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[Senate Hearing 112-67]
[From the U.S. Government Publishing Office]

                                                         S. Hrg. 112-67
 
            ASSESSING U.S. POLICY AND ITS LIMITS IN PAKISTAN

=======================================================================

                                HEARING

                               BEFORE THE

                     COMMITTEE ON FOREIGN RELATIONS
                          UNITED STATES SENATE

                      ONE HUNDRED TWELFTH CONGRESS

                             FIRST SESSION

                               __________

                              MAY 5, 2011

                               __________

       Printed for the use of the Committee on Foreign Relations

       Available via the World Wide Web: http://www.fdsys.gpo.gov
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                COMMITTEE ON FOREIGN RELATIONS         

             JOHN F. KERRY, Massachusetts, Chairman        
BARBARA BOXER, California            RICHARD G. LUGAR, Indiana
ROBERT MENENDEZ, New Jersey          BOB CORKER, Tennessee
BENJAMIN L. CARDIN, Maryland         JAMES E. RISCH, Idaho
ROBERT P. CASEY, Jr., Pennsylvania   MARCO RUBIO, Florida
JIM WEBB, Virginia                   JAMES M. INHOFE, Oklahoma
JEANNE SHAHEEN, New Hampshire        JIM DeMINT, South Carolina
CHRISTOPHER A. COONS, Delaware       JOHNNY ISAKSON, Georgia
RICHARD J. DURBIN, Illinois          JOHN BARRASSO, Wyoming
TOM UDALL, New Mexico                MIKE LEE, Utah
              Frank G. Lowenstein, Staff Director        
        Kenneth A. Myers, Jr., Republican Staff Director        

                              (ii)        

  
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                            C O N T E N T S

                              ----------                              
                                                                   Page

Ahmed, Dr. Samina, South Asia Project Director, International 
  Crisis Group, Islamabad, Pakistan..............................     5
    Prepared statement...........................................     7
Kerry, Hon. John F., U.S. Senator from Massachusetts, opening 
  statement......................................................     1
Krepon, Michael, cofounder and senior associate, South Asia, 
  Henry L. Stimson Center, Washington, DC........................    13
    Prepared statement...........................................    14
Lugar, Hon. Richard G., U.S. Senator from Indiana, opening 
  statement......................................................     4
Yusuf, Moeed, South Asia adviser, Center for Conflict Management, 
  U.S. Institute of Peace, Washington, DC........................    17
    Prepared statement...........................................    19

              Additional Material Submitted for the Record

Casey, Hon. Robert P., Jr., U.S. Senator from Pennsylvania, 
  prepared statement.............................................    50
DeMint, Jim, U.S. Senator from South Carolina, prepared statement    50

                                 (iii)

  

                     ASSESSING U.S. POLICY AND ITS
                           LIMITS IN PAKISTAN

                              ----------                              

                         THURSDAY, MAY 5, 2011

                                       U.S. Senate,
                            Committee on Foreign Relations,
                                                    Washington, DC.
    The committee met, pursuant to notice, at 10:05 a.m., in 
room SD-419, Dirksen Senate Office Building, Hon. John F. Kerry 
(chairman of the committee) presiding.
    Present: Senators Kerry, Cardin, Casey, Shaheen, Coons, 
Durbin, Udall, Lugar, Corker, Risch, Isakson, and Barrasso.

            OPENING STATEMENT OF HON. JOHN F. KERRY,
                U.S. SENATOR FROM MASSACHUSETTS

    The Chairman. The hearing will come to order.
    Thank you all for joining us. I apologize for being a 
moment late. I am coming straight from the dentist's chair to a 
hearing on Pakistan. Is there a parallel? [Laughter.]
    The Chairman. This is the second in our series of hearings 
on Afghanistan and Pakistan and I am very pleased to welcome 
another distinguished panel to help us explore the difficult 
issues that we face.
    This is a particularly challenging moment in terms of 
American foreign policy. From the rising economic power of 
China to the upheaval across the Arab world, to North Korea and 
Iran, the Mideast peace process, and of course, Afghanistan and 
Pakistan, we face a very complicated and difficult set of 
policy decisions, all of which will affect our economy and our 
security.
    But as we survey this complicated landscape, there are few 
countries as important to our national security right now as 
Pakistan, and the momentous events of the last week brought 
that into very sharp focus. The location and status of Osama 
bin Laden's hideout in Abbottabad, a garrison city not far from 
Islamabad, perhaps 35 miles as the crow flies, raises real and 
serious questions for all of us.
    What did Pakistan's military and intelligence services 
know?
    What is appropriate to think they should have known?
    What legitimate due diligence was exercised in order to try 
to find out or even to exhaust the possibilities of leads with 
respect to Osama bin Laden's whereabouts?
    Who did they think was living behind those 15-foot walls?
    Was there any level of curiosity?
    How could bin Laden have gone undetected living next door 
to Pakistan's equivalent of West Point, where just last week 
General Kayani gave a speech celebrating the Pakistani military 
``breaking the back'' of terrorism?
    It is simply honest to say that all Americans and many 
other people are troubled by these questions, and Pakistan has 
promised an investigation and answers. Like every other 
American, the members of this committee wonder whether the 
Pakistan military or its intelligence services--or some 
components thereof--were somehow either unaware of its infamous 
neighbor or were knowingly protecting him.
    In the search for our answers, I want to emphasize no 
matter what we learn about the events that preceded the killing 
of Osama bin Laden, we still have vital national security 
interests in this region, and we have worked hard to build a 
partnership with Pakistan, fragile and difficult and challenged 
as it may be at times. We have worked hard to build a 
partnership that allows us to pursue common threats and 
interests.
    Despite bin Laden's death, the fight against al-Qaeda and 
other extremist groups that threaten the United States and our 
allies is far from over. Going forward, we have to act 
thoughtfully. And no matter what we have to remember the big 
picture, the larger strategic interest, and the full nature of 
our relationship with Pakistan. We should not rush into a 
situation that in fact hurts our own interests.
    A legitimate analysis concludes that it is undeniable that 
our relationship with Pakistan has helped us pursue our 
security goals. More senior al-Qaeda terrorists have been 
caught or killed in Pakistan than in any other country, in most 
cases as the result of joint operations with Pakistani 
authorities. Keeping 100,000 troops in Afghanistan--or even 
half or a quarter of that number--depends on an enormous supply 
train that requires the daily cooperation of the Pakistani 
state. We rely on each other for intelligence, and often we 
work together to act on it. And we have some space in Pakistan 
to conduct drone strikes which have killed significant 
terrorists, significant leaders, perhaps 16 of the 20 top 
leaders of
al-Qaeda, all of whom we know were still plotting against the 
United States.
    So make no mistake. These strikes have relied on an 
expenditure of political capital of the Pakistani Government 
and they have certainly cost its leaders some of that political 
capital with their own population.
    The truth is, even before bin Laden's death, our 
relationship with Pakistan has been strained recently, even 
fragile. The Raymond Davis affair stirred widespread anti-
American sentiment across Pakistan. In the numerous trips that 
I have made in my capacity as chairman of this committee, in 
the last one, when I was asked to go to help work on the 
question of Mr. Davis' release, I will tell you I have never 
sensed as intense a level of anti-American feeling broadly felt 
across the country because of the way that incident had been 
handled. We need to be sensitive to both sides of this story. 
Nothing, obviously, would excuse the harboring of the No. 1 
criminal in the world, but we need to explore carefully exactly 
what the facts are.
    I might add that the relationship has been further 
diminished and serious questions have been raised as a 
consequence of news about a dramatic increase in Pakistan's 
nuclear arsenal, and that has raised our concerns, as well as 
our allies' concerns, about nuclear proliferation and regional 
security. No matter what flows out of this, no matter what the 
consequences in the end that alter or improve our relationship, 
Pakistan will remain a nuclear state in a tinderbox of a 
region. This part of Asia is a dangerous and difficult 
neighborhood and two basic facts are central to understanding 
the situation and the solution.
    First, the real conflict is not between the United States 
and Pakistan but within Pakistan itself. The battle is over 
what sort of nation Pakistan will become. Will the forces of 
violent extremism grow more dominant, eventually overpowering 
the moderate majority? If that happens, clearly our relations 
will get worse and our interests will be even more threatened. 
Or will Pakistanis recommit to the values espoused by the 
founder of their country, Mohammad Ali Jinnah, and come 
together to build a stable, moderate democracy, an economically 
vibrant and socially tolerant nation at peace with itself and 
its neighbors? If so, friendship between our nations and the 
working partnership can inevitably grow stronger.
    Second, while this outcome will be decided by Pakistanis 
themselves, the United States and other allies cannot afford to 
sit on the sidelines. We can play a role in promoting stability 
and prosperity, but we have to, in doing that, appreciate how 
deep anti-American sentiments run and the limited space we have 
within which to make a difference.
    So what does that mean for United States policy toward 
Pakistan?
    First, we need to continue to make certain we have a 
strategy that actually reaches and speaks to the people of 
Pakistan. For years, we had a Musharraf-centric policy, not a 
Pakistan policy. We knew that that needed to change. Even now 
we have to acknowledge that the lion's share of our energy and 
attention remains focused on the government and military side 
of Pakistan. We began to change that through the efforts of the 
Kerry-Lugar-Berman legislation which revived a tradition of 
United States assistance to Pakistan that goes back to the 
1950s when we helped lay the foundation for Pakistan's future 
agricultural and industrial growth. We still face the challenge 
of demonstrating to the Pakistani people the positive 
difference the United States can actually make in their lives.
    We also have to understand the impact of the war in 
Afghanistan on Pakistan. Too many in Pakistan are convinced 
that they will be encircled by India when coalition forces 
leave Afghanistan, and too many still speculate about the 
impact of a 350,000-person Afghan Army on their interests. As 
we discussed on Tuesday, Pakistanis, like too many Afghans, do 
not understand what the United States endgame in Afghanistan 
actually looks like, and they are hedging their bets in order 
to safeguard their perceived interests.
    There is a lot to discuss here today, and I look forward to 
hearing from our expert witnesses. I want to welcome Dr. Samina 
Ahmed who is the South Asia Project Director of the 
International Crisis Group based in Islamabad. Moeed Yusuf is 
the South Asia adviser at the U.S. Institute of Peace who 
focuses on research on his native Pakistan, and Michael Krepon 
is the cofounder of the Henry L. Stimson Center and an expert 
on nuclear proliferation issues, particularly in South Asia.
    Senator Lugar.

          OPENING STATEMENT OF HON. RICHARD G. LUGAR,
                   U.S. SENATOR FROM INDIANA

    Senator Lugar. Well, thank you very much, Mr. Chairman, for 
calling this important hearing on Pakistan. I join you in 
welcoming our distinguished witnesses. I wanted to take a 
personal privilege of mentioning Dr. Samina Ahmed in particular 
because she has come from Islamabad to meet with Members of 
Congress at the Aspen Institute congressional conferences on 
several occasions, and our understanding has been enhanced 
substantially by her testimony and her friendship. We are 
delighted to have all of our witnesses with us today.
    Much of what I have to say this morning tracks very closely 
with your analysis, Mr. Chairman. The circumstances surrounding 
this week's dramatic killing of Osama bin Laden--who was found 
by our forces near Islamabad in a well-populated area close to 
Pakistan's military academy--have raised questions about 
Pakistan's reliability as an ally. Pakistani officials have 
been accused of being complicit or incompetent, but in either 
case, some critics say it is time for us to wash our hands of 
the whole country.
    Even before the discovery of bin Laden's compound, our 
relationship with Pakistan had suffered strains. Pakistan's 
political institutions are weak and democracy has not developed 
deep roots. It is facing an internal extremist insurgency that, 
in the view of some U.S. experts, poses a serious threat to the 
state. President Zardari himself acknowledged earlier this 
week, ``The forces of modernity and moderation remain under 
serious threat.''
    Lately, terrorists trained in Pakistan have attempted to 
carry out attacks in the United States. A grand jury in Chicago 
last week indicted two alleged members of Pakistan's 
intelligence service for involvement in the 2008 attacks on 
Mumbai, India. High-ranking Pakistani officials were reported 
last week to have urged Afghan leaders to distance themselves 
from the United States and build stronger relations with 
Pakistan and China, instead. United States drone strikes on 
Pakistani territory anger many in Pakistan, while the Americans 
have repeatedly accused elements in Pakistan's Government of 
supporting Afghan insurgent groups, charges that have gained 
resonance with the bin Laden operation.
    Pakistan is not an easy partner. As Dr. Richard Haass 
testified before our committee on Tuesday, ``It is hard to 
imagine a more complicated bilateral relationship.'' But 
distancing ourselves from Pakistan would be unwise and 
extremely dangerous. It would weaken our intelligence 
gathering, limit our ability to prevent conflict between India 
and Pakistan, further complicate military operations in 
Afghanistan, end cooperation on finding terrorists, and 
eliminate engagement with Islamabad on the security of its 
nuclear weapons.
    Pakistan is a nuclear-armed state with missiles capable of 
delivering nuclear weapons. With more than 180 million people, 
it is one of the largest Muslim countries in the world and has 
five times the population of Afghanistan. It has a close 
working relationship with China, which is seeking to extend its 
influence throughout Asia. It frequently has been in conflict 
with India, with whom the United States has close relations. 
Pakistan is a neighbor of Iran, a terrorist-supporting state 
with nuclear ambitions. What happens along the Afghan-Pakistan 
border deeply affects the fate of our operations in 
Afghanistan. In short, Pakistan is a strategically vital 
country with which we must engage for our own national 
security.
    Acknowledging this fact, Congress supported, on a 
bipartisan basis, the Enhanced Partnership with Pakistan Act, 
signed into law in 2009. This legislation sponsored by Chairman 
Kerry, myself, and Howard Berman in the House, attempts to 
expand United States-Pakistani ties beyond military matters and 
signals our country's willingness to engage with Pakistan over 
the long term.
    I would point out, as we have heard, Mr. Chairman, from 
testimony from the State Department, despite these good 
intentions, maybe only $179 million of the $1.5 billion this 
year has been spent on four projects amid enormous controversy 
over the monitoring on the part of the United States and 
controversy within Pakistan about interference alleged with any 
such aid at all.
    The United States has made some progress. President Zardari 
and other Pakistani leaders have lauded the bin Laden 
operation, and John Brennan, President Obama's counterterrorism 
adviser, said this week, ``Pakistan has been responsible for 
capturing and killing more terrorists inside of Pakistan than 
any country.'' Our diplomatic, security, and development ties 
are growing despite many difficulties.
    We should not distance ourselves from a country that looms 
so large in our own strategic calculations. We should be clear-
eyed about the limits of our relationship. All military and 
development assistance should be subject to careful review to 
make sure that it is serving our national security interests.
    I hope our witnesses will offer specific suggestions on 
ways to improve the United States-Pakistani relationship, and I 
look forward very much to our discussion.
    I thank you, Mr. Chairman.
    The Chairman. Thank you very much, Senator Lugar. Indeed, 
we are parallel in our thinking without actually conversing 
about it.
    We welcome your testimony. Each of you can submit your 
testimony in full and it will be placed in the record as if 
delivered in full. We would appreciate sort of a summary so we 
can--we have a number of Senators here and we would like to try 
to have as much of a dialogue as we can.
    We will begin, Dr. Ahmed, with you. We will go from your 
left to right. Thank you.

  STATEMENT OF DR. SAMINA AHMED, SOUTH ASIA PROJECT DIRECTOR, 
        INTERNATIONAL CRISIS GROUP, ISLAMABAD, PAKISTAN

    Dr. Ahmed. Thank you very much, Chairman Kerry, for holding 
this important hearing and inviting me to testify on behalf of 
the International Crisis Group on an assessment of United 
States policy toward Pakistan and the challenges, indeed, in 
pursuing a constructive partnership. The killing of Osama bin 
Laden does not lessen the challenges but also offers new 
options for each side.
    We in the Crisis Group--and Senator Lugar has repeatedly 
actually read our material and our recommendations. We have 
repeatedly emphasized the importance of broadening U.S. 
engagement with Pakistan beyond that narrow focus on military 
security and military cooperation to a broad-based, long-term 
approach, in particular by strengthening democratic 
institutions, democratic functioning, and economic development. 
It was precisely this core philosophy that we were pleased to 
see reflected in the Enhanced Partnership with Pakistan Act, 
introduced by the chairman and the ranking member of the 
committee and now U.S. law.
    The challenges, quite obviously, are multiple, in 
particular if we are going to be just narrowly focusing on the 
security aspects of the relationship.
    We saw Admiral Mullen, Chairman of the Joint Chiefs of 
Staff, not that long before Osama bin Laden's killing talking 
to the Pakistani Government and the security agencies and 
asking them, warning them about the danger to U.S. national 
security and, indeed, to Pakistan itself from the syndicate of 
terror on Pakistani soil. It goes beyond just al-Qaeda. It 
includes organizations such as the Lashkar-e-Taiba now renamed 
the Jamaat-ud-Dawa which has been responsible for attacks such 
as in Mumbai in which American citizens were also killed, which 
has global aspirations and shares al-Qaeda's philosophy. It 
includes the Haqqani Network responsible for the deaths of many 
American soldiers and their allies in Afghanistan.
    Pakistan is a young democracy, a nascent democracy. Taking 
Pakistan back to its democratic moorings requires, at this 
point in time in particular, when there is a certain degree of 
concern and impatience about the inability of civilian 
institutions to deliver, to even more so strengthen that 
democracy because in that lies the answer to Pakistan's 
stability and also the promotion of vital U.S. national 
security interests.
    My testimony has been placed before the house. Let me just 
highlight some of our policy recommendations.
    And I think particularly in the context of what we have 
seen, the killing of Osama bin Laden so close to the main 
military academy and in a military cantonment--in a military 
town, I think it is absolutely essential now that the 
certification requirements included in the Kerry-Lugar-Berman 
bill be taken far more seriously than they were in the past.
    We would advise and very strongly urge Congress to 
condition military assistance on demonstrable steps to combat 
violent extremists that go beyond just al-Qaeda, the foreign 
al-Qaeda, but also homegrown jihadis, in particular, 
organizations such as the Lashkar-e-Taiba. Our concern about 
conflict between India and Pakistan is one of the reasons, but 
also the fact that this organization lends its support to 
violent extremist groups outside the region and within--
targeting U.S. national security and U.S. citizens.
    We would urge Congress to continue to insist on a 
certification requirement also of the Kerry-Lugar-Berman bill 
that the security agencies of Pakistan are not materially or 
substantively supporting the political and judicial processes 
of Pakistan and also to provide strong support--much stronger 
support--to civilian law enforcement agencies in combating 
jihadi groups.
    We would also urge Congress and the Obama administration to 
recognize that the Pakistan Government, not just the military 
alone, should be considered an essential partner not just in 
the context of combating extremism within Pakistan but also in 
the context of the ongoing negotiations on the transition plans 
for Afghanistan.
    South Asia is, as you said, Chairman, a region where you 
have multiple challenges and multiple crises, not just the 
presence of violent jihadis but also nuclear-armed neighbors 
that have fought wars in the past. We would encourage the 
United States to play a more active role in supporting the 
efforts of the Pakistan and Indian Governments to achieve a 
long-term, stable, and sustainable peace.
    We would also urge Congress and the Obama administration to 
support democratic reform that this elected government in 
Pakistan has actually taken--the first steps toward enacting, 
in particular, to end that status of a no man's land in FATA in 
the tribal belt. There is a political package of reform, agreed 
to by all political parties in Pakistan. Support for that 
package would advance the interests of the United States and 
the Pakistani people by denying sanctuary in this territory to 
violent extremist groups.
    Finally, I would urge Congress and the Obama administration 
to recognize the fact that this is a very young democracy. 
Expecting results overnight is unrealistic, but in the long 
term, supporting the civilian transition, encouraging the 
military to demonstrate better behavior, ensuring that civilian 
law enforcement takes the lead in combating violent extremists. 
It is absolutely urgent that civilian assistance that has been 
pledged by the Kerry-Lugar-Berman bill should not become the 
casualty of these strains in the relationship. This for the 
Pakistani people, and a partnership between the Pakistani 
people and the American people would be the best partnership 
and the most sustainable partnership in broadening this 
relationship.
    Finally, as far as security assistance is concerned, quite 
obviously, with the war in Afghanistan, you will have to take 
in some of the concerns that Chairman Kerry has identified, 
including the need for the military's cooperation in terms of 
providing supplies to United States forces in Afghanistan, but 
remembering that the threat of violent extremists, some of them 
jihadi proxies backed by the Pakistani military, remains quite 
obviously a major challenge. Certification should not be taken 
lightly, but economic assistance should be continued.
    Thank you very much.
    [The prepared statement of Dr. Ahmed follows:]

                 Prepared Statement of Dr. Samina Ahmed

    I want to thank Chairman John F. Kerry for holding this important 
hearing and inviting me to testify on behalf of the International 
Crisis Group on an assessment of U.S. policy toward and challenges in 
pursuing a constructive partnership with Pakistan. The killing of Osama 
bin Laden does not lessen that challenge but may well offer new options 
for each side.
    The Crisis Group has been in South Asia since December 2001, and 
has published reports on these issues. We have repeatedly emphasized 
the importance of broadening U.S. engagement with Pakistan beyond a 
narrow focus on counterterrorism and security to a long-term all-
encompassing approach, in particular by strengthening civilian 
institutions and democratic functions. Such an approach, we have argued 
in our reports, would help to stabilize a fragile state and a volatile, 
crisis-prone region critical to U.S. national security interests. It 
was precisely that core philosophy that we were pleased to see 
reflected in the Enhanced Partnership with Pakistan Act introduced by 
the chairman and the ranking member of the committee, and now U.S. law.
    By emphasizing political and economic interests, as well as the 
security aspects of the relationship, the KLB legislation remains a 
welcome step forward. Pakistan-based Islamist militants are threatened 
by this policy because it delegitimizes their actions against the 
Pakistani state and their efforts to undermine U.S. military efforts to 
stabilize neighboring Afghanistan. These homegrown jihadis have 
demonstrated an interest--and are gaining capacity to threaten--the 
U.S. homeland. They are seeking, along with Pakistani political 
opportunists and spoilers, to use American strikes against violent 
extremists and intelligence gathering operations to turn Pakistani 
public opinion against the United States. Slow and uneven disbursement 
of U.S. assistance further undermines efforts to win over an 
increasingly skeptical Pakistani public.
    However, the U.S. administration and Congress must not construe the 
failure to see immediate results on the ground as failure of the 
changed approach. Instead, sustaining the broad-based relationship over 
the short, medium, and long term, and exercising patience in its 
implementation will pay political and security dividends.
    Let me summarize some of the key policy options that we believe the 
United States should pursue:

   Continue to condition military support on demonstrable steps 
        to combat violent extremists and end the longstanding policy of 
        support and sanctuary to such elements, Pakistan or foreign.
   Continue to require but also provide additional oversight on 
        the State Department certification of Pakistani cooperation in 
        dismantling nuclear supplier networks, combating terrorist 
        groups, and ending support by the military or its intelligence 
        arms to extremist groups.
   Continue to insist that the ``security agencies of Pakistan 
        are not materially or substantively subverting the political 
        and judicial processes of Pakistan'' and provide stronger 
        support for civilian law enforcement agencies in combating 
        jihadi groups including prosecuting the small percentage of 
        madrassas that engage in jihadi terrorist training.
   Recognize that the Pakistani Government, not the military 
        alone by any means, are critical interlocutors in the ongoing 
        process of advancing a transition in Afghanistan, including an 
        end game that includes political negotiations, while 
        maintaining certain redlines which include breaking ties with 
        al-Qaeda as well as Pakistani al-Qaeda linked extremist groups.
   The United States must play a more active role in supporting 
        the efforts of the Pakistani and Indian Governments to achieve 
        long-term stability and peace in South Asia.
   Support the civilian government and the combined political 
        party reform effort to end the second class status of the FATA 
        and provide its citizens both the full rights and civilian law 
        enforcement protection of the Pakistani Constitution.

