The unraveling 

On a trip to Afghanistan before heading to Islamabad today, Chairman of the Joint Chiefs Adm. Mike Mullen said the U.S.-Pakistan relationship "cannot afford...to come apart," and said he would again raise the issue of the Pakistani intelligence service's support for the militant Haqqani network with Pakistani Army chief Gen. Ashfaq Parvez Kayani (Reuters, AJE, The News, AP, Dawn, AFP). Mullen and Kayani reportedly have a good relationship. The Pakistani military is said to be trying to shore up ties with the Afghan government as the eventual U.S. withdrawal draws closer, "to ensure a central role in a negotiated settlement of the conflict" (Reuters).[[BREAK]]

Earlier today, suspected militants blew up a market in the Ferozkhel area of Orakzai agency in northwest Pakistan, and Pakistani security forces said 80 militants surrendered in Mohmand, where the military has been carrying out operations recently (ET, The News). The government of Sindh has extended the special powers of Pakistan's Rangers in Karachi for another three months in light of the ongoing targeted killings in the southern city (ET, The News).   

Montana's attorney general has launched an investigation into the Central Asia Institute, Greg Mortenson's charity, following the 60 Minutes report calling into question some of the facts of the best-selling Three Cups of Tea and Stones into Schools and spending by the charity (AP). The attorney general's office oversees nonprofits operating in Montana. Bonus AfPak Channel reads: Three cups of B.S. and Cup half empty.  

Renegades 

A spokesman for the Afghan Defense Ministry said earlier today that the Taliban fighter who shot and killed two people inside the Defense Ministry earlier this week was not a member of Afghanistan's security forces, though he was wearing an Army uniform (AP). Afghan security forces are stepping up efforts to train personnel to identify possible Taliban infiltrators and disgruntled soldiers, and so far French and U.S. forces have trained 220 Afghan soldiers in counterintelligence (AP). Intelligence officers say they have recorded 20 incidents since March 2009 in which someone wearing an Afghan military uniform -- whether a member of the security forces or an infiltrator -- killed coalition forces. British military commanders say they are expecting a change in Taliban tactics this summer to "large-scale, spectacular" attacks (Guardian).    

Greg Jaffe has today's must-read describing how Lt. Gen. David M. Rodriguez, the "primary author of the U.S.-Afghan war plan" who first arrived in Afghanistan in 2007, is being passed over for the leadership of the U.S. and NATO command in Afghanistan after Gen. David Petraeus steps down later this year (Post). In Washington, "Rodriguez is seen as a savvy fighter but a so-so salesman;" Lt. Gen. John Allen, "who played a key role in turning the Sunni tribes against the Iraqi insurgency but has never served in Afghanistan," is believed to be the current front-runner for the top Afghanistan job.  

A "safe part" of the troubled Kabul Bank has been attached to Afghanistan's Ministry of Finance, according to the governor of Afghanistan's Central Bank, Abdul Qadeer Fitrat (Pajhwok). And the mother of the Jordanian suicide bomber who targeted a CIA base in Khost, Afghanistan in December 2009 said Jordanian security forces had arrested her other son, Ayman Balawi, in a sweep late last week of more than 100 members of the ultraconservative Salafi sect, which is banned in Jordan (AFP, AP).  

"Vote for me: I'm rich, and I've done jihad!"

The Wall Street Journal profiles Aman Mojadidi, a 40-year-old, Florida-born Afghan artist who has become the "leading agent provocateur of the nascent Afghan art scene" as he campaigns against Afghan government corruption and excess (WSJ). In his "first big attempt at performance art," in 2009 Mojadidi bought an Afghan police uniform, set up a fake checkpoint outside Kabul, and gave away "reverse bribes" to drivers, along with apologies if the drivers had ever been forced to pay off an Afghan cop in the past.

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Middle East

• Yemeni protest leaders are travelling to Saudi Arabia to meet with Gulf leaders to discuss a timetable for President Ali Abdullah Saleh's departure. 
• Syrian President Bashar al-Assad said his country's state of emergency should be lifted next week.  
• Egypt's former prime minister, interior minister, and finance minister will face trial on corruption charges, officials say. 

Asia

• An insurgent dressed as a soldier killed two at the Afghan defense ministry in an unsuccessful attempt to assassinate the Afghan and French defense ministers. 
• A leaked U.N. report finds that Sri Lanka targeted civilians during its offensive against the Tamil Tigers in 2009.  
• China raised banks' reserve requirements in an effort to tackle inflation.

Africa

• Incumbent President Goodluck Jonathan is reportedly leading in Nigeria's presidential vote.
• An army mutiny in Burkina Faso has spread to four cities. 
• Ugandan opposition leader Kizza Besigye was arrested, one week after he was shot in the hand. 

Europe

• Spanish police seized a record amount of bomb-making materials from suspected ETA hideouts. 
• An anti-Euro party made gains since Sunday's Finnish election, potentially imperiling a bailout plant for Portugal. 
• France blocked a train carrying recently-arrived Tunisian migrants from Italy.  

Americas

• Cuban President Raul Castro has called for term limits for the country's top political positions.
• The police chief in the Northern Mexican state of Tamaulipas has been replaced after the discovery of 145 bodies in mass graves.  
• Chile is planning to exhume former President Salvador Allende as part of an investigation into his death. 

Chris Hondros/Getty Images

In Afghanistan, living off the grid isn't a tree hugger's dream -- it's reality. but a renewable-power startup called Sustainable Energy Services Afghanistan is lighting up Afghans' lives, with help from the sun and the wind.

ON A PLEASANT AUTUMN DAY, Shakibullah Hedayat Rustaqi and his colleagues began to prepare for their next job. They grew out their beards. They stopped showering a week before their start date. They chose their most raggedy clothes. "We had very dirty shawls that we turned into turbans," he recalls.

Their destination was Paktika, an Afghan province just over the border from Waziristan, the lawless Pakistani region that's said to be home to Taliban and Al Qaeda bases. Their mission: to install four windmills.

Rustaqi and his team could never have gone to the countryside dressed as they typically would for work at a Kabul-based renewable-power firm called Sustainable Energy Services Afghanistan (SESA); to bandits, who are as common on Afghan highways as rest stops are on American ones, engineers look like ATMs. "If anyone asks, 'Who are you?' we tell them we are laborers," says Rustaqi. "If they get engineers, they cut off their heads. You know the Taliban: stupid people."

Get in, get the windmills up and running, get out as quickly as possible -- that's the basic game plan for each job. This mission, in Taliban territory, did not go smoothly. Partway through the afternoon, gunfire exploded in the air, followed by sirens crying out through the hills. Suddenly, a convoy of Afghan National Army vehicles sped by the work site. As the sounds of a firefight grew around them, Rustaqi was tempted to seek shelter. "It was very dangerous!" he says. But he had two engineers 100 feet up a half-finished windmill. "We couldn't leave our friends up there. We just kept working."

Within an hour, the fighting had passed as quickly as it had started. Their job finished, the engineers descended.

"What did you see?" Rustaqi asked them anxiously.

They stared at him blankly. They hadn't heard the gunfire or the sirens or his shouts. A hundred feet above the valley floor, all they'd heard was the sound of the wind whooshing past.

IN THE WEST, LIVING OFF THE GRID MAY BE AN ASPIRATION FOR SOME bleeding-heart eco-warriors. In Afghanistan, it is reality. Eighty percent of the country does not have electricity. In the villages where SESA typically works, the only form of it that some residents regularly encounter is lightning.

Even if someone were to build a new major power plant, it would be largely useless because there is no national electrical grid, and given Afghanistan's devilish terrain, with the jagged skyscraping peaks and the gash-in-the-earth valleys, there never will be. "You just can't string power lines all over the country," says Ahmad Saboor Arya, an engineer at the Afghan Ministry of Rural Rehabilitation and Development.

That makes Afghanistan the perfect place for small renewable-power installations with enough capacity to electrify a village. With unique coalitions of consumers and clients -- the U.S. Agency for International Development (USAID) and the U.S. military, which fund most of the construction; not-for-profits that often help secure local buy-in; tribal elders who welcome SESA teams into their communities and then oversee the completed power projects -- the company is gradually bringing power to one village after another.

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The U.S. and its NATO allies have plowed more than $56 billion into Afghan reconstruction and development. "We have to make sure we leave a sustainable solution," says British Major General Nick Carter, who, until November, commanded allied forces in southern Afghanistan. But a recent report by the Special Inspector General for Afghanistan Reconstruction said that USAID and the Departments of State and Defense together were responsible for $17.7 billion in spending that they could not now account for. In that context, the $4.8 million that the U.S. has spent with SESA seems like a very good deal. That money has bought more than electricity; it has also created a surprising model of local development. "What our clients purchase is not solar power or wind power -- they actually don't give a shit about solar," says Tony Woods, the affable Kiwi-American who is the company's founder, CEO, and majority owner. "It's a means to an end -- to stability, to employment, to growth."

Woods is convinced that with some minor modifications to suit local cultures, his strategy will work across the world, in inhospitable business environments from Asia to South America. By going where most businesses would fear to tread, his company is creating jobs and boosting agricultural output. It is aiding improvements to health and education -- and showing there is money to be made in some of the world's unfriendliest nooks and crannies.

KABUL IS AFGHANISTAN'S BEST-LIT CITY. MOST OF THE CAPITAL'S electricity is imported from Uzbekistan, via a transmission line completed in 2009 with foreign-aid funding. What little power there is in the rest of the Texas-size country comes almost entirely from fume-spewing diesel generators, but Afghanistan has no significant domestic crude-oil supply, refining capability, or affordable diesel fuel.

Before 2001, under Taliban rule, "only Taliban houses and ministries in Kabul had electricity," says an engineer at the Afghan Ministry of Energy and Water, who asked not to be named because he did not have permission to speak. Even in homes that had once had power, "people passed five or six years in darkness." Electricity wasn't the only thing most Afghans lacked. In a 2003 survey by the National Solidarity Program, Afghans were asked what they would want the government to do with the approximately $200 per family in development funds available through foreign aid. Thirty percent said water and sanitation, another 30% said transportation, and 11% made electricity their top choice. "When you bring even small amounts of electricity to a rural area, income, literacy, and health generally advance," says Chris Flavin, president of the Worldwatch Institute, a Washington, D.C., research group that specializes in energy and the environment. "Understanding this link is key to improving the lives of the rural poor."

Helping the poor was never the primary goal for Woods, who came to the energy business -- and Afghanistan -- circuitously. Born in the U.S. but raised in New Zealand and trained as an engineer, he had noticed nonoperational micro hydropower generators while biking through Pakistan. (He was en route from South Africa to China.) After the trip, he put together a proposal for New Zealand Aid, the national development agency, and got hired as a consultant to return to Pakistan and fix them.

