[Senate Prints 109-41]
[From the U.S. Government Publishing Office]


109th Congress                                                  S. Prt.
                            COMMITTEE PRINT                     
 1st Session                                                     109-41
_______________________________________________________________________

                                     


 
                   PAKISTAN EARTHQUAKE: INTERNATIONAL

                      RESPONSE AND IMPACT ON U.S.

                     FOREIGN POLICIES AND PROGRAMS

                               __________

                           STAFF TRIP REPORT

                                 TO THE

                     COMMITTEE ON FOREIGN RELATIONS

                          UNITED STATES SENATE

                       One Hundred Ninth Congress

                             First Session

                             December 2005

                                     




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                     COMMITTEE ON FOREIGN RELATIONS

                  RICHARD G. LUGAR, Indiana, Chairman

CHUCK HAGEL, Nebraska                JOSEPH R. BIDEN, Jr., Delaware
LINCOLN CHAFEE, Rhode Island         PAUL S. SARBANES, Maryland
GEORGE ALLEN, Virginia               CHRISTOPHER J. DODD, Connecticut
NORM COLEMAN, Minnesota              JOHN F. KERRY, Massachusetts
GEORGE V. VOINOVICH, Ohio            RUSSELL D. FEINGOLD, Wisconsin
LAMAR ALEXANDER, Tennessee           BARBARA BOXER, California
JOHN E. SUNUNU, New Hampshire        BILL NELSON, Florida
LISA MURKOWSKI, Alaska               BARACK OBAMA, Illinois
MEL MARTINEZ, Florida
                 Kenneth A. Myers, Jr., Staff Director
              Antony J. Blinken, Democratic Staff Director

                                  (ii)




                            C O N T E N T S

                              ----------                              
                                                                   Page
Letter of Transmittal............................................     v

Summary..........................................................     1

Earthquake Relief and Recovery...................................     2

    International Donor's Conference.............................     2

    Earthquake Assistance........................................     3

    USAID Response...............................................     3

    Department of Defense (DoD) Response.........................     3

    U.S. Private Sector Initiative...............................     6

    Ongoing Needs and Concerns...................................     6

    Shelter......................................................     7

    Food.........................................................     7

    Children.....................................................     8

Democracy........................................................     9

    Education....................................................    10

    U.S. Assistance Issues.......................................    11

India-Pakistan Relations.........................................    12

Recommendations..................................................    13

    Earthquake Relief and Reconstruction.........................    13

    Democracy....................................................    13

    India-Pakistan Relations.....................................    13

                                 (iii)




                         LETTER OF TRANSMITTAL

                              ----------                              

Dear Colleague:

    The committee recently sent Ms. Lisa Curtis of the 
professional staff to Pakistan to attend the November 19th 
International Donors' Conference in Islamabad and to assess 
international relief and recovery efforts in response to the 
October 8th earthquake in Pakistan.
    We are pleased to share with you her trip report, which we 
believe provides a useful assessment of the situation in 
Pakistan following the earthquake as well as a careful look at 
the U.S. response to this monumental disaster. The report 
examines the implications for U.S. policies and assistance 
programs to Pakistan as a result of the earthquake and provides 
recommendations for sustaining the momentum of our assistance, 
which has so far successfully demonstrated a strong U.S. 
commitment to the country.
    You also will find in the report an examination of other 
issues important to U.S.-Pakistan relations, including 
strengthening democracy and promoting peace between India and 
Pakistan. There are a few recommendations related to these 
issues that may be helpful as the Committee on Foreign 
Relations continues its oversight of U.S. assistance and 
policies toward Pakistan, where vital U.S. national security 
interests are at stake.
    We look forward to continuing to work with you on these 
issues and welcome any comments you may have on this report.
            Sincerely,

                                          Richard G. Lugar,
                                                           Chairman


                                  (v)



                   PAKISTAN EARTHQUAKE: INTERNATIONAL
                      RESPONSE AND IMPACT ON U.S.
                     FOREIGN POLICIES AND PROGRAMS

