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Panamagate hearing: Third offshore company of Sharifs crops up by By Hasnaat Malik The Express Tribune,Pakistan: December 1st, 2016.


Panamagate hearing: Third offshore company of Sharifs crops up

By Hasnaat Malik

Published: December 1, 2016


ISLAMABAD: Until now we knew that Premier Nawaz Sharif’s children owned two offshore companies — Nescol Ltd and Nielsen Enterprises Ltd — but now a third company, Coomber Group, has cropped up while the Sharif family is struggling to prove the money trail for the purchase of luxury flats in London.

In the documents submitted to the Supreme Court in the Panamagate case, the Sharif family has attached two different deeds where Maryam Safdar is a trustee of her brother’s companies.

London flats were bought through Qatari investments, Sharif family tells SC

On February 2, 2006, Premier Sharif’s daughter signed a declaration with her brother Hussain Nawaz as a trustee in his two companies Nescol and Nielsen. The same day, she signed a similar declaration with him for another company, Coomber Group, in which he owns 49% shares.

This third company is likely to be the focus of Pakistan Tehreek-e-Insaf’s legal team in the next hearing scheduled for December 6.

After a two-week hiatus when a five-member bench of the apex court resumed hearing on Wednesday, the PTI legal team raised more than 10 questions to establish their case.

Agreeing to some of the arguments put forward by PTI’s lead counsel Naeem Bukhari, some judges observed that the Sharif family was ‘hiding’ facts about the ownership of the offshore companies as some necessary documents still seem to be missing in their replies.

The judges also raised questions on the money trail the Sharif family has so far submitted before the court and pointed out missing links. The missing details included banking transactions or any other channels through which money had been transferred from Dubai to Qatar and then to London to acquire the expensive property in an upscale neighborhood of London.

One of the judges also pointed out that there were two contradictory descriptions on the part of the Sharif family. One was narrated by the prime minister on the floor of parliament, claiming his family had set up a factory in Jeddah in 1999 using money from the Gulf Steel Mills it had established in Dubai, and later the Saudi factory had been sold to buy London properties.

Panama leaks case: PTI submits ‘evidence’ against Sharif family

Justice Ijaz ul Ahsan, agreeing with Bukhari’s contention, said that the other narrative came from the written replies the Sharif family has submitted before the court in which the Jeddah factory has no mention and the money trail has been directly established from selling the UAE factory to investments with the Qatari royal family.

An affidavit submitted on behalf of a Qatari prince claims that the London flats had been given in the ownership of Hussain Nawaz in 2006 as part of a business deal against investments made by his late grandfather with his family in the real estate business in the early 1980s.

To substantiate this account, the Sharif family had submitted another affidavit from Tariq Shafi, a cousin of Premier Nawaz who actually owned the business in Dubai in the 1970s. According to him, he was working on behalf of his uncle, the late father of Premier Nawaz. All shares in those businesses in Dubai were sold in 1980, generating 12 million UAE dirhams. The bench observed that Shafi’s signature on the affidavit did not match with the signature on the agreement.

Bukhari contended that despite having a liability of 14 million dirhams to Bank of Credit & Commerce International Dubai (BCCI), the Sharif family had invested 12 million dirhams in Qatar in 1980. He went on to state that there was not a single document produced by the Sharif family to establish how the money had been sent from Pakistan to Dubai, Qatar, Jeddah, and London.

Justice Asif Khosa observed that there was no banking trail of transfer of money from Dubai to London. He, however, asked the PTI counsel to establish that the Sharif family was the owner of these flats prior to 2006.

Nawaz family used offshore firms to own UK properties

“If you establish a connection with this property prior to 2006, then the burden of proof will be shifted to other side. Show us the connection as this is your entire case,” Justice Khosa observed. However, he said Premier Nawaz in his speeches talked about the trail of the money as he may forget.