In 1999, he made his first visit to Afghanistan. One blue-sky day, he ran into a platoon of Taliban soldiers enjoying a picnic by a lake near Kabul. They were shooting ducks, and they directed a gun at him -- so that he could have a go at the ducks too. Maybe it was the weather or Woods's disarming Forrest Gump-like charm. "They were quite helpful," he says, recalling that they offered excellent driving directions and local knowledge, including tips on which roads were mined.

On that trip, Woods had an epiphany: Afghanistan seemed perfect for renewable energy. The northeast region has abundant water, the west has steady wind, and the south is blessed with strong sunshine. The only thing it did not have was someone who was willing to take on the challenge of harnessing those natural resources and turning them into locally distributed, grid-free sources of electricity. So in 2007, he moved to Kabul and founded SESA.

Kabul's dusty streets are full of expats -- aid workers, journalists, ex-military. If you didn't know them by their skin color, you'd know them by the hunger in their eyes. The prototypical Kabul foreigner is a former idealist now angling for an ever-bigger piece of the lucrative war-and-aid pie. Woods stands out from that crowd. In one of the world's hairiest countries -- a decade ago, an engineer who now works for Woods spent a week in jail for shaving his beard -- Woods never even sports a five-o'clock shadow. Amid the cynics, he is, even after four years in Afghanistan, endlessly optimistic about doing business in a poor, corruption-plagued land. "We're willing to do this where nobody else wants to go," he says. "We've always been about helping -- we grew out of the development field -- but we are unashamedly commercial."

Woods's company, which turned a profit in the fourth quarter of 2010, draws almost all its revenue from the American taxpayer; USAID and the U.S. military are his biggest clients. But they are not his end consumer -- the Afghan villager is -- and Woods views his operation as being as much about sales and marketing as it is about electrification. "We understand what our clients are actually buying," he says, explaining how he constantly switches between two languages: that of the people who pay for a facility and that of those who will use it. "The funder talks about employment and stability. But the villagers talk about TV and lights and refrigerators. We put as much, or often more, time and effort into nontechnical parts of a project. If the social, environmental, or economic sides fail, then the project will fail even if the engineering is done to a high standard."

The first priority on every job is to prep the territory. Woods and his team are often hired in disputed regions where the government is seeking to wrest influence from the Taliban, so it is important, as Woods puts it, "to call ahead." "The community must be involved at the earliest stage or else they will blame problems later on the lack of consultation," he says. "They must help along the way, providing security and labor. If the village wants us there, then they will protect us." SESA also requires that the village provide land for the installation, a tangible investment in the project.

Woods's team does the installation, which doesn't require much wiring since everything stays local, and the training. Communities must agree to collective ownership and co-op-style management for the installed system. Villagers pay for power -- "Otherwise, there's no revenue for service and support" -- and Woods recommends using prepaid electricity meters. The concept works because nearly all Afghans already know the prepay model from pay-as-you-go mobile-phone cards. It also avoids the dirty work of cutting anyone off for delinquency. In these tightly connected communities, "nobody wants to be the one to disconnect Auntie Maud," Woods says with a smirk.

Woods trains locals to do the maintenance, which creates one or two well-paid jobs. "Someone has to run it and maintain it," he says. The Soviets built hundreds of micro hydropower plants throughout the north of the country, but none of them work now because they weren't maintained. (SESA has $1.5 million in USAID contracts to help resuscitate some of them.) In the background of Taliban training videos, you can see arrays of solar cells. These systems need faithful maintenance of the type that only a committed organization -- say, a close-knit group of insurgents or a village -- can provide.

Woods brings a deft diplomatic touch to his work. Before launching a solar project in 2009 in the Gardez Province village of Sayed Karam, for instance, he rented a van to bring eight tribal elders to a meeting in Kabul. The men tumbled out of the van, all with long beards, black turbans, and scars from previous wars (one was missing an eye, another a finger). Over tea, nuts, and kebabs, they peppered Woods with questions and comments: Why should anyone have to pay for power? Even the mosque? Even the school? How does a meter work? Where does the equipment come from? Please don't send low-quality gear from China!

Woods patiently answered each question. "They're Taliban with a small t," he says later. "They'll tolerate some foreigners if there is something in it for them. They're traditional Pashtuns and mostly want to stay that way, but with satellite TV."

The appeal of his company's product has been helped by an unforeseen agricultural benefit. Because of the delicacy of some turbine components, they must be shipped to the installation site in 40-foot cold-storage containers that should then be shipped back out. Woods wondered, What if I left the container at the delivery site?

One of the Afghan agriculture industry's great limitations is the lack of refrigerated storage. Most produce can't make it to market before rotting. Also, each community tends to grow the same crops and harvest them all at once, pushing prices down and leaving surpluses to spoil. After SESA installs a turbine, it can hook up the leftover container to the new power supply, creating refrigeration that can extend a harvest's shelf life by up to two months. It has done this in two communities so far, and is bidding on a U.S. Marine-funded solar project, for Helmand Province, that would power cold storage for pomegranates.

THE WORK OF ELECTRIFICATION HAS GIVEN DIFFERENT KINDS OF new power to Woods's 25-person staff, including the freedom that a steady, middle-class salary brings. In a nation where there are few jobs outside the home available to women (even hotel housekeeping staffs are typically male), this is particularly true for the four women he employs -- and no other has a story like Samiya Amiri's.

A bubbly 27-year-old with warm, dark eyes and a fleeting smile, Amiri, just over a decade ago, was forced by her parents to marry. Her suitor was rising in the Taliban hierarchy. A top official in the Badakshan Province, he wanted Amiri as his second wife, and he offered her parents an irresistible dowry: their own lives. He pledged to kill them if they didn't let him wed her.

After the birth of her second child, Amiri says, she fled from her husband, taking her two children and living for a time in a women's shelter. She had missed high school because the Taliban eliminated schooling for girls, but the shelter had an adult-education program that included English tutoring. That's when Woods found her. "She showed technical competence but lacked confidence and field experience," he says. "She also has courage and tenacity. We needed both." So he hired her and spent another three years training her. Today, she manages an all-female team of technicians.

The office is an oasis for Amiri. After she left the shelter, she moved in with her parents, but they so despised the circumstances around her marriage that they would not allow the kids, now 7 and 9, to join her. She put them in an orphanage.

At times, Amiri speaks about her job with an air of wonder. "We're the only women installing solar in the field in Afghanistan," she says. "Out of 12 women who passed the exam in my engineering class, just 3 found work. The other 9 are at home." She is paid $450 a month -- more than the average Afghan earns in an entire year -- and now makes enough money to rent a room in a Kabul apartment. A few months ago, she reclaimed her children.

ON PAPER, IT SEEMS THAT SESA HAS THE POTENTIAL TO TRANSFORM lives not only across Afghanistan but also around the world. Its small-scale, locally based model works. Its training regimens create skilled labor. Its technology is solid -- so much so that Lockheed Martin approached Woods for advice about a big solar system it's building on a U.S. military base in Afghanistan.

Yet there's one wild card Woods cannot always account for: human meddling. To understand this, you have to go 90 miles north of Kabul to Panjshir Province, where the flat of the valley floor greets the foothills of the Hindu Kush and the road up-country traces gorges carved by tumbling lime-green rivers fed by snowmelt. During the Cold War, guerrillas would descend from the cliffs to ambush Soviet convoys. Today, old Soviet military vehicles sit rusting on the roadsides. Kids use the upside-down ones as playground equipment, a testament to the ultimate futility of the Russians' Afghan adventures.

SESA has installed 19 systems in the Panjshir: 18 solar and one wind. The solar arrays power 18 health clinics, which previously relied on kerosene lamps and generators that ran only intermittently because of fuel prices. (Diesel costs about 20% more in Afghanistan than in the U.S.) Presently, the clinics have clean water, spirited to the surface by new solar-powered pumps. Several of them even have a steady supply of hot water, thanks to solar heaters installed by Woods's team. This setup has run flawlessly.

Then there is the wind system, paid for by the U.S. military and overseen by Panjshir Province technology director Muhamad Tahir, a former mujahid who seems bent on proving that one of Afghanistan's biggest problems is the tyranny of small-time officials. In his spacious, sunny office in the governor's compound in the provincial capital of Bazarak, you will find no computers, no TVs, no photocopiers -- just expensive plush carpets and seven sofas lining the bare walls.

Two years ago, Tahir says, he asked the U.S. military for turbines along the roaring Panjshir River; hydropower could generate more kilowatts per dollar of investment, he argued. Instead, the Americans plowed $1 million into 10 windmills, he says with irritation. (Some news stories proclaimed this Afghanistan's first wind farm, though one engineer describes it more as a "wind garden.") Tahir grudgingly admits the investment has paid a decent return. Prewindmill, the generator in his compound burned 600 liters of diesel a month. With wind, it burns just 200 -- a savings of nearly $5,000 per year. "It was expensive," he says, fingering his prayer beads. "Now it's wind, and wind is free from God."

Alas, wind power is not free from human interference. In recent months, Tahir has unplugged every building in the compound but his own from the wind-powered mini-grid. "No more AC, no more fridges," he declares. He claims he doesn't want people to be spoiled by the abundance of affordable power, even though so little of it is being used that nearly all the electricity generated by the windmills is being wasted.

The power struggle befuddles the keeper of the windmills. Kefa- yatullah Muhammadi, 22, was trained by SESA to maintain the wind farm, which sits high on a hill above Bazarak. There's usually little to do, so he reads the Qu'ran, as well as books on agriculture and, of course, electricity. From his vantage point, he identifies the army outpost, the finance department, the bureau of refugees, and, on a neighboring crag, the local TV station. His windmills once powered all four. All four went back to burning diesel.

This kind of internecine battle is the one thing that can crack Woods's optimism. "It probably has something to do with money and budgets... . Or maybe the television station said something [Tahir] didn't agree with," he says. "Who knows?"

Whatever the case, Woods wasn't having any of it. In November, he drove up from Kabul. He stopped by the TV station, which broadcasts six hours a day from a one-room converted shipping container. SESA had covered the cost of laying cable from the wind farm to the station. Woods's hope was that, with the reliable energy, it would be able to broadcast around the clock.

"I asked them why they used diesel," he says. "They were not sure why. But they agreed it was better to use wind. I told them to just not be so silly. I looked at the TV-station manager and the wind-power manager together and just said, 'Come on, guys. Jesus. Sort it out.' "

Then he walked over to the unplugged cable that once connected the windmills to the TV station. He picked it up, and he plugged it right back in.