                              ----------                              



        SUBMITTED BY LISA CURTIS, SFRC PROFESSIONAL STAFF MEMBER


                                Summary

    From November 16-23, 2005, SFRC staffer Lisa Curtis 
traveled to Pakistan to attend the November 19th International 
Donors' Conference and to assess the international relief and 
recovery efforts in response to the October 8th earthquake. The 
itinerary was designed to allow staff to assess the 
implications of the earthquake for U.S. assistance programs to 
Pakistan as well as U.S. policies related to democracy building 
and the India-Pakistan peace process. Staff visited earthquake-
affected areas in Muzaffarabad in Pakistani Kashmir and 
Mansehra and Shinkiari in the Northwest Frontier Province.
    The earthquake claimed more than 73,000 lives, many of them 
children who were attending school when the quake measuring 7.6 
on the Richter scale struck at 8:50 am on October 8th. At the 
Donors' Conference, the international community pledged over 
$6.2 billion in cash, in-kind assistance, and soft loans. But 
staff found relief efforts remain difficult, given the rugged 
and mountainous terrain of the affected areas. Many survivors 
are in far-flung areas that are difficult to access and 
concerns remain about their ability to cope during the winter 
months in the absence of adequate shelter and supplies.
    The response to the earthquake disaster by the U.S. Embassy 
and USAID Mission in close coordination with the U.S. military 
was reportedly rapid, efficient, and robust. This humanitarian 
gesture has demonstrated to the Pakistani Government and people 
that the U.S. is firmly committed to the country and its well-
being. The U.S. must pay particular attention to the issue of 
transparency and accountability in the distribution of aid, a 
key concern among the Pakistani population.
    The Pakistan military is working closely with a mobilized 
Pakistani civil society and an extraordinary international non-
governmental organization (NGO) effort to help earthquake 
victims. Despite the relatively favorable view of the Pakistan 
Army's role in relief efforts, conversations with mainstream 
politicians and members of the civil society and think tank 
community revealed a hunger for a return to democratic 
politics. The U.S. needs to begin focusing its policies and 
assistance programs now toward the achievement of civilian 
government through free and fair elections in 2007. The impact 
of the earthquake on the Pakistan-India peace process is still 
unclear, although both Pakistani President Musharraf and Indian 
Prime Minister Singh appear personally committed to moving it 
forward.

                     Earthquake Relief and Recovery

International Donors' Conference
    The November 19th International Donors' Conference in 
Islamabad, attended by over 75 nations and international 
organizations, was successful in raising $6.2 billion in cash, 
in-kind assistance, and soft loans. The most generous bilateral 
donors include Saudi Arabia ($593 million in grants and soft 
loans); the U.S. ($510 million in grant and in-kind 
assistance); \1\ China ($320 million in grants and loans); Iran 
($200 million credit line); and the United Arab Emirates ($200 
million in grants). Among the multilateral lenders, the World 
Bank pledged $1 billion in soft loans; the Asian Development 
Bank $1 billion in grants and loans; and the Islamic 
Development Bank $500 million in soft loans.
---------------------------------------------------------------------------
    \1\ The U.S. has pledged $300 million in relief and reconstruction 
assistance; $110 million in transportation and military support; and 
$100 million in private donations.
---------------------------------------------------------------------------
    In his remarks at the conference, Pakistani Prime Minister 
Shaukhat Aziz highlighted the Pakistan government's commitment 
to helping earthquake survivors rebuild their lives, indicating 
this effort would be a ``marathon, not a 100-meter dash.'' The 
government created the Earthquake Rehabilitation and 
Reconstruction Authority (ERRA) to rapidly rehabilitate and 
reconstruct the devastated regions. PM Aziz said ERRA's work 
would be fully transparent and that all political parties would 
be invited to participate in reconstruction work through the 
mechanism of a parliamentary committee.
    UN Secretary General Kofi Anan noted that Pakistan needed 
the enduring support of the international community, and called 
on donors to focus on recovery needs, such as cash grants to 
restore livelihoods; resumption of schooling for children; and 
the re-opening of roads. In helping to rehabilitate and 
reconstruct the affected areas, the international community 
would change the lives of the survivors.
    President Musharraf, during his speech, pointed to the 
historical moment the earthquake had provided regarding 
Pakistan-India relations. Out of the 75 attendees from across 
the globe, President Musharraf singled out India's 
participation as historically significant and thanked the 
Indian government for its contribution of $25 million in relief 
aid. He then laid out a detailed plan for rebuilding the 
devastated areas and encouraged donors to ``adopt'' individual 
homes, schools, or hospitals for construction. He vowed that 
his government would ``turn this human catastrophe into an 
opportunity for human development.'' Musharraf acknowledged 
that his government initially had difficulties transporting 
goods to the affected populations, and that it was only through 
the help of the international fleet of helicopters that this 
problem was resolved. He said his government was on track to 
provide 500,000 tents to victims who lost their homes, and that 
the issue of providing shelter was now ``satisfactory.''
    Musharraf highlighted the government's efforts to monetize 
the earthquake-affected areas through the provision of $350 
million in cash to earthquake victims ($1,700 to next of kin 
and an additional $450 to each of the 400,000 affected 
families). He said this will help generate business and 
economic activity. The President also announced a Pakistan 
Volunteer Corps to channel the ``patriotic energy'' and huge 
outpouring from Pakistani civilians that had resulted from the 
disaster.

