance estimated trade losses of $116 million in 2002, and widespread piracy, especially
of copyrighted materials (Pakistan is a world leader in the pirating of CDs), has kept Pakistan
on the U.S. Trade Representative’s “Special 301" watch list for 13 consecutive years.
Narcotics
Pakistan is a major transit country for opiates that are grown and processed in
Afghanistan and western Pakistan, then distributed throughout the world by Pakistan-based
traffickers. The region has in the past supplied up to 40% of heroin consumed in the United
States and 70% of that consumed in Europe, and has been second only to Southeast Asia’s
Golden Triangle as a top source of the world’s heroin. The U.S. Department of State
indicates that Pakistan’s cooperation on drug control with the United States “remains
excellent.” The Islamabad government has made impressive strides in eradicating opium
poppy cultivation. Estimated production in 2001 was only 5 metric tons, down 59% from
2000 and less than one-thirtieth of the estimated 155 tons produced in 1995. In March 2003,
the Acting Assistant Secretary of State for International Narcotics and Law Enforcement
Affairs claimed that Pakistan has “essentially eliminated opium production,” but the State
Department’s International Narcotics Control Strategy Report for 2002 (March 2003)
indicates that Pakistan still remains a “substantial trafficking country” and notes that opium
production rose slightly in 2002 from a record low in 2001.
Pakistan’s counter-narcotics efforts continue to be hampered by a number of factors,
including lack of total government commitment; scarcity of funds; poor infrastructure in
drug-producing regions; government wariness of provoking unrest in tribal areas; and “acute”
corruption. In March 2003, former U.S. Ambassador to Pakistan Wendy Chamberlain stated
that the role of Pakistan’s intelligence service in the heroin trade over the past six years has
been “substantial.” Direct U.S. counter-narcotics aid to Pakistan totaled $2.4 million in
2002. The program is administered by the State Department’s Bureau of International
Narcotics and Law Enforcement Affairs (INL), which oversaw Pakistan projects with more
than $90 million in FY2002, including $73 million in emergency supplemental
appropriations for border security efforts that continue in FY2003. The INL allocation for
FY2003 was $6 million; rising to $38 million requested for FY2004.
CRS-11

IB94041
04-04-03
Terrorism
After the September 2001 terrorist attacks on the United States, Pakistan pledged and
has provided support for the U.S.-led anti-terror coalition effort. According to the U.S.
Departments of State and Defense, Pakistan has afforded the United States unprecedented
levels of cooperation by allowing the U.S. military to use bases within the country, helping
to identify and detain extremists, and tightening the border between Pakistan and
Afghanistan. In a landmark speech in January 2002, Musharraf vowed to end Pakistan’s use
as a base for terrorism of any kind, criticized religious extremism and intolerance in the
country, and banned numerous militant groups, including Lashkar-e-Taiba and Jaish-e-
Muhammad, both blamed for terrorist violence in Kashmir and India. In the wake of the
speech, thousands of extremists were arrested and detained, though many of these have since
been released.
In January 2002, Wall Street Journal reporter Daniel Pearl was kidnaped in Karachi and
was later found murdered. In May, a bomb blast in Karachi killed 14 people, including 11
French military technicians. One month later, a car bomb detonated outside the U.S.
consulate in Karachi, killing 12 Pakistani nationals. These attacks are widely viewed as
expressions of militants’ anger with the Musharraf regime for its cooperation with U.S. anti-
terror operations, and have raised fears that terrorist groups would further complicate the law
and order situation within the country. Both incidents were linked to Al Qaeda, as well as
to indigenous militant groups. In September 2002, Pakistani authorities announced a series
of high-profile arrests of those deemed responsible for the car bombings, and they claim to
have “broken the back” of the Al Qaeda network in Pakistan. Yet press reports indicate that
Al Qaeda and Taliban fugitives still are numerous in Pakistan and may be attempting to re-
establish their organizations in Pakistani cities such as Karachi. Alleged Al Qaeda leader
Osama bin Laden may himself be in Pakistan.
Islamabad has been under continuous pressure from the United States and numerous
other governments to terminate the infiltration of insurgents from Pakistani Kashmir into
Indian Kashmir. Such pressure elicited an explicit promise from President Musharraf to U.S.
Deputy Secretary of State Armitage that all such movements would cease. After
confirmations from both U.S. and Indian government officials that infiltration was down
significantly in the summer of 2002, the rate of infiltration reportedly rose again in the
autumn, and in December 2002 the U.S. envoy to New Delhi indicated that the problem in
Kashmir is “cross-border terrorism” that is “almost entirely externally driven.” President
Musharraf adamantly insists that his government is doing everything possible to stop such
movements. Critics contend, however, that Islamabad has renewed implicit, if not active,
support for the insurgents in Kashmir as a means to both maintain strategically the domestic
backing of Islamists who view the Kashmir issue as fundamental to the Pakistani national
idea, as well as to disrupt tactically the state government in Indian Kashmir and so seek to
erode New Delhi’s legitimacy there.
U.S. Aid and Congressional Action
The Bush Administration requested a total of $505 million in assistance to Pakistan for
FY2003 (including supplemental appropriations). Security-related assistance in the amount
of $56.5 million was allocated in P.L.108-7, as was $188 million in Economic Support Funds
that Congress authorized Pakistan to use to cancel approximately $1 billion in concessional
CRS-12