A version of this article appears in the April 2011 issue of Fast Company.

Event notice: Tomorrow at 12:15pm EST in DC, please join the New America Foundation's Counterterrorism Strategy Initiative for a discussion of Nelly Lahoud's new book, The Jihadis' Path to Self-Destruction. Details and RSVP here.

Attacks in Sweden

Two explosions hit Drottninggatan, a busy pedestrian shopping area in Stockholm a few minutes and several hundred yards apart on Saturday afternoon, in what Swedish authorities are treating as a "terrorist crime" and suspect may be Sweden's first suicide attack (WSJ, AP, DN, Local). The only person killed in the blasts, the first of which appeared to be from a white Audi filled with gas canisters bursting into flames and the second of which was the reported suicide blast, is believed to be the attacker, a man British and Swedish outlets and officials have identified as the 28 year old Taimour Abdulwahab al-Abdaly, an Iraqi-born Swede who reportedly lived in the U.K. for the last decade (Tel, NYT, DN, AJE, AP, DN). An Islamist website also identified him as the man "who carried out the martyrdom operation in Stockholm" (AFP, Local). Two people were injured in the attacks, and Swedish prosecutors say his bombs likely detonated prematurely (AP). [[BREAK]]

Several minutes before the blasts, the Swedish news wire TT and Sweden's security service Sapo reportedly received an email threatening attacks on Sweden because of the country's troops in Afghanistan and for caricatures of the Prophet Muhammad drawn by the Swedish artist Lars Vilks (BBC). Swedish prosecutor Thomas Lindstrand said the message was sent from the dead man's phone (WSJ, AP). A Swedish Armed Forces employee also reportedly told an acquaintance several hours before the attacks to avoid the area (Local).

The NYT, BBC, and the Guardian have profiles of what is known about the alleged attacker, who was found after the second attack surrounded by pipe bombs and a bag of nails, a Sunni Muslim whose family moved to Sweden from Baghdad in 1992 and is believed to have studied physical therapy at the University of Bedforshire in England (DN, NYT, BBC, Guardian). British authorities have searched a house in Luton, where Al-Abdaly's wife and three young children are said to be living (FT, Tel, BBC, AFP, WSJ). A will purportedly from Al-Abdaly on an Islamist web site reportedly states that he was fulfilling a threat by al-Qaeda in Iraq to attack Sweden (Local).

Sweden's prime minister has urged the country to "stand up for tolerance" (Post).

Critical conditions

Two new National Intelligence Estimates, one on Pakistan and one on Afghanistan, reportedly paint bleak pictures of the security conditions there, with the Afghanistan report concluding that the war cannot be won unless Pakistan takes on militants in its tribal areas and the Pakistan report assessing that the Pakistani government and military "are not willing to do that" (AP). Military officials say the reports are based on outdated information and don't take into account progress made this fall.

Obama administration representative to Afghanistan and Pakistan Amb. Richard Holbrooke collapsed at the State Department during a meeting with Secretary of State Hillary Clinton on Friday morning, and had more than 20 hours of surgery to repair a torn aorta (AFP, Bloomberg, Politico, Post, Daily Times/AFP). On Sunday, he underwent an additional procedure to improve circulation to his legs, and is said to be in critical condition.

Election tensions

The office of Afghanistan's attorney general, an ally of Afghan President Hamid Karzai, reportedly called for the country's September 18 parliamentary elections to be tossed out because of concerns over fraud, and urged the Supreme Court, which is packed with Karzai loyalists, to order a recount (WSJ, McClatchy). Final results were released by Afghan election authorities earlier this month and endorsed by the United Nations and Western governments. The head of Afghanistan's Independent Election Commission pushed back and said that annulling the vote could spark a national crisis, and claimed that a letter from the attorney general's office called for "capital punishment" for all members of the IEC and the Electoral Complaints Commission (AP, Tolo). Failed candidates protested in Ghazni on Sunday (Pajhwok).

The Taliban claimed responsibility for a suicide bombing in Zhari district of the southern Afghan province of Kandahar that killed six American soldiers on Sunday morning near the entrance of a new outpost jointly operated by U.S. and Afghan troops (NYT, AP, FT, Pajhwok). Four Afghan policemen and two civilians were injured in a blast outside a police headquarters in Kandahar city on Saturday (Reuters). A NATO airstrike reportedly killed at least 25 alleged insurgents in the eastern province of Kunar on Saturday, while a Taliban suicide bomber driving an Afghan police vehicle targeted an Afghan National Army convoy in Kunduz, wounding nine (AP, Reuters). In Helmand on Friday, 15 civilians were killed after a truck drove over a roadside bomb (AP). British outlets continue to note the security problems American troops are having in Sangin, the area of Helmand U.S. Marines recently assumed responsibility for from the British (Times).

Regional relations

Karzai met with officials from Turkmenistan, India, and Pakistan in Ashgabat over the weekend to sign an agreement for a 1,000-mile natural gas pipeline that would pass through gas-rich Turkmenistan, Kandahar, Quetta, ending in the Indian city of Fazilka, and could eventually net Afghanistan "billions of dollars in revenue" (LAT, AFP, Dawn). Afghanistan will deploy between five and seven thousand troops to protect the TAPI (Turkmenistan, Afghanistan, Pakistan, and India) pipeline, which is due to be operational in 2014.

Yesterday, Afghan officials announced a $100 million plan to issue electronic identification cards to all Afghans within five years (AP). The Afghan Ministry of Finance is funding the program from its development budget.

James Risen reports that Hajji Juma Khan, who was arrested in 2008 to face charges under U.S. narcoterrorism laws, was also a CIA and DEA informant whose case illustrates "how the war on drugs and the war on terrorism have sometimes collided, particularly in Afghanistan, where drug dealing, the insurgency and the government often overlap" (NYT). A U.S. official defended the relationship, commenting, "You're not going to get intelligence in a war zone from Ward Cleaver or Florence Nightingale."

Rajiv Chandrasekaran also has a pair of Post articles on the Afghan war, the first describing how the Afghan district of Nawa has become an example of "what is possible in Afghanistan when everything comes together correctly" and the second highlighting uncertainties in the U.S.'s relationship with Karzai (Post, Post). An American military official in Kabul noted, "The biggest problem in our relationship with Karzai is that we don't have any diplomats who actually have a relationship with him."

Bomb on a school bus

On Saturday night, two Pakistani policemen were killed by unidentified gunmen on the outskirts of Peshawar, and earlier today in the northwest Pakistani city a school bus drove over a roadside bomb that killed one and injured two children (ET, AP, AP, AFP). On Friday, a suspected U.S. drone strike was reported near Mir Ali in North Waziristan (AP, Reuters, CNN, ET). Pakistani authorities have reportedly decided to close the border between Pakistan and Afghanistan in Kurram from December 13 to 20 because of concerns about sectarian and militant attacks during the Shia holy month of Muharram (The News). Stricter security arrangements have also reportedly been completed in Karachi (Dawn).

A Muslim doctor who threw away the business card of a pharmaceutical representative named Muhammad Faizan has been arrested by Pakistani authorities in Hyderabad on allegations that he violated the country's blasphemy laws because the representative has the same name as the Prophet Muhammad (AP).

And the LAT profiles the head of Transparency International's office in Karachi, who some Pakistani officials have reportedly been trying to discredit, following "inquiries [that] have helped expose bidding irregularities at power plants that robbed government coffers of $2 billion, a real estate scam that cost taxpayers $16 million, and a $257-million scandal that brought down the chairman of Pakistan's largest steel mill" (LAT).

Make way on the runway

Next year, Peshawar will host its own Fashion Week, according to Waqas Ahmed of the Peshawar Fashion Council (ET). Though there are concerns about security, Ahmed said she "felt that if every major city can have a fashion week, why not Peshawar?'

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Tuesday, 16 February 2010, 13:41
S E C R E T SECTION 01 OF 05 DUSHANBE 000173
SIPDIS
STATE DEPARTMENT FOR S/RAP
EO 12958 DECL: 2/16/2020
TAGS PREL, PGOV, PHUM, EAID, ECON, EINV, TI
SUBJECT: CORRECTED COPY - TAJIKISTAN SCENESETTER FOR VISIT OF SRAP
HOLBROOKE
CLASSIFIED BY: NECIA QUAST, CDA, EXEC, DOS. REASON: 1.4 (b), (d) 1. (C) Summary: U.S. interests in Tajikistan are a stable state on Afghanistan's northern border, support for our military efforts in Afghanistan, and for Tajikistan to be a stabilizing influence and contributor to economic development in the region. Tajikistan gives unrestricted over flight rights, and quickly agreed to NDN ground transit. In the medium term, it could play a more active role in regional development, because of its huge hydropower potential, relative (to Afghanistan) stability, and religiously moderate population. But to do so Tajikistan must overcome multiple political and economic problems which stymie its own development: poverty, bad relations with Uzbekistan, intense corruption, Soviet-era economic structures and planning, an undemocratic political system, chronic food insecurity, and dependence on migrant labor in Russia.

2. (C) U.S. assistance has shown mixed results in the development sphere. Recent steps to improve the business climate have been offset by the government's campaign to force its citizens to contribute to the construction of the Roghun hydroelectric dam. The government is not willing to reform its political process. Our security cooperation shows some promise. Regardless of our efforts, there is a limit to what Tajikistan can offer: it produces very little, is poor, and its government has minimal capacity. The Tajiks have some unrealistic ideas about what we can offer them -- mainly large infrastructure projects including questionable power plants, tunnels to Pakistan, and bridges to nowhere. There is some truth to the quip that Tajikistan's real contribution to our efforts in Afghanistan is to be stable, and to allow unfettered over flight and transit to our forces - which the Tajiks have done unfailingly. We try to promote Tajik polices which will ensure continued stability. End summary.

A DIFFICULT NEIGHBORHOOD

3. (C) Some of Tajikistan's difficulties are geographic. Chronic problems with Uzbekistan, fueled by personal animosity between the presidents of each country, has stymied Tajikistan's trade, energy self-sufficiency, and economic development. Afghan instability is a malign influence: traffic in drugs undermines rule of law in Tajikistan, Tajiks fear the spread of extremist ideas from Afghanistan, and militants in Afghanistan can threaten Tajik security across the long, porous border. Russian interference looms large in the Tajik consciousness. The Russians control one major hydropower dam in Tajikistan, a source of disagreements between the two countries. The Tajiks seek alternative partners, including the United States, China, and Iran, to balance Russian influence. China is a major infrastructure donor, with over $1 billion in low-interest loans to Tajikistan to build roads and power line projects. Iran funds tunnel and hydropower projects, but displays of Persian solidarity do not mask deep suspicions between the hard-drinking, Soviet-reared, Sunni elite in Dushanbe and religiously conservative Shiites in Tehran.