                                BACKDROP

    The U.S. administration is understandably concerned about Pakistan, 
a country of some 170 million people with perhaps more than 100 nuclear 
weapons. Al-Qaeda and affiliated Afghan insurgent groups such as the 
Haqqani network have an established presence on Pakistani territory. 
Over time, links between al-Qaeda, Pakistani jihadi groups and their 
Afghan counterparts have expanded and consolidated to create a nexus of 
terror threatening American security and interests at home, in the 
region, and globally.
    After September 11, the U.S. relationship with Pakistan was 
adversarial at first, with Washington, DC, warning General Pervez 
Musharraf's regime--partnered with the Afghan Taliban and oblivious to 
al-Qaeda's presence on its territory--that Pakistan was either with or 
against the United States. As Musharraf's regime started countering al-
Qaeda's presence, and scores of al-Qaeda leaders were killed, detained, 
or extradited to the United States, the United States decided to back 
Musharraf and his military in the misguided belief that they alone 
could deliver the counterterrorism goods. But in propping up 
Musharraf's military regime, the United States alienated its natural 
partners, Pakistan's moderate majority. Regaining the trust of the 
people of Pakistan has not been an easy task.
    As the movement for democracy in Pakistan gained strength, the 
United States did attempt to make amends. Reaching out to the country's 
political leadership--particularly former Prime Minister Benazir 
Bhutto--the United States also pressured Musharraf to step down and 
thus influenced the Pakistani generals' decision to distance themselves 
from their army chief. The United States can therefore claim some 
credit for Musharraf's decision to hold elections and transfer power to 
civilian hands.
    With the Pakistani people winning their fight for democracy and 
elections resulting in the formal transfer of power to an elected 
civilian government, the U.S. Congress wisely decided it was in 
America's interest to support democracy and economic development in 
Pakistan through a multiyear partnership. The Enhanced Partnership with 
Pakistan Act, signed into law by President Obama in October 2009, 
redefined U.S. priorities in Pakistan, including by making security-
related assistance--including arms transfers--contingent on the 
security forces respecting political and judicial democratic processes.
    Three years later, many in Pakistan appear skeptical about U.S. 
support for Pakistan's democracy; just as many in U.S. policy circles 
appear skeptical about the ability of Pakistan's civilian institutions 
to stabilize the Pakistani polity and prevent the spread of violent 
extremism. Undoubtedly the Pakistan Peoples Party (PPP)-led government 
has failed thus far to curb violent extremism and civilian institutions 
have yet to meet the needs of an increasingly impatient public. 
However, the Obama administration and Congress must not expect a 
transitional democracy to deliver miracles overnight. Instead, the 
effectiveness of U.S policy toward Pakistan must be assessed in the 
context of a young democracy that needs time to mature and stabilize, 
with incremental civilian control over national security policy taking 
Pakistan back to its moderate mooring.

                      UNDERSTANDING THE CHALLENGE

    For some observers, Pakistan stands at the edge of an abyss beset 
with internal turmoil, with a deadly countrywide militant presence and 
a floundering economy that undermines the state's ability to deliver 
basic services to its citizens. Violent extremism, a rapidly expanding 
nuclear arsenal and a history of war with neighbors is more than 
sufficient reason to worry about the country's future. The answer, some 
Pakistani watchers believe, lies in ensuring that security takes 
precedence over governance. In their thinking, the Pakistani military 
might not respect human rights and promote fundamental freedoms, but it 
is the only institution that is organized, capable, and strong enough 
to hold the country together. Yet the answer for Pakistan's ills does 
not lie in its praetorian past.
    The military's repeated interventions have only widened internal 
fissures, straining a fragile federation almost to breaking point. The 
denial of democratic rights and freedoms by successive military rulers 
resulted in the dismemberment of the state in 1971. The social contract 
with the citizenry was painfully rebuilt by civilian rulers, with the 
basic law of the land--the 1973 constitution--helping to restore trust 
in the state. However, successive direct or indirect military 
interventions--the latest by General Musharraf--weakened the civilian 
edifice and the ability of civilian institutions to deliver good 
governance and development that is so badly needed today.
    The military's perception of national interest has also starved the 
state of resources it requires for development. Instead, already 
inadequate fiscal resources have been diverted to sustain the eighth 
largest army in the world, one that boasts a massive array of 
conventional and nuclear weapons, primarily aimed at confronting India. 
By cultivating jihadi proxies to weaken India and to dominate 
Afghanistan, Pakistan's military is also responsible for a countrywide 
jihadi blowback that could, if not countered now, become more and more 
difficult to contain. These military-backed homegrown extremists have 
also forged links with transnational terrorist groups--including al-
Qaeda--and with regional insurgents such as the Haqqani network. The 
resultant terror nexus is linked to terror plots aimed at the United 
States and bears direct responsibility for the deaths of U.S. soldiers 
and American allies in Afghanistan. Finding Osama bin Laden behind a 
200-foot-long walled compound very close to the Pakistan military 
academy also should raise additional questions about the Pakistan 
military's quite differentiated policy of counterterrorism.
    Pakistan's democratic transition faces many challenges but it also 
offers the United States important opportunities to craft policies that 
advance U.S. goals in a sustainable and strategic manner. Rather than 
reverting to another exclusive and short-sighted partnership with 
Pakistan's military establishment, the Enhanced Partnership with 
Pakistan Act's strategically comprehensive approach must continue to 
guide U.S. policy.

                     OPPORTUNITIES AND CONSTRAINTS

    With the right policy choices, the United States could play a major 
role in helping stabilize Pakistan's democratic transition which would 
in turn help to stabilize the volatile region in which it is situated. 
In making these policy choices, the U.S. administration must bear in 
mind that the democratic transition is still in its nascent stages, and 
will, at least in the near future, also place limitations on the 
pursuance of policies and strategies that would advance U.S. goals.
    Soon after the PPP-led government was formed under Asif Ali 
Zardari's leadership following the 18 February 2008 elections, domestic 
and international observers believed that it would be short-lived. 
Although the government has stumbled from crisis to crisis, it has 
survived against all odds, and is now in its fourth year in office. 
With the support of its parliamentary opposition, the ruling party has 
also spearheaded reforms that have set Pakistan back on the democratic 
path. Key among these is the 18th constitutional amendment, passed 
unanimously in Parliament and signed by the President into law on 18 
April 2010. A landmark bill, which restores parliamentary supremacy by 
removing the constitutional distortions of military rule, the amendment 
also strengthens federal democracy by meeting longstanding demands for 
the devolution of power from the center to the federal units. Other 
major democratic reforms include the passage of the National Finance 
Commission award on redistributing financial resources by the 
federation to the provinces, the first such award agreed upon by all 
stakeholders since 1997.
    For the ruling party, one of the greatest challenges to enacting 
democratic reforms lies in its dependence on an unwieldy coalition. 
With a slim majority in Parliament, it has been forced to include some 
unreliable partners in the federal and provincial governments, 
including the Muttahida Qaumi Movement (MQM), a former member of 
Musharraf's military regime. This lack of a stable parliamentary 
majority, combined with resistance to economic reform from coalition 
partners and the parliamentary opposition alike, has resulted in the 
failure thus far to gain legislative approval for enacting many 
pressing reforms. Under IMF pressure, the government is reducing 
subsidies (e.g., on energy consumption), fuelling domestic discontent. 
As the 2011-12 budget approaches, the government will be between a rock 
and a hard place: pressured by the IFI's to enact pressing economic 
reforms and pressured by the opposition to make concessions that could 
further weaken a fragile economy.
    The United States should continue to urge the Government of 
Pakistan on economic reforms but the United States should not make 
economic support contingent on such measures. Indeed, strings related 
to transparency and efficacy should be attached to U.S. assistance, to 
ensure that taxpayers' money is well spent and accounted for. However, 
the Obama administration must also step up the disbursement of 
congressionally appropriated funds provided for by the KLB law to help 
to shore up a young democracy by supporting economic freedom and 
development.
    Currently, the pace of disbursing the $7.5 billion over a 5-year 
period has fallen far behind schedule. The Pakistani Finance Minister 
recently disclosed that Pakistan had not even received $300 million of 
the $1.514 billion allocated for FY 2010. The multiagency quarterly and 
oversight report of the civilian assistance program (December 2010) 
identified ongoing security threats as impediments to monitoring and 
implementation--while substantive sums were reallocated to target flood 
recovery and assistance. Yet USAID must push the pace, understanding 
that the failure to meet raised expectations only benefits spoilers. At 
the same time, the generous funds allocated for Pakistan's conflict-hit 
tribal agencies--such as for the South Waziristan or Malakand Agency's 
quick impact programs--is money ill-spent. USAID-funded programs in the 
Federally Administered Tribal Areas (FATA) work through an 
unaccountable military and civil bureaucracy and local elites, severely 
limiting aid effectiveness. Rather than encourage, this assistance 
impedes democratization by empowering the very forces opposed to the 
extension of full constitutional and political rights to FATA.
    The absence of state institutions and the Frontier Crimes 
Regulations 1901 (FCR), a colonial-era law, has isolated the region 
from the rest of the country, giving it an ambiguous constitutional 
status, denying political freedoms and opportunities to the population, 
and allowing militants to exploit the resultant vacuum to gain 
significant power. On 14 August 2009, President Zardari announced a 
FATA reform package, which would have lifted restrictions on political 
party activity, curtailed arbitrary detention and arrests under FCR and 
audited funds for FATA. This first basic step to bring FATA into the 
mainstream was stymied by the military. One of the clearest signs of a 
policy that supports civilian democratic institutions would be for the 
United States to endorse the combined political party reform measure 
that would end the colonial status of FATA, providing its citizens with 
all the rights of constitutional protection, with civilian law 
enforcement agencies allowed to protect those citizens and to confront 
the full range of domestic and international jihadi forces which still 
find sanctuary in North Waziristan.
    The military has also undermined the government's reconciliation 
efforts in Balochistan, bordering on southern Afghanistan, where 
grievances against the center's exploitation of provincial resources 
and indiscriminate use of force have resulted in a provincewide 
insurgency. Instead, continued military operations--including targeted 
killings and disappearances of political dissidents--have further 
alienated the secular and moderate Baloch, who could play an invaluable 
role in helping to counter the extremist forces that are bent on 
destabilizing the state. Should the democratic transition stabilize, 
there is real potential to bring the Baloch back into the political 
fold and to enact meaningful democratic reform in FATA, thereby 
strengthening the federation and marginalizing extremists.
    Should the democratic transition stabilize, democratically elected 
civilian governments could also assert greater control over national 
security and defense policy. The two largest political parties, the PPP 
and the Pakistan Muslim League-Nawaz (PML-N), support peace with India 
and Afghanistan. At present, however, Pakistan's generals exercise 
considerable control over all sensitive areas of policy, which is 
shaped in accordance with the military's perceptions of national 
interest. Therefore the military continues to back Islamist proxies to 
undermine Indian security and to promote perceived interests in 
Afghanistan. That still raises the most serious threat for generating a 
full-scale war in South Asia.
    The United States is concerned about the safety and security of 
Pakistan's nuclear arsenal but there is a far greater risk in a 
conventional conflict between India and Pakistan escalating to the 
nuclear level. When Pakistan-based jihadis attacked Mumbai in 2008, 
India exercised considerable restraint. However, New Delhi could opt 
for a far more robust military response should another such attack 
occur, a likely prospect because of the Pakistani high command's 
continued support for
al-Qaeda-linked groups such as the Lashkar-e-Tayyaba, renamed Jamaat-
ud-Dawa (LeT/JD), and the Jaish-e-Mohammad, the former supported by the 
Pakistan military and the latter actually formed by that military 
through its intelligence arm, the ISI. It is unlikely that Osama bin 
Laden's death will affect those ties since these organizations share 
al-Qaeda's international goals.
    Army chief Ashfaq Parvez Kayani claims that his military is 
committed to eliminating violent extremists and has broken their 
backbone. But Admiral Mullen's recent publicly stated concerns are 
accurate and well-founded; Pakistan's continuing terror attacks, which 
claimed more than 2,500 Pakistani lives in some 67 suicide attacks in 
2010, show that militant organizations continue to flourish. Nor is 
there any proof that the tribal borderlands are now firmly under the 
state's control. On the contrary, ongoing operations in FATA agencies 
against some tribal militants have been accompanied by peace deals with 
equally violent extremist groups such at the Pakistani Taliban's Gul 
Bahadur group in North and the Maulvi Nazir group in South Waziristan 
agencies. Linked to the Haqqani network, these Pakistani militants are 
actively involved in attacks against American troops in Afghanistan as 
indeed are the Punjab-based al-Qaeda affiliates.
    India-oriented jihadi organizations in Pakistan's heartland, 
particularly the Lashkar-e-Tayyaba, now have global ambitions and an 
increasing global reach, posing a direct threat to the U.S. homeland. 
Despite billions of dollars of U.S. security assistance, the Pakistan 
high command still sees the LeT/JD as an asset in its proxy war with 
India. The controversy over a CIA contractor killing two Pakistanis, 
reportedly low level operatives of the military's intelligence arm, the 
Inter-Services Intelligence Directive (ISI) in Lahore, stemmed in large 
part from the military's sensitivity about U.S. intelligence activities 
in the Pakistani heartland, where the LeT/JD and other al-Qaeda linked 
India-oriented jihadis are based.
    Despite a partnership with the United States, of which the 
military, since September 11, has been the main financial and political 
beneficiary, the Pakistani generals appear willing to use elements of 
the media to whip up anti-U.S. sentiment. The military high command is 
also strongly critical of U.S. drone attacks when its tribal allies are 
the targets. On 27 March, for instance, Army Chief Kayani, for the very 
first time publicly condemned a U.S. drone attack, most likely because 
it targeted the military-backed Haqqani-linked Gul Bahadur group.
    This shaping of anti-American sentiment through public 
pronouncements or the media, especially influential broadcast media, is 
part of the military's strategy to redraw redlines in the relationship. 
Drone attacks, in short, are acceptable but not when jihadi proxies 
such as the LeT or chosen Pakistani or Afghan Taliban allies are 
targeted.
    The United States has belatedly drawn its own redlines. Admiral 
Robert Willard, for instance, expressed concern about the Lashkar-e-
Tayyaba's expanding reach and ambitions in testimony before the 
Senate's Armed Services Committee. The White House Quarterly report on 
Afghanistan and Pakistan in April assessed: ``there remains no clear 
path toward defeating the insurgency in Pakistan.'' In a far more 
explicit and for the very first time public criticism of the Pakistan 
military's support for homegrown and Afghan jihadi proxies, Chairman 
Joint Chiefs of Staff Adm. Michael Mullen called for an end for 
Pakistani backing of the Haqqani network and its local allies. Drawing 
Pakistan's attention, though media interviews, to the presence of al-
Qaeda's leadership in the borderlands and Haqqani's continued presence 
on Pakistani soil, Admiral Mullen stressed that the two countries must 
work together to eliminate this threat by sharing intelligence. He 
pointed out that the syndicate of terror on Pakistan soil, including 
the Haqqani network, al-Qaeda, the Lashkar-e-Tayyaba and the Pakistani 
Taliban threatened U.S. national security and the lives of U.S. 
citizens.
    The Pakistani military leadership has pushed back strongly, with 
Kayani rejecting, in the words of his spokesperson, U.S. ``negative 
propaganda.'' Reiterating opposition to drone strikes and U.S. 
intelligence operations within Pakistan, using the media to propagate 
anti-American sentiment, the high command appears to believe that the 
United States will back down, particularly since it needs the 
military's cooperation to stabilize Afghanistan militarily and 
politically. To change the military's behavior and to protect U.S 
national security interests, and indeed those of the Pakistani people 
who are victims of extremist violence, the United States must follow 
its advice to Pakistan with action.

                   U.S. POLICY OPTIONS: LOOKING AHEAD

    To continue security-related assistance, the KLB Act requires the 
Secretary of State to certify Pakistani cooperation in dismantling 
nuclear supplier networks, combating terrorist groups, and ending 
support by the military or its intelligence arms to extremist groups. 
Rather than give in to the high command's pressure tactics, the United 
States should condition military support on demonstrable steps to 
combat violent extremists and end the longstanding policy of support 
and sanctuary to such elements, Pakistan or foreign.
    The Act also requires certification that the ``security agencies of 
Pakistan are not materially or substantively subverting the political 
and judicial processes of Pakistan.'' The military should be reminded 
that future security assistance would also depend on such 
certification, particularly since the threat of another covert 
intervention cannot be ruled out.
    President Zardari's personal differences with the army chief aside, 
the military's opposition to the PPP is rooted in a long history of 
distrust and discord, with a former Prime Minister, Zulfikar Ali 
Bhutto, executed by a military dictator and Benazir Bhutto's government 
twice ousted through military-devised interventions during the 1990s. 
The current government too could be dismissed through a military-
manipulated intervention. The MQM, a former coalition partner of 
Musharraf's military government, could be persuaded to quit the PPP-led 
coalition, thus depriving the government of a stable parliamentary 
majority; and/or encouraging the PML-N to support a vote of no 
confidence in Parliament. The superior court's ongoing tussle with the 
executive could also provide the military the lever it needs to remove 
the government, replacing it with a puppet regime, which would allow it 
to rule from behind the scenes.
    Signals from Washington, DC, will play a major role in the 
military's cost-benefit analysis of intervening. The United States must 
resist the temptation of reverting to a reliance on quick fixes which 
would amount to falling back on a failed policy of engaging with the 
Pakistani military at the cost of Pakistan's young democracy. A 
sustained democratic transition will go a long way in stabilizing 
Pakistan though meaningful political, economic, and security-sector 
reform. The assertion of civilian authority over security policy will 
also result in a reassessment of the domestic costs of supporting 
jihadi proxies and a realignment of domestic priorities from military 
to human security. By strengthening the new civilian order, both the 
United States and Pakistan stand to gain.

    The Chairman. Thank you very much, Dr. Ahmed.
    Mr. Krepon.

