- The Washington Times - Thursday, November 1, 2001

Pakistan's foreign minister said yesterday his government is encouraged by a drop-off in anti-American protests, but this week's U.S. offer of $673 million in aid will not head off long-term instability as the war in Afghanistan weakens his country's economy.

"The number of [pro-Taliban] demonstrators is going down we discussed this in the Cabinet today," Foreign Minister Abdus Sattar said by telephone from Islamabad.

"About the law and order situation, there's much greater confidence than 25 days ago.

"This does not mean there is a decrease in the level of concern in the country, which is largely moved by reports of civilian casualties in Afghanistan we all share this compassion."

The U.S. ambassador to Pakistan, Wendy Chamberlin, said the government of President Pervez Musharraf "is quite secure."

Anti-American demonstrations are controlled by "minority fringe groups" and "have never gotten out of hand," she said Tuesday on the NBC "Today" show.

Yesterday's Cabinet meeting was convened to discuss Islamic extremists who had called for the overthrow of the government for assisting the U.S.-led war on terrorism.

In a sign of Gen. Musharraf's confidence in the government's ability to face down the protesters, the president said he would not push the United States to end the bombing of Afghanistan by the start of Ramadan.

"One has to achieve the objective of the military operation I only hope that this is achieved before Ramadan," he told Reuters television on Tuesday, referring to the Islamic holy month beginning Nov. 14.

"But if that does not happen, I would discuss the matter with [President Bush] but I wouldn't be pressing him as such."

Mr. Sattar said that despite the lifting of U.S. sanctions and the announcement this week of $673 million in aid, his country stands to lose $1.5 billion this year as U.S. and Japanese importers cancel contracts for textiles and clothing because of uncertainty following the September 11 attacks.

"As a result of the crisis in the neighborhood, exports are affected," the foreign minister said.

He urged the U.S. Congress to quickly approve a State Department request for dropping U.S. quotas and duties on Pakistani textile exports.

The United States also has agreed to support a $2 billion International Monetary Fund loan package, he said.

Pakistan will seek further aid from the "Paris Club" of donor nations, which will be asked to ease the terms on payment of its $38 billion foreign debt.

A large debt-relief package to Pakistan in the works would cut interest rates on its debt to 1 percent or less and spread payments over many years, said a Pakistani-American source.

Mr. Bush will announce the package when he meets Gen. Musharraf in New York on Nov. 10, the source said.

Mr. Sattar said Pakistan's economy had suffered from corruption and fiscal mismanagement under civilian governments "for the last several years until 1999" when Gen. Musharraf seized power in a military coup.

James Clad, a professor of Asian studies at Georgetown University, agreed that the military government had made credible efforts to reform the economy, collect taxes and reduce corruption. But he said there was a risk that generous assistance would reduce the incentive for needed, tough reforms.

Stephen Cohen, a former U.S. official currently with the Brookings Institution, said, "U.S. aid will be useless unless there are economic reforms. Aid can't be payment for services rendered.

"Our aid should be conditioned on improving, above all, the education system," he said.

The only schooling now available to many Pakistani children is in religious schools, or "madrassas," many of which have become training grounds for Islamic extremists.

Mr. Sattar said Pakistan would use any money that became available to force the schools to teach practical subjects such as the national language of Urdu, science and history.

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