4. (C) The Tajik government presses us for greater benefits in return for support on Afghanistan. The Tajiks think Uzbekistan is keeping all NDN-related business for itself; they want more traffic to transit Tajikistan, more infrastructure to support that traffic, and the United States to purchase Tajik goods for forces in Afghanistan. We currently purchase small amounts of Tajik bottled water for ISAF. They have indicated they would be happy for the U.S. establish an air base in Tajikistan. They see U.S. involvement in the region as a bulwark against Afghan instability, and as a cash cow they want a piece of.

FEAR OF INTERNAL RIVALS, MILITANTS, AND RUSSIA

5. (C) The Tajik civil war ended in 1997 with a power sharing arrangement between President Rahmon's government and the leaders of the United Tajik Opposition (UTO). Since the end of

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the war, Rahmon gradually has reneged on this deal and forced nearly all oppositionists out of government -- some are in prison, some left the country, and others died mysteriously. In May 2009 an armed group led by a former UTO figure, Mullah Abdullo Rahimov, returned to Tajikistan from Afghanistan, reportedly with several foreign fighters. Tajik security forces neutralized this group without outside assistance. They have told us U.S. training enabled their security forces to win, and they are eager for more training.

6. (C) Russian-Tajik relations have deteriorated. Tajik officials believe the Russians supported Mullah Abdullo's group, to signal Tajikistan that they need Russian protection. The two governments could not agree on the terms of Russian involvement in the Roghun Dam, and they have other differences. In October 2009 the President downgraded the formal status of the Russian language in Tajikistan. His government broached charging Russia rent for its military bases in Tajikistan. In 2009 the Russian-controlled Sangtuda-1 hydroelectric plant cut production when the government of Tajikistan's failed to pay its bills on time.

ECONOMIC DIFFICULTIES

7. (C) Tajikistan is the poorest of the former Soviet republics. It is more mountainous than Afghanistan, with earthquakes, floods, droughts, locusts and extreme weather. Parts of the country are often cut off by snow and avalanches. External links pass through obstructive Uzbekistan, unstable Afghanistan, or over the rough, remote Pamir passes to western China. Its only industrial products are aluminum and hydroelectricity. The Tajik Aluminum Company (Talco) accounts for most of Tajikistan's exports. Though it is technically state-owned, most of its revenues end up in a secretive offshore company controlled by the President, and the state budget sees little of the income. Talco consumes up to half of Tajikistan's electricity, contributing to major seasonal shortages and suffering.

8. (C) President Rahmon's response to Tajikistan's chronic energy insecurity was in late 2009 to launch a massive campaign to fund and build the Roghun Hydroelectric Plant. Roghun would be the highest dam in the world, and double Tajikistan's electricity generation capacity. The government's fundraising efforts, however, have drawn serious concern from international donors. Individuals and organizations across all walks of life have been coerced into buying shares in the project. Many people have been told they will lose their jobs unless they contribute an amount equal to many months' salary. While the government claims all share sales are voluntary, there is ample evidence that officials are forcing the population to cough up funds. Apart from the human rights question, donors are concerned that the nearly $200 million in funds raised so far will not be accounted for and spent transparently. Considering Talco's share of electricity consumption, the Roghun campaign looks like a means to ensure Talco's continued profitability.

9. (C) Tajikistan's economy suffers from the global recession through major drops in exports, imports, and remittances from a million Tajiks working in Russia. The money they sent home was equal to over 50% of GDP in 2008, and literally keeps rural communities alive. Remittances dropped 34% in 2009. The greatest obstacle to improving the economy is resistance to reform. From the President down to the policeman on the street, government is characterized by cronyism and corruption. Rahmon and his family control the country's major businesses, including the largest bank, and they play hardball to protect their business interests, no matter the cost to the economy writ large. As one foreign ambassador summed up, President Rahmon prefers to control 90% of a ten-dollar pie rather than 30% of a hundred-dollar pie.

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ELECTIONS ARE COMING, BUT DEMOCRACY ISN'T

10. (C) The government has limited opposition party operations and rejected electoral law reforms for the February 28, 2010 parliamentary elections. The Embassy does not expect the elections to be free and fair. There has been almost no coverage of opposition political parties by state media, and most of the population is unaware of the purpose of the elections. Parliamentary opposition is weak -- only 15 of the 62 members are not in the ruling party, and some of these are independent in name only. The most prominent opposition party, the Islamic Renewal Party of Tajikistan (IRPT), has two seats in the outgoing parliament. IRPT leadership has supported the government on most issues and downplays the importance of Islam in the party's platform. Parliament acts as a rubber stamp.

11. (SBU) In 2009 Parliament passed a restrictive new law on religion, curbing the activities of religious groups, Islamic or otherwise. Our advice that this could radicalize many believers has fallen on deaf ears. Last year, the government arrested dozens of individuals, accusing them of membership in the banned "Salafiya" movement, but it has no evidence that there is an organized Salafiya movement. It also arrested 92 members of the Muslim fundamentalist missionary group, Jamaati Tabligh. Most mainstream Muslim religious leaders view the Tabligh members as harmless missionaries and have called for their release.

12. (SBU) Independent media is reeling after government officials recently filed lawsuits against five newspapers for reporting on public government reports and statements in open court which were critical of judges and government ministries. The newspapers will be forced to close if the lawsuits succeed. We and European partners have protested the lawsuits.

DIFFICULT RELATIONS WITH DONORS

13. (SBU) In 2007 Tajikistan's National Bank admitted it had hidden a billion dollars in loans and guarantees to politically-connected cotton investors (of which $600 million was never repaid), violating its IMF program. The IMF demanded early repayment of some debt, an audit of the National Bank, and other reforms before renewing assistance. In May 2009 the IMF voted to lend a further $116 million to Tajikistan to help it through the next three years; the U.S. was the only IMF member to vote against this, which infuriated the Tajik government. The IMF has so far disbursed $40 million. A team from Washington was recently in Dushanbe to assess government progress, establish new benchmarks for the next tranche of funds, and assess the impact of Roghun fundraising. The team's assessment should be available soon. Donors are concerned that the campaign to finance Roghun is exacerbating severe poverty, and violates the terms of the IMF's assistance. It raises questions about the government's frequent appeals to donors for financial aid and its willingness to enact economic reforms as a condition of that aid. Donors have expressed their concerns formally to the government and await a response. Donors are pushing regional energy market integration and the construction of power lines that will allow Tajikistan and Kyrgyzstan to sell surplus summer electricity output to Afghanistan and Pakistan. A 220 kW line from Tajikistan to Afghanistan is under construction with Asian Development Bank financing, and will be finished in late 2010. The larger CASA-1000 power line project to link to Afghanistan and Pakistan has been delayed by financing problems.

U.S. ASSISTANCE

14. (U) U.S. assistance to Tajikistan will grow significantly to $45.3 million in FY 2010, from $27.8 million in FY 2009. The

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new money will go to agriculture, trade, and private sector initiatives to compensate for the loss of the much-needed food security programs. Until FY 2008 Tajikistan had a multi-year food aid program that had significant results reducing food insecurity in some of Tajikistan's most at-risk regions, followed by similar single-year programs in FY 2009 and 2010. A new Food Security Initiative is in development, but it remains unclear whether Tajikistan will receive any of those funds. New programs also will address chronic energy shortages by building a regional energy market and helping the Central Asian states address water and power issues. Tajikistan was awarded $9.9 million in FY 2008 1207 funds to address stability issues. The major threats to stability arise from the Tajikistan's poverty -- the World Bank estimates over 60% of the population lives below the poverty line -- and the government's demonstrated inability to respond to emergencies. The 1207 project works in 50 isolated communities in the Rasht and Fergana valleys, and along the Afghan frontier. Health and education deficiencies are so acute they imperil our progress in other areas. Our programs work to improve health policies, systems and services, teacher training, education finance, national curriculum, student assessment, and school governance.

SECURITY COOPERATION

15. (C) Security Cooperation remains a strong point in our relationship with Tajikistan. The Ministry of Defense volunteered last year for the first time to host CENTCOM's Exercise Regional Cooperation, including Afghanistan, Kyrgyzstan, and Kazakhstan, which concluded August 10. CENTCOM and the Tajik Armed Forces held Consultative Staff Talks in May and established the FY 2010 Security Cooperation Plan, which reflects Tajikistan's increased interest in demining and participation in the Global Peace Operations Initiative (GPOI). The U.S. Army Humanitarian Demining Research and Development Office will provide Tajikistan a mechanical demining machine for field evaluation in FY 2010 with a planned FMF purchase in FY 2011. Tajikistan reconfirmed its commitment to deploy a company-sized peacekeeping unit in 2011. Training begins this month with a National Policy White Paper Workshop that will help shape development in the Ministry of Defense and their Mobile Forces. A General Staff level workshop and actual unit training will take place next year.

16. (C) The Nizhny Pyanj Bridge and Point of Entry facilities have improved the links between Tajikistan and Afghanistan significantly. Though the bridge is not being used to its fullest capacity, traffic is much heavier than the old ferry system, and continues to grow. Counts vary between 40 and 200 containers and transport trucks per day. CENTCOM 2010funding at this facility will improve lighting, fences, and cameras, and parking areas. Tajikistan is eager to see us make greater use of our agreement on transit of non-lethal goods to Afghanistan through the Northern Distribution Network (NDN), and hopes for economic benefits to Tajikistan from this agreement. So far we have low rate truck traffic from Manas through Tajikistan to Bagram. Defense Logistics Agency is arranging to buy bottled water from a Tajik producer for forces in Afghanistan. The Tajiks are looking for any way to circumvent Uzbekistan's stranglehold on their trade.

US SOF ENGAGEMENT

17. (S) The U.S. Embassy plans to continue to build the capacity and capability of select Tajikistan security forces, in support of CENTCOM Joint Interagency Coordination Group for Counter Narcotics (JIACG-CN), and U.S. government strategic themes, goals and objectives for Tajikistan. Once SOCCENT forces have done an assessment and started organizing these groups into special units, the main goal is to sustain an increase in capabilities by U.S. Special Forces Joint Combined Exercise and Training (JCET) and Counter-narcotic training (CNT) missions.