IB94041
04-04-03
debt to the U.S. government. (At the end of 2002, Pakistan’s international debt was
estimated at $36.3 billion. P.L. 107-57 allowed Pakistan to reschedule $379 million of its
debt to the United States thereby enabling it to cancel its arrearage.) In early April, an
Emergency Wartime Supplemental Appropriations Act is making its way through Congress.
Both the House and Senate support the President’s request for $200 million in additional
security-related assistance to Pakistan for FY2003. Actual U.S. assistance to Pakistan in
FY2002 was just over $1 billion, up from about $10 million in FY2001. The current
Administration request for FY2004 stands at $395 million.
Some Members of the 107th Congress introduced legislation to reimpose restrictions on
aid to Pakistan in light of perceived to be continuing anti-democratic practices by the
Musharraf government. These resolutions were not were voted upon. In the 108th Congress,
H.R.1403 seeks to remove the democracy-related sanctions exemption with respect to
Pakistan (i.e., to repeal the President’s waiver authority). In February 2003 testimony before
the House International Relations Committee, Secretary of State Powell indicated that the
Administration has been “reviewing all of the various sanctions legislation that has been in
existence for a number of years” and would seek to extend the President’s waiver authority
on democracy-related and other aid restrictions for coming years. Some Members of the
108th Congress have urged reinstatement of proliferation-related sanctions in response to
reports of Pakistani assistance to the North Korean nuclear weapons program, though no
relevant legislation is pending.
Through a series of legislative measures, Congress incrementally lifted sanctions on
Pakistan and India resulting from their 1998 nuclear tests. Congress passed H.R. 2561, the
Department of Defense Appropriations Act, 2000 and it was signed by the President as P.L.
106-79 in October 1999. Title IX of the act gives the President authority to waive sanctions
applied against Pakistan and India in response to the nuclear tests. In a presidential
determination on Pakistan and India issued on October 27, 1999, the President waived
economic sanctions on India. Pakistan, however, remained under sanctions triggered under
Section 508 of the annual foreign assistance appropriations act as a result of the October
1999 coup. The Foreign Operations Export Financing and Related Appropriations Agencies
Act, 2001 provided an exception under which Pakistan could be provided U.S. foreign
assistance funding for basic education programs (P.L. 106-429; Section 597). After the
September 2001 terrorist attacks on the United States, and in recognition of Pakistan’s
cooperation with the U.S.-led coalition being assembled, policymakers searched for new
means of providing assistance to Pakistan. President Bush’s issuance of a final
determination on September 22, 2001 removed remaining sanctions on Pakistan and India
resulting from their 1998 nuclear tests, finding that denying export licences and assistance
was not in the national security interests of the United States (for details, see CRS Report
RS20995, India and Pakistan: Current U.S. Economic Sanctions).
CHRONOLOGY
04/01/03 –– The U.S. State Department announced that on March 24 the United States
imposed nonproliferation penalties on the Pakistani entity Khan Research
Laboratories pursuant to Executive Order 12938, as amended. The two-year
penalties ban all U.S. trade with that entity for its having received missile
technology from a North Korean entity.
CRS-13