Justice Azmat Saeed Sheikh, who has expertise in white-collar crimes, raised several questions about the money trail of the Sharif family’s London flats. No explanation has been given about how the family had cleared liability to the BCCI. He also observed that there was no explanation from the Sharif family that how had they gotten the money to set up Jeddah Steel Mills.

He was also surprised how the respondents had hidden the name of the owner of the Minerva Officer Limited, which was a shareholder of Nielsen and Nescol in 1994.

“No supportive document has been submitted to establish the ownership of Minerva. Why this information is being hidden from the bench,” Justice Azmat remarked. The judge also observed that the bench was conducting the inquisitorial proceedings in this matter.

Earlier, Bukhari pointed out that Premier Sharif has made contradictory statements regarding the ownership of the London flats. He also stated that the prime minister has evaded tax, adding that Marriam Nawaz Sharif was a dependent and remain a dependent. The Qatari prince’s letter has totally negated the prime minister’s earlier stance.

The case was adjourned until next Tuesday.


Published in The Express Tribune, December 1st, 2016.

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                          WHY TO SELL
Part 1



Asad Umar
Friday, February 14, 2014 
Part – I

The regressive fiscal measures taken by the PML-N government in its first nine months in power make it abundantly clear that PM Sharif’s ‘most experienced’ team has no interest in citizen welfare when taking important economic decisions. 

While the citizens have been burdened by unprecedented increase in prices of electricity, gas, petrol and burdened further by increase in taxes on essential daily use commodities, the elite has been lavished with tax breaks and amnesty schemes to get richer. However, the party may have just begun. The ‘most experienced’ team’s next target is to deliver what may be the ‘grand sale of the century’ – marketing it as the miracle cure for the ailing economy.

This is the same miracle cure that was administered by the ‘most experienced’ team in the 1990s under the IMF stabilisation programme. The results of the 1990s privatisation programme were dismal. The Asian Development Bank’s 1998 evaluation report found that only 22 percent of the state-owned enterprises (SOEs) that were privatised were performing better under private-sector management, whereas 34 percent of the unit’s performance worsened significantly. 

Out of the 83 manufacturing units privatised, 20 were closed down permanently, leading to significant loss of employment. We risk making the same mistakes if we are not more thoughtful in our approach. The government has prepared a list of 31 state-run enterprises to be privatised within the next three years. There is little to suggest that the results will be any different this time around.

The PTI supports a formal restructuring of state-owned enterprises under an independent board of directors (BoD) and through a transparent process as prescribed by the Pakistan Institute of Corporate Governance. The best example of a developing country successfully turning large inefficient state enterprises into engines of growth is Malaysia. The Malaysian government setup an autonomous strategic investment company ‘Khazana Nasional’, run by an independent BoD with powers to appoint CEOs and hold them accountable on clearly defined performance benchmarks. The landmark Government-Linked Companies (GLC) Transformation Programme of Khazana Nasional has been a huge success and has rapidly transformed inefficient SOEs into high performing corporate giants. 

SOEs with strategic importance were kept under government ownership but made competitive through eliminating influence of politicians/bureaucrats. Strategic importance can be for financial reasons (the income generated for government), energy security, employment generation capacity and public service delivery (water, health, education and public transportation). 

A few select SOEs with little strategic importance were also privatised. However, privatisation was pursued only after the SOEs had been restructured and made profitable to achieve maximum value for shareholders (government and public). Importance was given to strengthening the regulatory agencies to achieve the privatisation objectives of enhancing competition and raising competitiveness of industry.

The Khazana National model was also a key recommendation put forward in the National Economic Agenda that was presented to the government in 2012 by the Pakistan Business Council (PBC). This is also what the PML-N promised in their 2013 election manifesto. Specifically, the PML-N manifesto stated that “the immediate task of the CEOs – appointed by independent and professional boards, will be to manage these corporations effectively and to plug the losses”. Instead we see indecent haste in outlining over 31 SOEs for privatisation.