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NARCOTICS

18. (C) Tajikistan is a major transit route for Afghan heroin going to Russia and Europe. According to UN Office of Drugs and Crime (UNODC) estimates, 40 tons of Afghan opiates enter Russia each year via Tajikistan. Less than 5% is seized before reaching Russia. Capabilities of Tajik law enforcement agencies are severely limited. Corruption is a major problem. Law enforcement agencies are reluctant to target well-connected traffickers, but are effective against low- and mid-level traffickers. The Drug Control Agency (DCA) is a ten-year-old, 400-officer agency developed through a UNODC project. Many countries are donors, but an INL-funded salary supplement program provides the primary funding. DCA's liaison officers in Taloquan in northern Afghanistan were key to seizures totaling over 100 kilos of heroin in the last four months. U.S Drug Enforcement Agency (DEA) agents work with DCA to deepen operations.

19. (SBU) Until 2005, the Russians guarded the Tajik/Afghan border; after the Russians departed, the outposts were broken down lean-tos, unfit for human habitation. The Tajik Border Guard force is staffed largely by conscripts who are poorly trained, poorly paid, underequipped and often under-fed. INL rebuilt border posts, giving the Border Guards suitable and safe places to live, creating conditions for successful border patrol operations. Each new outpost costs about $500,000 and houses more than 100 guards. The outposts use low-maintenance energy-efficient prefab construction and alternative energy, including solar, wind and micro-hydro power. We are planning a pilot project of joint Tajik/Afghan border guard training in Khorog. If successful, it will be part of the regular training of guards assigned to the Afghan/Tajik border. We are exploring offering a popular Emergency First Responder course to a joint class of Tajik and Afghan border guards. INL has rebuilt the Tajik Border Guard academy. A U.S. Border Patrol team plans to visit to discuss and demonstrate patrolling techniques at the Academy and in the field; this might lead to an exchange of instructors.

20. (C) CENTCOM's Counter Narcotics program is making strong contributions to Tajikistan's security. This year, $16.9 million in funding, recently approved in the Supplemental Bill, will support construction of an interagency National Training Center, infrastructure at the Nizhny Pyanj Point of Entry, and communications equipment. The Training Center will be a multi-use facility for all ministries and serve as a venue for SOCCENT's bi-annual Counter Narco-Terrorism training. A recent end-use monitoring visit demonstrated the Tajiks are using previously provided communications equipment and maintaining the equipment. This year, we will begin establishing an interagency communications architecture at Nizhny Pyanj and the adjoining district. This will allow five government agencies to communicate using a compatible system. QUAST

King's Battle With Clerics Dictates Fate of Saudi's Oil Economy

When Saudi King Abdullah appeared in a newspaper photo with 40 veiled women in April, he broke a taboo by mixing with the opposite sex in public.

Since then, the 86-year-old monarch has crimped the power of conservative Muslim clerics more than any of his five predecessors since the foundation of the kingdom in 1932. He prohibited unauthorized religious edicts, or fatwas, and shut some of the websites where they’re issued. In the past month, he backed supermarkets employing females for the first time.

...The friction between king and clerics underscores a shift in Saudi society away from the dominance of strict Islamic law. The king is spearheading the move by forging a Saudi national identity and bringing women into the workforce as part of an attempt to make the economy less dependent on oil.

Crude Trades Near One-Week Low Because of Outlook for Weaker Fuel Demand

Oil traded near its lowest level in more than a week in New York on a stronger dollar and concern that U.S. fuel consumption is rebounding too slowly.

Crude fell as the Dollar Index climbed for a second day, damping the appeal of commodities as an alternative investment. Work began on 3 percent fewer houses in September in the U.S., the world’s largest oil user, than a month earlier, economists estimated before a Commerce Department report tomorrow.

Hedge Funds Cut Bullish Bets on Natural Gas to 2010 Low

Hedge funds cut their bullish bets on natural gas to the lowest level this year as expanding stockpiles drove prices to a 13-month low.

The funds and other large speculators cut wagers on rising prices by 36 percent in the seven days ended Oct. 12, according to the Commodity Futures Trading Commission’s weekly Commitments of Traders report. It was the third week of declines, bringing the reduction since Sept. 21 to 71 percent.

OPEC: A lifeboat in a turbulent sea

So why [is OPEC] a lifeboat? Through its policy on oil production, the organization has succeeded in maintaining oil prices at a reasonable level. It has also succeeded, through production cuts, in credibly and sincerely defending prices, in the wake of their collapse at the start of the global financial crisis (falling to nearly 30 dollars per barrel), all without dealing any blows to the global economy. In addition, the majority of OPEC’s member states have since injected the necessary funds for investments and new projects, particularly in the petroleum sector, in contrast to the deflationary policies of the industrialized nations which, first and foremost, attempted to rescue their crumbling financial institutions, while approving spending cuts in their budgets.

OPEC seems keen to draw Viennese blinds

OPEC appeared uncomfortable in the spotlight of the global media last week in Vienna.

Perhaps members were a little embarrassed that oil revenue this year is on target to be the second highest in the history of the 50-year-old organisation as the world faces the prospect of a double-dip recession.

France seeks to calm fuel fears as strike momentum builds

PARIS (AFP) – France sought Sunday to calm fears of petrol shortages, with the oil industry admitting it cannot hold on forever as strikes against pension reform intensified ahead of another wave of mass protests.

French Truckers Block Roads as State Pledges Fuel Supplies

French truckers blocked highways and officials said they’d use police to prevent strikers from cutting fuel supplies as the standoff hardened over President Nicolas Sarkozy’s plans to raise the retirement age to 62.

The government said it won’t give in to demands that it suspend parliamentary debate on the change and keep the minimum retirement age at 60. Sarkozy’s ministers sought to guarantee fuel, saying police would be deployed to ensure access to storage sites as refinery strikes entered a second week.

Oil workers defy French demand to open depots

French oil workers on Monday defied the government's demand to get back to work and end scattered fuel shortages, stepping up their fight against President Nicolas Sarkozy's plan to raise the retirement age to 62.

Striking workers piled up tires and set them ablaze in front of a refinery at Grandpuits, east of Paris, after authorities issued a legal order insisting that some strikers reopen the facility. Workers said Monday they would refuse, as curls of heavy black smoke wafted into the air.

Dh5bn power station for Abu Dhabi by 2014

The next major power station for Abu Dhabi will cost Dh5 billion and over time generate the cheapest electricity the emirate’s utility has secured since 1998, according to an official statement today.

Cnooc's Overseas Acquisitions May Increase Its Credit Risk, Moody's Says

Cnooc Ltd.’s debt may rise if China’s biggest offshore oil explorer increases overseas acquisitions following its stake purchase in Chesapeake Energy Corp.’s Eagle Ford project, Moody’s Investors Service said.

TNK-BP to acquire BP's Vietnam, Venezuela assets

MOSCOW (AFP) – Russian oil company TNK-BP said on Monday it had agreed a deal with its part-owner BP to acquire the troubled British oil giant's assets in Vietnam and Venezuela for 1.8 billion dollars.

TNK-BP, Russia's third-biggest oil company, is owned 50 percent by BP and 50 percent by a group of Russian billionaires including banking magnate Mikhail Fridman known collectively as Alfa Access-Renova (AAR).

Halliburton Net Income Increases as Work Shifts to Onshore

Halliburton Co., the world’s second- largest oilfield-services provider, said profit rose as onshore work in North America more than made up for a slowdown in the Gulf of Mexico following an April oil spill.

In Collins, effects of gas drilling are debated

Since July, Natalie Brant has complained to anyone who will listen that U.S. Energy isn't living up to its promises and isn't drilling safely.

But state environmental regulators say methane gas is found naturally in well water in this part of the area, and there's no proof the drilling is causing the family's health problems.

And U.S. Energy officials said they have tried to help the Brants and their neighbors, but the gas in their water is coming from a nearby septic system.

Analysis: Uncertain Energy Policy Among Key Risk to Upstream O&G;

Uncertain energy policy poses a key risk to upstream oil and gas companies worldwide, according to the Ernst & Young Business Risk Report 2010.

Uncertainty, which was ranked second in Ernst & Young's previous report in 2009, has grown as a risk as direction of energy policy have been prolonged, partly by the vague outcome of the Copenhagen climate conference in December 2009 and partly by the inability of the U.S. to adopt a clear energy policy. Policy decisions worldwide have further been complicated by the Gulf of Mexico oil spill.

India to launch shale gas auction before end-2011

MUMBAI (Reuters) - India will launch bidding for the exploration of shale gas before the end of 2011, Petroleum Secretary S. Sundareshan said on Monday at the opening of a new bidding round for conventional oil and gas blocks. Although India's estimated shale gas reserves are not known, the government is assessing the potential for the energy source and is seeking data and technology from the United States, petroleum ministry officials said.

Iraqi province pushes for more say

Iraq's western Anbar province is demanding more control over its potentially huge energy reserves ahead of this week's auction of gas fields, including the vast desert province's Akkas reservoir.

Blessing or Curse? Exploration of oil discoveries in Afghanistan not without risk

In September 2010 the Afghan government announced the discovery of an oil field containing an estimated 1.8 billion barrels in the northern region between Balkh and Jawzjan provinces. The find was made after a survey conducted by Afghan and international geologists and represents a key opportunity for the country to resume commercially viable industrial activities.

US says Sudan votes must be held on time

(CNN) -- The United States says that January's planned voting in Sudan on the southern region's independence should proceed as scheduled, despite a snag in talks over the status of a key oil-rich region.

Angola's oil-fuelled tragedy

Angola, where British oil companies have substantial interests, does not feature on the UK's list of countries whose human rights records are of concern.

A battle begins

In July, Ukraine’s Government announced coal market reorganisation for 2011 – 2014. The plan assumes the liquidation of unprofitable mines, coal trade liberalisation and privatisation.

Three major players will definitely compete in mine privatisation: System Capital Management (SCM), ArcelorMittal and the Russians. China may also enter the game.

Global Hydro and Nuclear Power in Perspective

The prospects for any future growth from nuclear power are now very dim, at least, if one was hoping to extract a meaningful contribution from that energy source. The reasons are myriad, but, in the developed world because of societal concerns and the pricing of risk it’s not even possible for the nuclear industry to function without government support–from financing to insurance. Meanwhile wind power, with its relatively fast construction times and consequent return on investment at moderately attractive levels, is now more competitive by comparison. Yes, wind is a different kind (and different quality) of energy. But we are already witnessing wind power construction globally pulling way, way ahead of the nuclear industry.

Unfortunately, the entire discussion of Wind, Solar, and Nuclear power is marginal when considering how the world powers itself, in the main. The title of my ASPO conference talk, Return to Coal, addressed the coming crossover point when coal once again becomes the primary energy source of the world. When we consider these energy sources, and their actual use in perspective, we can see that the politics of Climate Change legislation for example is actually just a parlour game played in the developed world: and one that offers no practical solutions.

