Index

Testimony by Assistant Secretary Karl F. Inderfurth

House International Relations Committee
Asia and Pacific Subcommittee
Wednesday October 20, 1999

"Immediate Challenges to U.S. Policy in South Asia"

Introduction

Mr. Chairman, I appreciate this opportunity to appear before the Asia
and Pacific Subcommittee today. For a number of rather obvious
reasons, I believe it is an auspicious time to meet with you and
Members of the Committee.

We have a number of immediate challenges facing United States policy
in South Asia, and this afternoon I would like to address three in
particular: the political crisis in Pakistan, where the army has taken
the reins of power; the recent elections in India and the formation of
a new government; and the situation in Afghanistan and our steps to
combat international terrorists who take shelter there.

Political Crisis in Pakistan

At the top of our agenda today is the political crisis which erupted a
week ago in Pakistan. I will begin by summarizing developments since
October 12 and then address our policy at present toward Pakistan.

On Tuesday, October 12, the Government of Prime Minister Nawaz Sharif
announced the retirement of Chief of Army Staff Pervez Musharraf, who
was out of the country at the time. In response, and with General
Musharraf returning to Karachi, the military seized power. Military
personnel placed the Prime Minister and other civilian and military
leaders under house arrest and occupied key facilities, including the
state controlled broadcast media in Islamabad and other cities. Late
that night, Pakistani media broadcast a short statement by General
Musharraf outlining why the Army had "moved in." The next day, General
Musharraf assumed power under the title of "Chief Executive," declared
a state of emergency, suspended the constitution and the elected
national and provincial assemblies, dismissed the government, and
declared other measures restricting judicial powers.

In response to these events, the White House issued a statement by
President Clinton which read: "The events in Pakistan this week
represent another setback to Pakistani democracy. Pakistan's interests
would be served by a prompt return to civilian rule and restoration of
the democratic process. I urge that Pakistan move quickly in that
direction. I am sending my ambassador back to Islamabad to underscore
my view directly to the military authorities, and to hear their
intentions. I will also be consulting closely with all concerned
nations about maintaining peace and stability in South Asia."

U.S. Ambassador William Milam returned to Islamabad on Friday, and met
with General Musharraf to deliver our strong message calling for a
rapid return to
constitutional democracy under a civilian government. He also called
upon General Musharraf to insure the safety and well-being of Prime
Minister Sharif, his brother the chief minister of Punjab, Shahbaz
Sharif, and the others who were detained.

On Sunday, October 17, General Musharraf addressed the nation to
describe the steps he plans to take in the days ahead. He announced
that he will chair a National Security Council, with military and
civilian members, which will give policy direction to a cabinet of
civilian ministers. President Rafiq Tarar will remain in office.
General Musharraf emphasized that martial law has not been declared
and that the announced government structure calls for a prominent role
for civilians. However, the military is clearly in charge. General
Musharraf also addressed Pakistan's international priorities,
including relations with India, the conflict over Kashmir, Pakistan's
sensitivity to international nonproliferation norms, and Afghanistan.
The United States believes it is critically important for Pakistan and
India to find a way to resume their dialogue; we hope both will
undertake confidence building measures, such as the unilateral troop
pullback along the international border announced by General
Musharraf, that could lead to a lessening of tensions. We note General
Musharraf's statements with regard to global non-proliferation
objectives and nuclear and missile restraint and hope to see concrete
action in these areas. He also stated his belief that the Afghan
conflict can be settled only through establishment of a representative
government in Kabul, a view we share.