IB94041
04-04-03
03/30/03 –– More than 200,000 Pakistanis took to the streets of Peshawar to demonstrate
in opposition to the U.S.-led attack on Iraq.
03/28/03 –– U.S. troops in Afghanistan launched a second major operation with an air
assault on mountains in northeastern Afghanistan near the Pakistan border.
On the same day, the period for Pakistanis in the United States to register
with the Immigration and Naturalization Service ended. More than 1,000
Pakistanis are reported to have sought asylum in Canada.
03/26/03 –– Both Pakistan and India test fired short-range ballistic missiles. On the same
day, while on a visit to Beijing, PM Jamali said that Pakistan and China will
enhance their defense ties.
03/25/03 –– One day after 24 Hindu villagers were shot and killed by apparent Muslim
extremists in Indian Kashmir, New Delhi accused Pakistan of carrying out
“cold-blooded murder,” saying that Pakistani involvement in the attack is “all
too clear.”
03/24/03 –– In a shift from previous pronouncements, President Musharraf said “the
possibility is there” that Osama bin Laden is in Pakistan. On the same day,
Pakistan and China signed a Memorandum of Understanding for the
construction of a second Pakistani nuclear power plant.
03/23/03 –– An estimated 200,000 Pakistanis took to the streets of Lahore to demonstrate
in opposition to the U.S.-led attack on Iraq.
03/21/03 –– Islamist leaders who control the legislature of Pakistan’s North West Frontier
Province announced their intention to establish a version of Islamic law there.
03/20/03 –– Pakistan’s foreign minister called the war against Iraq “unjustified” and
vowed to oppose it “in all fora.” On the same day, up to 1,000 U.S. troops
launched a military operation in southern Afghanistan near the Pakistan
border, reportedly in search of Osama bin Laden and other wanted Al Qaeda
and Taliban fugitives.
03/19/03 –– In response to rising tensions in the region, the U.S. State Department
advised all but essential U.S. diplomats in Pakistan and their families to
depart the country.
03/18/03 –– Pakistan and India established a permanent communication link between their
respective coast guard agencies. On the same day, Pakistan and Iran signed
an agreement to conduct joint border patrols.
03/14/03 –– President Bush exercised his waiver authority to remove coup-related
sanctions on assistance to Pakistan for FY2003. On the same day, the chief
of India’s Defense Intelligence Agency said he had provided the United
States with “solid documentary proof” that 70 Islamic militant camps are
operating in Pakistani Kashmir.
03/12/03 –– The Bush Administration declared that it had “carefully reviewed the facts
relating to the possible transfer of nuclear technology from Pakistan to North
Korea, and decided that they do not warrant the imposition of sanctions under
applicable U.S. laws.”
03/10/03 –– One day after some 100,000 Pakistanis demonstrated in Islamabad in
opposition to an anticipated U.S.-led attack on Iraq, PM Jamali said it would
be “very difficult for Pakistan to support a war against Iraq.” Reports
indicate the Islamabad government intends to abstain on any possible vote.
03/06/03 –– Control of the Shaheen-I (Hatf-IV) ballistic missile was formally handed to
the Pakistani Army’s Strategic Forces Command.
CRS-14

IB94041
04-04-03
03/01/03 –– In a “joint operation” involving U.S. and Pakistani security personnel, Khalid
Mohammed, alleged top Al Qaeda leader and mastermind of the September
2001 terrorists attacks on the United States, was arrested with two others in
Rawalpindi.
02/28/03 –– At least one gunman attacked Pakistani police officers guarding the U.S.
consulate in Karachi, killing two and wounding six others.
02/27/03 –– Assistant Secretary of State for South Asia Rocca met with senior Pakistani
leaders in Islamabad to discuss issues related to Iraq. Many observers believe
Rocca was lobbying for Pakistan’s support for the U.S. position in the U.N.
Security Council.
02/03
–– A diplomatic row between Pakistan and India resulted in the tit-for-tat
expulsions of four envoys from each capital. Later in the month, senate
elections give the PML-Q a simple majority in the Parliament’s upper body.
11/02

A fragile coalition of pro-military parties elected veteran politician and PML-
Q leader Mir Zafarullah Jamali to be the Pakistan’s new prime minister, the
first since Nawaz Sharif was ousted in an October 1999 military coup. The
coalition – which unexpectedly excluded both the Islamist MMA parties and
the secular PPP – was made possible by the defection of several PPP
members, some of whom were rewarded with high-profile ministerships of
their own.
10/02