U.S. Earthquake Assistance
    There is tremendous appreciation among the Pakistani people 
for the immediate, robust, and sustained U.S. relief efforts in 
the country. Even our harshest critics admit that the U.S. has 
come through for Pakistan at a critical moment and that this 
generous humanitarian gesture is improving the average 
Pakistanis' image of America. This is no small feat, given that 
polling data from last summer showed that only 23 percent of 
the Pakistani population held a favorable view of the U.S., 
while 51 percent of Pakistanis had a great deal of confidence 
in Usama Bin Laden.\2\
---------------------------------------------------------------------------
    \2\ PEW Global Attitudes Project, July, 2005.
---------------------------------------------------------------------------
    The success of U.S. relief efforts in Pakistan is due in 
large part to the work of the U.S. Embassy in Islamabad under 
the leadership of Ambassador Crocker. According to interviews 
with Embassy personnel, Ambassador Crocker was quick off the 
mark in assessing how the U.S. should respond to the 
devastating earthquake and has worked assiduously with Embassy 
staff over the last two months to ensure an effective 
humanitarian response.

USAID Response
    USAID has so far disbursed about $60 million in earthquake 
relief assistance. Immediately following the earthquake, USAID 
focused its efforts on providing humanitarian assistance and 
shelter to the earthquake victims. USAID has also taken steps 
to promote livelihoods and market revitalization and has so far 
provided about $4.5 million for cash-for-work, cash-for-
training, and voucher activities. USAID is funding distribution 
of shelter materials, such as metal sheeting, tools, and 
tarpaulins, and supports about a dozen international NGOs 
working in Pakistan. USAID is housed on the Embassy compound in 
newly-constructed facilities, but it is clear these facilities 
will need to be expanded to accommodate new programs related to 
earthquake relief operations.\3\
---------------------------------------------------------------------------
    \3\ Information in this paragraph was drawn largely from the USAID 
``South Asia Earthquake Update'' dated December 2, 2005.
---------------------------------------------------------------------------
Department of Defense (DoD) Response
    Within 24 hours of the earthquake, the U.S. military sent 
two helicopters from Afghanistan. The U.S. now has 16 
helicopters involved in relief efforts in Pakistan, down from 
24 in mid-November. DoD reports that there are currently four 
Australian helicopters and a fleet of 73 additional 
international helicopters (mostly Pakistani, for which the U.S. 
has provided spare parts) involved in the relief effort. DoD 
says that winter weather conditions are beginning to prohibit 
their ability to fly, but that they intend to retain some U.S. 
helicopters in Pakistan through the winter.



         U.S. Chinook at Chaklala Air Base, the staging ground
                    for international relief efforts

    Perhaps the largest contribution the U.S. military made to 
the relief effort was the logistical management of the air 
space and relief operations staged from Chaklala air base 
(located adjacent to the Islamabad International Airport). 
Given the mountainous terrain of the earthquake-affected 
regions, limited landing zones, and the Pakistanis' limited air 
traffic control capacity, the Pakistani system was initially 
overwhelmed and U.S. military support was crucial in ensuring a 
coordinated, efficient, and effective international relief 
effort. During the November 21st staff visit to Chaklala air 
base, U.S. military officers made clear that the Pakistan 
government was in charge of the international relief effort, 
but also reported that the U.S. military had worked closely 
with the Pakistan Army to organize and coordinate it. NATO has 
also played an instrumental role in providing relief, clearing 
roads, removing debris, and providing medical assistance. NATO 
is scheduled to depart Pakistan in February. Pakistani 
religious parties have questioned the presence of NATO troops 
in Pakistan and tried to whip up fears that NATO was 
establishing a long-term presence in the country.