Mr. Chairman, we listened closely to what General Musharraf had to say
in his Sunday night address. We heard his pledge for a return to a
"true" democracy in Pakistan and that the armed forces have no
intention of remaining in power any longer than necessary. But we are
disappointed with what we did not hear: an announcement of a clear
timetable for the early restoration of constitutional, civilian, and
democratic government. You will remember that an earlier Army Chief,
General Zia, anticipated a brief period of military control when he
took power and ended up ruling for 11 years. The press in Pakistan and
here has focused, in recent days, on the rationale for the General's
actions. Much of the coverage has seemed to support General
Musharraf's statement that Pakistan had "hit rock bottom." For our
part, we are not justifying or condoning the General's actions. As a
matter of principle -- one that we believe applies throughout the
world -- the remedy for flawed democracy is not a military coup,
suspension of a democratically elected legislature, and the detention
of the elected government. In our view, Pakistan's long-term stability
lies in developing civilian political institutions which are
self-correcting through political processes, not through the expedient
of military intervention. President Clinton, Secretary Albright, and
other U.S. officials have expressed our deep regret at this setback to
democracy, and our hope that Pakistan's authorities will acknowledge
and fulfill their duty to restore Pakistan to civilian, democratic,
constitutional government as soon as possible.

Mr. Chairman, until we see a restoration of democracy in Pakistan, we
have made it clear we would not be in a position to carry on business
as usual with Pakistani authorities. As you know, Section 508 of the
Foreign Operations Appropriations Act contains a prohibition against a
broad range of assistance for a country whose democratically elected
head of government is deposed by military coup or decree. We have
applied those sanctions with regard to Pakistan. As a practical
matter, most forms of assistance are already prohibited for Pakistan
under the Glenn Amendment and other statutory restrictions.

As General Musharraf told his nation, actions speak louder than words.
The United States will watch closely as the General acts to fulfill
his pledge to return his country to democracy and to address the other
serious problems he identified, including the economy and corruption.
We call on General Musharraf to respect civil liberties, freedom of
the press, judicial independence, and human rights while this process
proceeds. Our own actions toward Pakistan in the days ahead will be
guided in large part by the steps the new authorities take.

One final word, Mr. Chairman. Despite our deep disappointment with
this latest setback to democracy in Pakistan, we have no choice but to
stay engaged. We cannot walk away because Pakistan is important. It is
important because stability or the lack thereof in Pakistan will have
an impact on Pakistan's neighbors, the region, and beyond. Pakistan is
important because it can serve as an 'example of a progressive Islamic
democracy, because it is a link -- both economic and political --
between the Indian Ocean and Central Asia, because it has significant
human and economic resources, and because it has historically been a
friend of the United States. It is important therefore for the United
States and other long-time friends of Pakistan to express their
concern, exert their influence, and take those steps necessary and
appropriate so that Pakistan can see a "prompt return to civilian rule
and restoration of the democratic process" as called for by President
Clinton.

National Elections in India

Turning to India, Mr. Chairman, we are also facing a challenge, but in
this case a more positive one. India has just completed the largest
exercise of democratic voting the world has ever witnessed. More than
360 million voters cast ballots, and more than a few had to defy those
who would use violence to disrupt the political process. The final
results of India's month long election gave the 17-party coalition of
Prime Minister Vajpayee 303 seats in the lower house of parliament, 31
more than needed to form a simple majority. Atal Bihari Vajpayee was
sworn in for the third time as India's Prime Minister on October 13.
It was also, as Foreign Minister Jaswant Singh pointed out, the first
time in 27 years in India that an incumbent Prime Minister has been
returned to office. President Clinton phoned Prime Minister Vajpayee
to offer his congratulations.

There are substantial elements of continuity between the previous and
the new governments -- in particular, in the key positions of Prime
Minister, Foreign Minister, Home Minister, Finance Minister, and
Defense Minister. Prime Minister Vajpayee's ability to maintain
continuity of leadership in the key ministries and his largely
successful effort to accommodate his coalition partners should mean
that his government will be quick off the mark in implementing policy
priorities, including economic reform, rural development, and national
security. This new government also appears to have a larger and
therefore potentially stronger coalition -- a fact that we hope will
enable India's leaders to adopt a longer-term perspective rather than
one overshadowed by the prospect of a brief tenure.