Like all other pre-election promises, the PML-N government has abandoned its promise of a transparent privatisation process managed by an independent board, free of nepotism. Instead the Privatisation Commission BoD nominated by PM Sharif are all members affiliated with the ruling party and hence not independent. The professional expertise of some of the members is also highly questionable.

Despite the passage of over nine months in power, the PML-N government has failed to appoint CEOs of over 28 of the SOEs/institutions. The SOEs being run with acting CEOs include PSM, PSO, OGDCL, SNGPL, SSGC and Pepco etc. 

For example the acting CEO of the PSM is the same man accused by the PML-N to have systematically destroyed Pakistan Steel under the PPP government. This raises serious questions marks on the intent of the government. Questions are propping up over the government preparing to hand over these SOEs at throw-away prices to friends and family.

Similarly, the PML-N government has systematically moved to weaken the regulatory authorities ahead of the planned privatisation programme. Ogra, Nepra, SECP and now even the SBP are without appointed CEOs and are being run on an ad hoc basis. The scant regard this government has for laws pertaining to regulators can be evidenced from the multiple violations of the State Bank Act being committed by the government in the last few months. This again raises serious question marks over transparency of the privatisation process – with the government deliberately and systematically weakening regulatory authorities ahead of initiating privatisation.

The PML-N privatisation mantra is deeply flawed. The party argues that the private sector can run these SOEs more efficiently and that the government can no longer afford to spend taxpayers’ money on bailing out these SOEs every year. There is little evidence to suggest that private enterprises are always more efficient than state-run enterprises. Take the example of the energy sector; Sinopec of China and Saudi Aramco are just as profitable as BP or Exxon Mobil. Similarly, Singapore Airlines and Emirates, both state owned, are bigger and more profitable than almost any of the private sector airlines. 

The corporate banking giants in the US and EU had to be renationalised or recapitalised following the 2008 global financial crisis. The railways sector in the UK and EU had to be renationalised following disastrous results under private-sector management.

The real reason the government is demonstrating undue haste in pushing through privatisation is the need for money to finance its large deficits. The PML-N government borrowed over Rs883bn (June 1 to January 24) from the SBP for deficit financing – a new record beating even the woeful PPP government’s dismal performance. 

The IMF has put strict limits on further money printing and so the government is seeking new avenues to finance its unsustainable deficits. Instead of initiating real reforms to raise government income through tax on the large, extremely wealthy untaxed segments of the economy or curtailing unproductive spending, the government has gone for the easier short cut to finance its large deficits. This is, of course, a very short-sighted strategy as it is onetime revenue earned through sale of the SOEs and will leave the structural problem unresolved.

Let’s dig deeper and see how serious a drain the SOEs put on the government finances. The budget documents show that government paid Rs367bn in FY13 to SOEs for subsidies/losses out of which Rs350bn (95 percent) was accounted by only two entities – Wapda and KESC. As we know, KESC (Karachi Electric) is now a privatised entity. If we take out Wapda and KESC the losses of the SOEs paid by the government in the FY13 budget were only Rs18bn. 

Interestingly, the government forgets to mention the fact that most of the SOEs put up for privatisation are profitable and earned the government over Rs63 billion in dividends alone in FY13. So the net budget impact for the government (dividends minus subsidies) of the SOEs, excluding the power sector, was a positive contribution of Rs45 billion last year!