Severn barrage tidal power plan axed

Chris Huhne, the Secretary of State for Energy, is to give the go-ahead to a string of new nuclear power stations, wind farms and clean coal plants as he sets out how the coalition plans to keep the lights on in the next three decades.

But tomorrow's major statement on energy policy will pull the plug on the vast Severn barrage plan, which it was claimed could generate 5 per cent of Britain's electricity. Wildlife campaigners are delighted at the news, ending fears of the destruction of unique habitats.

Government to announce plan for ocean energy

A new blueprint for a billion euro ocean energy industry is being developed by the government, and energy minister Eamon Ryan is expected to make a major announcement over the next few months.

Financing Dearth Holds Solar Back in U.S.

NEW YORK — The U.S. solar energy industry is having its best year ever, yet financing remains scarce for the billion-dollar projects needed for it to gain ground on global leaders like Germany.

For the U.S. solar sector to move up from rooftop add-on technology to the scale of fossil fuel power plants, the country needs to build large plants covering hundreds of acres. Each can cost as much as $1 billion, a huge sum for the nascent industry to finance, even with U.S. government incentives.

“Because the debt market is so thin right now, it is very difficult to find lenders who are able to lend long-term,” said Scott Frier, chief operating officer of Abengoa Solar, which has two big U.S. plants under development.

NASCAR to use ethanol fuel mix

NEW YORK (CNNMoney.com) -- NASCAR says that it will use a 15% ethanol blend in its racing fuel, days after the government approved the mix.

Global Macro Notes: Fed Simply Driving Markets Toward a Brick Wall

And finally, there is simply a lot of crude oil in the world. Crude oil inventories just keep hitting record levels. New production keeps coming online in all sorts of places. The peak oil thesis, if not flat-out defeated, seems at least very much on hold from a medium-term supply and demand perspective.

Apple poised to become largest public company in America

With suggestions that the world is approaching 'peak oil' as supplies begin to dwindle and increasing concern over the role that fossil fuels play in climate change, Exxon looks set to be replaced by perhaps the most potent symbol of the digital age.

Blowout in the Gulf: The BP Oil Spill Disaster and the Future of Energy in America

In this intelligent and refreshingly readable--if inevitably depressing--expose, Freudenburg and Gramling, professors of environmental studies and sociology respectively, and longtime collaborators and observers of the oil industry, analyze the origins of the Deepwater Horizon explosion and its aftermath, concluding that we may be facing a "technological Peter Principle": we may have elevated "the societal significance of our technology up to, and perhaps beyond, the point where it can actually do what we expect it to do."

Our Thirst for Oil: A Deeper Dive

This summer's Deepwater Horizon disaster in the Gulf of Mexico called attention to the world's thirst for oil and the hazards of that dependence. It also heightened concerns about the health of the world's oceans. We asked experts in these areas to recommend books that shed light on these topics. Here's what they say about some of their favorites.

Cable cars: back to the future to help combat peak oil?

A plan to run cable cars along High St could be a "small but significant" start to Dunedin preparing for the effects of peak oil, an Australian transport researcher says.

"Cable cars and trams worked wonderfully 100 years ago when we did not have cheap oil," Associate Prof Philip Laird, of Wollongong University, told the Otago Daily Times last week.

New Zealand: Pipe upgrade urgency signalled

Dunedin's water pipes must be upgraded before oil shocks intensify and worldwide energy prices surge, a draft paper prepared for the city council suggests.

The paper warns potentially expensive improvements could be much harder to afford in the maelstrom of supply crunches and price spikes as the world grapples with peak oil.

Funky cob house is first to meet extreme-green standard

On a hilltop in Victoria, British Columbia, Ann and Gord Baird lived in a trailer with his two children for 20 months while they hand-built their dream home -- out of cob.

Their funky, multi-generational home has curved, two-foot thick cob walls -- a mixture of water, clay (the glue), sand and straw (the strength) as well as pumice (for extra insulation.)

Fossil fuel future

So there is no denying that cheap fossil fuel has been a boon to humankind, and we are not about to foist guilt feelings on anyone for its use, or even on those who made bundles of money in its extraction and trade. But we now know that like any business, the cost analysis is deficient in one area-the cost on the environment. Carbon emission as a consequence of fossil fuel use is like cigarette smoking to cancer. When we started costing the consequences and saw facts our business bottom lines did not like to see, we went into massive denial. Up to now, there are still people who refuse to see that climate warming is a consequence of the accumulated emissions that retain solar heat in the environment, melting the polar caps and putting additional water into our oceans with consequences on the weather we are now just beginning to suspect are not pleasant.

Global warming issue spans two ballot items

Fundraising for a ballot initiative to suspend California's global warming law has flagged, but oil companies and other business interests are pouring millions of dollars into a separate ballot measure that could dry up funds to implement the law.

Global warming will be a problem for youth, NASA climatologist warns

James Hansen, one of the world's leading climate scientists, visited the University Saturday to talk about the scientific impacts of climate change on the Earth's species and the importance of protecting the planet for future generations.

CG admiral asks for Arctic resources

ABOVE NORTHERN ALASKA — The ice-choked reaches of the northern Arctic Ocean aren't widely perceived as an international shipping route. But global warming is bringing vast change, and Russia, for one, is making an aggressive push to establish top of the world sea lanes.

This year, a Russian ship carrying up to 90,000 metric tons of gas condensate sailed across the Arctic and through the Bering Strait to the Far East. Last year, a Russian ship went the other way, leaving from South Korea with industrial parts. Russia plans up to eight such trips next year, using oil-type tankers with reinforced hulls to break through the ice.

All of which calls for more U.S. Coast Guard facilities and equipment in the far north to secure U.S. claims and prepare for increased human activity, according to Rear Admiral Christopher C. Colvin, who is in charge of all Coast Guard operations in Alaska and surrounding waters.

"We have to have presence up there to protect our claims for the future, sovereignty claims, extended continental shelf claims," Colvin told The Associated Press in a wide-ranging interview conducted aboard a C-130 on a lumbering flight to the Arctic Ocean.

Bank in corruption scandal to get $200m lifeline from state as thousands of customers queue to withdraw savings

The Afghan government is preparing a $200m (£130m) bailout for the country's biggest commercial bank, which is mired in a corruption scandal that has prompted a rush by thousands of customers to close their accounts.

Officials at the country's Central Bank confirmed that regulators asked the Ministry of Finance on Saturday for permission to make the huge loan from the country's reserves to help prop up Kabul Bank.

There are widespread suspicions that the payment has already been made. Large queues continued to form outside Kabul Bank branches across the country on Sunday as desperate customers tried to withdraw their money.

Security guards put up razor wire in front of the largest branch in Kabul to prevent anxious customers getting in.

Although the Central Bank has reserves worth $4.5bn (£2.9bn), the $200m figure is an enormous amount for one of the world's poorest countries. The Afghan government's entire tax revenues are just $1.2bn a year.

At the weekend the US Treasury department insisted that no US money would go into the bailout of a bank that got into financial trouble in part by buying luxury properties in Dubai, which were then used as the private homes of shareholders and other friends of the bank's management.

Earlier, Mahmoud Karzai, a brother of the president, who owns 7% of the bank's shares, had called for a US financial guarantee. Today the bank's spokesman said he had no information about a bailout.

The prospect of so much public money being used to prop up a bank reeling from allegations of corruption prompted an angry response from Abdullah Abdullah, the leader of the opposition movement, who competed against Karzai in last year's fraud-marred presidential election.

"Mr Karzai himself assured the citizens of Afghanistan that we were going to save the bank. Which money?" he asked. "The money belongs to the people of Afghanistan – it is not anybody's private entity."

He said he feared the cash would be used to prop up the bank, which would then continue with "business as usual". That has included unorthodox business practices, such as the flouting of rules designed to prevent risky lending.

Abdullah demanded to know how the bailout money would be repaid to the state's coffers, and lambasted the government and regulators for failing to stop the looming disaster earlier.

He claimed that Abdul Qadir Fitrat, the Central Bank governor who has ultimate responsibility for regulating the financial system, had last year admitted to him that he knew the bank was breaking banking rules by using depositors' money to invest heavily in risky ventures, including the luxury property market in Dubai.

Hundreds of millions of dollars, out of a total cash pile that before the bank run stood at more than $1bn, was used to buy up properties, which then crashed in value after the global financial crisis.

Money was also lent to the loss-making business ventures of the main shareholders, including Sherkhan Farnood and Khalilullah Frozi, the former chairman and chief executive, who were both ordered to step down this week.

Abdullah also alleged that the bank had used its financial clout to buy favours from politicians, including the president, who received millions of dollars from the bank for his re-election campaign

He said that those payments coincided with the decision to award to Kabul Bank the contracts to run the accounts of the country's soldiers and policemen, who have all been given accounts for the payment of their salaries.

It is not clear how much money has so far been withdrawn. On Friday Mahmoud Karzai said $160m had been withdrawn from Kabul Bank's cash reserves of about $400m. But frantic withdrawals continued at the start of the new business week on Saturday.

Afghan President Hamid Karzai reassured nervous customers at the troubled Kabul Bank on Thursday, saying every penny of their deposits would be guaranteed by the government.

Larger than usual crowds gathered to withdraw funds from Afghanistan's largest bank Wednesday and Thursday after two top executives resigned amid allegations of mismanagement and unorthodox real estate loans.

"The Kabul Bank is safe," Karzai said in a news conference with visiting U.S. Defense Secretary Robert Gates.

Afghan Finance Minister Omar Zakhilwal echoed that message, saying that fears about the stability of Kabul Bank had not sparked a "crisis" at Kabul Bank.

"We are 100 percent sure that Kabul Bank is safe," Zakhilwal said. "I, as finance minister, am giving you my guarantee that your money is safe — if it's one Afghani, one dollar, one euro, up to millions. ... Kabul Bank is not in danger."

Afghan television stations broadcast remarks Wednesday night from the central bank governor, Abdul Qadir Fitrat, who insisted that Kabul Bank was solvent and had enough liquidity to meet demands. On Thursday, the Afghanistan Banks Association issued a statement of support for the bank, and Zakhilwal sought to reassure customers that their deposits were safe.

"The government of Afghanistan guarantees that every penny that they have deposited will be paid back to them if they request it," he said. "But what we are requesting of the Afghan people is not to rush because rush is not good for them, and it's not good for the banking system. We guarantee the money."

Some customers went anyway.