                  Relief supplies at Chaklala Air Base

    There are currently about 1,000 U.S. soldiers on the ground 
in Pakistan, including some from Louisiana who lost their own 
homes in Hurricane Katrina. Staff heard numerous stories from a 
wide variety of Pakistani interlocutors about the warm feelings 
the Pakistani population held toward the U.S. military because 
of their involvement in the relief efforts. Pakistanis had 
spontaneously thanked U.S. soldiers in the markets in 
Islamabad, while U.S. flags could be found flying in remote 
villages of Pakistani Kashmir.
    During a brief stop in Muzaffarabad, staff visited a U.S. 
military mobile medical unit that had been established in late 
October. There were 16 doctors and 72 nurses at the facility, 
treating about 100 patients per day, mostly for broken bones 
and some cases of tetanus. Staff also visited a newly-
established U.S. mobile medical unit in Shinkiari in the 
Northwest Frontier Province (NWFP). Nearly 200 Okinawa-based 
Marines and sailors set up camp in this remote village on 
November 15th and reportedly treat about 100-200 patients per 
day.\4\
---------------------------------------------------------------------------
    \4\ Information on the current number of patients was drawn from 
the DoD website.



 Local children receiving medical attention at the U.S. mobile medical
                          unit in Muzaffarabad

U.S. Private Sector Initiative
    On October 27th, President Bush launched a private sector 
initiative to encourage private donations for relief and 
reconstruction. On November 14th, State Department Under 
Secretary for Public Diplomacy Karen Hughes led a delegation to 
Pakistan that included three distinguished U.S. CEO's: Hank 
Mckinnell, Chairman and CEO of Pfizer, Inc.; Anne Mulcahy, 
Chairman and CEO of Xerox Corporation; and Jim Kelly, former 
Chairman and CEO of United Parcel Service (UPS), Inc. These 
business leaders will work with other Americans to raise 
awareness and resources to help victims of the earthquake. 
According to an Indiana University-based tracking system, $73 
million in U.S. private donations has so far been disbursed to 
victims of the South Asia earthquake.

Ongoing Needs and Concerns
    Pakistani interlocutors noted the importance of the U.S. 
disbursing its aid in a way that encourages transparent and 
accountable development. Pakistanis, in general, were pleased 
by the huge international outpouring of support at the Donors' 
Conference, but they questioned how this money would be 
disbursed and whether it would go through the President's 
Relief Fund or through established NGOs. During staff visit to 
Muzaffarabad, one of the Urdu speakers on the U.S. delegation 
was stopped by a local woman who claimed that the aid was not 
being distributed fairly and pleaded for the U.S. to use its 
influence to ensure that the aid went to the people who 
genuinely needed it.
    Staff observed a fair amount of economic activity in 
downtown Muzaffarabad, with shopkeepers displaying an array of 
food items, clothing, shoes, and other household items. Many 
shop owners displayed their goods in the open air, with their 
collapsed shops behind them. There was a tremendous amount of 
destruction and rubble that still needed to be cleared.



            Earthquake destruction in downtown Muzaffarabad

Shelter
    There was mixed feedback on the dangers winter poses to 
those in remote areas, but one NGO reported in early December 
that the grim predictions of mass deaths registered one month 
ago now appear unlikely. During staff visit, Pakistan 
government officials seemed to think the issue of shelter was 
under control, while some NGOs said it is still a question. One 
Pakistani commentator noted that since some areas had not yet 
been accessed, it was impossible to assess what percentage of 
the population might still be at risk. Most NGOs are now 
focusing on distributing shelter packages (roofing material and 
tools) to those in remote areas still without shelter, rather 
than trying to transport tents. The UN says it expects an 
exodus of refugees (100,000-200,000) from the mountains into 
low-lying areas in the coming weeks, as villagers flee an 
increasingly bitter winter.