To be continued 


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The curse of Nawaz Sharif family corruption is coming soon to a theatre near you, to show how to rob a nation. Watch modern Nero Nawaz Sharif frozen by fear and incompetence, while Pakistani professionals are slaughtered according to the neocon Zionist-India axis, and their agents taliban who morph into Ahrar-i-Hind to slaughter Pakistan lawyers and judges. They are brutal to the core and mercilessly gunning down a woman law intern Fiza. They belong to the devil-worshipping sect that grows by murdering unarmed Pakistani professionals, because these professionals are the biggest threat to their nihilistic ideologies, which have not been sanctioned by any religion or creed. By killing others and killing themselves they achieve their nirvana of hell. Pakistan is fighting alone this war unleashed by a confluence of known and unknown enemies, each with their single point agenda destroy the most power nuclear Islamic nation. Two lethal enemies of Pakistan and enemies of Muslims have joined hand with Saudi Wahhabis, Takfiris, and Salafis to conduct operation “Crush Pakistan.” they have their plans and 180 million strong Pakistanis have their protector, the almighty Allah, he has his plan. While their plans fail. His plan works, because He is the one Absolute, Omnipotent, Omniscient, and Omnipresent ruler of ours and multiple other universes or multiverses, which he creates every moment. He created Pakistan and Pakistan will outlast and defeat all its enemies. They have tried to destroy it for 65 years but have ignominiously failed. All Pakistan’s enemies are warned; you will fail and die in misery for killing innocent people of Pakistan to achieve your evil agendas. Your economies will be destroyed. Your children will die worst deaths than those you bring upon innocent Pakistanis. Your generations will be afflicted by plagues and diseases you have never know. Learn from the deaths of three people who destroyed united Pakistan. Indira Gandhi=shot to death, Sh.Mujib = shot to death by his own people, and ZA Bhutto hanged by his favorite Army Chief. Clinton humiliated and abused by his own nation as a lecher and a womanizer, living a loveless life with a woman who despises him. All had a part in destroying united Pakistan; Ariel Sharon the last schemer against Pakistan died a slow death living in purgatory for years. Read the poem Ozymandias & learn a lesson. But, you have lead in your ears and steel curtains on your eyes.




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Nawaz Sharif—- Hypocrisy Exposed

Nawaz agreed to support Musharraf: WikiLeaks

May 24, 2011

WikiLeaks claimed that President Asif Ali Zardari told former US ambassador Anne Patterson that PML-N chief Nawaz Sharif was willing to support Pervez Musharraf. In another cable, it was revealed that the United States stopped Zardari from buying cheap oil from Iran. Former US ambassador Anne Patterson wrote on March 10, 2008 that Zardari told her that Nawaz Sharif was ready to support Musharraf and accommodate Justice Dogar as the chief justice. According to another cable, Zardari told former ISI chief Nadeem Taj that Justice Iftikhar should be shifted to his ancestral house in Quetta. Nadeem Taj said that people’s sympathies were with Justice Iftikhar and the move could backfire.

Nawaz agreed to support Musharraf: WikiLeaks | Pakistan | News | Newspaper | Daily | English | Online

WikiLeaks: Sharif asked US to provide him security
Published: June 11, 2011

The Resident Security Officer (RSO) of the US Embassy in Islamabad met three representatives of Nawaz Sharif to discuss his security. PHOTO: FILE
New WikiLeaks cable revealed that the PML-N Chief Nawaz Sharif wanted the US government to provide him personal security. However he was advised by the US embassy that besides being illegal it would be politically incorrect to do such a thing.
The WikiLeaks cable (reference no. 136305), which was released on 4 January 2008, revealed that the Resident Security Officer (RSO) of the US Embassy in Islamabad met three representatives of Nawaz Sharif to discuss his security.
According to the cable, Sharif’s representatives were told that US government security would violate several considerations.
They were advised that an indigenous security operation would be preferable for cultural understanding, political awareness, and even geographical familiarity reasons.
The RSO began by explaining the various reasons why American (or other foreign) securitywould be the wrong choice to make. First, legally and without appropriate guidelines, officialUSG security would violate several considerations. Second, hired professional commercial American security would not only complicate the anti-American politics already in play, but would create a higher target profile for the Protectee, rather than reducing it. And third, that in a foreign country, an indigenous security operation would be preferable for cultural understanding, political awareness, and even geographical familiarity reasons, providing the indigenous company is competent.