Nazifa Amiri, who works for a foreign aid agency in Kabul, said problems with the bank would have an especially devastating effect on poor Afghans like herself.

"I need this money to feed my children, plus we have the festival coming up," said Amiri, referring to next week's celebration of the end of the Muslim holy month of Ramadan.

Amiri successfully drew her monthly salary of $390 from the bank's branch in Kabul's Wazir Akbar Khan neighborhood. However, Defense Ministry employee Mohammad Zami said he had been rebuffed when attempting to withdraw dollars from his account at the same branch, with managers saying more currency was on its way.

"I don't have a lot of money in it, but this is supposed to be a trustworthy bank to serve the Afghan people. It's not good to see it tied up in politics," Zami said.

A branch manager, who declined to give his name because staff had been ordered not to speak to media, said dollar stocks ran out about one hour after opening, although supplies of Afghan currency were sufficient to meet demand.

Shah Masood Azha, a businessman in the southern city of Kandahar, said residents remained worried about the safety of their accounts.

"This is a result of poor oversight, and the government needs to have many more checks and balances," Azha said.

Problems at the bank could have wide-ranging political repercussions since it handles the pay for Afghan teachers, soldiers and police in this unstable, impoverished nation beset by the stubborn Taliban insurgency, widespread drug trafficking and plundering of aid money.

The Finance Ministry issued a statement assuring government employees that they would continue to be able to deposit and withdraw their salaries at Kabul Bank. The statement added that the replacement of top executives would improve management and services and was "part of the life cycle of a business."

The bank's woes also tie into the web of corruption and personal connections that has soured many Afghans on their government.

Gen. David Petraeus, top commander of U.S. and NATO forces in Afghanistan, was asked about Kabul Bank's woes at a round-table with reporters on Thursday.

"I'm not really the guy in the financial sector here in Afghanistan but financial issues can have security issues and therefore we keep an eye on them," Petraeus said. "In this case our assessment is that the governor of the central bank has taken prudent measures. He has announced what it is that he has been doing to reassure depositors ... Our sense is that he and the minister of finance have taken a very prudent course," that should reassure depositors. "I think this will be OK."

A U.S. official, speaking on condition of anonymity because he was not authorized to speak to the media, said that while the United States was providing technical assistance to the Afghan government, it was taking no steps to recapitalize Kabul Bank.

Sherkhan Farnood, former chairman of Kabul Bank, and Khalilullah Ferozi, former chief executive officer, resigned because, under new reforms, only banking professionals can hold the top operating positions at banks. The bank is being run by Masood Ghazi, a former official at the central bank. The bank said top executives at some of Afghanistan's other 16 private banks might have to step aside as well to conform with the reforms.

Farnood, a world class poker player, and Ferozi each own 28 percent of the bank's shares. President Hamid Karzai's brother, Mahmood Karzai, is the bank's third largest shareholder with 7 percent.

The New York Times and The Wall Street Journal reported Wednesday that Kabul Bank's losses could exceed $300 million — and that the figure is more than the bank's assets. The Washington Post reported that the central bank had ordered the newly resigned chairman to hand over $160 million in real estate holdings in Dubai purchased for relatives and friends of the political elite.

Zakhilwal challenged claims that the bank was on a shaky foundation. Kabul Bank has more than $1 billion in deposits. He said the property pledged as collateral for loans at the bank is "way more — in fact twice as much — as the loans that they have given out."

Associated Press

Your one-stop pundit shop.

Eugene Robinson:

This is a radical break from journalistic convention, I realize, but today I'd like to give credit where it's due -- specifically, to President Obama. Quiet as it's kept, he's on a genuine winning streak. ... He still hasn't walked on water, though. What's wrong with the man?

Jeffrey T. Kuhner:

A picture is coming into focus now, and it should trouble all Americans. It is widely known that Mr. Obama is a post-national progressive. Yet he is also a cultural Muslim who is promoting an anti-American, pro-Islamic agenda.

So now he's a cultural Muslim? But then Kuhner has been down this road before.

Jonathan Bernstein:

Just last month, Matt Bai "discovered" that the source of Barack Obama's troubles was that the Democrats weren't specific enough in their campaign proposals during the 2006 and 2008 campaigns.  He's back again today with yet another explanation for Obama's sagging approval ratings; now, it seems that Americans have soured on Obama because he's too much of a legislator.  It was nonsense then, and it's nonsense now.  It's not complicated at all: Obama's approval ratings have fallen because the economy stinks.  End of story.  Anything else is on the margins...and it's certainly possible that everything else is pushing his ratings up, not down.  

Robert Fisk:

...the millions of American soldiers who have passed through Iraq have brought the Iraqis a plague. From Afghanistan – in which they showed as much interest after 2001 as they will show when they start "leaving" that country next year – they brought the infection of al-Qa'ida. They brought the disease of civil war. They injected Iraq with corruption on a grand scale. They stamped the seal of torture on Abu Ghraib – a worthy successor to the same prison under Saddam's vile rule – after stamping the seal of torture on Bagram and the black prisons of Afghanistan. They sectarianised a country that, for all its Saddamite brutality and corruption, had hitherto held its Sunnis and Shias together.

As you can see in the column that follows, there are still a few self-described American imperialists who don't think the U.S. shouldn't pack up all its military bags in Iraq.

Max Boot:

There is a pressing need for a new U.S.-Iraq agreement that will allow a considerable force (10,000 to 20,000 troops) to remain in Iraq for years to come. But that accord cannot be negotiated until a new Iraqi government is seated. That, in turn, will require more muscular diplomacy than the Obama administration has hitherto displayed.

Paul Krugman:

As I look at what passes for responsible economic policy these days, there’s an analogy that keeps passing through my mind. I know it’s over the top, but here it is anyway: the policy elite — central bankers, finance ministers, politicians who pose as defenders of fiscal virtue — are acting like the priests of some ancient cult, demanding that we engage in human sacrifices to appease the anger of invisible gods.

Froma Harrop:

Clarence the angel has a tough job in "It's a Wonderful Life." He must show the suicidal George Bailey what terrible things would have happened had he not been born. Two prominent economists are playing Clarence to the multitudes who believe that forceful government intervention during the financial meltdown should never have been.

Haris Tarin:

When my parents decided to leave their war-ravaged homeland of Afghanistan in the 1980s, they had the option of migrating to a number of different countries, but sought one that they could make their "home." You see, my father was a government official in the Afghan Education Ministry, before the Russian invasion and the subsequent takeover by the Taliban. He was tasked with modernizing the Afghan educational system while also ensuring that core, centuries-old Afghan values were preserved. ...

As young children, we would ask him why he chose this country. He would calmly respond: "The acceptance of my faith that I received in my travels through this country, I would not be able to find anywhere else."

He would tell us about the people who respected his religious practice of praying five times a day and created spaces for him to pray in. He would fondly recall how warm and open people were.

Yet today, I am afraid for my children. I am afraid that when they turn the TV on, or listen to the radio (which I now turn off when we are in the car), they will receive a very different message from the one my father shared with us. The message they hear today is of intolerance. Whether it be about an Islamic center in New York blocks from ground zero or a mosque in Temecula, their faith is being openly and viciously maligned, and they themselves are made to feel responsible for the attacks on 9/11.

Marjorie Valbrun:

Now that public pressure has forced her exit, Dr. Laura Schlessinger, the popular conservative radio talk-show host, is reinventing herself as a helpless victim of free speech. Her feelings are hurt; how sad for her. I would venture a guess that she wasn’t worried about hurting the feelings of the woman who called in to her show, or concerned about the tone of the exchange between them that ultimately led to her leaving the show.

She certainly didn’t care about others’ feelings when she demonized gay men as pedophiles—she once said “a huge portion of the male homosexual populace is predatory on young boys”—or spoke out against adoption by gay couples.

The two-faced Dr. Laura's racist meltdown was an outrage, to be sure, but also a blessing, removing from the airwaves a person whose poisonous spew ranked up there with Glen Beck, Michael Savage and Sean Hannity, reaching people they never reached.

As China Expands in Latin America, Tensions Fester at Its Mining Venture in Peru

SAN JUAN DE MARCONA, Peru — In its worldwide quest for commodities, China has scoured South America for everything from Brazilian soybeans to Guyanese timber and Venezuelan oil. But long before it made any of those forays, China put down stakes in this desolate mining town in Peru’s southern desert.

The year was 1992. Chinese companies had begun to look abroad. One steelmaker, the Shougang Corporation of Beijing, set its sights on an iron ore mine here and bought it in a move that seemed particularly bold. At the time, Peru was still plagued by attacks by the Maoist guerrillas of the Shining Path.

But the hero’s welcome for Shougang soon faded. Workers at the mine, which was founded by Americans in the 1950s and nationalized by leftist generals in the 1970s, began fomenting the unexpected: a revolt that has endured to this day, marked by repeated strikes, clashes with the police and even arson attacks against their nominally Communist bosses from China.

Afghanistan Says It Locates 1.8 Billion-Barrel Oilfield in Nation's North

Afghanistan discovered an oilfield containing an estimated 1.8 billion barrels of crude in the north of the country, a Mines Ministry official said.

“A huge oil resource, which looks like a triangle, with an estimated 1.8 billion barrels of oil, has been discovered by Afghan geologists in cooperation with international geologists between Balkh and Sheberghan provinces,” Jawad Omar, a spokesman for the ministry, said in a phone interview today from the capital, Kabul.

Aramco invites bids for Shaybah gas plant - sources

KHOBAR, Saudi Arabia, Aug 15 (Reuters) - State oil giant Saudi Aramco has invited engineering firms to bid for the construction of a power plant related to a natural gas liquids (NGL) project at the kingdom's Shaybah oilfield, industry sources said on Sunday.

Aramco is shifting its exploration and production focus to developing gas output as it looks to meet rising domestic demand from power plants and the petrochemical industry.

Capital spending fuels revenue need

Increased spending by the Abu Dhabi Government is pushing up the level of oil revenue that the emirate needs to balance its budget, official documents show.

Iran offers three billion dollar bonds to fund gasfields

Iran in need of 40 billion dollars of investment to fully develop its South Pars gasfields.

Ex-BP boss Lord Browne did not discuss Lockerbie bomber release

Former BP chief executive Lord Browne has said he never discussed the release of the Lockerbie bomber when he held talks with Libya's leader.

Lord Browne, whose 12 years in charge at BP ended in 2007, said he had met Colonel Gaddafi twice to discuss gas and oil exploration in Libya.

But he told an audience at the Edinburgh International Book Festival he had not lobbied the UK government for the release of Abdelbaset al-Megrahi in order to help BP land a deal.

