Aug. 18 (Bloomberg) -- Pakistan’s destructive floods will raise the cost of the U.S. effort to keep the country from sliding further under the influence of Islamic militants allied to al-Qaeda who oppose America’s presence in the region.
A year after Congress passed $7.5 billion in aid to undercut the insurgents by strengthening Pakistan’s governance and economy, the worst floods in decades have destroyed more than $13 billion worth of crops, farms, railroads and towns along the country’s economic spine, Pakistani economists and officials say. Militant groups, including the banned Jamaat ud-Dawa, are giving food and tents to uprooted villagers in districts where guerrillas allied to them have battled police and soldiers.
“If the Pakistan government cannot repair roads and bridges to reconnect its cities, if it cannot put people back into homes and offer them some chance of a livelihood, the government will face its biggest political problem” in renewed radicalization, said Zafar Moin Nasser, director of research at the Pakistan Institute of Development Economics, in the capital, Islamabad.
The 1,600-kilometer-long (1,000-mile) swath of destruction along the Indus River may cut Pakistan’s economic growth by 2.5 percentage points this year, Finance Secretary Salman Siddique said in a phone interview Aug. 13. The U.S. has rushed about $90 million in emergency relief to Pakistan, according to the State Department.
With the devastation outstripping the government’s ability to meet flood victims’ needs, “the deterioration of social and economic circumstances creates the perfect atmosphere for jihadists to realize their goals of undermining the state,” said the Austin, Texas, risk analysis firm Stratfor in an e-mail yesterday.
Militant-controlled zones in northwest Pakistan are havens for guerrillas fighting North Atlantic Treaty Organization forces in Afghanistan, and for al-Qaeda, the U.S. says.
Residents uprooted in four weeks of floods have criticized the government for what they call slow relief work, even as President Asif Ali Zardari was shown on television visiting Paris and London. Zardari toured the flood zone on Aug. 14. Visiting the northwest Swat Valley today, Prime Minister Yousuf Raza Gilani said the government will rebuild bridges and stockpile food in affected areas.
The government won’t be able to prevent militants from providing aid and winning public support, said Talat Masood, a political and security consultant in Islamabad.
Its best hope of winning support is to build a bigger, better assistance network to outweigh what the militants may achieve, said Masood, a former army lieutenant general. “That is where the international community can help,” he said. The EU today proposed raising its assistance to 70 million euros.
Pakistan has suffered more than $10 billion in infrastructure damage, Nasser said in a telephone interview last week. A survey of four provinces, showed nearly a fifth of medical facilities have been damaged, the World Health Organization said today. Floods have damaged crops valued at up to $3.3 billion, Farm Minister Nazar Muhammed Gondal said Aug. 16.
Borrowing May Rise
The government may have to increase borrowing, while crop shortages may fuel an inflation rate running at 12 percent. Pakistan hasn’t said what it may ask of foreign donors. “Reconstruction will be a huge budget, and that we will talk about after we are through the rescue and relief phase,” Pakistan’s ambassador to the U.S., Husain Haqqani, told Bloomberg Television on Aug. 10.
Jamaat ud-Dawa is providing food and shelter for 10,000 people in four districts of northwest Pakistan, where the floods began more than a fortnight ago, said Muhammad Hamza, director of a Jamaat relief camp.
“Those who call us terrorists have only seen us from a distance and if they come to see our work directly, they will see that we are only trying to do good work for the people,” said Hamza, 40, in an interview Aug. 14 at his camp in Risalpur, 100 kilometers west of Islamabad.
Pakistan has banned Jamaat ud-Dawa, and the United Nations has called it a front for the Lashkar-e-Taiba guerrilla group, whose members face trial for the 2008 Mumbai terrorist attack.
The U.S. is devoting “substantial resources to support Pakistan’s democracy and development,” President Barack Obama said as he announced his strategy against al-Qaeda and the Taliban on Dec. 1.
The act he signed six weeks earlier included projects to improve inefficient irrigation systems and power grids in the Indus valley, and the rebuilding of homes in the war-damaged Malakand region. All those problems have now been magnified by the flood damage.
According to polls by the Washington-based Pew Research Center, Pakistanis’ approval of the U.S. peaked in the past decade at 27 percent in 2006, after its military helicopters became public icons of U.S. help following the 2005 earthquake in the Kashmir region. Militant groups also won public support after moving faster than the government to get tents and medics into the quake zone, the Associated Press reported.
Masood and other analysts of Pakistani militants say groups such as the Taliban and Lashkar have fused with the Afghan Taliban and al-Qaeda to conduct attacks outside Pakistan.
While “the Taliban and their sympathizers” reportedly have conducted relief operations “where the government have not been able to reach the people,” the guerrillas are unlikely to rebuild popularity after having increasingly killed civilians with suicide bombings and other attacks, said Kamran Bokhari, an analyst with Stratfor. Still, it will let them gain enough support to complicate government efforts to fight them later, he said in a video statement on the company’s website.
“Pakistan needs the help of the international community very badly and if that fails to arise, it will destabilize Pakistan,” said Nasser, the economist. “This time, Pakistan is in real trouble.”
To contact the reporter on this story: James Rupert in New Delhi at firstname.lastname@example.org
To contact the editor responsible for this story: Bill Austin at email@example.com