Pakistan Security Brief

U.S. representatives express concerns over LeT in U.S.; Al Qaeda leader Zawahiri attempts to reassert control over regional affiliates; Pakistan unveils new, more austere budet, raises defense spending; Conflict information on whether Pakistan will continue Iran pipeline project; Gen. Dempsey says U.S. relations with Pakistan improving; Secretary of State to visit South Asia soon; Khyber-Pakhtunkhwa swears-in news ministers; Army chief calls on prime minister; MQM calls strike in Karachi; Imran Khan fit to be sworn in; Pervez Musharraf formally arrested in Bugti murder case; Lt. Col. killed in Khyber operation; Army declares part of Kurram clear of militants; Violence across Balochista, Karachi; Israel denies exporting military equipment to Pakistan.

U.S.-Pakistan Relations

• U.S. Representatives of the House Committee on Homeland Security on June 12 voiced concerns during a hearing on the activity of Pakistani militant group Lashkar-e-Taiba (LeT) in the U.S. Representative Peter King (R-NY) described LeT as “operationally active” in the U.S., and Representative Brian Higgins (D-NY) suggested that the LeT threat be “examined and evaluated”.1

• Chairman of the Joint Chiefs of Staff Gen. Martin Dempsey said on Wednesday in front of the U.S. Senate Committee on Appropriations that Pakistan and the U.S. are gradually rebuilding their relationship under Pakistan's new leadership.2

• For the first time since taking office, U.S. Secretary of State John Kerry will travel to Pakistan and India at the end of June, Pakistani officials announced on Thursday. Drone strikes and the U.S. withdrawal from Afghanistan will reportedly be issues on the table.3

Domestic Politics

• On Thursday, twelve ministers of Khyber-Pakhtunkhwa province, all male, were sworn in in Peshawar at the Governor's House. The allocation of ministries was only finalized on Wednesday, after disagreements over the distribution of ministries between the Pakistan Tehreek-e-Insaf (PTI) and the Jamaat-e-Islami (JI) parties, as well as a potential merger of the Social Welfare and Women's Development Ministry with the Zakat and Ushr Ministry that brought criticism from women's rights groups.4

• Chief Election Commissioner Fakhruddin G. Ebrahim and Chief of Army Staff Ashraf Pervez Kayani separately called on Prime Minister Nawaz Sharif on Thursday.5

• On Thursday, Muttahida Qaumi Movement (MQM) leaders called for a strike on Friday to protest the killing of an MQM activist in Karachi. Many businesses and private schools in Karachi plan to observe the strike.6

• Doctors on Thursday gave Imran Khan the go-ahead to travel to Islamabad to take his oath as a member of the National Assembly.7

• Former president General Pervez Musharraf was formally arrested on Thursday in the Akbar Bugti murder case by Balochistan police forces. He will remain at his farmhouse during a two-week judicial remand.8

Economy

• On Wednesday, Pakistan's new government unveiled its first budget, for $35.5 billion. To help with Pakistan's energy crisis, the budget includes funds for buying two nuclear power plants from China, but not for the proposed Iran-Pakistan gas pipeline. The lack of funding is reportedly seen as a strategic move, as the U.S. is firmly against the plan and has threatened sanctions if Pakistan goes through with it. Pakistan, for its part, is reluctant to drop the plan entirely due to penalties it would need to pay Iran for non-compliance with the deal. A senior Pakistan Muslim League-Nawaz (PML-N) leader, speaking on condition of anonymity, said that Pakistan would try to stall the program on price renegotiation issues. However, a conflicting report by the Express Tribune states that the pipeline project will continue, but with at lower cost than before. Also aiming to improve the energy situation, the new budget allocates funding to schemes switching gas- or oil-based plants to coal, and building two new coal-fired plants. Additionally, defense spending will be raised, by 10 percent according to some sources and 15 percent according to others. Dawn reports that opposition leaders are criticizing the budget by characterizing it as more “business friendly than people friendly.” he budget's new sales taxes and cuts to corporate taxes, were criticized by Leader of the Opposition in the National Assembly Syed Khursheed Shah in a report to the media after the budget unveiling. The new sales and income taxes will altogether raise $2.02 billion in revenue. On Thursday, Finance Minister Ishaq Dar explained various points of the budget to the media, saying that people should support his new taxes on the rich. Another source of expected revenue is the U.S. Coalition Support Fund (CSF), from which Pakistan expects reimbursements of $1.12 billion. On the whole, the budget is reportedly more austere than last year's, with only a 0.6 percent rise in overall spending and a lowered budget deficit totaling 6.3 percent of GDP.9

• Budget documents released to parliament show a Rs600 million payment to the Inter Services Intelligence (ISI) for a “special assignment” for the prime minister.10

• On Wednesday, the Bureau of Statistics reported that in the first 11 months of fiscal year (FY) 2012/13 Pakistan's trade deficit fell by 3.89 percent, falling to $18.7 billion from $19.4 billion the year before.11

• The Benazir Income Support Program (BISP), a keystone initiative of the previous government, has been renamed the Income Support Program and has been given an 87.5 percent boost in funding in the new budget, according to Finance Minister Ishaq Dar on Wednesday.12

Militancy

• On May 23, al Qaeda leader Ayman Al-Zawahiri reportedly sent a memo to two regional affiliates reiterating his control over the global jihadist movement. The memo, published by al Jazeera on Monday, appears to show Zawahiri's attempt to re-establish control over al Qaeda's Iraqi and Syrian franchises and to reassert the centrality of the al Qaeda leadership based in Pakistan.13

• An improvised explosive device in the Tirah Valley, Khyber agency, on Wednesday killed a lieutenant colonel of the Pakistan Army, who was leading an operation to clear the area.14

• On Wednesday, civil and military forces announced that the Parachamkani area of central Kurram agency had been cleared of militants, and that Internally Displaced Persons (IDPs) from the area would soon be able to return to their homes.15

• Five people went missing in Balochistan's Loralai district on Wednesday, including three doctors. Levies forces and police officers are reportedly working towards recovery of the five.16

• Two people were killed on Peshawar's Dora Road on Wednesday in a firing incident, including a policeman and his attacker. An armed tribesman was reportedly shot by another police officer.17

• One person was killed in Karachi's Baldia town on Wednesday when explosives he was transporting detonated. Witnesses claim that the man was a militant who had opened fire and was about to throw a grenade when it exploded in his hand.18

International

• On Tuesday, Israel and the Pakistan Army's Inter Services Public Relations (ISPR) both denied British reports that Israel had sold military equipment to Pakistan.19

Karachi NGOs

• A report on Asia's largest slum, Orangi Town in Karachi, in the Wall Street Journal focuses on local non-profit The Orangi Pilot Project (OPP) and its work in Orangi Town. Despite the murder of OPP leader Parveen Rehman in March, the group has continued to lobby for the rights of Orangi's residents and improve living conditions in the area, including helping to finance a new school.20