 STATEMENT OF MICHAEL KREPON, COFOUNDER AND SENIOR ASSOCIATE, 
      SOUTH ASIA, HENRY L. STIMSON CENTER, WASHINGTON, DC

    Mr. Krepon. Mr. Chairman, Senator Lugar, members of the 
committee, the United States-Pakistan relationship could not 
have survived this long without the presence of vital common 
interests. But we are now very close to another divorce. It 
would be a serious error in judgment in my view to conclude 
that this relationship cannot be salvaged. Pakistanis have 
great resilience and their military leaders are capable of 
making good as well as bad decisions. This relationship will 
not be salvaged unless Pakistan gets its house in order and 
unless we are clearer amongst ourselves about what we can and 
cannot expect from Pakistan.
    Pakistan is a weak country with strong powers to resist 
United States pressures. Our reliance on Pakistan for 
logistical support for our many troops in Afghanistan is a 
great source of friction. We argue over compensation. We argue 
over the extent of the United States presence in Pakistan, and 
we argue over the ground rules under which we operate there.
    United States and Pakistani interests diverge on nuclear, 
on India, and on Afghanistan. Pakistan's sense of insecurity is 
growing, which translates into increased reliance on nuclear 
weapons and continued links to the groups that Samina has 
mentioned; groups that carry out deadly attacks in Afghanistan 
and in India.
    On Afghanistan, we both seek a negotiated settlement, but 
we are backing different horses. Our military forces in 
Afghanistan--God bless them--are performing in an exceptional 
manner, but every one of us knows that their sacrifices will be 
in vain unless tactical gains can be handed off to competent 
Afghan authorities. If a lasting political settlement can be 
found in Afghanistan, it will require extraordinarily difficult 
internal and regional dealmaking. I doubt whether this heroic 
undertaking is worthy of an annual U.S. military commitment in 
excess of $100 billion. Dealmaking will continue within 
Afghanistan and with Afghanistan's neighbors at a fraction of 
this cost and sacrifice. The results may well be modest or 
ephemeral no matter how much we spend there.
    The future of Pakistan matters a whole lot more than the 
future of Afghanistan. Pakistan, unlike Afghanistan, is a hinge 
state in the Islamic world. United States military and 
diplomatic investments do not remotely correspond to the 
relative importance of Afghanistan and Pakistan to vital United 
States national security interests. And some of our policies 
are increasing stress fractures within Pakistan.
    It will require, in my judgment, a four-cornered bank shot 
to leave Afghanistan as a reasonably functioning country. 
Pakistan may also become lost to its own pathologies regardless 
of what we do there. But it would be immensely tragic if the 
loss of United States blood and treasure in this theater 
results in little better than the usual state of affairs in 
Afghanistan, alongside far greater deterioration within 
Pakistan and in United States-Pakistan relations.
    At best, we will continue to have a checkered track record 
with Pakistan. Its security apparatus will continue to seek to 
influence Afghanistan's future no matter what carrots and 
sticks we apply. Pakistan is not going to give up nuclear 
weapons, but we can actually work with them, I believe, to 
increase nuclear risk reduction in the region.
    United States ties with India are going to continue to get 
better, as they should, and Pakistan's national security 
establishment is going to feel more insecure as a result. We 
cannot convince Pakistan's military to befriend India. We can 
work with them to have a more normal relationship with India, 
especially in the areas of trade and regional development.
    The biggest challenge facing Pakistan's national security 
establishment is to recognize how growing links to extremist 
groups mortgage that country's future. The ISI still does not 
get this. Outfits like Lashkar-e-Taiba are the leading edge of 
Pakistan's national demise. If Pakistan's military leaders 
cannot rethink the fundamentals of their anti-India policy and 
their increased reliance on nuclear weapons, they will never 
know true security. I do not expect a change in Pakistan's ties 
to the Afghan Taliban, but this would be a very good time for 
Pakistan's military leaders to rethink any lingering ties they 
may have to the remnants of al-Qaeda within their country. A 
rethink of their ties to the LeT, Lashkar, would also be 
helpful.
    We might also reconsider our present course. In my view, 
our Afghan policies hurt rather than help Pakistan to find its 
own balance. If authorities in Afghanistan are unable to 
safeguard our military's hard-won games, we are obligated to 
ask how much more blood and treasure ought to be devoted to 
this cause. I acknowledge that there are risks in accelerating 
reductions in the United States level of effort in Afghanistan. 
In my view, there are greater risks and costs by remaining on 
our current glide path.
    I, therefore, respectfully suggest that this committee 
consider accelerating efforts to secure a political settlement 
in Afghanistan alongside steeper reductions in our level of 
military effort there.
    Thank you so much.
    [The prepared statement of Mr. Krepon follows:]

                  Prepared Statement of Michael Krepon

    Mr. Chairman, members of the committee, thank you for inviting me 
to testify about Pakistan. I have been working on national security 
issues relating to Pakistan at the Stimson Center for almost 20 years. 
Pakistan is a very confusing place, but one thing is unmistakably 
clear: there are no simple solutions to what ails Pakistan or United 
States-Pakistan relations.
    Osama bin Laden's death is a landmark in U.S. counterterrorism 
efforts. The failure of this operation would likely have had horrific 
consequences for United States-Pakistan relations. Instead, its success 
will result in an even more trying bilateral relationship, but not a 
divorce.
    Pakistan's leaders had little choice but to put a positive gloss on 
bin Laden's death, as Washington had put them on notice many times that 
military action would result if we had strong intelligence of his 
whereabouts. That Pakistan's security apparatus was kept in the dark 
about this operation speaks volumes about the growing difficulties of 
this partnership.
    Less than 2 weeks ago, the Pakistani chief of army staff, Gen. 
Ashfaq Kayani, visited Pakistan's premier military academy to 
congratulate the cadets. General Kayani claimed that Pakistani security 
forces ``have broken the back of terrorists'' and that the Pakistan 
Army ``was completely aware of internal and external threats to the 
country.'' Osama bin Laden's compound was a mile away from the parade 
ground where Kayani spoke.
    General Kayani and the director general of interservices 
intelligence, Gen. Ahmad Shuja Pasha, were rewarded with term 
extensions by the current Pakistani Government because of their 
competence in dealing Pakistan's profound internal and external 
threats. The presence of Osama bin Laden in Pakistan reflects very 
poorly on both of these officers. The No. 2 ranking al-Qaeda figure, 
Ayman al-Zawahiri and the worst offenders of the Taliban regime in 
Afghanistan are also widely believed to be on Pakistani territory.
    Hard times lie ahead for United States-Pakistan relations. The 
interests of our two countries in Afghanistan diverge as well as 
converge. Groups that engage in violent acts against U.S. and allied 
forces in Afghanistan and against targets in India are based, trained, 
and equipped on Pakistani soil, without serious interference by 
Pakistan's security apparatus.
    Osama bin Laden's violent demise comes at a time when U.S. 
expenditures in Afghanistan are reaching the half-trillion dollar mark. 
It is far from clear that the hard-earned tactical achievements of U.S. 
forces there can result in long-lasting gains. It is even more apparent 
that Pakistan can only lose by being a safe haven for violent 
extremists. Bin Laden's death provides an opportunity for Pakistani and 
U.S. authorities to reconsider our complicated and unsatisfactory 
relationship.
    Pakistan is a weak country with strong powers to resist U.S. 
pressures. Pakistani leaders usually do not ``just say no'' to 
Washington. Instead, they often use circumlocution, delay, and work-
arounds when they believe that U.S. demands are inimical to Pakistani 
national security and domestic political interests.
    The very large U.S. military presence in Afghanistan which is 
dependent on Pakistani logistical support is a great source of friction 
between our two countries. We argue over compensation, the extent of 
the U.S. presence on Pakistani soil and the ground rules under which 
U.S. personnel operate. U.S. reliance on Pakistan for logistical 
support provides Rawalpindi with unusually strong leverage to resist 
U.S. demands. But even if the United States greatly reduces our 
footprint in Afghanistan, Pakistani military leaders would still be 
able to deflect our demands when they run counter to their perceived 
interests.
    One area of divergence relates to Afghanistan. We both seek a 
negotiated settlement there, but we are backing different horses. 
Pakistan's security establishment seeks an outcome that maximizes its 
influence in Kabul as well as in Afghan provinces adjacent to Pakistan 
against hostile influences, primarily from India. This helps to explain 
why Pakistan's security apparatus retains close links to the Afghan 
Taliban.
    The United States-Pakistan relationship could not have survived 
this long without the presence of vital common interests. Foremost 
among them is our common goal of a stable Pakistan that is at peace 
with itself. With U.S. support, Pakistan's Armed Forces are engaged in 
selective efforts to increase domestic security, at significant cost. 
Washington has helped Pakistan increase the security of its nuclear 
assets. We also serve as an essential crisis manager and as a promoter 
of more normal ties with India.
    It would be a serious error, in my judgment, to conclude that this 
relationship cannot be salvaged. Pakistanis have great resilience, and 
their military leaders are capable of good as well as bad decisions. In 
order to salvage this relationship, Pakistan needs to get its house in 
order, and we need to be clearer about what we can and cannot expect 
from Pakistan.
    U.S. and Pakistani interests diverge on nuclear issues, India, and 
Afghanistan. Pakistan's sense of insecurity is growing, which 
translates into increased reliance on nuclear weapons and continued 
links to groups that carry out deadly attacks across its borders.
    Pakistan's national security managers have ``just said no'' with 
respect to the initiation of negotiations on a treaty to stop producing 
fissile material for weapons--one indicator of their sense of 
insecurity and anger at the United States--India civil nuclear deal. 
The Punjab-based Lashkar-e-Toiba, which has carried out mass casualty 
attacks in Kashmir, New Delhi, Mumbai, and elsewhere, is not greatly 
inconvenienced by Pakistan's security apparatus. The Haqqani network, 
which carries out cross-border attacks against U.S. and NATO forces in 
Afghanistan, seems to have few constraints on its operations. This 
track record reflects Rawalpindi's perceived interests to counter 
India's growing conventional military capabilities and to secure 
Pakistan's interests in Afghanistan.
    The United States has given Pakistan economic and military 
assistance, assuming that Pakistan would pay greater heed to U.S. 
interests. This transactional relationship has been unsatisfactory to 
both parties. First, as noted above, U.S. and Pakistani security 
objectives are not always in alignment. Second, Pakistan's security 
culture has been deeply wedded to poor decisions. There is positive 
movement on some fronts--for example, since 2002, Kashmir has not been 
a ``flashpoint'' between Pakistan and India--but even when there is 
private acknowledgment of unwise choices, it's very hard for Pakistani 
authorities to change course. Third, U.S. economic assistance remains 
quite modest compared to Pakistan's budget outlays and domestic needs. 
Fourth, U.S. military assistance to India is growing far more in 
qualitative and quantitative terms than is U.S. assistance to Pakistan. 
Consequently, Pakistani grievances with whatever level of military 
support we provide will also grow.
    Sometimes Washington can quietly encourage helpful changes at the 
margins of Pakistani policies. Over time, course corrections can become 
increasingly significant with quiet U.S. encouragement and Pakistani 
recognition of unwise policies. But this ongoing process is 
frustrating, time consuming, and becoming more difficult as our 
estrangement grows.
    The enlarged U.S. military commitment to facilitate a political 
settlement in Afghanistan greatly increases friction with Pakistan. I 
have reluctantly concluded that greater U.S. efforts in Afghanistan are 
unlikely to result in long-lasting gains. Our military forces in 
Afghanistan--God bless them--are performing in an exceptional manner. 
But we all know that their sacrifices will be in vain unless tactical 
gains can be handed over to competent Afghan political leaders and 
military units.
    If a lasting political settlement can be found in Afghanistan, it 
will require extraordinarily difficult internal and regional deal 
making. I doubt whether this heroic undertaking is worthy of an annual 
U.S. military commitment in excess of $100 billion. Deal making will 
continue to be pursued at a fraction of this cost and sacrifice. The 
results may well be modest or ephemeral, no matter how much we spend 
there.
    The future of Pakistan matters far more than the future of 
Afghanistan. For the foreseeable future, militant groups with global 
reach are likely to reside in far greater number in Pakistan than in 
Afghanistan. Pakistan has a growing nuclear arsenal and production 
capacity for weapons-grade fissile material. Pakistan, unlike 
Afghanistan, is a hinge state in the muslim world. U.S. military and 
diplomatic investments do not remotely correspond to the relative 
importance of Afghanistan and Pakistan to vital U.S. national security 
interests. Some U.S. policies are also increasing stress fractures in 
Pakistani society.
    Take, for example, the highly emotive issue of U.S. drone strikes 
on Pakistani soil. I am obviously not privy to the profiles of those 
targeted. According to what limited information is publicly available, 
most of the targets of U.S. drone attacks are apparently not big 
difference makers in the region's strategic calculus. I trust that 
these attacks offer tactical gains, but they have very significant 
downside costs.
    That Pakistani authorities have reportedly consented privately in 
the past to some attacks under some criteria is not particularly 
reassuring, since these practices have served to distance Pakistani 
citizens from their government as well as from the United States. It is 
particularly upsetting for most Pakistanis to bear witness to aerial 
attacks on their sovereign territory, whether by the Soviet Union 
during the 1980s or by the United States a quarter-century later.
    To my way of thinking, the targets for these attacks need to matter 
a great deal in order to merit the adverse consequences they engender. 
I would not underestimate the resulting damage to United States-
Pakistan relations from U.S. drone strikes--damage far greater than the 
tactical gains we seek along the Afghan border.
    It will require a four-cornered bank shot to leave Afghanistan as a 
reasonably functioning country. Assuming this is possible, is this 
effort worth the hollowing out of United States-Pakistan relations? 
Granted, there are many reasons beside Afghanistan for Pakistan's 
current trajectory. And Pakistan may become lost to its own pathologies 
regardless of U.S. efforts there or in Afghanistan. But it would be 
immensely tragic if the loss of U.S. blood and treasure in this theater 
results in little better than the usual state of affairs in Afghanistan 
alongside far greater deterioration within Pakistan and in United 
States-Pakistan relations.
    I realize how hard it is to get U.S. policies toward Pakistan and 
Afghanistan ``right.'' Indeed, one message that I have tried to convey 
in my testimony that it may well be impossible to get things anywhere 
near ``right'' in this part of the world. Even if the United States 
greatly reduces our level of effort in Afghanistan and removes Afghan 
war-related sources of friction with Pakistan, I do not expect 
significant dividends in United States-Pakistan relations. There will 
be other important matters on which we will continue to disagree.
    Nonetheless, the removal of some sources of friction in bilateral 
relations remains a worthy objective, especially when friction widens 
and accelerates Pakistan's domestic fissures. The removal of tactical 
irritants in the pursuit of improbable objectives in Afghanistan could 
also facilitate constructive changes at the margins of Pakistan's 
national security policies. With patient and persistent engagement, we 
can help Rawalpindi reconsider policies that have manifestly weakened 
Pakistan. Our focus on Afghanistan is crowding out these important 
agenda items.
    At best, we will have a checkered track record with Pakistan. 
Pakistan's security apparatus will seek to increase its chances to 
influence Afghanstan's future dispensation no matter what carrots or 
sticks Washington chooses. We can also forget about convincing Pakistan 
to give up its nuclear weapons, but we may be able to persuade 
Rawalpindi that Pakistani security can be enhanced with more nuclear 
risk-reduction measures. U.S. ties with India will continue to improve, 
reflecting our substantial and growing common interests. Pakistan's 
national security establishment will feel more insecure as a result. 
Washington can't convince Pakistan's military leaders to befriend 
India, but we can promote more normal ties between Pakistan and India, 
especially in the areas of trade and regional development.
    The biggest challenge facing Pakistan's national security 
establishment is to recognize how continuing links to extremist groups 
mortgage Pakistan's future. Outfits like Lashkar-e-Toiba, which some 
view as a strategic reserve in the event of another war against India, 
are instead the leading edge of Pakistan's strategic demise. Every mass 
casualty attack that Lashka- e-Toiba carries out on Indian soil brands 
Pakistan as an exporter of terrorism. India rebounds from extremist 
attacks; Pakistan's economy and social cohesion do not rebound. If 
Pakistan's national security establishment cannot rethink the 
fundamentals of its anti-India policy and its increasing reliance on 
nuclear weapons, it will never know true security.
    As for Afghanistan, the sooner we and Pakistan revisit painful 
questions, the better. Pakistan cannot break damning links with the 
past as long as senior leaders of al-Qaeda and the Afghan Taliban find 
safe havens there. I do not expect a change in Pakistan's ties to the 
Afghan Taliban, but Rawalpindi may now wish to rethink its passive 
relationship to what may remain of al-Qaeda's leadership within the 
country.
    We might also reconsider our present course. Our Afghan policies 
hurt, rather than help, Pakistan to find its balance. If authorities in 
Afghanistan are unable to safeguard our military's hard-won gains, we 
need to ask how much more blood and treasure ought to be devoted to 
this cause. I acknowledge that there are risks in accelerating 
reductions in the U.S. level of effort in Afghanistan. In my view, 
greater risks and costs are incurred by remaining on our current glide 
path. I therefore suggest that this committee consider accelerating 
efforts to secure a political settlement in Afghanistan alongside 
reductions in our level of military effort there.

    The Chairman. Thank you very much, Mr. Krepon.
    Mr. Yusuf.

   STATEMENT OF MOEED YUSUF, SOUTH ASIA ADVISER, CENTER FOR 
  CONFLICT MANAGEMENT, U.S. INSTITUTE OF PEACE, WASHINGTON, DC

    Mr. Yusuf. Chairman Kerry, Ranking Member Lugar, members of 
the committee, thank you very much for this opportunity to 
speak to you today about United States policy toward Pakistan.
    These views are my own but are influenced and informed by 
my work at the U.S. Institute of Peace where I am based. USIP 
not only conducts research and analysis on Pakistan but we have 
a sizable programmatic presence in the country, which takes me 
back to Pakistan on a very regular basis.
    Osama bin Laden's presence and comfortable existence in a 
Pakistani garrison town was shocking, to say the least. In the 
wake of bin Laden's killing, many have understandably called 
for a reevaluation of the bilateral relationship with Pakistan.
    I would, however, submit, Mr. Chairman, that retreating 
from a promise of long-term holistic support to Pakistan will 
be a grave error on the part of United States decisionmakers. 
The relations with Pakistan will never be good, but they are 
still necessary. With 180 million people, the world's fifth-
largest nuclear arsenal, a global hub for Islamic militants, 
and recent evidence of fast-growing extremism in Pakistani 
society, a further destabilization of Pakistan would be nothing 
short of catastrophic in my view.
    The decision by the U.S. Congress to allow a more broad-
based relationship capable of reaching out to the Pakistani 
people, crystallized as it was through the Enhanced Partnership 
with Pakistan Act, was refreshing precisely because it 
understood the importance of a stable Pakistan for the United 
States. The beauty of that was that for once we were now 
thinking of Pakistan for Pakistan's sake.
    We must be clear that the ultimate U.S. national security 
interest in Pakistan will be served only by ensuring stability 
of this country and nothing less. Afghanistan is a critical 
element of that but only one of them. Therefore, the tendency 
to tie this relationship's future solely to Afghanistan, in my 
view, is a flawed approach.
    Taking a long-term view of the partnership, my written 
testimony, which has been submitted, provides a number of 
specific measures regarding America's security, economic, and 
political engagement that would help further this United States 
interest of assisting Pakistan become stable.
    Very briefly on Afghanistan, which of course is the most 
urgent of our security interests, recent research that we have 
conducted at USIP suggests a much greater possibility of 
convergence between United States and Pakistani positions than 
is generally believed. The prerequisite to benefiting from this 
convergence, however, is a clearly laid-out reconciliation plan 
from the United States, followed by frank and specific 
discussions with Pakistan on the positive role they would be 
able to play as we try to reach out for a negotiated settlement 
in Afghanistan. I think it should be fairly clear that there is 
no military solution possible, and a Pakistani role in the 
reconciliation phase remains indispensable to us.
    Let me say a word about economic assistance. The irony here 
is that while continued economic assistance cannot guarantee 
success, withdrawing it at this moment would be tantamount to 
giving up on Pakistan. To optimize gains, economic assistance 
must be tailored to ensure maximum development benefits. There 
is a need to reconsider use of aid for short-term stabilization 
objectives, as I increasingly see being the case in Pakistan, 
because what this does is it risks diluting development gains 
while proving to be ineffective on the security front as well.
    I would, however, recommend making civilian economic 
assistance conditional upon the Pakistani Government's ability 
to undertake structural tax reforms, which there is now a 
consensus both in Pakistan and outside is critical for 
Pakistan's fiscal revival.
    Then, Mr. Chairman, there are things that money cannot buy, 
and in Pakistan's case it is their strategic mindset. Having 
worked on this issue very closely, I am convinced that no 
amount of United States aid will be able to deliver on that 
front. India-Pakistan normalization is critical for Pakistan, 
but it is not our aid that is going to do the trick. It would, 
therefore, be best to use America's economic leverage to ensure 
better development outcomes, and returns on the 
counterterrorism front should be linked only to security 
assistance.
    I would add here, though, that the conditionalities, 
whatever they are, must be ones which can be proven and which 
are tangible. When there is such an acute trust deficit, it is 
very difficult to prove conditionalities which really go with 
one's word against the other, which has been the case so far in 
my view. We also need to keep in mind the Pakistan military's 
capacity constraints when we decide what conditionalities are 
going to be applied.
    In terms of America's political engagement, the dilemma of 
who to work with in Pakistan will remain a real one for the 
foreseeable future. The temptation to waiver toward the 
relatively more organized and efficient military will be strong 
from time to time. However, we must not repeat the mistakes of 
the past. Political engagement with Pakistan should have one 
overriding objective. Whatever change occurs, it would have to 
come about democratically and constitutionally for it to be 
acceptable to Washington.
    Let me close by reiterating that Pakistan's stability as a 
state is a critical U.S. national security interest, if not for 
any other reason than, unfortunately, purely for the country's 
destructive potential: one of the largest youth bulges, 
extremism, terrorism, nuclear weapons, and inability to hold 
India's, and indeed South Asia's, progress back. America's 
focus must remain on the long-term vision that I believe can 
still turn Pakistan around to help it become a moderate Muslim 
country with a middle-sized economy. There is still enough in 
the society which is pushing back against this onslaught of 
extremism. Failure, Mr. Chairman and members of the committee, 
is simply not an option when it comes to Pakistan.
    Thank you.
    [The prepared statement of Mr. Yusuf follows:]