Food
    One local NGO representative working in the Balakot area 
reported that the availability of food was not yet a problem in 
these areas since many people were able to salvage food that 
had been stored in the ground. Food drops had also been 
successful in remote areas like the Allai Valley. Other NGO 
representatives reported food shortages in remote areas. 
Inflation was also a concern, partly due to the Government's 
cash infusion of over $350 million to affected families. U.S. 
military officers at Chaklala air base reported that food 
relief operations were focused largely on moving food stocks 
into forward areas since helicopters would not be able to fly 
into far-flung areas once snow started to fall.

Children
    Pakistani children have suffered tremendously from this 
disaster, and need special attention from relief workers. It is 
estimated that perhaps 50 percent of the 73,000 that perished 
were children who were attending school when the earthquake 
struck. According to the Pakistan government, 16,000 schools 
were destroyed or badly damaged. UNICEF has identified four 
fundamental steps to addressing children's needs in the wake of 
the disaster: keeping children alive, caring for those children 
separated from their parents, protecting children from 
exploitation, and getting them back to school. Education 
programs provide security, a sense of normalcy, and hope for 
the future. They are ``safe spaces'' for children and provide a 
support system, especially for vulnerable children, such as 
those separated from their families. \5\
---------------------------------------------------------------------------
    \5\ This information was drawn from the Basic Education Coalition's 
``After the Earthquake: Pakistan's Affected Children and Schools,'' 
published in October 2005.
---------------------------------------------------------------------------
    Staff visited a makeshift school in Muzaffarabad that the 
U.S. military, in cooperation with the local population, had 
established. The school, comprising about 15-20 winterized 
tents, was set up on a site where an elementary school had 
completely collapsed. U.S. soldiers were still clearing much of 
the debris from the area, but it was heartening to see about 
150-200 children attending school in the tents. Staff visited 
an 11th grade class in which the teenage girls and boys were 
studying Physics. Some of these children reported living in 
camps on the outskirts of Muzaffarabad. The students appeared 
in good health and to be coping as best as could be expected.



    Girls attending 11th grade Physics class in a makeshift school 
                             established by
the U.S. military, in cooperation with local workers, on the site of a 
                               completely
                    collapsed school in Muzaffarabad

    Representatives from an established local NGO, the Kashmir 
Institute of International Relations (KIIR), reported concerns 
immediately following the disaster that orphaned children would 
be trafficked. However, following the Pakistan government's 
institution of a ``no adoption'' policy and increased scrutiny 
by security forces of the transport of children at security 
check points, the dangers of child trafficking appeared to be 
in check.