Cable Referenced: WikiLeaks no. 136305 

WikiLeaks: Nawaz Sharif’s broken promise
Published: December 1, 2010

According to the cable, Saudi Arabian Ambassador to the United States (US), Adel al-Jubeir, said that Sharif had ‘tested the limits of this promise five or six years in his exile’. PHOTO:FILE/AFP
Pakistan Muslim League-Nawaz (PML-N) chief Nawaz Sharif broke a promise he had made with Saudi Arabia, when he returned to Pakistan in 2007.
According to a WikiLeaks cable release, the Saudi government had offered asylum and protection to Nawaz Sharif on the condition that he would not take part in political activity for ten years.
According to the cable, Saudi Arabian Ambassador to the United States (US), Adel al-Jubeir, Sharif had ‘tested the limits of this promise five or six years in his exile’.
Jubeir goes on to say that the Saudis had allowed Sharif to travel to London and despite promising not to take part in political activities, he had flow from London to Pakistan. He says that the Saudi government had worked with Musharraf for the arrest and immediate deportation of Sharif when he returned.
In another cable, US Charge d’Affaires Michael Gfoeller noted that Nawaz Sharif was under the economic hold of the Saudis, as he had received a special economic development loan from the country.
Helping the Lashkars
A cable release alleges that the PML-N government in Punjab helped Lashkar-e-Taiba (LeT) ‘evade’ United Nations (UN) Sanctions right after the Mumbai 26/11 attacks.
President Asif Ali Zardari, speaking to former US Ambassador Anne Patterson, had alleged that Shahbaz Sharif had tipped off the LeT about UN sanctions, which gave the banned outfit a chance to empty its bank account before a raid or freeze. The cable goes on to say that President Zardari expressed his ‘frustration’ with the move.
The US diplomats were unable to confirm the allegation, but noted that they came at a time when
US diplomats were unable to confirm the allegation, but accepted the fact that information had been passed on, which was an indication of a surprisingly small amount of money in the bank accounts.

WikiLeaks: Nawaz Sharif’s broken promise – The Express Tribune

WikiLeaks: ISI asked Saudis to stop funding Nawaz’s campaign
Published: May 31, 2011

Former ISI chief told Saudi Ambassador that the aid violated Pakistan’s agreement on Nawaz’s return from exile. PHOTO: FILE
New WikiLeaks cables have revealed that the ISI had asked Saudi Arabia to stop funding Nawaz Sharif’s campaign in the last elections.
Former ISI chief Nadeem Taj told the Saudi Ambassador in a meeting that the aid violatedPakistan’s agreement with the Saudis on Nawaz’s return from exile.
The cable, which was filed by former ambassador Anne Patterson, reads:
Aziz expressed great concern to Ambassador about a possible PPP-Nawaz alliance. Aziz claimed the Saudis were heavily funding Sharif’s campaign to ensure a PPP defeat and hedge their betsagainst Musharraf. Taj called the Saudi Ambassador and requested this stop, saying it violated the GOP’s agreement with the Saudis on Nawaz’s return from exile. Aziz observed that if the PML-N and the PPP formed a government, “What options would Musharraf have?”
Former National Security Advisor and Musharraf’s trusted aide Tariq Aziz also expressed great concern to the American Ambassador in this regard.
He told the American envoy that the Saudis were heavily funding Sharif’s campaign to ensure PPP’s defeat and hedge their bets against Musharraf.
The cable has also revealed that President Zardari had raised the idea of becoming Prime Minister with Tariq Aziz after the 2008 polls. But Aziz supported Amin Faheem.
Zardari complained that Faheem was a poor administrator who lacked the skills needed to run the government.

Cable Referenced: WikiLeaks no. 141804
WikiLeaks: ISI asked Saudis to stop funding Nawaz’s campaign – The Express Tribune

Chaudhry Nisar admits his wife, children are US citizensFrom the Newspaper | Front Page | By Amir Wasim September 14, 2011

ISLAMABAD: A PML-N firebrand and leader of the opposition in the National Assembly, Chaudhry Nisar Ali Khan, on Tuesday admitted for the first time that his wife and children were US citizens, but criticised the Pakistani media for “unnecessarily playing it up” when in fact it was his personal matter.

