Pak May Review its Cooperation with US!

Ambassador to the United Nations (UN) Maleeha Lodhi condemned the United States (US) administration's aggressive remarks against Pakistan and said that Islamabad could "review its cooperation if it is not appreciated".

Referring to US Ambassador to the UN Nikki Haley's comments a day earlier where she had accused Pakistan of playing a "double game" with the US, Lodhi cautioned against "shifting the blame for [the US'] own mistakes and failures onto others".

Speaking to the media on Wednesday, Lodhi said that Pakistan has "contributed and sacrificed the most in fighting international terrorism".

The diplomat added that Pakistan's role in the war against terrorism did not depend on US aid but on "national interests and principles".

Has ISIS been Eliminated from Eastern Afghanistan?

 

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American military dropped the largest bomb in its arsenal on an Islamic State cave complex in eastern Afghanistan in April,2017.It was thought that ISIS is going to be eliminated from Afghanistan in near future. But as the year comes to an end, the Islamic State is far from being vanquished in eastern Afghanistan. It has waged brutal attacks that have displaced thousands of families and forced even some Taliban fighters, who had long controlled the mountainous terrain, to seek government protection. The shifting dynamic has, in turn, threatened the American-backed government’s tenuous hold on the region. And two years into the joint United States-Afghanistan operation, a clear understanding of the Islamic State affiliate, the latest enemy in the long Afghan war, still evades even some of those charged with fighting it.

Part of the reason the two-year joint operation by the United States and Afghanistan against the Islamic State has made little progress is simply that the two forces are operating in a terrain where they have had little control for years. Air strikes and commando operations bring bursts of pressure, but the militants have release valves all around them. On one side is the porous border with Pakistan, where many of the fighters come from. Elsewhere is largely Taliban country.

Although the Taliban are known for their opposition to girls’ education, in Khogyani, the militants here allowed schooling, showing a willingness to drop a demand that had lost them hearts and minds before. In return for having nominal control, the government has paid the salaries of teachers and health workers that the Taliban could not afford.Abdul Jabar, who had been displaced from his home near the Pakistan border by recent battles between ISIS and the Taliban, said there was a two-story high school for girls close to his new home, with an enrollment of up to 1,600. Mir Haidar, who distributes vaccinations, said the three clinics there employed women, despite the Taliban’s past opposition to women in the workplace.

The Islamic State’s local affiliate in Afghanistan first emerged in 2014, swiftly gaining ground across Nangarhar Province. It quickly drew the attention of the United States military, which had scaled down its presence in Afghanistan to a small counterterrorism mission against Al Qaeda and a larger NATO mission to train Afghan forces to hold their ground against the Taliban.American and Afghan officials now have little reason to believe that the Afghan group, despite pledging allegiance to ISIS, maintains regular contact or receives directions from the Islamic State operating in Iraq and Syria. Instead, they say, the Islamic State in Afghanistan is largely made up of Pakistani militants pushed across the border by military operations in that country.
Credit: New York Times

Bitcoin Plunged from $20000 to $11000

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Bitcoin plunged on Friday, extending a fall that saw the crypto-currency lose almost a third of its value from a record of nearly $20,000 (£15,000).The crypto-currency's price dipped below $11,000 on Friday,  before recovering to above $13,000.Amid the swings, three Bitcoin-related exchanges suspended certain trades.Bitcoin has had a blistering trip over the past 12 months. Its price at the start of the year was about $1,000.
But since Sunday Bitcoin has been on a losing streak, falling back to where it was at the start of December.Analysts said investors should be prepared for such rapid changes, which have characterised the asset from its start."This is exactly how this asset trades and has done since the beginning," said Nick Colas, co-founder of New York-based DataTrek Research. "It has a lot of volatility and it will for the foreseeable future."
This week's plunge led to a flood of trades that swamped one of Bitcoin's major exchanges, Coinbase, on Friday. A technical slowdown prompted the firm to halt buying and selling twice.The CME and CBOE exchanges in the US also temporarily suspended trading of certain Bitcoin futures contracts, which allow investors to bet on where they expect the price of Bitcoin to be at certain points in the future.The exchanges have automatic brakes that apply once a commodity or asset has moved by a certain amount - as happened in this case.