                   Prepared Statement of Moeed Yusuf

    Chairman Kerry, Ranking Member Lugar, and members of the committee, 
it is an honor to appear before you today to present my views on U.S. 
policy toward Pakistan. Thank you for this opportunity.
    My views are my own. They are informed by my work at the U.S. 
Institute of Peace (USIP) which provides analysis, training and tools 
to help prevent, manage, and end violent international conflicts, 
promote stability, and professionalize the field of peacebuilding. 
USIP's work in Pakistan encompasses three interrelated areas: improving 
mutual understanding between United States and Pakistan; strengthening 
capacity to mitigate conflict; and promoting peacebuilding through 
education and civil society initiatives. Over several years, USIP has 
been involved in training conflict resolution facilitators, promoting 
peace education in Islamic seminaries, and conducting research and 
analysis on the ground in Pakistan. I travel frequently to Pakistan and 
have a broad network of contacts across the country.
    Mr. Chairman, you could hardly have selected a more pressing moment 
to reflect upon the state of the Pakistan-United States relationship. 
Just 5 days ago, the world's most wanted man, Osama Bin Laden was 
killed inside Pakistan. There are multiple ways to absorb and analyze 
this development. The most obvious reaction, as we have witnessed in 
the wake of bin Laden's killing, is to question Pakistan's commitment 
as a partner in the fight against terrorism given that he was found 
living comfortably in a Pakistani garrison town. Understandably, many 
have suggested that Pakistan is not sincere, and thus Washington should 
contemplate breaking off ties.
    I, however, believe the United States should see this extremely 
difficult moment as an opportunity to strengthen the bilateral 
relationship. America has tried the ``walk away'' route before; it is 
primarily the reason for our presence in Afghanistan today. But this 
time, the outcome of a ruptured relationship with Pakistan is certain 
to be even more detrimental as its multiple faultlines have rendered 
the country much weaker and fragile than it was at the end of the 
Afghan Jihad.
    While Pakistan has provided ample reasons for the United States to 
consider it untrustworthy, Pakistan's No. 1 complaint vis-a-vis the 
United States has always been, and is, that Washington has proven to be 
an undependable partner. It was not long after the news of bin Laden's 
death flashed across TV screens in Pakistan that commentators were 
asking if the United States would consider this as ``mission 
accomplished'' and abandon its partnership with Pakistan. Indeed, we 
have known for a long time that Islamabad is not convinced of U.S. 
promises to stick with Pakistan over the long haul. I believe that bin 
Laden's death provides an opportunity to convince them otherwise. A 
demonstration of U.S. resolve to persist with Pakistan even after al-
Qaeda's leader and mastermind is gone will send an extremely positive 
message to the average Pakistani.
    Let me return to the bin Laden episode later and instead focus on 
the United States-Pakistan relationship in a broader framework.
    The bilateral relationship dates back to Pakistan's creation but 
never have the stakes been higher than over the last decade. Since 9/
11, the relationship has had a discernible schizophrenic element to it. 
It has been both, good and bad; encouraging as well as frustrating; 
invaluable, and yet, at times counterproductive.
    The oscillatory nature of the engagement has left few comfortable 
for too long. Even today, there is a heated debate among the policy and 
academic community on whether the United States-Pakistan engagement has 
been a net positive or negative from an American perspective. 
Increasingly, I find myself being asked the question: will the United 
States be able to achieve its objectives in Pakistan? And if not, why 
should Washington commit so much money and effort to a country that is 
unwilling or unable to deliver?
    I want to take this opportunity to highlight why retreating from a 
promise of long-term, holistic support to Pakistan will be a grave 
error on the part of U.S. decisionmakers. I will also highlight 
specific measures with regard to the monetary, security, and political 
aspects of the engagement that would further what I consider to be a 
fundamental U.S. interest: assisting Pakistan in its quest for 
stability. In doing so, I will provide an assessment of U.S. policy and 
its limits in Pakistan--which is what I was asked to focus on today.

                      U.S. OBJECTIVES IN PAKISTAN

    Recalling Charles Dodgson's 1865 novel, ``Alice's Adventures in 
Wonderland,'' ``if you don't know where you are going, any road will 
take you there.'' This is not an entirely unfair characterization of 
U.S. policy toward Pakistan or, for that matter, Islamabad's outlook on 
Washington. The two countries have been partners for over a decade but 
the answer to ``what they are ultimately after'' remains ambiguous.
    For the first 6-plus years of the post-9/11 relationship, Pakistan 
was viewed squarely through the Afghanistan prism. The relationship was 
transactional and was tied to America's engagement in Afghanistan and 
Pakistan's counterterrorism cooperation. The revision toward a more 
broad-based partnership capable of reaching out to the Pakistani 
people, crystallized through the Enhanced Partnership with Pakistan 
Act, was a welcome one.
    The Act, as I interpreted it, contained the necessary ingredients 
to make the Pakistan-United States relationship a lasting one. It was 
realistic in what it thought the much-enhanced civilian assistance 
could get Washington in return. No one claimed that the fresh 
assistance alone would be able to transform Pakistan or would be able 
to alter Pakistan's India-centric strategic paradigm. But it would, one 
hoped, contribute to economic stability, improved governance, and 
strengthened civilian institutions. It was to begin to convey the 
message that the American Government and people care about the well-
being of the ordinary Pakistani. The beauty of this vision was that it 
was clear that the United States had begun to think about Pakistan for 
Pakistan's sake.
    Unfortunately, the vision has been overwhelmed by an urge to 
retreat to the old model, a model which saw Pakistan from a purely 
security lens and in relation to the mission in Afghanistan. The 
discourse on Pakistan has, once again, shifted to tying U.S. assistance 
to results on the security front. This view has also filtered into 
decisions on the use of U.S. assistance in Pakistan. The USAID mission 
in Pakistan, much like in Afghanistan, is being asked to view aid as a 
stabilization tool, with short-term interests and politicized 
objectives which too often trump an effective, long-term development 
approach. Geographical and project priorities as well as the 
implementation models are often influenced by the need to generate 
security dividends rather than simply approaching development for the 
sake of development--the only tested way of creating stability and 
turning young minds to constructive endeavors over the long run. There 
is also an active effort to try and win the ``hearts and minds'' of 
Pakistanis, which again is, an overly ambitious goal with unclear 
utility.
    I do not need to inform this committee that these returns have not 
been forthcoming from the Pakistani side. Pakistan has not eliminated 
the militant sanctuaries; nor has there been any notable decrease in 
the anti-American sentiment in Pakistan. But what I do want to stress 
is that none of the strategic results mentioned above are likely to 
come at all--not in the timeframe that is in any way relevant to the 
mission in Afghanistan. If the benchmark to evaluate the efficacy of 
the broadened relationship, and indeed of the United States-Pakistan 
partnership overall, is Islamabad's behavior between now and 2014, I am 
afraid, the conclusion is foreknown.
    But viewing the relationship through such a short-term prism is 
fraught with danger. It is this very desire to see ambitious 
expectations fulfilled quickly that sets one up for disappointment and 
which in turn feeds resentment toward Pakistan. And ultimately, one 
comes back full circle to the question: Why should we support a country 
that is not delivering? The conclusion, for many among the policy 
circles is already that we should not; that U.S. requires a ``Plan B'' 
which is stern and more aggressive--which seeks to ``get the job 
done.'' Unfortunately, such a ``Plan B'' is not possible; at least 
there is none that can produce the desired results without leaving 
Pakistan in more dire straits.
    In Pakistan, this sentiment is interpreted as proof of the 
momentary nature of the partnership. Those Pakistanis who support a 
deeper and a more sincere engagement with the United States quickly 
lose out in favor of those who prefer that Pakistan work to extract 
maximum benefits from Washington before relations turn sour again--
which they believe to be inevitable.

                         PAKISTAN'S IMPORTANCE

    The impulse to keep Pakistani unwillingness to tackle militant 
sanctuaries in Pakistan at the forefront of the relationship is 
understandable when American troops are engaged in Afghanistan. 
However, this is only productive if the ``end games'' in Afghanistan 
and Pakistan are seen synonymously. It ignores the reality--which 
incidentally was behind the decision to broaden the relationship with 
Pakistan--that while Afghanistan may be the primary concern 
momentarily, it is Pakistan that holds far greater importance for 
future U.S. security, and its interests in the South Asian region. 
There is hardly any other country whose failure could have as serious 
and lasting repercussions for the world as Pakistan. And yet, a stable 
and prosperous Pakistan is the only hope for a peaceful South Asia and 
an ultimate defeat of terrorist forces in the region.
    Pakistan is a country with 180 million people, a figure that will 
have surpassed 300 million by the middle of the century. Over 100 
million of the current population is under the age of 24. It is a 
country which is believed to possess the fifth-largest nuclear arsenal 
in the world. It is now also the global magnet for Islamist militants. 
Moreover, recent events including street support for coldblooded 
murders and sloganeering against the United States for killing bin 
Laden show just how quickly extremism and intolerance is growing in 
Pakistani society. Were Pakistan to destabilize further over the next 
decade or so, its demographic dividend will transform into a timebomb; 
the state may begin to lose even more space to the extremist right; 
there would then be more opportunities for terrorists to operate and 
plot attacks against the West, India, and elsewhere; and ultimately, 
the concern about safety and security of nuclear weapons, to this point 
exaggerated, may become real. Should it come about, such a Pakistan 
would be a direct threat to the United States in multiple ways.
    Pakistan simply cannot be cut loose without immensely hurting long-
term American security interests. There is therefore an urgent need to 
pursue the spirit of the decision to broaden the bilateral 
relationship; to resist the temptation to view Pakistan on 2-to-3-year 
timelines; to want to achieve too much too soon. If the United States 
is truly interested in a stable Pakistan, it needs to approach the 
relationship through a long-term vision and determine priorities 
accordingly. This is not to say that immediate interests such as 
Afghanistan should be ignored. Of course not--but they should not be 
presented as the sum total of the relationship. It is the urge to seek 
quick quid pro quos that highlights the transactional nature of ties 
and prompts Pakistani decisionmakers to view U.S. commitment as 
momentary. It also leads them to make choices which are often directly 
opposed to U.S. interests but which they feel compelled to pursue 
because they lack confidence in U.S. support.
    Let me now turn to policy options across the three main aspects of 
the relationship: (i) monetary assistance; (ii) security; and (iii) 
political developments.

                            U.S. ASSISTANCE

    The Enhanced Partnership with Pakistan Act is perhaps the first 
time that the United States has expressed an explicit interest to work 
through a democratically elected government in Pakistan for the 
betterment of the Pakistani people. Yet, the irony is that while U.S. 
civilian economic assistance may be critical to keep Pakistan from 
buckling under, it cannot, by itself, fix Pakistan's development and 
security problems. Moreover, while continued economic assistance cannot 
guarantee success, withdrawing assistance would be tantamount to 
failure.
    The civilian assistance promised to Pakistan is a substantial sum 
in absolute terms but remains only a portion when it comes to 
Pakistan's requirements. This is not to say of course that $1.5 billion 
per year cannot, if spent efficiently and smartly, make a noticeable 
contribution to Pakistan's development and capacity uplift. Also, U.S. 
assistance amounts to more than what it seems on paper. It is an 
important signal for multilateral and other bilateral donors. U.S. 
assistance reflects Washington's determination to continue supporting 
Pakistan, and in turn allows other donors to remain buoyant. Private 
sector investors depend heavily on investment ratings which are 
directly affected by the donor outlook.
    Moreover, at present, Pakistan's economy, with a ballooning fiscal 
deficit and poor prospects for the immediate future, remains externally 
dependent. Lack of support from the United StatesUnited States and 
other major donors at this point can quickly unravel the already-
tenuous economy. This will, in turn, further discredit the state in the 
eyes of the Pakistani people and weaken its ability to control events 
to an even greater degree. Down the line, the downward spiral links up 
to frustration among the youth and generates greater susceptibility to 
militant recruitment.
    Going forward, the following deserve attention:

   The task of spending $1.5 billion a year efficiently is not 
        an easy one. Foremost, there is a need to reconsider the belief 
        that development aid and security benefits are tied through a 
        linear relationship. Most literature points to the contrary: 
        using aid for short-term stabilization objectives risks 
        diluting development gains while proving to be ineffective on 
        the security front.\1\ Such outcomes will also keep Pakistanis 
        unconvinced about U.S. interest in their long-term welfare. My 
        frequent visits to Pakistan, and a forthcoming report by the 
        Center for Global Development's study group on U.S. development 
        strategy in Pakistan, of which I am a member, reflect a sense 
        from the ground that this dynamic has already set in.\2\
---------------------------------------------------------------------------
    \1\ Andrew Wilder, ``Aid and Stability in Pakistan: Lessons from 
the 2005 Earthquake Response,'' Disasters, 34 (S3), 2010.
    \2\ Nancy Birdsall, Wren Elhai, and Molly Kinder, ``A Report of the 
Center for Global Development's Study Group on a U.S. Development 
Strategy in Pakistan,'' Center for Global Development (forthcoming, 
2011).
---------------------------------------------------------------------------
   As much as possible, the primary focus of the civilian 
        assistance should be sustainable development and capacity-
        building of the civilian sector over the long run. This is best 
        managed by aligning programmatic and development assistance 
        with the overall priorities of the Government of Pakistan. The 
        U.S. Government should be receptive to new ideas originating 
        from Pakistani planners. The Planning Commission of Pakistan 
        has produced a new growth strategy for the country, which 
        focuses on entrepreneurship and innovation among the private 
        sector as the engine for growth, and in turn, job creation. If 
        this translates into employment for the over 100 million youth 
        of the country, the attendant benefits in terms of luring them 
        away from crime and extremism will be forthcoming.
   Civilian assistance should be made conditional upon the 
        Pakistani Government's ability to undertake domestic reforms 
        needed to complement external support. Pakistan's perennial 
        problem of a single digit tax-to-GDP ratio is well known. Their 
        official reasoning aside, the fact is that the Pakistani state 
        apparatus is captured by a small number of power-wielding elite 
        that has stalled reform for personal gains. Yet, there is a 
        virtual consensus that Pakistan's fiscal revival is tied to 
        structural tax reform. Washington should use its economic 
        leverage and declare tax reform a non-negotiable agenda point.
   More action is required on the ``trade not aid'' front. This 
        involves addressing the U.S. reluctance to allow key Pakistani 
        exports, particularly textiles, greater market access. U.S. 
        legislators must comprehend the multiplier effect such an 
        opening would have; that too, without having any structural 
        impact on the U.S. textiles industry.
   The quest for winning hearts and minds is overly ambitious. 
        Unfortunately, America may have set itself up for a failure of 
        expectations in Pakistan. As explained, the development 
        benefits from U.S. aid will be real if assistance is spent on 
        key development priorities but they will not be able to 
        transform the lives of ordinary Pakistanis across the board. 
        Yet, the hype created around the U.S. assistance package has 
        raised tremendous expectations in Pakistan. Aid should be 
        accompanied not by promises of major transformation but by 
        increased transparency on where, how, and why, aid is being 
        spent. Moreover, the onus of responsibility of aid utilization 
        needs to be transferred to the Pakistani Government. At least 
        for all aid flowing through the government, the United States, 
        through its public messaging should make clear to the Pakistani 
        people that any success or failure is the home government's 
        responsibility, not that of the United States. The Congress 
        should continue to insist on accountability and transparency, 
        but it should not allow a model that brings Washington blame 
        for Pakistani mistakes.
   There are things money cannot buy. In Pakistan's case, it is 
        their strategic mindset. For years, Pakistani leaders, civilian 
        and military, have pretended that U.S. economic assistance and 
        political support is the key to obtaining strategic 
        deliverables. Washington has seemed too eager to go along. 
        Every time, the outcome has been unsatisfactory. Indeed, 
        expecting monetary assistance to alter Pakistan's strategic 
        paradigm reflects a lack of understanding of just how deep 
        rooted are Pakistan's concerns about India and an insecure 
        neighborhood to its west.
   Finally, military aid is important in its own right and the 
        desire to continue support at the present level is a positive 
        one. Given the multitude of militant threats and the dwindling 
        economy, the Pakistan military would require continued 
        assistance from the United States just to keep up with its 
        current challenges. However, the relationship should be 
        transformed into a broad-based military-to-military partnership 
        that seeks to build capacity and supports the needs of the 
        Pakistani military in its counterterrorism and 
        counterinsurgency operations. The quasi-rentier arrangement 
        under the Coalition Support Fund harkens back to the 
        transactional prism and needs to be discontinued in favor of an 
        upgraded assistance package.