Mr. Chairman, the new government's initial messages to the world are
positive. Both Foreign Minister Singh and the Principal Secretary to
the Prime Minister, Brajesh Mishra, have reiterated their intention to
seek a national consensus for signing the Comprehensive Test Ban
Treaty. This Administration remains committed to the CTBT and believes
it is an important measure to restrain the prospect of a nuclear arms
race in South Asia. We have faced our own challenges with
ratification, and understand the importance of forging a solid
domestic consensus. The United States will continue to urge both India
and Pakistan to sip and ratify the CTBT because we believe it is in
their national security interests to do so.

There are a number of other steps in the nonproliferation area that we
are encouraging India and Pakistan to take to address our concerns and
those of the international community. These steps, which we believe
are consistent with Indian and Pakistani security interests, include:
constructive engagement on FMCT; agreement to participate in a
multilateral moratorium on missile material production for weapons,
pending conclusion of an FMCT; restraint in missile developments,
including non-deployment; and strengthened export controls.

Mr. Chairman, we see signs of promise on the economic front. India
made a policy decision in the early 1990s to open its economy,
encourage more foreign investment and liberalize its trading rules. It
has experienced some fits and starts on the liberalization front, and
since the government fell last spring, political uncertainty has put
economic reform in a holding pattern. Recently, we have seen reports
that the new government will put in place an economic package by
mid-November. The package would cover a wide spectrum, including
reforms in the financial, industrial and infrastructure sectors. In
Finance Minister Sinha's own words: "We want to undertake the second
generation of economic reform."

Prime Minister Vajpayee has acknowledged the need for India's greater
integration into the world economy, saying: "The priority is to build
a national consensus on the acceptance of global capital, market
norms, and whatever goes with it. ... You have to go out and compete
for investment" Several bills that would help open India to greater
investment are awaiting the new parliament's approval. These include
proposals to open up the insurance sector to private domestic and
foreign companies and a telecommunications plan that would accelerate
investment in private telephone networks. With the new government in
place, we are hopeful that India will return to a firm course towards
liberalization. Economic opportunities in the energy sector will be
one of the many subjects that Energy Secretary Bill Richardson will
discuss with his Indian counterparts next week when he becomes the
first U.S. Cabinet official to visit India since the formation of the
new government.

Mr. Chairman, as you know, the security and nonproliferation dialogue
conducted by Deputy Secretary Talbott and Foreign Minister Singh was
interrupted when the previous Indian government lost its majority in
parliament. We hope to resume that dialogue shortly. Since that time,
Kargil and, more recently, the removal of the government headed by
Prime Minister Sharif have called into question the promising
departure symbolized by the bus trip to Lahore, and underscored the
importance of dealing urgently with the many challenges to regional
and indeed global security, whether these be terrorism, proliferation,
bilateral disputes or the illicit narcotics trade. These subjects
will, of course, be high on the agenda in our dialogue with India.

We will also focus intensely on the future of the Indo-American
relationship. President Clinton is acutely aware that, as the first
American president elected since the end of the Cold War, he has an
unprecedented opportunity to put our relations with India on a
substantively different footing. No longer do New Delhi and Washington
find themselves at cross-purposes because of Cold War constraints. In
the words of Prime Minister Vajpayee, we are "natural allies." To
define that new relationship and to invest it with the broadest and
deepest possible meaning, we have to address the complex set of issues
that surfaced with the Indian nuclear weapons tests in May 1998, from
our perspective and from India's. Our ability to move forward and the
extent of our future cooperation will be influenced by the progress we
make, particularly in the nonproliferation area.

In that connection, the Administration appreciates Congress' recent
action granting the President comprehensive waiver authority for the
Glenn, Symington, and Pressler sanctions. I want to emphasize that we
sought enhanced waiver because this authority would give us more
flexibility as we pursue our agenda in South Asia, particularly with
regard to non-proliferation. The unfolding situation in Pakistan is a
reminder of how quickly things can change in South Asia, and therefore
of the importance of ensuring that we have a range of tools at our
disposal. Once the legislation is enacted, we will use the authority
effectively and prudently and in consultation with the Congress.