US Dishonest Mediator Says Abbas

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Palestinian President Mahmud Abbas said on Friday that he would “no longer accept” any peace plan proposed by the United States, dealing a pre-emptive blow to a new initiative expected by Washington next year.The Palestinian president, Mahmoud Abbas, has formally declared that Palestinians will no longer accept the US as a mediator in the Middle East peace process following Donald Trump’s recognition of Jerusalem as the capital of Israel.In his strongest public statement since Trump’s announcement last week, Abbas said Palestinians would go to the United Nations security council to seek full membership of the UN while asking the world body to take control of the peace process as Washington was no longer “fit” for the task.The meeting took place a day after the US secretary of state, Rex Tillerson, suggested that the linked – and equally contentious – move of the US embassy from Tel Aviv to Jerusalem might not actually take place during Trump’s current term in office.

Abbas was speaking at a hastily convened meeting of the Organisation of Islamic Cooperation (OIC) in Istanbul, where members were called upon to recognise a Palestinian state, amid strong condemnations of both the US and Israel.
“Jerusalem is and will forever be the capital of the Palestinian state,” Abbas told delegates. “We do not accept any role of the United States in the political process from now on, because it is completely biased towards Israel.”The Palestinian president’s comments were echoed later in the summit’s official closing statement, which declared “East Jerusalem as the capital of the state of Palestine” and invited “all countries to recognise the state of Palestine and East Jerusalem as its occupied capital”.

The statement said the OIC summit viewed Trump’s move “as an announcement of the US administration’s withdrawal from its role as sponsor of peace” in the Middle East, describing it as legally “null and void” and “a deliberate undermining of all peace efforts” that would give impetus to “extremism and terrorism”.The summit was attended by King Abdullah of Jordan, the Lebanese president, Michel Aoun, the emirs of Qatar and Kuwait, and the Iranian president, Hassan Rouhani, who called on all Muslim nations to unite to defend the rights of Palestinians.
The Turkish president, Recep Tayyip Erdoğan, opened the meeting by denouncing the US move as a provocative “red line” for Muslims, describing Israel as an occupying and “terror” state. His remarks were echoed by other speakers.But in a sign of cracks in the unity of Muslim countries – and reflecting the wider tensions in the region – Saudi Arabia and Egypt were represented at a relatively junior level, and took a back seat in the proceedings.

Away from the summit, however, King Salman of Saudi Arabia echoed its language, telling the kingdom’s consultative council that Palestinians had the right to establish the Israeli-annexed East Jerusalem as their capital.“The kingdom has called for a political solution to resolve regional crises, foremost of which is the Palestinian issue and the restoration of the Palestinian people’s legitimate rights, including the right to establish their independent state with East Jerusalem as its capital,” the king said.Analysts raised doubts as to whether Turkey’s leadership could bridge gaps in the Muslim political community, which is divided along Shia and Sunni lines.Despite the strength of the condemnations, the meeting appeared to have fallen short of Palestinian hopes for a display of unity.
There are fears that regional tensions may be fanned further by a visit by the US vice-president, Mike Pence, early next week, originally billed as focusing on the experience of Christians in the Middle East.Abbas has already said he will refuse to meet Pence in protest, and Christian Palestinian leaders have also come under pressure to boycott his visit.Trump’s announcement last week prompted an outpouring of anger in the Muslim and Arab world. Tens of thousands of people took to the streets to denounce Israel and show solidarity with the Palestinians.

Erdogan Vowed to Protect Jerusalem

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President Recep Tayyip Erdoğan vowed to protect Jerusalem and said that a new plot targeting Muslims was unfolding. “A new attack has been launched using Jerusalem to target the entire Middle East and all Muslims,” he said. The Organization of Islamic Cooperation (OIC) issued a declaration on Wednesday recognizing East Jerusalem as the capital of Palestine.

Military Ready to Support Political Govt Normalizing Relations with India

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Military was ready to back political leadership’s initiative for normalisation of relations with arch rival India.Gen Bajwa, according to some senators, said that relations with all neighbours had to be normalised and urged political leaders to try to improve relations with India. He assured that their efforts would be fully supported by the army.The general’s offer was particularly significant because Indians allege that the army has been blocking peace efforts.
Gen Bajwa reminded the legislators that a large part of Indian military deployments was mostly against Pakistan, even though it cited other threats. He also recalled that India was fomenting instability and terrorism in Pakistan and had in this regard developed a strong nexus with Afghan intelligence agency NDS.On Iran, Gen Bajwa said Islamabad and Tehran could not have adversarial relations. He is reported to have also touched on Pakistan’s efforts for a rapprochement between Tehran and Riyadh and noted that the initiative received a lukewarm response from Saudi Arabia.
In reply to a question about the Saudi-led military alliance of which Pakistan is also a part, the army chief confirmed that the terms of reference governing the alliance had not been finalised as yet and promised to share them with parliament once they were decided. He, however, assured the lawmakers that the alliance would not be allowed to acquire sectarian colours.