                         SECURITY RELATIONSHIP

    Osama Bin Laden's presence in Abbottabad deep inside Pakistan was 
shocking to say the least. It raises questions about the competence, or 
worse yet, intentions of the Pakistani ISI. Not enough facts are 
available yet to decipher where the reality lies. On the one hand, one 
is hard pressed to find a rationale for the Pakistani state to harbor 
bin Laden. It defies all logic. After all, Pakistan and the United 
States have collaborated in previous operations/strikes against senior 
al-Qaeda leaders inside Pakistan. Indeed, President Obama's 
conciliatory mention of Pakistan in his speech on Sunday night and the 
Secretary of State's subsequent remarks in the same vain suggest a 
certain degree of confidence that the Pakistani state was not 
complicit. On the other hand, Pakistani security establishment's 
propensity for risk-taking is well known and this may just have been a 
major gamble gone wrong. At this stage, there are numerous questions 
with few answers. This chapter can surely not be closed on this note. 
Candid discussions need to take place with the Pakistani intelligence 
to determine the precise facts. Did the Pakistani security 
establishment help, remain irrelevant, or hinder? Were individuals from 
the ISI involved in harboring bin Laden, or was it a case of sheer 
incompetence on the part of Pakistan's spy agency?
    Regardless, while bin Laden's killing will likely dent al-Qaeda 
globally, it neither reduces Pakistan's internal security challenges, 
nor completes the mission in Afghanistan.
    The episode, itself, is a reminder that Pakistan has truly become 
the global hub for Islamist terrorists. The Pakistani state is 
challenged by multiple militant outfits with different agendas and 
capacities. This is a result of three decades of misplaced policies 
which saw militants as tools of foreign policy.
    Broadly, four types of militant groups are situated on Pakistani 
soil: anti-Pakistan state; anti-U.S./NATO presence in Afghanistan; 
anti-India; and sectarian. While the groups do not lend themselves to 
neat distinctions, and members frequently overlap, the Pakistani state 
has tended to see them in silos. The military has chosen a graduated 
response, going wholeheartedly only after the principal anti-Pakistan 
group, the Tehrik-e-Taliban Pakistan (TTP) and some of the sectarian 
outfits. Against others, the state has employed a variety of law 
enforcement, coercion, appeasement, outsourcing, and ignoring tactics. 
The military remains concerned about spreading itself too thin by 
opening multiple fronts simultaneously. Even in areas like Swat and 
Buner where the military has scored impressive victories, the 
transition to civilian governance structures is missing and the 
military is forced to continue holding areas indefinitely.
    Pakistan's graduated response may make sense at one level but it 
reflects a fundamental disconnect between Pakistani and U.S. strategic 
interests. Pakistan's refusal to target Afghan insurgent sanctuaries 
inside its territory, explained partly by capacity constraints and 
partly by its concerns about an antagonistic Kabul, is actively raising 
Western costs in Afghanistan. To date, Pakistan has been, in order of 
importance, both an invaluable lifeline and a hindrance to the U.S. 
mission in Afghanistan. However, as the U.S. strategy moves toward the 
negotiations phase, Pakistani and U.S. strategic interests are likely 
to converge on the question of reconciliation.
    At the U.S. Institute of Peace, we recently undertook a project, 
``The End Game in Afghanistan: View from Pakistan'' aimed at better 
understanding Pakistani perceptions about the ``end game'' in 
Afghanistan.\3\ We involved over 50 Pakistani opinionmakers, analysts, 
political leaders, and officials in a series of round tables to draw 
out Pakistani views on U.S. strategy and how Pakistan plans to pursue 
its interests. The results provide important lessons on the way forward 
for the United States-Pakistan engagement on Afghanistan.
---------------------------------------------------------------------------
    \3\ Moeed Yusuf, Huma Yusuf, and Salman Zaidi, ``The End Game in 
Afghanistan: View from Pakistan,'' United States Institute of Peace and 
Jinnah Institute (forthcoming, 2011).
---------------------------------------------------------------------------
    We were encouraged to find that Pakistani opinion seems 
unequivocally opposed to prolonged instability in Afghanistan. It also 
no longer favors a Taliban-led Afghanistan. Moreover, there is support 
for convincing the Taliban to divorce ties with al-Qaeda. Incidentally, 
this task will become easier after bin Laden's death. For some time 
now, I have been of the view that the best case scenario for 
Afghanistan entails a negotiated settlement in which all Afghan groups 
guarantee a clean break from al-Qaeda and agree to return within the 
Afghan constitutional framework. Bin Laden's death is likely to make 
the Taliban leadership more amenable to this demand.
    In terms of the problem areas, our research clearly indicates that 
Pakistanis do not see an interest in targeting the Afghan Taliban. The 
primary reason, however, is not an active collusion to undermine U.S. 
efforts--although, as mentioned, de facto the policy does raise U.S. 
costs substantially; rather, it is a function of the lack of confidence 
in the current U.S. strategy in Afghanistan. The predominant view in 
Pakistan, and indeed around the region, holds that the military surge 
will only have a marginally positive impact but that the absence of a 
clear American political strategy will undermine the military gains. 
Indeed, much has been said about the diplomatic surge and the plan for 
reconciliation talks in Washington but there is little evidence of a 
well thought-out plan.
    Prompting Pakistan to change its mind about leaving the militant 
sanctuaries untargeted requires no less than a total military victory 
in Afghanistan. Short of that, no Pakistani expert or decisionmaker--
largely deriving their view from the history of the region--believes 
that the United States will be able to decimate the opposition. The 
other option, a direct U.S. action inside Pakistan to target the 
sanctuaries will be detrimental, not only because it will rupture ties 
and unite Pakistani Islamists under an anti-U.S. platform, but also 
because tactically, little can be achieved without full Pakistani 
support.
    Moving forward, I offer these recommendations:

   U.S. policymakers must lay out a clear plan for the 
        reconciliation phase in Afghanistan. Incidentally, this is a 
        desire shared not only by Pakistan but also by the Afghan 
        Government, the relevant Central Asian Republics, Russia, and 
        Iran. The clarity required is not necessarily about the end 
        state since that will be an outcome of the process; it is about 
        where Washington wants to start and how it foresees the process 
        moving forward.
   There is little doubt that a positive Pakistani role in the 
        reconciliation phase is all but necessary for a sustainable 
        outcome. Therefore, in anticipation of the reconciliation 
        talks, a frank and candid dialogue needs to be initiated with 
        Pakistan's security establishment to decipher what role they 
        are able and willing to play. Just what exactly will Pakistan 
        be able to offer in terms of negotiating with the Taliban? A 
        simultaneous broader dialogue focusing on more strategic 
        questions is also required: issues that are often brought up in 
        Pakistan--U.S. military bases, future of the Afghan National 
        Security Forces, guarantees of noninterference by India, and 
        from U.S. perspective, guarantees of noninterference from 
        Pakistan in a post-settlement phase--need to be part of the 
        dialogue. It is surprising how little of this has happened to 
        date; there have been plenty of discussions, but no serious 
        structured negotiations that I am aware of, largely because of 
        lack of clarity on how reconciliation will proceed.
   The most obvious stumbling block from Pakistan's perspective 
        is Indian presence in Afghanistan. Ideally, the United States 
        should nudge both sides to initiate a dialogue specifically on 
        Afghanistan. Two parallel tracks ought to be facilitated: (i) 
        intelligence-to-intelligence dialogue to satisfy Pakistan's 
        concerns about Indian activities in Afghanistan; and (ii) 
        development-focused dialogue to chart out sectors/projects 
        where Pakistan and India could work jointly.

            THE SILVER BULLET: INDIA-PAKISTAN NORMALIZATION

    If one were asked to identify the top two or three developments 
that could sow the seeds for sustained stability in Pakistan, and 
indeed peace in South Asia, all of them would be directly or indirectly 
linked to India-Pakistan normalization. Despite what has happened in 
Afghanistan since 9/11, including the backlash within Pakistan, it is 
my considered view that the road to a stable Pakistan, ultimately 
travels through New Delhi. There was even a prolonged window after 9/11 
when reassuring Pakistan vis-a-vis India, especially its presence in 
Afghanistan, could have reflected in more conciliatory Pakistani 
policies in Afghanistan. That window is closed now.
    Nonetheless, a proactive U.S. stance in nudging the two sides 
toward normalization is advisable, not only for Pakistan's stability 
but also for the sake of optimizing the Indo-U.S. alliance. Till India 
and Pakistan are at daggers drawn, India's ascendance to the global 
stage will remain constrained.
    Washington finds itself in an extremely awkward situation as a 
third party. In Islamabad, the United States is now popularly viewed as 
having shifted camps, leaning toward India as a long-term partner and 
maintaining tactical ties with Pakistan for the time being. While 
Washington always reacts to this sentiment by negating this structural 
shift, the fact is that the shift is real and a positive one from an 
American point of view. Rather than being defensive, this fact should 
be acknowledged and instead, Washington's leverage with both South 
Asian countries ought to be used to keep the two sides at the 
negotiating table.
    Three avenues for U.S. facilitation stand out:

   Terrorism from Pakistan-based militants has become the 
        single most important sticking point in bilateral ties. Anti-
        India militant organizations no longer require active Pakistani 
        state support to operate but matters are made worse by the 
        state's seeming indifference, as is reflected in its handling 
        of the Mumbai attack suspects. While pushing Pakistan to launch 
        a forceful offensive against Lashkar-e-Taiba (LeT) in the 
        Pakistani heartland of Punjab can backfire, Pakistan will have 
        to show extreme political will and sincerity in its law 
        enforcement measures against groups like LeT to make its 
        efforts credible. Simultaneously, the two sides will have to 
        show resolve to work together in defeating this menace. The 
        existing ``joint terrorism mechanism'' provides the most 
        obvious mechanism to do so.
   Kashmir still remains the ultimate game changer. The 
        motivations for anti-India terrorism, all directly or 
        indirectly link up with Kashmir. There was unprecedented 
        progress on the issue during the India-Pakistan peace process 
        between 2003-07; both sides had, at the time, a fair 
        understanding of the broad contours of the solution. Political 
        hurdles in both countries aside, the leaderships have 
        repeatedly expressed their desire to move forward on Kashmir. 
        If it cannot actively facilitate, the United States can 
        certainly ensure that bilateral negotiations on the issue do 
        not break down. One could point to a number of moments in the 
        past where a more proactive U.S. role could have been pivotal. 
        The most recent example is 2007-08 when after making 
        substantial progress, the dialogue on Kashmir hit a roadblock. 
        Had Washington been more involved all along, it may well have 
        been able to step in and prevent the process from being 
        derailed completely. As the bilateral dialogue resumes, U.S. 
        vigilance would be advisable.
   Facilitating a fundamentally transformed economic 
        relationship is another hitherto ignored avenue. Pakistan's 
        traditional stance that trade and investment will follow the 
        resolution of the Kashmir issue has been inherently 
        counterproductive and has stifled regional development. Should 
        a freer trade and investment regime be instituted between the 
        two countries, the extent of economic and human interdependence 
        it is expected to create will by itself make the security-
        dominated narrative in Pakistan difficult to uphold. Washington 
        could use its diplomatic offices to nudge both sides toward 
        greater liberalization and, to overcome Pakistani hesitance, 
        consider monetary incentives to Pakistan to offset some of the 
        initial losses due to the inflow of Indian goods. It could also 
        contemplate industrial investment packages to help expand and 
        upgrade specific Pakistani industries capable of exporting to 
        India. Some of the funding authorized under the Enhanced 
        Partnership with Pakistan Act can be used for this purpose.
   Finally, the United States should also be cognizant of the 
        unintended consequences of its regional policies. Dehyphenation 
        of the India-Pakistan relationship along with a civil nuclear 
        deal to India created a sense of discrimination--of being boxed 
        in--in Pakistan. Pakistan went on a nuclear buildup spree and 
        viewed this as the only long-term guarantee against growing 
        Indian might. The Indo-U.S. deal also pushed Pakistan to seek a 
        deal from China. The dynamic of Indian military modernization, 
        periodic terrorist attacks from Pakistan, and Pakistan's 
        nuclear buildup will also make escalation control in South 
        Asian crises a much greater challenge. Again, reassuring 
        Pakistan by setting preconditions for initiation of talks on a 
        nuclear deal and finding ways to bring Pakistan and India into 
        the legal ambit of the nonproliferation regime, with all its 
        responsibilities, may be beneficial in this regard.

                         POLITICAL DEVELOPMENTS

    Throughout the history of the United States-Pakistan relationship, 
Washington has faced the dilemma of who to deal with in Pakistan. The 
anomalous civil-military relations have meant that the Pakistani 
civilians have often been subordinated by the military, and despite the 
obvious consequences for democracy in Pakistan, Washington has worked 
directly with the military. Today is no different, except in one 
regard: the military is in charge of the security policy but it is more 
a case of the civilians having abdicated this responsibility than the 
military having usurped the space.
    In February 2008, when the present Pakistan People's Party (PPP)-
led coalition took over, Pakistan had a great opportunity to rebalance 
the civil-military equation. The PPP government was riding on a 
sympathy wave after the assassination of its leader, Benazir Bhutto, 
the two largest political parties were in a coalition, the Army was 
both tied up in the antiterrorism effort and discredited after General 
Musharraf's prolonged rule, and the new Army Chief seemed committed to 
pulling the Army back into the barracks. However, gradually, the 
military's footprint has enlarged again, with a number of instances in 
the last 3 years suggesting an overreach into civilian affairs.
    At present, the United States has little choice but to work within 
the framework offered by Pakistan. The Pakistan military therefore is 
likely to remain the point of contact on Afghanistan. On nonsecurity 
cooperation, the U.S. Government is already making a commendable effort 
to prop up the civilian set up which must be continued over the long 
run.
    The toughest test in terms of persisting with support for democracy 
in the country however is likely to come over the next few years. 
Politically, Pakistan is moving toward a phase where coalitions are 
likely to replace hegemonic parties. As coalition politics becomes the 
norm, it will bring with it all the messiness, uncertainty, and 
superficiality inherent in it. Pakistan will see repeated political 
tensions: coalition partners will switch sides regularly to up the 
ante; oppositions will support the ruling alliance in times of distress 
and create hurdles on other occasions; smaller parties will piggyback 
on the larger ones at times and oppose the same when they see fit, etc. 
Even coalition governments may form and break relatively frequently.
    It is only by going through repeated iterations of such politicking 
that the political elite may develop a spirit of ``consociationalism'': 
indigenous mechanisms that will allow them to coexist; to bargain 
keeping the country's long-term interests in mind even as they protect 
their own short-term gains; and ultimately to arrive at a consensus on 
certain national issues that they deem too important to hold hostage to 
political expediency. At this point, Pakistani politics will resemble 
that in India today. Individual politicians would not have changed 
(although some new, dynamic ones would have arrived on the scene), nor 
would their desire for short-term gains have disappeared. But they 
would have forged a grand, elite consensus around certain national 
interests they agree must not be undermined at any cost.
    The interim however will be inefficient, tense, and relatively 
unstable. The United States will have to show patience with the 
civilian set ups; it may have to continue support despite inefficiency, 
lack of accountability, inability to deliver on promises, and similar 
shortcomings. The temptation to waver toward the more organized, 
relatively efficient military will be strong, especially as security 
concerns are set to remain prominent. However, it is imperative that 
U.S. policy continue to work within the system--and not repeat the 
mistakes of the past.
    Political engagement with Pakistan should have one overriding 
objective: change must come about democratically and constitutionally. 
There is nothing sacrosanct about a 5-year term for a government in a 
parliamentary system. But any premature change must come from within 
the parliamentary structure. Moreover, at this point, there is no 
danger of Islamist parties gaining power through the ballot. However, a 
perception of constant U.S. involvement and interference in political 
developments in Pakistan may well, in a decade's time, allow them to 
ride on an anti-American wave to stake a claim from within the system. 
There is a need for a lower American profile in political outreach 
along with greater transparency on the purpose of frequent meetings 
between U.S. officials and Pakistani politicians.

                               CONCLUSION

    Pakistan's stability as a state is a critical U.S. national 
security interest. I will be the first one to admit that this message 
runs contrary to the natural impulse, especially at a time when 
questions continue to be raised about Pakistan's sincerity in the wake 
of Osama Bin Laden's killing inside the country.
    Indeed, the relationship will continue to give ample opportunities 
for finger pointing; tempers will run high; and often, frustrations 
with Pakistan may boil over. The Pakistani leadership will also remain 
inefficient and U.S. aid will seldom get the short-term returns that 
lawmakers desire. And yet, losing Pakistan and letting it destabilize 
will have systemic implications, if not for any other reason, then 
purely for its destructive potential: one of the largest youth bulges; 
extremism; terrorism; and nuclear weapons.
    On the other hand, well-crafted U.S. policies with a long-term 
vision can still turn Pakistan around and help it become a moderate 
Muslim country with a middle-sized economy. The silver lining is that 
much of the present strategic divergence of interest between the two 
sides is Afghanistan-specific. Should Pakistan and the United States 
manage to work together and find a mutually acceptable negotiated 
settlement in Afghanistan, a sustained relationship beyond that would 
by definition be for Pakistan's sake alone. The basis for Pakistani 
perceptions about fickleness of the U.S. partnership, transactional 
nature of the relationship, and even anti-American sentiment would have 
disappeared. Presuming that the flow of economic and security 
assistance is uninterrupted throughout and that Pakistan's democratic 
process has not been disrupted, the returns on U.S. investment will be 
greater and swifter beyond that point.

