Global Financial Crisis Fuels Pakistan Instability

[Turborama]

I think it's about time we all stopped saying, "yeah, whatever" about nuclear armed Pakistan...

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The financial crisis that has spanned the globe has had an especially strong impact in countries beset by political uncertainty. Analysts say weak governments saddled with poorly performing economies are more vulnerable to social unrest and armed insurgency.

According to analysts, Pakistan is one of the most prominent examples of a nation where economic pressures are feeding unrest and threatening a wobbly government.

In recent Congressional testimony, Director of National Intelligence Dennis Blair said the burgeoning world financial crisis is highlighting the linkages between insurgency and economic instability there. "The government is losing authority in the north and west. And even in the more developed parts of the country, mounting economic hardships and frustration over poor governance have given rise to greater radicalization," he said.

Growth has stalled in Pakistan, while prices of food and fuel are up. Inflation, while down slightly from last year, still hovers at around 20%. Shuja Nawaz, director of the South Asia Center at the Atlantic Council, says such ingredients are a classic recipe for radicalization.

"Well, I don't know if they're paying much attention to the economic news, but the Taliban know only that when the government is unable to deliver services, and when there is unhappiness among the general population because food prices have gone up tremendously, gasoline is not available, electricity shortages are rampant, that it is much easier to convince the people that the Taliban have the solution rather than the government," he said.

In a new report, the Atlantic Council says time is running out for Pakistan, and calls for an immediate infusion of an additional $4 billion to $5 billion in aid with similar amounts next year. Nawaz says the aid is critical to Pakistan's survival. "It has to be propped up in the sense that you have to stop the slide. And if you don't do that then everything else really falls by the wayside," he said.

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