International Terrorism and Afghanistan

Mr. Chairman, let me now turn to Afghanistan, and the Taliban, who
persist in defying international opinion by sheltering Usama Bin Laden
and other terrorists. We attach the highest priority to ending the
activities of Usama Bin Laden's terrorist organization and bringing
him to justice. The Taliban's sheltering of Bin Laden, who continues
to threaten U.S. lives and property, presents a clear danger to the
security of the U.S. and its citizens.

Over the past year we have repeatedly contacted the Taliban and
encouraged them to expel Bin Laden without delay and avoid further
confrontation on this issue with the United States and others in the
international community.

In July, President Clinton issued an Executive Order blocking the
Taliban's property and banning commercial transactions with the
Taliban. In August, Ariana Airlines was placed under sanctions. To
date, we have frozen more than $34 million in Taliban assists.
Ariana's operations have been disrupted, thanks to cooperation from
India and several other countries.

Through U.S. diplomatic efforts, the rest of the world has now joined
us in expressing its resolve to end terrorist operations in
Afghanistan. A U.S.-initiated resolution passed unanimously by the UN
Security Council last week demands that the Taliban stop sheltering
Bin Laden and ensure that he is expelled and brought to justice. If
the Taliban fail to do so by November 15, their assets will be frozen
worldwide, and Taliban-owned, leased, or operated aircraft will be
denied permission to take off or land anywhere in the world. This
resolution is the result of intense U.S. effort and represents a
significant step forward in our campaign to end Bin Laden's terrorist
activities.

Mr. Chairman, we are prepared to work with the Taliban to rid
Afghanistan of terrorist networks. As President Clinton said following
passage of the U.N. sanctions resolution last week: "The international
community has sent a clear message. The choice between cooperation and
isolation lies with the Taliban."

At the same time, we have a number of other issues with regard to the
Taliban, including its appalling human rights policies, especially its
treatment of women and girls. As Secretary Albright said recently, we
are not going to abandon the women of Afghanistan. We are also greatly
concerned by recent surveys showing that Afghanistan, and specifically
the area under Taliban control, is the number one producer of opium in
the world. The most productive way to address all of these issues will
be a cessation of the civil war and the formation of a broad-based
representative government.

We continue to seek a negotiated settlement between the Taliban and
the opposition forces. But our immediate focus is terrorism. We will
press ahead in our efforts to bring the terrorist activities of Bin
Laden to an end and will consider additional measures to bring him to
justice if necessary.

Resources

Mr. Chairman, before I conclude, I would like to note that our ability
to pursue our agenda in South Asia -- and indeed throughout the world
-- depends in large part on adequate funding for our foreign affairs
budget, a point that Secretary Albright makes repeatedly. As you know,
earlier this week President Clinton vetoed the Foreign Operations
Appropriations bill because it was funded, at approximately $2.2
billion below his request. These cuts are dangerously short-sighted.
The bill's low funding level, in the President's words "puts at risk
America's 50-year tradition of leadership for a safer, more prosperous
and democratic world."

Obviously, the across-the-board cuts in foreign affairs spending harm
what we are trying to do in South Asia. The political crisis in
Pakistan serves as a good reminder of the important role our diplomats
play in ensuring the safety of Americans in times of crisis, in
delivering our message abroad, in providing timely reporting to our
policy makers, and in promoting and protecting U.S. interests. We need
to ensure that our diplomats have sufficient resources to do their
jobs.

If the proposed cuts are enacted, the Administration will be forced to
reduce our efforts to: counter terrorism, prevent and reduce conflict,
stem the spread of deadly diseases like HIV/AIDS, and fight drugs --
all of which are clearly in the interests of the American people and
key to our agenda in South Asia. In fact, our programs to support
regional democracy, to eradicate illegal poppy cultivation, and to
address trafficking in women and children -- will be sorely
under-funded.

Mr. Chairman, we face a number of challenges and opportunities in
South Asia where our national interests are engaged. We need your
support -- and the necessary resources -- to do our job. Thank you.