    The Chairman. Well, thank you all for a very effective 
framing of the issues. There are so many issues, obviously the 
issues of India and Pakistan, United States-Pakistan, internal 
strife, the attitudes that are conditioning their strategic 
perceptions particularly with respect to Afghanistan.
    Let me just begin by saying I have had this conversation 
with General Kayani, with Prime Minister Gilani, with President 
Zardari, with General Pasha, and others. The Pakistani 
strategic view and posture vis-a-vis India, at least in this 
Senator's judgment, and I think for many people who talk about 
it, is absurd in this modern context: both nuclear nations, 
both with much bigger interests that would take them under good 
reasoning to a very different conclusion. But there just seems 
to be a kind of automatic historical/cultural desire to keep 
focusing on India, and it is depleting their ability to focus 
on their own economy, on their own needs. To learn that they 
have increased their nuclear arsenal when by most people's 
judgment they already had a bigger one than India and an 
absolutely adequate capacity to deter as well as to destroy 
within the region simply does not make sense. So we have to 
measure the strategic capacity of Pakistan to understand its 
real interests correctly.
    And I particularly was struck, Mr. Krepon, by your comment 
that our Afghan policies in fact hurt the Pakistani ability to 
reach equilibrium and to move in the right direction. So could 
you respond both to this problem of Pakistani perception of 
India and misallocation of resources and effort, and also to 
the ways in which Afghanistan and our policies there now may be 
complicating and reducing the ability of Pakistanis to see 
things differently?
    Mr. Krepon. When I visit Pakistan, I get the sense that the 
Pakistani business community, the political classes get it, 
that they have no future if they are at constant war mentally 
with India. I think a lot of people get it now. But the 
national security establishment, which is a rather important 
part of Pakistan, still does not get it.
    The Chairman. Well, can I be blunt about that? Do they not 
get it because they have so many business interests that are 
actually dependent on the continuation of tensions with India 
and the flow of money that comes with that? And recognizing the 
importance of the military as an institution in Pakistan, does 
that frame their needs?
    Mr. Krepon. The tack I am taking when I am there is 
actually to flip it. Because the Pakistan Army is such a big 
player in the economy of that country, perhaps regrettably so, 
but they have an interest also in growing their economy, and 
there are ways to do this particularly across the Punjab 
Divide. If we can grow trade and help foster trade and 
development projects across the border--Punjab was divided 
during the birthing process of India and Pakistan--then I think 
that could unlock a lot. But it is a strategic mindset that 
Moeed was talking about that is very hard to shift. I think 
economics can be the way to shift it.
    The Chairman. Do you believe that this crisis over the 
question of Osama bin Laden's hideaway, so to speak, in 
Abbottabad--does that present perhaps the possibility for the 
pushing of a reset button and for some new calculation which 
could actually expand the better side of the relationship 
rather than diminish it?
    Mr. Krepon. Well, I will say clearly what I hinted at in my 
testimony, and that is the No. 2 al-Qaeda guy may well still be 
in Pakistan. And I think this is a real good opportunity for 
Pakistan's security apparatus to be of assistance in this 
regard.
    The Chairman. What about the Afghan piece of this that you 
mentioned. You said our Afghan's policies affect the Pakistani 
judgment. Now, we all know that they do not love the idea of a 
350,000-person army on their border. They do not like the idea 
of India using Afghanistan to ``encircle them within that 
larger context of their India fears.'' Are there things that we 
are doing or could be doing with respect to Afghanistan that 
might help change those calculations?
    Mr. Krepon. Well, I am going to talk about the drone 
attacks, and I know this a very emotive subject. I have 
struggled with this myself because there are so many 
particulars that I do not know. But my understanding is that 
almost all of these attacks on Pakistani soil are not directed 
against big difference makers. And the political fallout within 
Pakistan of these attacks is very significant. It is 
manipulated for sure by the security apparatus, but the 
security apparatus has a lot to work with, with public opinion 
because folks in Pakistan do not like breaches of their 
sovereign territory.
    The Chairman. I would like to ask this of any of you. Why 
does the ISI not get the internal threat?
    Mr. Yusuf. I think increasingly and much too slowly they 
are getting the fact that this is a Frankenstein that has 
gotten out of hand. The problem, of course, is that they are 
trying to balance the old strategic mindset with this new 
perception that they have to do something internally. And the 
approach they have taken is basically a graduated approach. We 
will go after those who are targeting us and then we will look 
at others who are not.
    Now, you are really playing with fire. On the other hand, 
it is also true that the capacity constraints of the Pakistani 
military are real.
    And what I have seen of the Pakistani establishment over 
the past 3 or 4 years, which I had never before, is that this 
is really a petrified state, and every decision they take, they 
first calculate whether things may go worse if they do 
something.
    The Chairman. Petrified in terms of fear?
    Mr. Yusuf. In terms of fear of actually making more 
enemies. The problem, of course, is that even those who do not 
pretend to be enemies are helping those who are actually 
attacking the state. So I think it is a very difficult 
conundrum on that side as well.
    But from what I can see, it is a very sequential approach. 
They want to go after the main groups first and then go to the 
others.
    The Chairman. Senator Lugar.
    Senator Lugar. All of you, in one form or another, have 
indicated that development aid provided by the United States is 
essential and that the realization of stability in Pakistan is 
a major objective of this aid. And as a matter of fact, you 
assert that if stability is not ultimately realized, the 
destructive consequences of the disintegration of the Pakistani 
state entail all sorts of ominous difficulties not only with 
regard to India, Afghanistan, Iran, or China, but also the 180 
million people residing in Pakistan itself.
    At the same time, even though you have testified that 
stability is essential and that our development aid would help 
to engender that, Mr. Krepon, you have indicated that we cannot 
ultimately affect Pakistan's strategic outlook and that 
whatever we may be doing in terms of development aid is an 
attempt to prevent the disintegration of the Pakistani state, 
which in itself is a valuable objective. That is an interesting 
question to begin with. As Americans look at this, we would say 
it is very important to us that we do affect the strategic 
outlook of Pakistan, and we are not certain that second prize, 
namely that we somehow keep Pakistan from disintegrating, is 
enough.
    But even if we took the position that second prize here is 
adequate, officials from our own Government have testified 
repeatedly that the delivery of this assistance has been 
extremely difficult. As a matter of fact, it is not really 
clear to me to this day who in our Government is actually 
ultimately responsible for doing all of this in any concerted 
way. It is unclear to me where in the world decisions are made. 
The late Dick Holbrooke testified from time to time and claimed 
some of the responsibility and noted that of USAID, but not 
very much is getting done. Plans change, priorities shift, and 
both Pakistani and American officials bemoan the other's 
ambivalence.
    And I remember Secretary Hillary Clinton testifying that 
she was involved in a community meeting in Pakistan with 
Pakistani citizens who were berating her about perceived 
interference that the distribution of this aid might entail. 
And finally, perhaps in exasperation, she asked whether they 
wanted the money or not. By and large, that group wanted the 
money.
    This all brings to light the importance of the question of 
how we organize our own governmental apparatus and find common 
objectives. This question is extremely relevant even when we 
have the best intentions. Pakistanis who have come to coffee 
meetings given by the Foreign Relations Committee have 
suggested they are really interested in large infrastructure 
projects, as opposed to what they feel are more intrusive 
projects dealing with education, students, the building of 
democratic institutions, or initiatives that have to do with 
facilitating the growth of private enterprise or the 
constructing of a market economy, which we here in the United 
States think would be very helpful for the future and the 
stability of the Pakistani people.
    So do any of you have comments on these general questions? 
First of all, what should we be trying to do with the 5-year 
assistance program which the Congress has agreed to? I would 
note that this initiative was at first welcomed in Pakistan 
because of the important long-term commitment that it 
represented. But having said that, almost every aspect of this 
has been bitterly fought over with very little occurring. So 
what are steps that we ought to be taking in the United States 
to make any difference with regard to the broader situation 
that has been described?
    Dr. Ahmed. Senator, you are absolutely right. What happened 
with the decision on the part of Congress to provide this long-
term 5-year assistance was expectations were certainly raised 
on the ground, but those expectations have yet to be met in 
terms of aid delivery.
    There are a number of factors that U.S. agencies emphasize 
in what the problems that they see as effective aid delivery. 
They talk about the security environment. They talk about the 
difficulties of monitoring.
    But part of the problem is how the U.S. agencies 
responsible for disbursing this aid also failed to put together 
a cohesive plan of delivery. First, identification of projects. 
You had plan after plan changed midway, abandoned, restarted 
from something that would aid democratization, health, 
education, all the good things that we expect today to deliver. 
We have got to have American visibility. We have got to be able 
to show the Pakistani people that we are delivering this 
assistance to high-profile, high-visibility projects.
    It is problematic when plans are changed halfway. It is 
also problematic when assistance is provided in areas where 
there, indeed, cannot be any monitoring, but also not just the 
lack of monitoring.
    And I have said this in my testimony as well. We are deeply 
concerned about the kind of assistance provided to FATA, to the 
Federally Administered Tribal Agencies. You cannot provide aid 
effectively in FATA without political reform. As long as you 
use the structures that exist, which is an unaccountable 
bureaucracy, civil and military, and local elites that have 
their own interests, the people of FATA will not see the 
results of that assistance. And because of insecurity in those 
areas, there cannot be any monitoring of that assistance.
    Considering that FATA is a tiny little sliver of territory 
and should not even have been the focus of stabilization 
efforts, stabilization, even if we are talking specifically in 
terms of national security, needs to be the in Pakistani 
heartland, not in areas--and we have the Afghanistan example as 
well--not in areas where you cannot deliver assistance and 
where you know where it is going to go missing.
    I will say this I do not agree with my colleague's comment 
that tax reform should be conditional on economic assistance 
provided to Pakistan. What you have at this point in time, as I 
said, a fragile coalition. The government, despite all its 
problems, is trying to push for an economic reform agenda, but 
in weak coalitions--it is very, very difficult to actually 
enact pressing and large-scale economic reform.
    I will say this that there have been hard choices made and 
not happy choices for a young democracy, as well for a 
democratically elected government. Removal of subsidies, for 
example, has increased popular discontent against the 
government but it was needed. It had to be done. So tax reform 
comes down the road. American conditionalities--you need to do 
A, B, and C--is not, I think, necessarily helpful.
    What is helpful is identifying the most appropriate 
projects and then following through, not changing midcourse. We 
have seen this happen again and again since the Kerry-Lugar-
Berman funds were actually appropriated.
    Senator Lugar. Thank you very much.
    The Chairman. Thank you, Senator Lugar.
    Senator Cardin.
    Senator Cardin. Thank you, Mr. Chairman, and let me thank 
you for holding this hearing and thank you for the panel that 
we have before us.
    As has been pointed out, all of you agree that we need to 
continue our engagement in Pakistan. You also indicate that the 
conditionality of aid needs to be strengthened and we need to 
have better oversight and enforcement on those 
conditionalities. Under those circumstances, we have to be 
prepared to cut off aid or at least to suspend aid if in fact 
the conditionalities are not being met.
    And we have a responsibility to the taxpayers of this 
country. We have to make some tough decisions in our budget, 
and quite frankly, there is concern as to whether the value is 
being properly used as it relates to Pakistan. Of course, the 
bin Laden issue just puts a big spotlight on that.
    I want to cover one point of this in relationship to bin 
Laden because it may give us a chance on a restart in Pakistan 
with the popularity of the people. You all talk about the 
sovereignty of Pakistan and we all know the political risks 
that we run when we do military missions within Pakistan 
because of the sovereignty concerns of the populace in a 
democratic state.
    But recent reports show that the population of Pakistan 
might be equally concerned about the sovereignty of its country 
as a result of the terrorists using Pakistan as a safe haven. 
Do we have an opportunity as a result of bin Laden being so 
visible within the country and such a disappointment that the 
leadership was unable to discover his location? Does that give 
us an opportunity perhaps to have more popular support with the 
people of Pakistan as to
the United States involvement to rid Pakistan of its extreme 
elements, particularly the terrorists who have used it as a 
safe-haven country?
    Dr. Ahmed. 2010--67 suicide attacks, more than 2,500 
civilians killed. There is good reason why in poll after poll 
Pakistani citizens say the greatest threat to their security 
comes from violent extremists. So there is, indeed, an 
opportunity to forge that partnership because there is a common 
understanding of the threats. There is a common understanding 
of the challenges and the opportunities.
    The problem lies--and I think Michael phrased it out very 
well--until and unless the leaders of national security policy 
are with those democratically elected institutions that 
represent the Pakistani people and unless and until the 
military and the security agencies understand the risks that 
they face, it is going to be a difficult task to implement 
policy in a way that will change perceptions, which is why it 
is important to take certification requirements seriously, 
whether it is a suspension or benchmarks that are identified.
    I will give you one benchmark, for example. Lashkar-e-
Taiba,
al-Qaeda-linked, a threat to U.S. national security, a threat 
to India, and indeed a threat to Pakistan. Making sure that 
there is action taken against this group which is banned, which 
is on the U.N. Security Council's list of banned organizations, 
to make sure that the security agencies end their support for 
it, but also to allow the civilian law enforcement agencies to 
take action against these groups. It does not necessarily have 
to be a cutoff of aid, but this is certainly an opportunity to 
press in that direction for action in terms of certification, 
not just certification given automatically.
    Senator Cardin. I think that is an excellent point.
    I guess my main point here is that it is at least apparent 
to us that we have more understanding with the military as to 
the actions we need to take in order to deal with the terrorist 
activities, but we are confronted with the reality that there 
is a political issue whenever there is an incursion within 
Pakistan by the United States. And that is mainly because of 
the populace reaction more so than the military's understanding 
of what the United States needs to do in order to help 
Pakistan.
    My point is, is there some way we can use the location of 
bin Laden as a way to get more understanding among the 
Pakistanis and their political establishment then responding to 
it that would allow us to have a better relationship on 
military maneuvers within the Pakistani territories?
    Mr. Yusuf. I think the point is well taken. I mean, this is 
certainly an opportunity, and this is what I say in my 
testimony as well.
    The onus of changing the narrative in Pakistan on extremism 
lies with the Pakistanis. We can only help, but it is them who 
have to do this.
    The problem in some ways now has become that the popular 
sentiment is so charged and so anti-American, unfortunately, 
that it becomes very difficult politically for a weak 
government to come out and make this case. So while I 
completely agree with you I think there is an opportunity, we 
should be careful not to expect too much out of it either. But 
certainly this is something that is worth trying.
    Dr. Ahmed. Could I actually just go back to the point that 
you have raised--public opinion? Public opinion is shaped, and 
sometimes public opinion unfortunately is shaped quite 
deliberately to depict America as the enemy, in particular, 
through elements of the broadcast media. It has been done quite 
deliberately. This is not public opinion being shaped as such.
    We know very little about the impact of these drone attacks 
in the territories where they are taking place because these 
are not accessible either to the Pakistani population at large 
or, indeed, to the Pakistani media. So information is fed out 
of these areas is problematic in itself. So we have to be a 
little careful when we say Pakistani public opinion is enraged 
by the drone attacks. In actual fact, the Pakistani public at 
large does not know what happens in these areas where the drone 
attacks are----
    Senator Cardin. But we do know that there is anti-American 
sentiment in Pakistan. And the point that was raised by Senator 
Lugar and Senator Kerry about the refocusing of our economic 
assistance specifically so that we get not only the results 
within country, which are important for Pakistan's development, 
but also that the view of the United States is more favorably 
perceived within Pakistan, I think, are very important points. 
And yes, we have to have a game plan and stick to it, and yes, 
it is very important that the institutional changes be made 
within the country because if you do not have the institutional 
changes, you will not have the long-term stability and 
reliability that we need. But we also need to make sure that 
the type of projects are signature enough that the United 
States is recognized as being a partner with the Pakistani 
people for their economic future, and I do not think we have 
done that as effectively as we need to.
    Mr. Yusuf. Could I just lend a word of caution here? I 
think the problem perhaps is that good development and winning 
hearts and minds do not always go together. So the decisions 
and the actions--I for one have a lot of sympathy for the U.S. 
organizations who are actually implementing this aid package. 
And the problem sometimes becomes that their focus is too short 
term, too stabilization dependent, rather than looking at 
development for the sake of development.
    I think the hearts and minds argument perhaps is not going 
to be won by development in the next 3 or 4 years. This is a 
long-term process. But what we can do is perhaps bring much 
more transparency into this relationship, and I think both 
sides need to do that. If there is an understanding on drones, 
I think the Pakistani Government should be pushed to own up to 
it.
    A lot of times what happens is that U.S. aid goes there. 
The money leaks because of problems on the Pakistani side, and 
then the United States is blamed for it. I think more 
transparency there.
    But then also I think transparency on our side. Certain 
things which we may be dealing with the government on which 
either we should bring out in public or perhaps think not to do 
them if people are not going to accept that.
    I will just add one other thing. I think there is a 
paradigm shift in Pakistan. The old paradigm was public opinion 
was always shaped. Now I would say much of it is actually 
coming out of the people and only some of it is shaped.
    Mr. Krepon. Two things.
    The targets of drone attacks ought to be worthy of the 
negative consequences they have for United States-Pakistan 
relations. That is No. 1.
    With respect to aid, water, electricity, agriculture. These 
are the three keys. Pakistan's needs are so great in these 
areas. The delivery, if it is done well, is direct and has a 
humane impact.
    My understanding is that $50 million of the Kerry-Lugar-
Berman money was redirected--$50 million--to provide seeds for 
farmers whose land was inundated by those terrible floods. 
Somebody must have stamped a classification on the delivery of 
those seeds and the expenditure of those funds. It seems to be 
a secret.
    The Chairman. Yes. Let me, as I pass the baton here to 
Senator Corker, just make two quick comments. We have raised 
this issue forcefully with the Embassy and with the State 
Department and others. There needs to be a much more effective 
communications strategy. It is just not happening sufficiently. 
And this is something I think a lot of people are well aware of 
now and hopefully that will change.
    Second, I think, Mr. Krepon, you may have mentioned this in 
your comments, but something I have talked about with General 
Kayani and others--there is a powerful sense in Pakistan among 
many of the leaders of the complete discrepancy between 
allocation of resources and interests. And I share it, may I 
say. One hundred and twenty billion dollars is the budget for 
Afghanistan. But we have got a pittance going into Pakistan 
which, by all of our judgments, is infinitely more 
strategically important in terms of the nuclear weapons, the 
center of terror, and other things. And if we are going to make 
a difference to the people of Pakistan, in terms of their needs 
for energy, power, for the economy to turn around, to deal with 
their larger economic practices, we ought to try to put that 
into some better balance. And that is all I would say.
    Senator Corker.
    Senator Corker. Thank you, Mr. Chairman. I have really 
enjoyed today's hearing, and I thank each of you for your 
testimony.
    Mr. Yusuf, I am one of those folks who thinks we need to 
alter our bilateral relationship, but not from the standpoint 
of just ending aid and that kind of thing. And by the way, I 
felt that for some time.
    If you want to paraphrase what Senator Kerry said--he is 
not doing this. I am--basically Pakistan acts very irrational. 
I mean, I leave there almost feeling like I have had a Rodney 
Dangerfield moment whenever I am there. And so they do not act 
rationally as it relates to their own strategic interests. And 
so for some time, I have felt that we should alter and really 
focus this aid in a very different way. I really have. So I 
look at this as an opportunity.
    For a long time, we have known they have not worked with us 
in a very cooperative way. I mean, we know of fertilizer plants 
that are not being used to make fertilizer. They are being used 
to kill our soldiers. We know they know that. We know that 
probably some of our resources are helping build their nuclear 
arsenal.
    So I think this is an opportunity. I think this is a great 
opportunity. As has been said, either they are in cahoots or 
incompetent, but this gives us an opportunity now to sort of 
rearrange that relationship.
    So talking about Afghanistan--and that is where I think the 
central issue in our relationship today is. We do have longer 
term issues there. And I agree that some of these energy 
issues, ag issues, water issues are far more important--far 
more important--than much of what we are doing there.
    But at the end of the day, Afghanistan. We know that when 
we leave Afghanistan, we are going to make an accommodation 
with the Taliban. Everybody knows that. That is what is going 
to happen. Pakistan wants to make an accommodation. They are 
making an accommodation right now with the Taliban. So while it 
is hard to understand what the endgame is, we know that that is 
going to be an element of it. There is no question.
    So the central relationship issue today is what is 
happening in the FATA areas. And, Mr. Krepon, I loved your 
testimony. And the fact is all we are doing is irritating 
people there. It is like we got a BB gun. We are just 
irritating people. And so the question is, can we use this 
opportunity that has come about--and I think the President 
showed great leadership. Our Navy SEALs showed great 
leadership--you know, outstanding opportunity now to actually 
fight the war where our enemy is. I mean, the most frustrating 
thing to our military leaders in Helmand and Kandahar and every 
place else, they are fighting a war where our enemies are not. 
Our enemies exist in FATA and Balochistan and the former 
Northwest areas.
    So is there something about what has just happened to allow 
us to focus our efforts where our efforts need to be focused in 
a very different way? To me that is the central issue and that 
is hopefully an outcome that we can achieve. I would love to 
have any comments from you all.
    Dr. Ahmed. I think one of the things we need to recognize 
is the relationship between the insurgent groups in Afghanistan 
with the jihadi groups in Pakistan. It is not as simple as 
making accommodation with the Taliban alone because the Taliban 
is shorthand for many, many, many groups. Amongst the insurgent 
groups, we have the three which is the Hezb-e-Islami, Taliban, 
and the Haqqani Network. And one of the problems that we are 
going to face both sides of the border as we are going into 
transition mode in Afghanistan is how will this nexus, this 
relationship, this network affect United States national 
security interests and regional stability. I think it is 
important right now for us to understand who is it that we are 
going to negotiate with, how are we going to negotiate with 
them, and what are the redlines in negotiation, in particular--
--
    Senator Corker. If I could, that is not the point of my 
question. Is there something about what just happened in the 
last several days that will absolutely change the dynamic so we 
will focus on our enemies in FATA? I do not want to hear about 
negotiation. I am talking about the military piece of it where 
we can actually route out the folks that are directing the 
killing of American soldiers and move our soldiers from 
fighting criminality, which is what we are doing in 
Afghanistan--we are fighting criminality--when our real enemy 
is in Pakistan. That is my question. I am not focused on 
negotiations. I am focused on routing out the remnants of al-
Qaeda and these other terrorist groups.
    Dr. Ahmed. Let me say this again and perhaps slightly 
differently. What you are absolutely fighting is an enemy but 
the enemy has a presence both sides of the border. The enemy is 
not necessarily linked or based only in the tribal borderlands. 
The enemy is based in the Pakistani heartland. So it goes a 
little beyond warfighting. You need strong diplomacy and strong 
signals sent. We will not tolerate an organization which is 
linked to
al-Qaeda that is killing American soldiers across the border in 
Afghanistan, that is posing threats to United States national 
security interests in the homeland. We will not allow you to 
continue to support this organization. So I think we are going 
a little beyond the tribal borderlands.
    Senator Corker. Mr. Krepon.
    Mr. Krepon. I think there are some strategic issues where 
we can shape and even over time change Pakistan's perception of 
its national security. I will give you one example, and then I 
will get to where you want to go.
    Senator Corker. I cannot get any of you to go where I want 
to go for some reason. [Laughter.]
    Mr. Krepon. But for the longest time in Pakistan, people 
were talking about Kashmir as a nuclear flashpoint and it was 
the heart of every conversation. No more. So there has been a 
shift on Kashmir.
    Will there be a shift with respect to what Pakistan's 
security establishment believes to be its strategic reserves 
for Afghanistan? I do not think so. I do not think so. I know 
you do not like this answer, but it is my analytical conclusion 
that Pakistan's security apparatus will do whatever it takes to 
increase the likelihood that the outcome, however ephemeral it 
is, in Afghanistan serves their interests. They do not want an 
Afghanistan that is unfriendly to its interests in Kabul and 
certainly along the provinces adjacent to FATA and even more so 
Balochistan. Balochistan is where they get half their natural 
gas. It is where their mineral deposits are. It is where their 
nuclear test site is. It has a restive population. It is also 
along the Iranian border. And Pakistan does not want India to 
do to it in Balochistan what it did to India in Kashmir.
    So I do not see big adjustments over time in Pakistan's 
perceived interests in an Afghan settlement. So we are backing 
different horses here. It is going to take amazing diplomacy to 
make this work and to make this last, and the more level of 
effort our military applies to the heart of the problem, as you 
see it, I do not see that as making a big difference in 
outcomes. I do see----
    Senator Corker. Play that last three sentences again 
please. [Laughter.]
    Mr. Krepon. Pakistani security forces know what they want 
in Afghanistan. It is going to be really hard to budge them 
from that, what they think they need in Afghanistan.
    Senator Corker. Which is?
    Mr. Krepon. Which is a country that has got all kinds of 
fissures and divisions, but whose political leaders and whose 
provincial authorities are not antagonistic to Pakistan. And 
they have a lot to be antagonistic about. I do not see Pakistan 
and Afghanistan having a smooth relationship in the future. But 
Pakistan does not want folks in charge of these provinces and 
in Kabul that make their life more insecure. We cannot change 
that. And I do not think a greater level of military effort in 
FATA or in Afghanistan itself will make a large difference in 
political outcomes.
    Senator Corker. So if I could just say this, I am very 
concerned about a military effort in Afghanistan too, and I am 
willing to allow this fighting season to go on because we have 
been asked to have patience. But I have the same concerns you 
have.
    I will say that our reason for being in Afghanistan changes 
about every 6 months. I have been here 4 years. I do not know 
how many reasons we have had for being there. One of those, 
though, the most recent, was having a stabilized Afghanistan is 
good for Pakistan. And it is fascinating me to hear you saying 
today that Pakistan actually wants an unstable Afghanistan. So 
it seems to me our most recent reason for being there may be at 
odds with the very country we are there for.
    And I just think, Mr. Chairman, I would say on the support, 
I think somehow or another Afghanistan and what is happening in 
the FATA areas has got to be a central element of why we are 
having foreign aid there. And I think all of us need to talk 
about that and look at that because it seems to me having those 
divergent views and us providing $22 billion in aid since 2002 
do not add up in the right way.
    But I really thank you for this testimony and for this 
hearing. I appreciate it.
    The Chairman. Well, thank you, Senator Corker. I think you 
are putting your finger on some very important questions and 
contradictions, and we have got to work through them.
    Senator Shaheen.
    Senator Shaheen. Thank you, Mr. Chairman, and thank you all 
very much for being here.
    You are here at what we all know is a very critical time. I 
know there have been a lot of references today to the questions 
that we have and the public has about how much Pakistanis and 
the government knew about where Osama bin Laden was and how he 
could have been living for so long within such close proximity 
to so much of their military establishment. So I believe that 
we should continue to ask those questions in the coming months 
and hopefully we will have some answers and they will be 
answers that will help address the public concerns here.
    I appreciate what you are all saying about the need to 
continue our relationship with Pakistan and how important that 
is. So I do not think a knee-jerk reaction to what Pakistan 
knew or did not know is an appropriate response, but I do think 
it is important for us to get some of those questions answered.
    I am going to try and ask the question that I think Senator 
Corker was alluding to in a little different way, and that is: 
Do you think that bin Laden's death affects the strategic 
calculation of Pakistan's military with respect to where the 
real threats or where there are internal threats to the 
country? And do you think they will reevaluate that or that 
this will have any impact on how they view those internal 
threats?
    Mr. Krepon. I think it will have or it can have an impact 
on the security establishment's view of the remnants of al-
Qaeda within the country. I have testified that I do not think 
it will have a big impact on their view about their proxies 
along the Afghan border.
    Senator Shaheen. Can I just get you to explain a little 
more clearly what you mean by that?
    Mr. Krepon. Yes. Al-Qaeda is now utterly peripheral to 
Pakistan's interests. They accepted fleeing al-Qaeda leadership 
in 2001, and it might have served some purpose at the time. It 
no longer serves any purpose, so I think they can give these 
folks up.
    But the Afghan Taliban, the folks who will, they believe, 
serve their interests in an Afghanistan after we leave, are a 
different category. There are links, but I think they will 
continue to be viewed as an essential part of Pakistan's 
national security.
    Now, there is this third group of people. It is a very 
complicated people. A lot of folks have guns and shoot at one 
another. But Samina has mentioned this Punjabi-based set of 
groups, and the most important one is the one we call Laskhar-
e-Taiba. These are the guys that are trained, equipped, and 
based in Pakistan, and every once in a while, they blow 
something up that is really important in India and create a big 
crisis, and we are the crisis manager. And these are the guys, 
in my judgment, who pose the biggest of all threats, bigger 
than al-Qaeda--what is left of al-Qaeda--and even bigger than 
these outfits we do not like along the Afghan border because 
these guys, the Punjabi-based extremist groups, can spark a 
big, ugly, uncontrolled conflict between India and Pakistan.
    Senator Shaheen. Can I just ask Mr. Yusuf and Dr. Ahmed? Do 
you both agree with that assessment?
    Dr. Ahmed. I would say that I not only agree with this 
assessment but I think one needs to also remember that even as 
we are talking about the insurgency across the border, the 
network, the nexus that we are talking about are the Punjab-
based jihadi groups, plus al-Qaeda or the remnants of al-Qaeda, 
what is left of it--and let us not forget there are many types 
of groups within
al-Qaeda, and we see a lot of them passing through Pakistani 
territory--and the Haqqani Network. We are not just talking 
about one entity which is based on the tribal borderlands, and 