The revelation about the family of the PML-N leader, who otherwise is perceived in political circles as one who is opposed to the American policies in the region, were part of a confidential US diplomatic cable released by WikiLeaks.

Visibly disturbed by media coverage of the issue, Chaudhry Nisar made serious attempts at a news conference to defend his family by stating that his wife was already holding dual nationality when he married her in late 1980s as his in-laws were settled in the US since 1970s.

The citizenship issue was disclosed in a secret cable sent by the then US Ambassador in Islamabad, Anne W. Patterson, to Washington after her meeting with him soon after becoming opposition leader three years ago. The US ambassador had stated that the PML-N leader had assured her that he and his party were “pro-American”.

“As always, Nisar insisted that he and the PML-N were pro-American (saying that his wife and children in fact are Americans),” said the cable sent to Washington on Sept 19, 2008.

According to the cable, “(Ch) Nisar did admit that he went to the US Embassy in London to renew his daughter’s passport because he wanted to avoid being seen at the US Embassy in Islamabad.”

It further stated: “Ch Nisar was cagier, noting that US attacks over the past few weeks hurt the hearts and minds campaign. He called for more transparency in the bilateral relationship and reserved the right to criticise US actions to remain politically credible.”

In her comments at the end of the cable, the ambassador wrote: “Nisar appears to be positioning himself to be a candidate for prime minister, if the Sharifs are disqualified in the upcoming battle with the PPP over control of the Punjab. Nisar is at heart a nationalist, and he will be an eloquent and formidable opposition leader. But he does recognise the need to stay in the good graces of the US, and we should invite him to Washington when an opportunity arises.”

Interestingly at the news conference, the PML-N leader said the contents of most of the WikiLeaks cables seemed to be true.

However, he said, these cables were based on the assessment and understanding of the diplomats which could be wrong.

Ch Nisar denied that he had ever visited the US Embassy in London in connection with the renewal of his daughter’s passport.

He said perhaps the ambassador had misunderstood what he had stated at that time. In fact, he said, there was no need for him to visit the US Embassy for renewal of his children’s passports as, according to him, this job was performed by his wife.

The PML-N leader said that he was feeling pain while discussing his family matters before the media as he always kept his family away from politics and official work. “I am a person who wants to live a private life,” he said, adding that he had been forced to come out with this explanation despite opposition by some of his party colleagues and friends because his “honesty and patriotism” were being questioned by some people through a malicious propaganda campaign using WikiLeaks cables.

“For me it is necessary that no one can raise finger at my self-respect and patriotism,” he said, adding that four generations of his family had worked for the country’s defence and gave blood to the motherland. “Therefore, it had become difficult for me to remain silent,” Ch Nisar told journalists.

Turning to more serious issues, perhaps to deflect the focus from his family’s American citizenship issue, Chaudhry Nisar claimed before the journalists that a high-level American delegation stated in talks with his party that Pakistan Army was involved in terrorism.

“They said not Gen Musharraf, your army is involved in terrorism,” the PML-N leader quoted US Senator John Kerry and now US vice-president Joe Biden as saying while speaking at a news conference he had called to respond to a WikiLeaks cable that disclosed the American citizenship of his wife and children.

Chaudhry Nisar said the offensive remark was made when he, at a meeting the US delegation had with PML-N chief Nawaz Sharif and Shahbaz Sharif immediately after the 2008 general election, protested the US support to a military dictator instead for the people of Pakistan. At this the Americans “flared up and hit the roof”. The then US Ambassador Anne W. Patterson had to intervene to prevent the situation from worsening.

Ch Nisar recalled a number of his meetings with visiting US officials, including Secretary of State Hillary Clinton, asserting that in each meeting he opposed the post-9/11 US policy towards Muslims and suggested that US withdraw from the region.