                               Democracy

    There were mixed feelings about the Pakistan Army's role in 
relief efforts, and widespread criticism that the Army had been 
slow to respond in the first 3-4 days, possibly because they 
were coping with their own losses along the Line of Control 
(LoC). Despite its slow start, a number of people expressed 
that the Pakistan Army was now doing a relatively good job with 
relief efforts and cooperating effectively with international 
and local NGOs and civilian volunteers on the ground.
    The Pakistani civil society mobilized effectively to help 
the earthquake victims, a phenomenon that has energized and 
emboldened many Pakistani civilians. There was a tremendous 
urge to help their countrymen and many Pakistanis rushed to the 
affected areas to do whatever they could to help. One 
commentator noted that Pakistani civilians now see what they 
are capable of achieving when they organize and work together.
    During his speech at the Donors' Conference, Gareth Thomas, 
UK Minister for International Development, pointed to the need 
for ``broad political ownership'' of the recovery and 
reconstruction efforts in the country. A UK diplomat said his 
government saw an opportunity in the reconstruction process to 
encourage political reconciliation between the military and 
mainstream political parties.
    There is widespread concern among Pakistani politicians, 
commentators, and journalists that the democratic process and 
institutions in Pakistan have been set back under the six-year 
rule of President Musharraf. Pakistani interlocutors expressed 
frustration that President Musharraf was weakening democratic 
institutions and contributing to an overall militarization of 
society. They viewed his publicized plan of ``enlightened 
moderation'' as disingenuous, noting that his government had 
contributed to the increasing influence of the religious 
parties, while closing the political space for mainstream 
political parties with more moderate, progressive agendas. Some 
voiced concern that the U.S. had failed to comment on local 
bodies elections held in August that were widely viewed as 
flawed, and urged that U.S. support for democracy in Pakistan 
be given a higher priority in bilateral relations.
    Despite complaints about the decay of democratic 
institutions, interlocutors widely agreed that the media was 
much freer than a few years ago. One Pakistani academic told 
staff that he felt freer to publish what he wanted than he did 
ten years ago under a democratic government. Many attributed 
the freedom of the media to the information explosion rather 
than any specific government policy.
    There was criticism of President Musharraf's devolution 
plan and the USAID program supporting it. The Pakistan 
government has presented its plan for devolution as an effort 
to improve public services and has attracted considerable 
support from international donors. Some contended, however, 
that it was merely a plan to ensure the military regime's 
survival. Others noted that USAID officials did not have 
appropriate monitoring mechanisms to ensure the program's 
efficacy and that the program was not meeting the objective of 
promoting democracy. USAID officials acknowledged to staff in 
mid-December that there had been problems with USAID's support 
to the devolution process but that they had recently identified 
a new contractor to redesign the USAID program and would be 
transitioning to a more focused initiative to support 
devolution. The U.S. official noted that it was important to 
encourage local government support for health and education 
programs and that USAID would focus increasingly on those 
districts where other USAID-supported programs are active, 
addressing governance issues that impede service delivery.

Education
    USAID's education program in Pakistan began in 2002 and 
involves both basic and higher education. The education 
programs are concentrated in the underdeveloped provinces of 
Sindh and Baluchistan and the Federally Administered Tribal 
Areas (FATA). Education funding for Pakistan totaled $66 
million for FY 2005. The Basic Education program benefits over 
367,000 Pakistani children and 18,000 teachers and includes 
teacher training, school improvement, policy and planning, and 
other basic education activities. The higher education program 
includes a grant to the Fulbright Commission to provide 500 
scholarships for post-graduate degree scholarships in the 
U.S.\6\
---------------------------------------------------------------------------
    \6\ Information in this paragraph was drawn from USAID information 
sheets provided by the USAID Mission in Islamabad.
---------------------------------------------------------------------------
    Staff visited a USAID-supported girls' school on the 
outskirts of Islamabad. Through a grant of only $1,500, USAID 
inspired the people of this community to establish a Parent 
Teacher's Association (PTA) and build a library for the school. 
Staff met with members of the PTA, visited with students in the 
first-grade class, and toured the library that is under 
construction. The community has taken responsibility for 
equipping the library that will serve the 517 primary and 
secondary level girl students and teachers.
    The U.S. also is encouraging the Government of Pakistan to 
spend more of its own resources on education to support 
President Musharraf's goal of promoting a progressive, moderate 
society. Pakistan recently pledged to increase its spending on 
education to 4 percent of its GDP, according to the USAID 
Mission Director in Islamabad, and allocated about $35 million 
to education from the FY 2005 $200 million in U.S. direct 
budget support.

U.S. Assistance Issues
    Many observers have noted over the last two years that U.S. 
assistance to Pakistan needs to focus more directly on 
institution building and on projects that demonstrate the U.S. 
is committed to uplifting the lives of average Pakistanis. A 
study done last year by the Center for Strategic and 
International Studies (CSIS) argues for more programmed 
assistance to Pakistan, at least half of which should be 
dedicated to supporting a major effort to rebuild institutions. 
``The 9/11 Public Disclosure Project,'' released on November 
14, 2005, states that too much of our assistance is in the form 
of a cash transfer and that more U.S. funding should be 
dedicated to education.
    U.S. assistance to Pakistan since September 2001 has 
focused largely on debt relief, budgetary support, and to a 
lesser--but increasing--degree on education, health care, and 
development projects. The U.S. has provided about $1.2 billion 
to the Government of Pakistan for foreign exchange needs and to 
repay debts to multilateral institutions since 2001, while 
USAID has obligated about $300 million during the same period 
on health, governance, and economic growth programs.\7\ 
Although the $1.2 billion in direct funding has helped ease 
macroeconomic pressures on Pakistan, such as enabling it to 
reduce its total government debt from 89 percent of GDP in 2000 
to 64 percent in 2004, \8\ the administration should consider 
whether a portion of this direct assistance can now be 
programmed toward additional USAID education, health, and 
democracy building projects.
---------------------------------------------------------------------------
    \7\ These figures were provided by USAID staff in December 2005.
    \8\ Secretary of State Congressional Budget Justification for 
Foreign Operations, fiscal year 2006.