I think this is where the danger lies. We see too much of an 
emphasis in forming U.S. national security policies to look at 
FATA as the problem when you really need to be looking at the 
terror threats that have been posed to the security of the 
homeland. They do not come from the Pakistani Taliban or the 
Afghan Taliban. They are coming from groups such as the 
Lashkar-e-Taiba. Taking these groups with far greater 
seriousness is not just a matter of a threat in the region or 
even a possible attack that could lead to a confrontation 
between two nuclear-armed neighbors. I am talking about the 
potential, the real risk. And this, by the way, has been raised 
again and again now at levels of the U.S. Government, including 
in the national intelligence estimates, of the threat that this 
particular group and others linked to it pose to the U.S. 
heartland.
    And to answer your question, let me also say this. It is 
absolutely essential to acknowledge that there is not one 
government in Pakistan. It is a democratic transition. As far 
as the arms of a democratic government are concerned, we are 
forgetting in all this discussion the legislature, the 
Pakistani Parliament. There is talk now amongst Pakistan 
parliamentarians about an inquiry. How did this happen? Who was 
responsible? Why did it happen? What are the implications for 
our national security? And there are deep concerns being 
voiced. And I think this is an opportunity again for the U.S. 
Congress to also reach out to those committees in the Pakistani 
Parliament that have expressed deep concern about this incident 
and about the threats and the real threats that it poses to 
United States and Pakistani national security interests.
    Mr. Yusuf. Thank you, Senator.
    Let me first agree on the bin Laden issue. Al-Qaeda had 
become peripheral to Pakistan's Afghanistan calculus a long 
time back. And if bin Laden would have died, say, in 2001, the 
Afghan calculus would not have changed much. In fact, I think 
it is a bit of a worry for the Pakistanis to see that so many 
al-Qaeda remnants are still around.
    As far as the question of extremists goes, I am convinced 
that this idea of good versus bad extremists is a very 
dangerous one. Ultimately every type of extremists and 
terrorists in Pakistan has to be dealt with. The real question 
to my mind is how do you do it. And there are two issues here.
    The first issue is a capacity issue, and I do not think we 
have a clear answer on this. There is a debate on whether the 
Pakistani security establishment, civilian and military, have 
the capacity to open up any more military fronts at this 
moment. So that is one because it is very easy for things to 
backfire.
    Second, I think there is an issue of the reasons why these 
groups continue to exist, and I think one has to be blunt about 
this. Pakistan used these proxies for a long, long time.
    And if I were to look from the U.S. Congress' perspective, 
I would say capacity is one issue. Pushing them to change the 
strategic mindset, of course, is the other one. And the third 
is to see where these problems actually lie and perhaps be a 
bit more proactive to go out and look at it in a regional 
perspective to try and hit the very basis of why this is 
happening.
    Senator Shaheen. Thank you.
    The Chairman. Thank you very much, Senator.
    Senator Risch.
    Senator Risch. Thank you, Mr. Chairman.
    First of all, let me say that I think all three of you have 
made reference to the fact that the incursions by the United 
States into Pakistani sovereign territory enrages the Pakistani 
people. And I think that that is understandable.
    The question I have for you--and I would like this in 
executive summary, if you would, in a couple or few sentences 
please. Many elements of the U.S. Government, including myself, 
were surprised, even shocked by the lack of reaction by the 
Pakistani people to what we did on sovereign Pakistani 
territory in the middle of the night on May 1 within very short 
distance of the Pakistani capital, indeed in the heartland. And 
I have to say that I fully expected to pick up the paper and 
see the fires and the burnings and the protests and what have 
you the next day, and it did not happen. I have heard lots of 
theories. I have not reached a conclusion myself, and I do not 
know that there is even a consensus yet as to why that is. But 
I would like all three of your thoughts on that in a very 
summary fashion, if you would.
    Mr. Krepon. Senator, my answer is because the operation 
succeeded. Had the operation failed, the consequences you 
envision I believe would have happened.
    Senator Risch. Failed because he was not there or failed 
because it fell apart?
    Mr. Krepon. The security apparatus has been saying over and 
over again this guy is not here, and we made it clear that if 
he was and we had actionable intelligence, we would have acted 
on it regardless. We had actionable intelligence. The mission 
was a success. The cover story of the Pakistani security 
apparatus was clearly false. Therefore, the results were as you 
saw.
    Senator Risch. That is a legitimate theory. The only 
difficulty I see with that is, yes, we did say if we had 
actionable intelligence, we would act on it. And that may very 
well be a really good answer for ISI. I do not think that is a 
really good answer for the Pakistani people. I know it would 
not be here in this country.
    So, anyway, you are next.
    Dr. Ahmed. I think there is way too much made about 
Pakistani public opinion being so anti-American. You know, when 
the Raymond Davis affair happened and everybody was predicting 
if he is freed, there will be demonstrations in the streets of 
Pakistan, the average Pakistani is concerned with a job, with 
making sure that he gets health services for his family. He is 
making sure that his government is capable of delivering basic 
services. And yes, you have the media and elements of the media 
whipping up public sentiment or attempting to, in particular, 
through the broadcast media. There is absolutely no doubt about 
it that there are attempts made to shape elite opinion in 
particular, which is what you will hear a lot more, but at the 
level of the Pakistani public, yes. Well, America is out there. 
We hear all these bad things about it through our journalists, 
but how does it affect me? Are they going to go out in the 
streets in absolute anger because a terrorist was killed? They 
were just surprised. How was----
    Senator Risch. Except this was not just a terrorist.
    Dr. Ahmed. Absolutely, but in their perceptions, Osama bin 
Laden in Pakistan? What is he doing here? It would have been 
far more that reaction.
    Senator Risch. We have the same question.
    Dr. Ahmed. Exactly.
    Senator Risch. Mr. Yusuf, your turn.
    Mr. Yusuf. So let me say I think we do not give enough 
credit to the Pakistani people. Osama bin Laden found in 
Pakistan, one, a surprise, and second, I think the reaction I 
saw was good riddance. Thank God this is over.
    Even when you have seen the Pakistani street come out in 
support--you know, there was a politician's murder where people 
came out in support. Quite frankly, that is the street value 
these people have. If you really go back and look how many 
Pakistanis were protesting and coming out, it is a minuscule 
number given the size of the country. So I am not surprised at 
all this did not happen.
    I will not, though, downplay the anti-American sentiment. 
It is very much there. But bin Laden certainly did not feature 
in that sort of category where they should have come out and 
done something like that.
    Senator Risch. Thank you very much.
    Going down another street and just very briefly, I guess I 
come at the financial issues and the aid a little different 
than other people do here. And this is probably above your pay 
grade, but in the very near future, there are going to be 
massive cuts in spending by the U.S. Government. We are 
borrowing 40 cents out of every dollar we spend. We are 
borrowing about $40 billion-$50 billion a day in order to go in 
debt another $4 billion to $5 billion a day and refinance debt 
that we cannot pay. And things are going to change and they are 
going to change dramatically.
    I have to tell you that my feeling is the American people 
are not stupid and they are not too red hot about doling out 
money to people who, No. 1, do not want it and are not 
particularly appreciative of it. They understand that every 
dollar that they spend in Pakistan--building a bridge, for 
instance, in the Swat Valley or anywhere where there were 
floods over there--is strapping their children and 
grandchildren with a horrendous debt when we need bridges right 
here at home.
    So this is, like I say, probably a little beyond your pay 
grade, but you might start thinking about it because in the 
future there is going to be massive cuts in Federal spending, 
and I suspect this is one area that is going to get looked at 
pretty closely. You do not need to respond to that.
    Thank you, Mr. Chairman.
    The Chairman. Thank you very much, Senator.
    Senator Coons.
    Senator Coons. Thank you, Mr. Chairman. Thank you for 
convening this very constructive series of hearings, and thank 
you to the panel for your input.
    I joined Senator Corker in a visit to Pakistan and 
Afghanistan a number of months ago and was really challenged by 
what we heard and what we saw, in particular, the enormous 
amount of investment and sacrifice we are making in Afghanistan 
and then its uneven impact on Pakistan and our relationship 
there. The comment that we heard from one analyst that has 
really hung with me is that Pakistan in many ways is both fire 
fighter and arsonist in our efforts to try and tackle extremism 
and terrorism.
    Obviously, these events that we have all been speaking 
about have raised some real troubling questions for the folks 
who represent. At best, the ISI was unable to detect bin 
Laden's presence; at worst, was complicit in providing him a 
safe haven probably for 6 years. And in either way, it then 
challenges us to recalibrate our relationship.
    So let me start with a few questions, if I might.
    I also have Senator Corker's concern that the justification 
for the scale of our presence in Afghanistan, the analysis of 
its likely outcome seems to change every 6 months, and you have 
given a number of challenging points to that.
    One of the reasons I have been given all along for this 
very large presence in Afghanistan and the need for us to 
continue significant investment in our relationship with 
Pakistan is because it is a nuclear-armed nation. It is a 
Muslim nation that is at a critical juncture point.
    What does Pakistan's inability, just taking it at face 
value, to detect Osama bin Laden within Pakistan say about the 
security of its nuclear arsenal? It is one of the fastest-
growing nuclear arsenals in the world. There is a widespread 
presumption that the Pakistani military is stable and capable 
of controlling its nuclear arsenal, but this raises some real 
concerns for me, just accepting for the moment at face value, 
if you would, the idea that they had absolutely no idea that 
bin Laden was, I believe, less than a mile from their 
equivalent of West Point, I mean, not in some obscure cave in 
the FATA but right in the very center of the military 
establishment. A brief response to that, if you would.
    Mr. Krepon. Senator, on October 10, 2009, 8 to 10 gunmen 
attacked army headquarters in Rawalpindi. They had automatic 
weapons. They seemed to have had some insider knowledge of the 
facility. It took 18 hours to subdue them. And I think you know 
where I am going.
    The security of Pakistan's nuclear facilities has greatly 
improved. There was a time, believe it or not, when A.Q. Khan 
was in charge of security of Kahuta. And that changed. And 
there is now an outfit at joint staff headquarters that is 
responsible for security. And it is really no secret that this 
is one area where the United States and Pakistan have actually 
worked together to improve security. And there is now a very 
large security force that is devoted to this task, and the 
number that is thrown around is around 10,000 guards, plain-
clothes as well as in uniform.
    Senator Coons. Given my limited time, let me move to the 
main question I would really like to focus on.
    United States aid to Pakistan takes two different basic 
forms, development and military. And, Dr. Yusuf, you made a 
comment about the winning of hearts and minds for, in some 
ways, strategic or diplomatic or military purposes is quite 
different from fundamental development. And one of the best 
things I think about the Kerry-Lugar-Berman assistance was an 
attempt to move from assistance government to government to 
assistance directly affects the Pakistani people.
    One of my concerns is that I did not see that we were 
getting enough visibility or credit for what assistance we are 
providing. One of my concerns is that the timeline on which we 
operate as a nation does not necessarily lend itself toward 
long-term strategic development aid.
    If we are going to get the Pakistani regime and 
intelligence and security apparatus to rethink their 
relationship vis-a-vis India, what advice would the three of 
you have about any conditioning of assistance. You suggested 
conditioning it on aggressive action against LeT. You have 
suggested conditioning it on real tax reform internally. How 
can we use our assistance to Pakistan most effectively to 
achieve both our long-term development interests and our 
shorter term strategic and military interests? Please.
    Mr. Yusuf. I would say I would look at these in two 
different baskets. I think when I mentioned the tax reform, 
that is something Pakistanis have a consensus on. It is just 
that the vested interests are not allowing it to move forward.
    I think the aid has to be looked at as a development tool, 
and I do not believe that any amount of money is going to 
change the India mindset. But there is something we can do to 
change the India mindset, and my written testimony talks about 
that and that does not have to do with money. But there are 
three things.
    Both sides were fairly close to an understanding on a 
Kashmir solution themselves. I think we dropped the ball by not 
pushing them hard enough to keep sitting on the table when they 
pulled back in 2007.
    Second, terrorism is a serious issue, and I think Pakistan 
needs to be pushed as much as it can. There is a joint 
terrorism mechanism which we need to continue, both sides have 
agreed, but we want to make sure they do not pull out.
    And third, I think equally important and overlooked is the 
economic relationship. If the United States can help Pakistan 
and India, once they open up trade, there will be an initial 
backlash. There will be vested interests. Maybe some of the 
money going toward industrial packaging, some incentive so that 
the backlash in Pakistan economically is assuaged in the 
beginning. But once you open up the economy and keep these two 
sides sitting on the table, I would argue for the next 5 years 
no more. You will see some change on the India front. But money 
may not do it.
    Dr. Ahmed. I would just say this. I think Michael raised 
this issue and I think we did not follow that through. In 
actual fact, there is a consensus in Pakistan on peace with 
India and peace with Afghanistan, a consensus amongst the major 
political parties, a consensus in civil society--and it is a 
vibrant civil society, by the way--a consensus amongst elected 
representatives. So in actual fact, here you have the entire 
civilian face of the government believing that crises in the 
region have undermined Pakistan's stability and security and 
development. And the only way forward is peace with their 
neighbors, peace with Kabul, peace with Delhi. The two major 
parties believe it. The smaller parties believe it, and indeed, 
civil society supports it, as do all the business houses. Talk 
to the business communities both sides of the border. Where do 
we see the problem?
    And we need to be tackling the problem, as well as using 
the opportunities. We tend to look very narrowly only at 
tackling the problem, which is the military's perceptions of 
national security. How will they change? They are not going to 
change overnight. I agree they will not change overnight. But 
here is the thing. Pakistan has changed. It is, after all, a 
country--right now if you were to have a poll on peace with 
India in the holistic sense, you would get huge approval 
ratings for it.
    It is a democracy, and this is one of the things we are 
not--the opportunity that we are not exploiting as fully as we 
should be, exploiting the fact that there are democratic 
institutions and a democratic people who want peace with their 
neighbors. You have a security establishment that has still got 
a mindset of the 1950s who wants a cold war with its neighbors 
or a hard war if need be. If you are going to factor in U.S. 
policy, just think of the opportunities that you have. You even 
have those opportunities in the budding movements for democracy 
in the Middle East that you have in Pakistan right now.
    Mr. Yusuf. If I may just add one line, which is that the 
three ideas that I have put on the table must be worked through 
the democratic process. There is no doubt about that.
    Senator Coons. Thank you all very much.
    The Chairman. Thank you very much.
    Senator Durbin.
    Senator Durbin. Thank you, Mr. Chairman, for this timely 
hearing and thank you to this panel.
    I have three questions which I will try to ask and give you 
opportunities to answer.
    I was struck by the letter from--pardon me--the column that 
came from President Zardari and appeared in the Washington Post 
earlier this week right after the capture and killing of Osama 
bin Laden. And it was rather straightforward in which he said 
that Pakistan joins the other targets of al-Qaeda in our 
satisfaction that the greatest evil of the new millennium has 
been silenced. He acknowledged it was not a joint operation but 
went on to say he thought that Pakistan had been helpful in 
what had occurred and then told the very personal story about 
the assassination of his wife by similar extremists.
    Was this published in Pakistan?
    Dr. Ahmed. The Washington Post and the New York Times are 
now carried in a newspaper in Pakistan which is called the 
Express Tribune. So, yes, it would have been published.
    Senator Durbin. So the point I am getting to is whether or 
not his expression of sentiment is one that he is publicly 
expressing in his own country.
    Mr. Krepon. Senator Durbin, after this momentous event, the 
Prime Minister of Pakistan got on a plane and went to Paris. 
And after this momentous event, the President wrote an op-ed in 
the Washington Post. Samina talks about Pakistan being a 
fledgling democracy with lots of deficits. Neither one of these 
political leaders addressed the people directly after this 
momentous event. It is stunning to me.
    Senator Durbin. It is to me as well.
    Second question. I have been the easiest vote for 
development aid in the history of the U.S. Congress. 
[Laughter.]
    I really have been. I believe in it. I think it is the 
right thing to do. But I would raise a question about, Mr. 
Krepon, your statements and yours too as well, Mr. Yusuf, 
because putting this in perspective, I remember a trip to South 
America where I went to a developing country, a very poor 
country, and said to their leaders, what is the evidence of 
foreign aid in your country? Well, the Cubans have sent in 
hundreds of doctors that opened clinics. And of course, Chavez 
has sent in hundreds, if not thousands, of teachers to go to 
village schools. And I said, what have we done? Oh, the United 
States has engaged in this massive infrastructure investment. 
We have built this fantastic road that is going to transform 
the economy of the region. And I said, how do the people know? 
And they said, there is a sign next to the road. In winning the 
hearts and minds, my guess is that the Cubans and the 
Venezuelans are going to have the upper hand.
    Now let us look at Pakistan. A billion dollars in aid, 
which I know is off to a rocky start, but certainly has the 
best of intentions and some good goals to it. How likely is it 
that this billion dollars will translate into any credit for 
the United States in what we are trying to do? Does virtue have 
to be its own reward when it comes to development aid?
    Mr. Krepon. One idea that I have been promoting that to my 
knowledge is not now part of the package is to create a 
Pakistani-American service corps that includes doctors, 
optometrists, health care providers. It could be heavily 
recruited. I think there would be volunteers in the Chicago 
area and elsewhere to go over there and be very visible symbols 
of our country's commitment to Pakistani well-being.
    Senator Durbin. But you mentioned water, electricity, and 
agriculture. And all of those I have to say are not easily 
identifiable as to the source. We should do it because it is 
the right thing, but whether it is a politically effective 
thing is the question I am raising.
    Third point. Zardari's column in the Washington Post said 
Pakistan has never been and never will be the hotbed of 
fanaticism often described by the media. Radical religious 
parties have never received more than 11 percent of the vote. 
Can you comment on that statement by Zardari in light of the 
reaction by the public as well as by the government leaders to 
the assassinations of Salman Taseer and Shahbaz Bhatti?
    Dr. Ahmed. Senator, could I just say this? When Zardari is 
actually talking about the 11-percent support in elections for 
the religious parties, it is actually the peak. That was in a 
rigged election, rigged by Musharraf. It normally is around 4 
to 5 percent of the vote.
    If you are talking about the reaction, the knee-jerk 
reaction to Salman Taseer's assassination, there was a 
pervasive atmosphere of fear, and this is what terrorism does 
to you--one high-profile attack.
    After that and including Shahbaz Bhatti, you actually saw 
people saying, you know what? We are not going to be scared of 
the monsters that are keeping us in chains. And people came out 
in the streets. They risked their lives. They came out and 
demonstrated and supported the moderate voices that had been 
silenced by this atmosphere of fear.
    Let me say, to answer your question about will the United 
States get credit for development, it depends on how you do it. 
It is as simple as that. Making a dam is not the same thing as 
providing a small hydroelectric plant. If you bring in the 
communities that are the recipients into the process, if you 
bring in the stakeholders who are the elected representatives, 
if you shape it in a way that goes beyond just the capital--we 
made the mistake in Afghanistan as well--beyond the capital 
into the provinces and into the districts, do you think people 
will not appreciate United States assistance? Most children in 
Pakistan under the age of 5 who die, die because of the lack of 
clean drinking water. Those families would appreciate it.
    Senator Durbin. And this great committee, before I was 
fortunate enough to become a part of it, has passed the Paul 
Simon Water for the World Program, and I hope we will do it 
again. It did not pass in the House of Representatives. They 
stopped it. We passed it on the floor, and I hope, following 
your example, that we will try again.
    Thank you very much for your testimony.
    The Chairman. Senator Durbin, thank you, and I hope we will 
likewise pass it, though obviously the House will remain 
difficult, but we have to do our part and we certainly will.
    We are going to try and wrap up quickly here because I know 
we have some competing things. But I just want to ask you a 
couple things, if I can, and Senator Lugar may or may not have 
a couple questions.
    What are we to make of the reports on Prime Minister 
Gilani's discussions in Afghanistan suggesting that they should 
pull away from the United States?
    Mr. Krepon. My understanding is that Prime Minister Gilani 
works from talking points, and these talking points--parts of 
them ring true to me. Some of the tonality might have been 
different in the room, but Pakistan's security establishment is 
looking ahead to a time when the United States presence in 
Afghanistan is quite--our footprint is way smaller, and they 
are trying to maximize their positioning in the country. The 
notion of bringing China in seems to me to be pretty fanciful. 
China has got commercial interests which they will pursue, but 
to think of China as being part of a security troika for 
Afghanistan is completely fanciful.
    The Chairman. What, do you believe--all of you--is the 
general Pakistani strategic view with respect to the FATA and 
Balochistan and Waziristan, the western part of the country, 
the Pashtun-populated part of the country? I have heard them, 
obviously, express a desire to have the Pashtun of Pakistan 
look toward Islamabad and folks talk fancifully about the 
Pashtun of Afghanistan looking toward Kabul. It seems like the 
Pashtun of both places want to look where they want to look, 
which is pretty much where they have looked for centuries. How 
is that really going to work out in this context?
    Mr. Yusuf. Let me, Senator, first just mention--I mentioned 
this research project we have done at USIP, and we went across 
the board on opinionmakers and officials. I do not think there 
is anybody who seriously believes in Pakistan that any solution 
in Afghanistan can leave the United States out. So I have my 
doubts about this report.
    They are certainly looking to expand the regional 
framework.
    And the other thing I never found was this Chinese angle. 
They know exactly where the limits lie. So I am not sure what 
to make of this report.
    As far as the Pashtun aspect is concerned, what we also 
found during this research was that the Pakistani establishment 
and the civilian government to my mind are overly worried about 
their Pashtuns being comfortable with whatever solution comes 
about in Afghanistan. They fear that if that is not the case, 
there will be a backlash within Pakistan. My view on this is 
that as long as the Afghans agree to whatever solution there 
is, I do not think there will be much of a problem, although I 
think the state is worried about that. They keep on talking 
about the Pashtun element on both sides being OK.
    The Chairman. Dr. Ahmed.
    Dr. Ahmed. I would disagree with that statement. I think 
that the Pashtun boogey is used quite deliberately. The 
military has had no compunction in changing its allies. There 
always have been Pashtuns, but it has moved from the Hezb-e-
Islami to the Taliban to the Haqqani Network. It is a useful 
way of trying to gain--by saying the Pashtuns in Afghanistan 
are alienated and so because there is not a Pashtun presence, 
well, perhaps that was true 2002, 2003, but after that even the 
security organs of the state are now predominantly in 
Afghanistan under Pashtun control. It is not a matter of the 
Pashtuns. It is our Pashtuns, and this is the challenge you are 
going to face.
    The Chairman. And to what degree do any of you believe that 
the Pakistanis have an ability to play a significant role in 
motivating a resolution among the Taliban with respect to 
either reintegration, reconciliation, or peace?
    Mr. Yusuf. I think Pakistan will not be able to guarantee 
success. We need to be very clear about that. This idea that 
they can go and tell who to do what is no longer true. But at 
the same time, they perhaps are in the best position to try and 
bring these people on the table for a solution. Let me add, 
though, that while I think they are indispensable in trying to 
get this negotiation going, the spoiling power is even more, 
and so somehow this has to be balanced. But the Taliban are no 
longer the tools where the state can go----
    The Chairman. Given the fairly significant description here 
of the diverging interests, Mr. Krepon has articulated we 
diverge on India, we diverge on nuclear, we diverge on 
Afghanistan itself. What motivation then do they actually have 
to engage constructively in making that happen? It seems to me 
all of those other interests are assisted by not, in fact, 
acting.
    Mr. Yusuf. There were three things we came out with from 
what we learnt.
    One, the Pakistanis are no longer looking for a complete 
Afghan Taliban domination in Afghanistan. They want a broad-
based government. When they say ``broad-based,'' it really 
means Pashtun-heavy but not the old school.
    Second, they are very worried about a civil war in 
Afghanistan, again going back to the 1990s, because they think 
they will not be able to manage the spillover.
    These are two converging points, and that is why I said in 
my remarks--and it is in my written testimony--that as we move 
to reconciliation, which I think we should immediately as much 
as we can, we will find much more convergence than we think. 
This does not mean that the divergence is still not there, but 
I think there is a lot to work with.
    The Chairman. Are there any signs that there is anybody who 
really wants to reconcile?
    Mr. Yusuf. You know, nobody has really seen the Afghan 
Taliban as a group for 10 years, and so this is a question we 
will only have an answer to once this moves forward. What I do 
know is I think there is an opportunity with bin Laden's death 
because the idea of divorcing the Taliban links with al-Qaeda 
to my mind becomes easier now, and that is something that 
Pakistan will also want. They do not have an interest in these 
Taliban going back to what they were doing----
    The Chairman. Dr. Ahmed, I saw you smile on that.
    Dr. Ahmed. Let me put it this way. We keep on using the 
Taliban as shorthand for the Afghan insurgents, and that is a 
dangerous thing to do to begin with because it is not just 
Mullah Omar's Shura. There are many commanders within 
Afghanistan, as well as the Peshawar Shura, as well as, of 
course, the Haqqani Network. In some ways what we are talking 
about is can we bring Mullah Omar Shura into the process and 
then make sure that we can possibly either deal with the other 
groups militarily or otherwise? Can the Pakistanis deliver 
Mullah Omar Shura in short? If need be, they can but they want 
to make sure that the deal serves their interests in Kabul.
    My concern about it? Fine, even if they manage to deliver 
Mullah Omar Shura, what does it matter? Because in Kabul right 
now, because I also cover Afghanistan--I have an office in 
Kabul--there is huge concern and anger that a deal is being cut 
possibly with folks who might undermine our national security, 
the security of our communities, and the security of the 
institutions that we have helped build. Remember that these 
were people who gave up the gun, joined the political process, 
and as a result, are now the voices also of the Afghan people.
    So the real challenge is going to be how do you bring the 
Pakistani military in--let us be very clear about it, we are 
talking about the Pakistani military--into a process in which 
they are willing to agree on a settlement that will favor their 
people but which will be acceptable to the political opposition 
of President Karzai as well.
    The Chairman. I think that hits the nail on the head. In my 
judgment, the key question coming out of this incident, this 
episode with the Osama bin Laden, is whether or not, Mr. 
Krepon, your pessimism about the capacity for a changed 
calculation can, in fact, be achieved. I do not think we know 
the answer to that, and I do not think anybody can. It is 
speculative. You have made powerful reasons for why you do not 
think it can be.
    You know, it is interesting. The Pakistani press is 
displaying a very significant amount of public questioning and 
criticism of the military and the intelligence for the first 
time. That is unusual. And I think it is possible that out of 
this may come a recalibration of some of those interests, that 
they might be willing to engage in a different kind of 
discussion about the kind of settlement in Afghanistan which 
may have different equities than it did before this. So we do 
not know the answer to that. That is part of this potential for 
something good to come out of it and for a change. And we have 
to explore that, which is another reason why I think it is so 
important--and I think you all agree--that we do not go off in 
a knee-jerk way that simply shatters any capacity to try to 
test that or achieve it. And so that will be the test in the 
next days.
    Senator Lugar, do you have additional comments, questions?
    Senator Lugar. I have just one question. In the aftermath 
of the death of Osama bin Laden, I have read at least two 
scholars indicating that although there do not appear to be 
many al-Qaeda operatives in Afghanistan and the movement's 
members are at this point scattered in several nations, those 
in al-Qaeda who followed the guidance of Osama bin Laden saw 
the Taliban as a very special asset for several reasons, 
including their emphasis on Sharia law. There was a perceived 
element of purity with regard to the Taliban's governance. 
While al-Qaeda members were never interested in participating 
in the official structure of goverance, the Taliban were 
perceived as a very useful instrument of doing that which, at 
least in terms of their theological emphasis, was very 
important to al-Qaeda.
    Now, I raise this because from time to time there may be 
superficial comments about some type of truce between the 
United States and the Taliban in Afghanistan. Additionally, 
some will say, well, there are different kinds of Taliban, some 
of which may adhere to Sharia law or affiliate themselves with 
al-Qaeda more stringently than others. You cannot really throw 
the whole group into one lump.
    But I simply raise these thoughts in order to ask you as 
close observers of the region how serious of a problem is it to 
have peace with the Taliban if that means, in fact, potentially 
infecting the institutions of governance in Afghanistan with 
the legacy of Osama bin Laden?
    The Chairman. Before you answer, I need to excuse myself 
because I have another meeting. Senator Lugar will close out 
the hearing.
    I want to thank you all for being here. Thank you very 
much.
    Dr. Ahmed. Senator, it is so very important that in any 
negotiations, even in the earliest stages of that negotiation, 
there are certain redlines drawn, and we really do not see that 
happen. One of those redlines has to be--and I know this is now 
being seen as the end result of negotiations and not a redline 
at the start of negotiations--the protection of the fundamental 
freedoms that are provided by even an imperfect Afghan 
Constitution so that you do not have a return to Taliban rule. 
To assume that the Taliban have changed, well, whether they 
have or not, let us at least try and ensure that what was 
created and which is supported by the Afghan people in terms of 
democratic freedoms is not lost because of political or 
military expediency.
    Mr. Yusuf. Senator, I would say that it is a huge problem. 
To me, this is one of the biggest problems. Under ideal 
circumstances, one would never want to do this. And I think 
there is a duplicity in the Pakistani position here even with 
the people. Well, the Taliban are great for Afghanistan. By the 
way, we do not want them here. And I think that has been there 
from day one, and that is a problem.
    And I would completely agree. I think the redlines have to 
be there for the people of the region because we also need to 
remember that if Afghanistan goes back to the 1990s, it will 
engulf Pakistan in no time. This is not a Pakistan which will 
be able to handle that spillover anymore. So I think it is a 
very, very important point and one of the most difficult ones, 
I believe, to negotiate when the reconciliation process goes 
on.
    Senator Lugar [presiding]. Thank you. Well, I thank you on 
behalf of the committee again and the chairman who has just 
mentioned our appreciation to all three of you for your 
leadership for many, many years and the specific wisdom you 
have given today in this public testimony.
    Having said this, the hearing is adjourned.
    [Whereupon, at 12:14 p.m., the hearing was adjourned.]
                              ----------                              