The PML-N leader clarified that he was not against the American nation, but was opposed to the US policy towards Muslims after the 9/11 attack.

Summary. During a one and a half hour meeting December 3 with Pakistan Muslim League-N party leader Nawaz Sharif and his brother Shahbaz, Ambassador outlined USG support for free and fair elections with the participation of all parties. Nawaz indicated that he would boycott the elections but reserved a final decision until after consultations later that day with Pakistan People’s Party leader Benazir Bhutto. He wanted to convince Bhutto to boycott and then form a national unity government where they would alternatively share power. He maintained his public line about restoring the judiciary as the key to Pakistan’s future. Nawaz had been “disappointed” and “hurt” that President Bush did not know him, according to advisors who went to great pains to defend Nawaz’s pro-U.S., “anti-mullah” history. PML-N wants good relations with the U.S., but believes America should support a more balanced policy towards the political parties. End Summary. 2. (C) Ambassador and Poloff met for an hour and a half December 3 with former Prime Minister and leader of the Pakistan Muslim League-Nawaz (PML-N) in his newly refurbished Lahore estate. Also in the meeting were Nawaz’s brother Shahbaz Sharif, former Petroleum Minister Chaudhry Nisar Ali Khan and former Finance Minister Muhammed Ishaq Dar. Nawaz spent a good deal of the meeting reliving past history, beginning with how Musharraf had not allowed him to return from exile to attend his father’s funeral. The meeting was more cordial that we expected, given PML-N’s public posturing about being independent from the U.S. Overall, Nawaz was calm, even placid, especially in comparison with his more agitated and eloquent brother, Shahbaz. Nawaz allowed Shahbaz and the former ministers to take the harder line and provide much of the detailed arguments in favor of his positions. After the meeting, Nawaz went out of his way to avoid discussing with the press any differences with the USG position on the proposed boycott. 3. (C) As the Election Commission had just rejected his nomination papers, Shahbaz launched into a detailed defense of the charges (absconding, loan default and murder) against him. The charges were either baseless or resolved, he insisted, and he would not appeal the decision because it meant recognizing illegal courts. 4. (C) Ambassador asked if Nawaz was determined to boycott the elections. Nawaz responded that Musharraf’s voter strength rested on former Nawaz supporters and today Musharraf would be lucky to win one-fifth of the National Assembly if elections were free and fair. But, he asked, how can we participate if our papers are rejected and Musharraf has hand-picked the courts and the Election Commission? There was no consultation with other parties on naming the now biased caretaker government, lawyers like Aitzaz Ahsan were still in detention, and the press was being restricted. We don’t see a level playing field anywhere, he insisted. Pervaiz Elahi (former Chief Minister of Punjab) is calling he shots behind the scene. The Election Commission transferred judges just before the deadline and controls the vote counting. 5. (C) Ambassador detailed USG plans to support election observer missions staffed by the International Republican Institute, The Asia Foundation and the Mission and said we were encouraging the European Union to go forward with its observer mission as well. We were not naive about the history of electoral manipulation in Pakistan, but we hoped that the presence of observers would help discourage fraud. Nawaz responded that the (intelligence) agencies controlled everything; Musharraf needed a two-thirds majority in the next Assembly to avoid treason charges, and the agencies would get it for him. 6. (C) Nawaz said he would sit down with Pakistan People’s Party leader Benazir Bhutto later in the day and hoped to convince her to join the boycott. He would suggest that he and Bhutto agree to a national unity government under which they would trade off being prime minister. Asked how he arrived at a national unity government without participating in elections, Nawaz said his party would go to the streets with the support of the lawyers and civil society. ISLAMABAD 00005138 002 OF 003 7. (C) Nawaz appealed to the U.S., UK, and European Union to press Musharraf to reinstate the judiciary. Asked to clarify what that meant, Nawaz said everything should be rolled back to November 2 (i.e., before the state of emergency and the Provisional Constitutional Order). Ambassador