Pakistan held its first national elections since an October 1999 military coup
brought President Gen. Musharraf to power. No party won a majority of
national assembly seats, but the pro-military PML-Q won a plurality while
the MMA, a coalition of Islamist parties, won a surprisingly large number of
seats and exerts considerable influence in the provincial assemblies of
Baluchistan and the North West Frontier Province along the border with
Afghanistan. The secular PPP of former PM Bhutto won 81 parliamentary
seats, but was shut out of both the national and four provincial ruling
coalitions. Upon completion of the elections, both India and Pakistan
announced major troop redeployments that signaled the apparent end of a
tense 10-month-long military face-off along their shared border.
09-10/02
State elections in India’s Jammu and Kashmir result in the ousting of the
long-ruling National Conference party of Farooq Abdullah and the seating of
a new government ruled by a coalition that vows to “soften” the policy
toward separatist militants. In boycotting the election, the Kashmiri
separatist All Parties Hurriyat Conference – which has political ties to
Islamabad – found itself marginalized.
09/02

A moribund U.S.-Pakistan security relationship is revived when officials
from both countries meet in Islamabad for the first Defense Cooperation
Group session since 1997. A range of bilateral security-related issues are
discussed.
07/02

The U.S. Congress is notified of two pending U.S. arms sales to Pakistan, the
first such sales in more than a decade. The 7 C-130 transport aircraft and six
Aerostat surveillance radars reportedly are meant to bolster Islamabad’s
counterterrorism capabilities.
06/02

Intense international diplomatic pressure – including multiple visits to the
region by senior U.S. government officials – apparently was sufficient to
persuade New Delhi to refrain from taking military action against Pakistan.
Key to the effort are explicit promises by Pakistani President Musharraf to
CRS-15

IB94041
04-04-03
U.S. Deputy Secretary of State Armitage that all infiltration of militants
across the Line of Control and into Indian-held Kashmir will be halted. Also
in June, a car bomb exploded outside the U.S. consulate in Karachi, killing
12 Pakistani nationals. The attack was blamed on Islamic radicals who are
later arrested and who may have links to Al Qaeda.
05/02

A terrorist attack on an Indian army base in Jammu and Kashmir killed 34,
mostly women and children. New Delhi blamed the attack on the “cross-
border terrorism” of Pakistan-sponsored Islamic militants and vowed to fight
a “decisive war” against Pakistan. Also in May, a car bomb exploded outside
a Karachi hotel, killing 14 people, including 11 French military technicians.
The attack was blamed on Islamic radicals who are later arrested and who
may have links to Al Qaeda.
04/02

A controversial referendum ostensibly legitimized Gen. Musharraf’s status
as Pakistani President, though Musharraf later apologized to the nation for
acknowledged irregularities in the process.
Spring

U.S. military and law enforcement personnel began engaging in direct, but
low-profile efforts to assist Pakistani security forces in tracking and
apprehending fugitive Al Qaeda and Taliban fighters on Pakistani territory.
03/02

A major U.S. military offensive (Operation Anaconda) in Afghanistan’s
eastern Shah-i-Kot mountains – in the wake of a massive December 2002
aerial bombardment of Afghanistan’s Tora Bora region – apparently
prompted two waves of up to 5,000 Al Qaeda fighters fleeing into Pakistan.
Press reports indicated that Al Qaeda set up new bases of operations in
western Pakistan and in the city of Karachi.
01/02

President Musharraf delivered a landmark address in which he vowed to end
all Islamic extremism and terrorist activity originating from Pakistani soil.
Also in January, Wall Street Journal reporter Daniel Pearl is kidnaped in
Karachi and later found dead. Four Islamic radicals with possible links to Al
Qaeda subsequently are arrested and convicted of murder.
12/01

A terrorist attack on the Indian Parliament complex in New Delhi left 14
people dead. India blamed the attack on Pakistan-backed Kashmiri militants
and began a massive military mobilization along the Pakistan-India frontier.
Also in December, the United States designated two Pakistan-based militant
groups – Lashkar-e-Taiba and Jaish-e-Mohammed – as Foreign Terrorist
Organizations under U.S. law.
10/01

A terrorist attack on the assembly building in India’s Jammu and Kashmir
state killed 34 people. New Delhi blamed the attack on Pakistan-backed
separatist militants and the J&K Chief Minister called for an Indian military
assault on training camps in Pakistan-held Kashmir.
09/01

Terrorist attacks on the United States, and ensuing U.S. diplomatic pressure,
substantively transformed the U.S.-Pakistan relationship and spurred the
Islamabad government to sever ties with the Afghani Taliban and join in the
U.S.-led anti-terrorism campaign as a key front-line state. Within one month,
all remaining proliferation- and democracy-related restrictions on U.S. aid to
Pakistan were removed or waived and large amounts of U.S. economic and
military assistance began flowing into the country.
CRS-16