PAKISTAN - Peace Talks With India.

In an ideal world, the US should get Pakistan and India to progress as quickly as possible in peace talks started in late June. Both Pakistan and India now have prime ministers who formerly served as finance ministers and are excellent economists. Both should lead the peace talks and concentrate on those mutual socio-economic opportunities for which India and Pakistan must make territorial sacrifices. They can do that if the US concentrates on them as well as give them meaningful economic aid, such as free trade pacts.

This is not an ideal world, however, and no one is certain whether or not the US right now wants to concentrate on the peace process between Pakistan and India. The Republican administration of George W. Bush has become too pre-occupied with the Iraq situation and electioneering. The two issues have become inter-linked. Iraq as a fiasco would cost Bush re-election on Nov. 2 and time is running fast. The Democrats have had a good momentum since their recent party convention in Boston.

It was the outcome of the Indian general elections last May that got the Bush administration to propose to Musharraf that he bring Aziz to the post of prime minister. Sonia Gandhi's Congress Party won the Indian elections; but, in a clever move, the Italian-born widow of the late Rajiv Gandhi refrained from taking the post of prime minister and gave it to Manmohan Singh.

It was thanks to a Congress government, under Prime Minister P.V. Narasimha Rao with Singh as finance minister, that most foreign investments in India have been made since the early 1990s and, more importantly, that India's fast economic growth has been more balanced than that of China. Under Singh, New Delhi is concentrating more on rural India than on urban India. The Indian model in development, if it succeeds further, could serve as a model for Pakistan (see the July issue of the APS Economic & Strategic Review - The Indian Subcontinent).