              Additional Material Submitted for the Record

            Prepared Statement of Hon. Robert P. Casey, Jr.,
                     U.S. Senator From Pennsylvania

    Uzbekistan is an important partner in the Northern Distribution 
Network, which is a major strategic priority for the U.S. war in 
Afghanistan. The Navoi airbase in Uzbekistan provides a vital supply 
route for U.S. and NATO efforts to defeat
al-Qaeda and its allies in Afghanistan and western Pakistan. The Uzbek 
Government also cooperates with U.S. security forces on 
counterterrorism and drug trafficking, two serious transnational 
threats.
    The United States, however, must balance our strategic interests in 
Uzbekistan with the need to hold the government accountable for serious 
human rights abuses, including the use of force to oppress its own 
citizens, as demonstrated by the massacre in Andijon in 2005. According 
to the State Department's 2010 Human Rights Report, the Uzbek 
Government continues to commit serious human rights violations, 
including arbitrary arrest and detention, restrictions on freedom of 
speech and assembly, and forced child labor in the cotton industry. I 
would like to especially acknowledge Senator Harkin's efforts to expose 
child labor in Uzbekistan, which remains of critical concern. I look 
forward to hearing how George Krol will encourage the Uzbek Government 
to abide by its international human rights commitments while 
maintaining our important security cooperation.
    Ambassador Krol is the Deputy Assistant Secretary of State for 
South and Central Asian Affairs. He served as U.S. Ambassador to 
Belarus from 2003-06, and has served in several other challenging posts 
in Poland, India, Russia, and Ukraine. I am confident that his broad 
knowledge and experience working in the former Soviet Union will serve 
him well in this post if confirmed.
    Algeria is an important strategic partner of the United States in 
the fight against al-Qaeda-linked groups in North Africa, most notably 
Al-Qaeda in the Islamic Maghreb (AQIM). The Algerian Government has 
taken an active leadership role in the African Union's effort to combat 
terrorism, and the recently announced U.S. and Algeria bilateral 
counterterrorism contact group will help to expand on our existing 
cooperation to ensure greater security, peace, and development in the 
region.
    Algeria's protest movement has remained limited compared to other 
countries in the region, but economic factors and longstanding 
political grievances have contributed to a series of strikes and 
demonstrations. Algeria's decision in February to lift the 1992 state 
of emergency law was a welcome step, but more needs to be done to 
address human rights concerns such as freedom of assembly and 
association, prisoner abuse and violence against women. I look forward 
to hearing from Henry Ensher about how the United States can work with 
the Algerian Government to promote further democratic reforms while 
also strengthening our security relationship.
    Mr. Ensher is currently serving as Advisor in the Office of 
Afghanistan Affairs. He recently returned from southern Afghanistan, 
where he served as the Senior U.S. Civilian Representative. He has also 
served in our Embassies in Algeria, Saudi Arabia, Oman, Syria, Israel, 
and Iraq and was the Director of Political Affairs for Iraq in the 
StateDepartment's Bureau of Near Eastern Affairs in 2006. I would also 
like to welcome Mr. Ensher's wife, Mona, and two sons, Henry and Tariq, 
who are here with us today.
                                 ______
                                 

Prepared Statement of Hon. Jim DeMint, U.S. Senator From South Carolina

    Since the late-breaking announcement on Sunday evening that Osama 
bin Laden had been killed, the Nation has been riveted by the valor and 
courage displayed by our troops that led to his demise.
    It took years of painstaking work to create the pivotal moments 
when U.S. forces descended upon bin Laden's compound and flawlessly 
executed their mission making the world a much safer place. In the 
aftermath, the public has learned how the fateful raid was made 
possible as the intelligence community has disclosed what clues allowed 
them to find bin Laden. Now is an appropriate time to review how that 
information was obtained in order to evaluate how the United States can 
continue to prevent terrorist attacks.
    One thing is clear: Central Intelligence Agency interrogators used 
secret prisons, that have since been dismantled, and enhanced 
interrogation techniques, that are now prohibited, to glean information 
from detained terrorists that was used, in part, to find bin Laden.
    According to U.S. officials, the path that ultimately led to bin 
Laden's door began with the nom de guerre Abu Ahmed al-Kuwaiti that was 
revealed by detainees to CIA interrogators in secret prisons sometime 
after the deadly 9/11 attacks. After
al-Qaeda's No. 3 leader and 9/11 mastermind, Khalid Sheikh Mohammed, 
was captured, he was subjected to enhanced interrogation methods, 
including waterboarding, by CIA interrogators. Former CIA Director Mike 
Hayden has explained that these enhanced techniques are ``designed to 
create a state of cooperation.'' This certainly seems to be the case 
with KSM, who following the use of enhanced interrogations, reportedly 
confirmed to the CIA that he knew the courier al-Kuwaiti that other 
detainees had discussed with the CIA--a sign this person had access to
al-Qaeda's inner circle.
    This was only a small piece of all the information KSM provided. 
After being subjected to the enhanced interrogation techniques, KSM 
disclosed information about a ``second wave'' plot using an East Asian 
al-Qaeda group known as the Guraba cell to hijack and crash an airliner 
into the Library Tower in Los Angeles. KSM also gave interrogators 
information that led to the capture of Riduan bin Isomuddin, known as 
Hambali and leader of the Indonesian terrorist organization Jemaah 
Islamiyah.
    KSM eventually became compliant, and conducted what U.S. 
intelligence officers called ``terrorist tutorials'' for U.S. 
officials, instructing them about the inner workings of al-Qaeda.
    Enhanced interrogation methods were used on other top CIA terrorist 
detainees with success, including Abu Zubaydah and Abd Al-Rahim Al-
Nishiri, the alleged mastermind of the October 2000 suicide bombing of 
the USS Cole in Yemen. Interrogations of Zubaydah, who was captured 
before KSM, identified KSM as the coordinator of the 9/11 attacks and 
assisted the intelligence community in finding KSM.
    Those techniques, however, are no longer allowed to be used. In 
2009, President Obama signed an executive order to shut down CIA 
detention centers and restrict all U.S. interrogators, across all 
agencies, to only 19 interrogation techniques contained in the Army 
Field Manual, all of which are available online.
    Yet, there is no question the enhanced interrogation methods 
prohibited and the detainee centers shuttered under that executive 
order were effective.
    Reflecting upon the use of enhanced interrogation techniques that 
were used on terrorist detainees who provided information about bin 
Laden's whereabouts current CIA Director Leon Panetta has said, 
``Obviously, there was some valuable information that were derived 
through those kinds of techniques.''
    This is consistent with the CIA's previous statements under the 
Bush administration. A May 30, 2005, Justice Department memo said: ``In 
particular, the CIA believes that it would have been unable to obtain 
critical information from numerous detainees, including KSM and Abu 
Zubaydah, without these enhanced techniques . . . Indeed, before the 
CIA used enhanced techniques in its interrogation of KSM, KSM resisted 
giving any answers to questions about future attacks, simply noting, 
`Soon, you will know.' ''
    The Justice memo continued, ``As Zubaydah himself explained with 
respect to these enhanced techniques `brothers who are captured and 
interrogated are permitted by Allah to provide information when they 
believe they have reached
the limit of their ability to withhold it in the face of psychological 
and physical hardships.' ''
    In 2005, KSM's successor, Abu Faraj al-Libi, was captured. The CIA 
again used the information that was obtained from the detainees in 
secret prisons. Al-Libi gave the CIA indications the courier al-Kuwaiti 
was an important figure.
    Tracking down the courier was the key to finding bin Laden. 
Sometime last year the courier talked on the phone with a person who 
was being monitored by U.S. intelligence. From there, the United States 
was able to follow the courier to bin Laden's lair in Abbottabad, 
Pakistan.
    There is no question the CIA's secret prisons and successful 
interrogation methods played a crucial role in finding bin Laden. 
Neither of those programs, however, is utilized today.
    In fact, Attorney General Eric Holder is considering prosecuting 
the men and women of the CIA who produced this information from 
detainees.
    Now is the time to honor the CIA's work. As we praise the courage 
and bravery of those who killed bin Laden and give thanks to the 
thousands of men and women who serve in our Armed Forces, we should 
also applaud members of the intelligence community who have done so 
much, under incredible political pressure, to keep the country safe.
    While Americans can find relief in the fact that bin Laden is dead, 
we must remain vigilant. Our homeland continues to be threatened by 
radical Islamist terrorists intent upon killing Americans at home and 
abroad. Richard Reid's shoe bombing plot, Jose Padilla's planned use of 
a dirty bomb against America, the Lackawanna Six, the Virginia Jihad 
Network, the 2007 Fort Dix conspiracy, the attempted Christmas Day 
bombing plot in 2009, the attack at Fort Hood in 2009, and the failed 
Times Square bombing plan are haunting reminders of this.
    Many others have been arrested for plotting to bomb shopping malls, 
subway stations and train tunnels, domestic oil and gas refineries, 
conspiring to target the Capitol and World Bank, as well as making 
plans to blow up the Brooklyn Bridge, the Sears Tower, and fuel tanks 
and pipelines at JFK International Airport. Twenty-four men were 
arrested in 2006 that sought to detonate liquid explosives on U.S.-
bound commercial airlines. At least 30 planned terrorist attacks have 
been stopped since September 11. U.S. authorities stopped six in 2009 
alone.
    Thankfully, dedicated and relentless U.S. security forces averted 
all of those attacks.
    Our Nation is fortunate to have so many men and women who volunteer 
to protect America. Although the United States made a great advance in 
winning the war on terror by killing Osama bin Laden, it is not over. 
Unfortunately, one of our most productive programs is now gone. Given 
its proven success, President Obama should consider restarting the 
program.

                                  
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