   Out of this fiscal year's $700 million economic and 
        military assistance package to Pakistan, only $15 
        million of this funding is allocated to democracy and 
        governance programs. Staff was pleased to learn from 
        USAID officials that this sum is expected to increase 
        in FY 2007 by another $15 million, but this still 
        appears to be an insufficient sum, given the need for 
        democratic institution building in the country.

                        India-Pakistan Relations

    Last month's opening of five crossing points along the Line 
of Control (LoC) that divides Kashmir provided a much-needed 
boost to peace efforts, following two weeks of public wrangling 
between the two governments over implementation of assistance 
to the earthquake survivors. The two sides wasted precious time 
in the days following the earthquake by arguing over the use of 
helicopters. Pakistan refused Indian helicopter support, saying 
this would allow New Delhi to collect intelligence in a 
sensitive part of the country, while India rebuffed Pakistan's 
request that the Indian helicopters be piloted by Pakistani 
servicemen. The LoC border openings provided a way out of the 
helicopter impasse, but many were disappointed by the public 
jockeying in the wake of the disaster.
    During staff visit, Pakistani Prime Minister Aziz declared 
his support for demilitarization and self-rule in Kashmir. 
Although Aziz did not provide details on his proposal, some 
interlocutors in Pakistan recommended gradual demilitarization 
in Kashmir, beginning with urban areas. They further asserted 
that self-rule applied only to Azad Kashmir on the Pakistan 
side and the Valley and three districts of Jammu (Punch, 
Rajauri, and Jammu districts) on the Indian side of the LoC. 
When staff queried how demilitarization can occur when militant 
violence continues in Indian Kashmir, they argued that 
extremist groups will never change their minds or stop using 
violence.
    A major issue to monitor over the next several months is 
whether extremist groups, such as the Jamat ul-Dawa (JUD--
formerly the Lashkar-e-Tayyiba, a State Department-designated 
Foreign Terrorist Organization), are using their increased 
influence with the population in Pakistani Kashmir to recruit 
for the Kashmir militancy. The JUD was one of the first groups 
to help rescue victims in Pakistani Kashmir and help families 
in the region bury their dead. The JUD is not only familiar 
with the terrain in these areas, but also experienced in social 
outreach and adept at raising funds at Mosques. Pakistani 
observers reported that several extremist groups formally 
banned by the Pakistan government are now fully operative and 
highly visible in all earthquake zones. They are seen in the 
market places and reportedly drive in SUVs, indicating they 
have substantial income sources. Observers note that these 
extremist organizations have a new claim to legitimacy, given 
their successful relief efforts in the region.

   The Pakistan Government will need to ensure that 
        violent extremist groups like the JUD are restricted 
        from using their resources for terrorism-related 
        activities, such as militant recruitment or incitement 
        toward violent jihad in Kashmir and/or Afghanistan.

    One Pakistani commentator, citing the increased influence 
of the jihadi organizations and unprecedented international 
access to Pakistani Kashmir, noted that ``winds of change were 
blowing in the region.'' It is still unclear whether President 
Musharraf and Prime Minister Singh will be able to harness some 
of the recent goodwill and capitalize on sympathetic feelings 
on both sides to move the peace process forward. They will need 
to act boldly and swiftly in this regard in order to counter 
some of the negative trends that could develop in the region.

                            Recommendations

Earthquake Relief and Reconstruction
    1. The relief and recovery effort in Pakistan will continue 
over the next one to three years. The U.S. should maintain air 
support to relief operations through at least March 2006, 
especially since road travel will be increasingly limited due 
to severe weather conditions. USAID should begin as soon as 
possible efforts to reconstruct schools and health facilities 
in earthquake-affected areas in the Northwest Frontier Province 
and Pakistani Kashmir.