said this was just too difficult, given Musharraf’s position on the former Chief Justice. The USG had called for all detainees, including the judges to be released, and we wanted to see the judiciary begin functioning normally again. Was there a way to restore some of the judges? Nawaz asked if President Bush or the leader of any civilized country could simply fire the Supreme Court and get away with it. 8. (C) Nawaz continued on this theme, saying that a corrupt judiciary has been a problem in Pakistan for the last 60 years; Justice Chaudhry for the first time reversed the “doctrine of necessity.” If the people abandoned the judges who stood up for an independent judiciary, where was Pakistan’s future? Musharraf, he said, should have waited for the ruling on his case and simply accepted his fate, one way or another. If he had lost, there would have been free and fair elections and the country would have been able to move on. General Kayani (the new Chief of Army Staff) was a good man (formerly Nawaz’s deputy military secretary) and would have ensured an orderly transition. 9. (C) Ambassador stressed again that the USG believed the way forward was through the electoral process. The USG had an enormous counter-terrorism stake in Pakistan. Our goal was political stability and democratization. We know that elections will not take place under ideal conditions, but we need to move ahead. Nawaz asked “our papers have been rejected, so how do we participate?” Pro-U.S./Anti-Mullah ——————– 10. (C) Nawaz allowed his former ministers to make a long and detailed case defending Nawaz’s pro-American and anti-militant stance. Ali Khan and Dar both said that they had been “disappointed” and “hurt” to read that President Bush did not know Nawaz and felt the U.S. was unfairly supporting Bhutto and Musharraf. They recounted Nawaz’s meetings with former President Clinton, who had praised Nawaz for pulling back from the nuclear brink after the Kargil debacle. They said the religious parties had never won more than 11% of the vote in Pakistan, and that was only when Musharraf was in power. Nawaz put forces in the street to oppose the mullahs supporting Saddam at a time when Bhutto ignored them. Nawaz was the first to privatize the national bank, the first to lay the groundwork for reconciliation with India, the first to fight the Taliban. 11. (C) Musharraf, they claimed, only supported the U.S. after 9/11 out of necessity, and he always asks for something in return. Musharraf has wrecked Pakistan’s institutions, and the U.S. should carefully re-think its policies. To win the fight against extremists, you must win hearts and minds and Musharraf is too unpopular for that. PML-N wants good relations with the U.S. and considers America a good ally, but its policy needs to be better balanced. 12. (C) Ambassador replied that the USG recognizes that the PML-N is a secular party, and when President Bush said he didn’t know Nawaz, that was the truth as they have no history together. She promised to convey Nawaz’s messages to Washington. The U.S. is neutral on the elections and we will work with whomever the Pakistani people elect. Our primary focus was the deteriorating security situation in the tribal areas and now in the settled areas. We were concerned that we were not winning this war, and we needed to work together with Pakistan to defeat militant extremism. The best way to do that was with a government chosen through free and fair elections. 13. (C) Selective history and idealism aside, our sources continue to believe that Nawaz will not boycott the election because most of his party wants a chance to return to power. The government’s decision to reject the nomination papers of Shahbaz (and subsequently Nawaz) will not help convince PML-N ISLAMABAD 00005138 003 OF 003 to participate. Nawaz does not appear to have thought through the option of taking a boycott to the streets. His party was not able to deliver mass demonstrations when he was deported September 10, and his party structure after eight years in exile is weak. His subtle message was that he was counting on the Army to step and remove Musharraf after street demonstrations. We are concerned that this option would introduce violence and uncertainty that, again, would distract from our primary mission of fighting extremism. But we have little leverage over Nawaz and should concentrate our efforts in reinforcing what appears to be Bhutto’s decision to participate in elections. If she goes forward, we still believe that Nawaz will–however reluctantly–follow suit. PATTERSON<ANN W.>

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