Pak Rupee Downfall or Realistic Adjustment?

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The exchange rate uncertainty — which engulfed markets in July after the then finance minister, Ishaq Dar, audaciously reversed the central bank’s move to depreciate the local currency — ended on Dec 8. On that day, the State Bank of Pakistan (SBP) once again withdrew rupee support through a market mechanism, leading to a fall of 4.3 per cent in the currency’s value against the dollar in the next six days.Bankers and analysts have long been saying that the depreciation of the rupee was not a question of ‘why’, but ‘when’ and ‘how’. So here it is — a new rate band of Rs110-110.50 per dollar that the SBP may now defend until the full impact of the readjusted exchange rate becomes clear, top bankers say.
In fact, the central bank did intervene in the market twice last week, warded some undue pressure off the rupee and helped it close at Rs110.09 at the end of the day on Dec 14. “Had two large local banks not pumped in greenbacks in the market (which forex dealers suspected was done on SBP’s advice), the rupee would have closed at around Rs111 a dollar,” treasurers of a local bank told this writer.But another bank treasurer said the pressure on the rupee seen on Dec 13 and Dec 14 was also in response to a rise in the dollar’s value across Asia after a decision by the US Fed to increase its policy rate for the third time in 2017.Regardless of whether the SBP defends a new rate band or leaves it completely in the hands of market forces, the rupee may continue to remain under pressure for some time because of soaring trade and current-account deficits.
Pakistan’s trade deficit shot up to $15 billion (with exports at $9bn and imports at $24bn) in the first five months of this fiscal year, according to the Pakistan Bureau of Statistics. And according to the SBP, the current account deficit in the first four months of this fiscal year totalled $5bn, more than double the $2.26bn figure in the year-ago period.Regardless of whether the SBP defends a new rate band or leaves it to market forces, the rupee may continue to remain under pressure for some time because of soaring trade and current-account deficits.
A weakening rupee may provide some support to exports, which have already started growing this fiscal year. But fixing the trade deficit will remain elusive unless imports slow down.The rupee depreciation can make a dent in import growth in the areas of non-machinery, non-oil groups of food, luxuries and automobile, where the imposition of regulatory duties in August is also expected to make an impact.
But the sixty-four thousand dollar question is: how well will the rupee depreciation support export growth? Emboldened by an incentive package, less-interrupted supply of energy and growth in the large-scale manufacturing, our main export — textiles — is already growing.And while a weaker rupee can increase the pace of growth of overall exports, exporters are also trying to improve their own manufacturing and marketing capabilities to become more competitive in the world market.“The rupee depreciation is sure to boost the cost of external debt financing. But the prospects of a 6pc economic growth in the current fiscal year and the ongoing fiscal belt-tightening and plugging in revenue losses can offset its impact,” says a senior official of the Ministry of Finance.
Central bankers say they would keep watching the impact of the rupee decline on inflation, but hope it would not to be too problematic because domestic supplies of both food and non-food items are sufficient at the moment.
They privately admit that imports of industrial raw materials would become more expensive after the exchange rate adjustment. How the new rates will affect essential imports and how industries using those raw materials will respond to it should be watched closely.While most local bankers and analysts are apparently satisfied with the new exchange rate, some of them insist the rupee is still overvalued.Describing the recent rupee depreciation a welcome move, London-based Pakistani economist Raza A. Agha said in an emailed comment that “more needs to be done”, considering the still prevailing weakness of the external sector.
“The real effective exchange rate model suggests the rupee was 14.5pc overvalued in end-November, implying a rate of Rs121 per dollar. (But) whether the rupee will … get to Rs121 is another question,” said Mr Agha, who works as the chief economist for the Middle East and Africa at VTB Capital.He and other analysts believe that after the rupee’s decline, there is a need to raise domestic fuel and power tariffs, “otherwise there will be a fiscal impact.”SBP officials point out that in addition to maintaining the interest and exchange rates at adequate levels, their mandate also includes promoting economic growth.
“That is why you see we don’t always buy pure technical arguments for rupee depreciation beyond a certain level, even when the pressure comes from the IMF,” one official told this writer, implying that the IMF, too, had called for more depreciation of the rupee value than allowed by the central bank.
Credit:Dawn