The Problem From Hell

SRINAGAR, Kashmir: A quiet anniversary was celebrated last month. For anentire year, Indian and Pakistani forces have observed a cease-fire along theLine of Control that divides Kashmir. Bilateral talks to improve relations areunder way on eight topics, including Kashmir and nuclear risk reduction. For thefirst time ever, there is serious talk about a natural gas pipeline crossingPakistan from Iran into the energy-starved states of western India. Another newinitiative under consideration would allow travel across the Kashmir divide forseparated family members, pilgrims, tourists, and traders. In December, nearly600 athletes from both countries competed in the first ever "PunjabGames."

The Kashmir dispute, labeled the "problem from hell" by former USSecretary of State Madeleine Albright, is thawing. How long the good news lastsis uncertain. Old habits, especially bureaucratic obstructionism, die hard inSouth Asia. Big obstacles to peacemaking remain, including extremists in bothcountries who will seek to blow up the process. No one has lost money bettingagainst reconciliation on the subcontinent. And yet strangely positivedevelopments are happening in South Asia, without much notice or impetus fromoutsiders.

President Pervez Musharraf has publicly strayed from Pakistan's unrealisticstand calling for a referendum to decide Kashmir's future. He now says that asolution acceptable to the Kashmiri people will be acceptable to Pakistan.Indian Prime Minister Manmohan Singh visited Kashmir in mid-November, promisinga US$5 billion multi-year package of economic development. He has also signaledhis interest in creative solutions - while ruling out a territorial settlementthat hands Pakistan the highly contested and fabled Valley of Kashmir.

For almost six decades, Pakistan has failed to pry the Valley away from Indiaby war, diplomacy and support of jihad. Musharraf insists that the Line ofControl is part of the problem, not the solution. New Delhi insists are-partition of the Subcontinent is out of the question. So why is Musharraftalking about a final settlement? And how long can positive developmentscontinue when major territorial changes are not in the cards?

India's goal – a return to normalcy in Kashmir – is transparent;Musharraf's is not. In the corridors of power in New Delhi, Musharraf'sdiplomacy is viewed as grandstanding. Few believe that he is serious aboutseeking a realistic settlement – or able to sell one at home. Nonetheless,Indian government officials will pursue this process as far as Musharraf iswilling or able, stressing the need for near-term steps to boost the exchange ofpeople and goods.

In Srinagar, the violence-scarred summer capital of the Indian state of Jammuand Kashmir, public skepticism is directed against the Indian government, notMusharraf. New Delhi's US$5 billion offer fell flat, as three-quarters of thepackage is devoted to long-planned hydropower projects that will mostly benefitother Indian states. Meanwhile, power shortages continue to plague locals.

Musharraf's calls for new ideas and meeting half-way have struck a chordamong disaffected Kashmiris. But Pakistan's willingness to jettison thereferendum idea if India relaxes its rigidity over the Line of Control is atrade that no Indian leader can accept.

How serious and realistic is Musharraf about a settlement? Perhaps he isill-informed about a feasible outcome in Kashmir. Or perhaps Musharraf'sself-assurance is leading him to a dead end, just as in 1999, when he championeda scheme to seize the high ground above Kargil on India's side of the Kashmirdivide. This misadventure resulted in US and international leaders affirming the"sanctity" of the status quo. Alternatively, Musharraf may once againbe playing the role of the celebrated tightrope walker who enjoys the spotlightand engages in risky tactical maneuvers without thinking through his end game.

Conventional wisdom in New Delhi and Washington holds that the Pakistan Armyneeds the Kashmir dispute to justify its hold on the levers of national power.But the Army is already deeply entrenched in the workings of Pakistan'sgovernment and the economy. Its corporate interests also require a healthynational economy.

If this is the case, we must consider the possibility that Musharraf reallyis looking to turn the page on Kashmir. The search for a face-saving exitstrategy makes sense if Musharraf understands that current Pakistani methodscannot wrest territorial gains in the Valley. New Delhi would be making a gravemistake not to explore this possibility, relying instead on cynical judgmentsabout his game plan.

How sustainable is the current thaw? Already there are familiar signs ofbacksliding, with promising initiatives on the pipeline and on Kashmir's roadopenings becoming linked to other negotiating proposals. Progress can alsobecome quickly stymied by horrific acts of violence – including anotherassassination attempt against Musharraf.

Even so, near-term prospects for progress look better than in decades. Bothcountries seem ready to take a breather from the succession of intense crisesthey have lived through since acquiring nuclear weapons 15 years ago. Inaddition, after the horrendous revelations of the proliferation networkorganized by A.Q. Khan, Pakistan needs to demonstrate responsible nuclearstewardship. This means that Islamabad has an interest in de-linking progress onnuclear risk-reduction measures from a Kashmir settlement. Pakistan also seekssignificant arms transfers from the United States, including nuclear-capableF-16 combat aircraft. It makes little sense for Washington to arm Pakistan withoffensive weapons if tensions are on the rise in South Asia.

In addition, New Delhi and Islamabad have placed a high priority on economicdevelopment in the years ahead. For the first time in the history of any nuclearrivalry, the prime ministers of both countries have backgrounds in economics.Musharraf hand-picked Shaukat Aziz, an investment banker, to pursue a growthstrategy. Manmohan Singh is a developmental economist by training. India'seconomy is five times larger and growing at more than two percent faster thanPakistan's. Islamabad's support for the "freedom struggle" in Kashmiris not attractive to foreign investors or conducive to economic growth.

The prospect of a natural gas pipeline and travel across the Kashmir divideare the most interesting new developments in the Kashmir equation. Washingtonwill oppose, but cannot successfully obstruct a pipeline originating in Iran, ifNew Delhi, Islamabad, and Tehran can reach an agreement that provides credibleassurance of supply. Pipelines take years to construct, and financing can fallthrough if, in the interim, war clouds return to the horizon.

Well before a pipeline is constructed, the psychology of the Kashmir disputecould change markedly if Pakistan and India agree to open roads and tradingposts along the Line of Control. The first road opening between Srinagar andMuzaffarabad, the capitals of Indian- and Pakistani-held Kashmir, could occurwithin months - if Musharraf is serious about facilitating outcomes thatKashmiris want. Only hard-core oppositionists on both sides of the Kashmirdivide oppose this initiative.

Bridging the Kashmir dispute through transits and trade could havepsychological effects that would be difficult to reverse. Opening the road istherefore a key indicator of progress, as well as Musharraf's intentions. NewDelhi's willingness to proceed with the natural gas pipeline across Pakistan isa second key indicator that, at long last, significant progress might bepossible in detoxifying the Kashmir dispute.

Michael Krepon is co-founder of the Henry L. Stimson Center. He is theauthor of Escalation Control and the Nuclear Option in South Asia andthe editor of Nuclear Risk Reduction in South Asia. This article appeared in YaleGlobal Online, a publication of the Yale Center for the Study of Globalization, and is reprinted bypermission. Copyright © 2004 Yale Center for the Study of Globalization