    2. Congress should continue to monitor and evaluate whether 
the current package of $150 million in 2006 funding for 
humanitarian relief and recovery is sufficient (as of this 
date, $80 million of those funds had already been programmed).

    3. U.S. earthquake assistance programs should focus on 
promoting democratic, self-sustaining social development as 
well as capacity building within civil society and community 
participation. The U.S. also will need to pay particular 
attention to the involvement of women in the reconstruction 
process.

Democracy
    1. Focus U.S. policies and assistance programs now on 
ensuring free and fair elections that will produce a civilian 
government in 2007. This could include increasing public 
awareness of U.S. support for democracy and programming more 
funds toward democracy and institution building.

    2. The U.S. administration should consider transferring 
more funds from the current annual $200 million in direct cash 
transfer to the Pakistani Government toward USAID programs that 
promote democracy. These programs should focus on rooting out 
institutional corruption, improving the functioning of the 
judiciary and parliament, and strengthening the electoral 
process.

    3. Given concerns raised about USAID's support to 
devolution in Pakistan, Congress will need to monitor this 
program, for which USAID has programmed $17.7 million over the 
period of 2002-2007.

Pakistan-India Peace Process
    1. Monitor activities of JUD and other militant groups that 
may be trying to take advantage of the situation to whip up 
support for militancy in Kashmir.

    2. Encourage India and Pakistan to take another major 
confidence building step that involves participation by the 
local populations on both sides of the Line of Control that 
divides Kashmir as a way to fortify the peace process.
                              ----------                              

Staff held discussions with the following individuals in Pakistan:

U.S. Embassy/State Department
    Patricia Brandemaier, Acting Deputy Chief of Mission
    Tim Wilder, Political Counselor
    Divya Swamy, Political Officer
    Andrew Quinn, Economic Counselor
    Peter Kovach, Director, Public Affairs Office
    Mary Virginia Kennedy, South Asia Bureau Earthquake Coordinator

USAID
    USAID Mission Director, Lisa Chiles
    USAID Mission Deputy Director, Patricia Rader
    Julie Koenen-Grant, Senior Governance Advisor
    Thomas Crehan, Education Officer
    William Berger, DART Leader, Office of U.S. Foreign Disaster 
Assistance

U.S. Military
    Navy Rear Admiral Michael LeFever, Commander of the U.S. Disaster 
Assistance Center in Islamabad

Pakistan Government
    Syed Sail Abbas, Director (Americas), Ministry of Foreign Affairs

Non-Governmental Organizations
    Charles MacCormack, President, Save the Children
    Samina Khan, Executive Director, Sungi Development Foundation
    Asma Jehangir, United Nations Special Rapporteur on Freedom of 

Religion or Belief of the Commission on Human Rights
    Sardar Amjad Yousef, President, Kashmir Institute of International 

Relations
    Sheeba Afghani, Independent Development Consultant

Commentators/Academics
    Dr. Pervez Hoodbhoy, Professor of Physics, Quaid-e-Azam University, 
Islamabad
    Talat Hussain, Special Correspondent with Newsweek
    Naveed Ahmad, Staff Correspondent for the Pakistani Daily, ``The 
News''
    Farhan Bokhari, Correspondent, ``Financial Times''
    Dr. Pervaiz Iqbal Cheema, President, Islamabad Policy Research 
Institute
    Lt. Gen. Talat Masood (Retd.), Former Secretary Defense Production, 
Ministry of Defense
    Major Gen. Jamshed Ayaz Khan (Retd.), President Institute of 

Regional Studies
    Khalid Rahman, Executive Director, Institute of Policy Studies

Politicians
    Raja Pervez Ashraf, Secretary General of the Pakistan People's 
Party Parliamentarians and Member of the National Assembly
    Senator Iqbal Haider
    Abida Hussain, Pakistan Muslim League-Nawaz and former Ambassador 
to the U.S.
    Aitzaz Ahsan, Member of the National Assembly
    Ahsan Iqbal, Pakistan Muslim League-Nawaz
    Shah Ghulam Qadir, Secretary General, All Jammu and Kashmir Muslim 
Conference

Other
    Peter Wilson, British High Commission

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