BP’s Relief Well Delayed on Risk of New Oil Release in Gulf

(Bloomberg) -- BP Plc needs to provide additional analysis and plans that will ensure no oil is released when the company drills a relief well and pumps mud and cement to the bottom of the Macondo well to permanently kill it.

BP determined there is 1,000 barrels of oil trapped in its Gulf of Mexico Macondo well after cement was poured from the top earlier this month. The London-based company will probably need until Aug. 17 to provide a method to perform the so-called bottom kill without an uncontrolled release of crude, National Incident Commander Thad Allen said during a conference call with reporters yesterday.

Fishermen take shots at BP skimming program

PASCAGOULA, Miss. — Johnny Ray Harris hunted for oil in the gulf near his home for 45 days straight, radioing in coordinates to cleanup crews when he spotted large, inky patches floating in the choppy waters.

“I would call it in, but no one ever came. Not once,’’ Harris said, sitting on his 73-foot-long shrimp boat beside a box filled with unused rubber boots, gloves, and coveralls. “What a waste.’’

Energy world will miss you Matt!

Peak oil guru Matthew Simmons is dead. Considered a maverick in the close-knit world of energy finance and idolized by many, Simmons did more than anyone else to bring to widespread public attention the obscure theory of "peak oil."

Demand for energy has become a "runaway train that cannot be easily slowed or reversed," Simmons said in May at the Offshore Technology Conference in Houston. "We are in the early stages of a global train wreck when demand outstrips supply and shortages begin," he underlined.

Simmons was controversial — at the least — yet he enjoyed a global following. When he spoke, the world listened. "Single-handedly Matt set out on a crusade not to change the world but to wake us all up," said Lad Handelman, a colleague and friend.

Simmons put Maine on the green energy map

He will be missed here less for what he did than for the future he told us was possible.

Transition agriculture

DURHAM - We know that fuel prices will rise dramatically as they dry up in the near future, so what are farmers, who are so depend-ent on oil, going to do about it?

That is what a global initiative, begun in Ireland in 2002, called Transition Town is looking at specifically, and a big part of its perspective is agriculture.

‘Abandon affluence’ — 25 years on

In his influential 1985 book Abandon Affluence, radical Australian sociologist Ted Trainer made the argument that the capitalist economies of the rich world, and the wasteful consumer culture they spawned, were unsustainable and the ecological limits of capitalist growth were fast approaching. Trainer will speak at the November 5-7 Climate Change Social Change conference in Melbourne.

India Needs New Farm Methods to Boost Growth to 4%, Singh Says

(Bloomberg) -- India needs to invest in technology to cultivate dry areas and boost farm production lagging at the slowest pace of growth in five years, Prime Minister Manmohan Singh said in his Independence Day speech.

Playing for Columbus, but Fighting for the Lands Back Home

Growing up in the small southern Louisiana town of Gonzales, Jason Garey did not venture far for family vacations. Many of them were spent down in the marshes, where Garey and his three siblings learned to fish, shrimp and crab in the bountiful brackish waters.

But by the time he was in college, Garey began to notice that the landscape was changing. A small barrier island near the outpost of Grand Isle — a dirt mound, really — where he had landed his canoe six months earlier was no longer there. In other places, the shoreline was 30 feet farther back than the last time he had visited.

“That’s when it hit home that this is a huge, huge problem,” said Garey, a reserve forward for the Columbus Crew who has a goal and two assists this season. “You realize that it’s gone and it’s going to keep getting worse.”

A Battle in Mining Country Pits Coal Against Wind

LORELEI SCARBRO’S husband, Kenneth, an underground coal miner for more than 30 years, is buried in a small family cemetery near her property here at the base of Coal River Mountain. The headstone is engraved with two roosters facing off, their feathers ruffled. Kenneth, who loved cockfighting, died in 1999, and, Ms. Scarbro says, he would have hated seeing the tops of mountains lopped off with explosives and heavy machinery by mining companies searching for coal.

Critics say the practice, known as “mountaintop removal mining,” is as devastating to the local environment as it is economically efficient for coal companies, one of which is poised to begin carving up Coal River Mountain. And that has Ms. Scarbro and other residents of western Raleigh County in a face-off of their own.

German Government Considers Nuclear Power-Plant Operators' Fund Proposal

Germany’s government may drop a plan to tax nuclear fuels and instead accept an industry proposal to receive revenue from a fund, financed by nuclear power-plant operators, in exchange for extending reactors’ operating lives.

The government is considering alternative ways of collecting 2.3 billion euros ($2.9 billion) a year from nuclear- energy producers while also promoting renewable energy sources by diverting some of the profit utilities make by letting their nuclear reactors run longer.

'Green' gas could power up to 300,000 Irish homes

Around 300,000 Irish homes could be heated for a year by the natural gas produced from grass and household waste. A new study by Bord Gais, the Irish gas board, reveals that at least seven and a half percent of Ireland's annual natural gas demand could be met by processing waste into cheap, green and renewable energy.

Green means go as high-voltage vehicles hit isles

The movement to make Hawaii's roads greener passed a milestone yesterday.

The first high-voltage electric car that supports the 240-volt international charging standard J-1772, the Wheego, and its dedicated charging station were unveiled at the Green Energy Outlet's location in Kakaako. The cars were available for test drives and pre-orders.

U.S. Cancels Some of Brazil's Debt in Exchange For Forest Protection

On Friday, the Obama Administration announced that it will cancel debt from Brazil in exchange for forest protection. The U.S. has done the same for Bangladesh, Belize, Botswana, Colombia, Costa Rica, El Salvador, Guatemala, Indonesia, Jamaica, Panama, Paraguay, Peru, and the Philippines. Deforestation accounts for about 20 percent of global warming emissions, making zero deforestation a priority in places like Brazil and Indonesia, which rank third and fourth for GHG emissions, respectively.

In total, the U.S. will cancel $21 million of Brazil's debt in exchange for protection of the Amazon. This won't cancel all Brazil's debt payments, but it will lesson them over the next five years.

India, Mexico to discuss climate change

Ahead of the global climate change summit in Cancun, Mexican Foreign Minister Patricia Espinosa touches down in New Delhi on a three-day visit on Sunday that will explore views on evolving a strategy for negotiations at the Nov 29-Dec 10 UN meet on combating global warming. Espinosa will hold talks with External Affairs Minister SM Krishna on issues relating to climate change, intensification of economic ties and the UN reforms. She will also meet Environment Minister Jairam Ramesh and Indian officials involved in climate change negotiations.

In Weather Chaos, a Case for Global Warming

The floods battered New England, then Nashville, then Arkansas, then Oklahoma — and were followed by a deluge in Pakistan that has upended the lives of 20 million people.

The summer’s heat waves baked the eastern United States, parts of Africa and eastern Asia, and above all Russia, which lost millions of acres of wheat and thousands of lives in a drought worse than any other in the historical record.

Seemingly disconnected, these far-flung disasters are reviving the question of whether global warming is causing more weather extremes.

The collective answer of the scientific community can be boiled down to a single word: probably.

An incredible flood

The website WikiLeaks.org released roughly 92,000 government documents related to the war in Afghanistan from 2004-2010 yesterday evening, after giving the documents   to the New York Times, The Guardian, and Germany's Der Spiegel weeks ago (NYT, Guardian, Guardian, Der Spiegel, NYT). Composed in large measure of "secret" reports and cables from the U.S. military, the initial review of the documents reveals new details about multiple aspects of the war, including civilian casualties caused by international forces, the increased use of sometimes unreliable armed drones, Pakistan's alleged role in supporting various Taliban and militant factions and suspicion of Iranian involvement as well, secret special operations task forces that hunt Taliban and al Qaeda leaders, formerly unrevealed reports that the Taliban may have used heat-seeking surface-to-air missiles against coalition helicopters, and increased evidence that Afghan government corruption is undermining efforts to win over the Afghan population (Wash Post, AJE, CNN, Guardian WSJ, Atlantic, Danger Room, Guardian, Guardian). [[BREAK]]

The collection also documents the alarming rise in Taliban use of improvised explosive devices (IEDs), noting that in the period in question that IEDs alone killed approximately 7,000 Afghans (Guardian). And C.J. Chivers has a must-read piece closely examining reports from Combat Outpost Keating, the isolated post in E Afghanistan that would eventually be nearly overrun by Taliban after it had been ordered to close (NYT).

Many of the reports document civilian casualties and links between current and former elements of Pakistan's Inter-Services Intelligence (ISI) and the Taliban and al Qaeda (Guardian, NYT, WSJ). Details of civilian casualties come from 144 reports filed on different incidents, including last September's U.S. airstrike on a gasoline truck in Kunduz that killed scores of civilians, and incidents where American, French, British and Polish forces fired on or shelled Afghan civilians (Guardian, Guardian). The reports also note high-level cooperation between the ISI and militants, from training to supporting plots to assassinate Afghan President Hamid Karzai, and an allegation that former ISI head Hamid Gul met with three presumed al Qaeda representatives in South Waziristan to plan a suicide bombing against U.S. forces (NYT, Guardian). However, much of this reporting came from single informants and Afghan officials hostile to the ISI, leading the Guardian's Declan Walsh to write that the reports, "fail to provide a convincing smoking gun for ISI complicity," in aiding the insurgency (Guardian).

American and Pakistani officials condemned the document's release (Bloomberg, AJE, AFP, BBC, NYT). The leak comes as House and Senate Democrats are debating how to approve additional funding for the war (LAT). And the documents also emerge when Afghanistan's neighbors have grown increasingly worried about closer relations between Afghanistan and Pakistan, a fact that may change due to political pressure generated by the documents' release (Wash Post, Guardian, WSJ).

Back and forth

U.S. forces searched furiously this weekend in Afghanistan's Logar province after two U.S. Navy personnel went missing Friday (LAT, Wash Post, NYT). While U.S. officials said the men were still listed as missing, a Taliban spokesman said and Afghan officials confirmed that one sailor was killed in a firefight, while Taliban forces were detaining the other (CNN, Wash Post, WSJ, LAT, Bloomberg).

The Taliban took control of the village of Barg-e-Matal in the isolated E Afghan province of Nuristan on Saturday, for the second time in recent months (Tolo, Wash Post). Reports Sunday night indicated that U.S. and Afghan forces were engaged in combat with Taliban elsewhere in the same district, and the Afghan Defense Ministry said Afghan forces had retaken the village (AP).And the Afghan government will investigate reports that an unidentified rocket struck a village in Helmand province, killing 40-45 civilians (Dawn).

Arrivals and departures

Chairman of the Joint Chiefs of Staff Adm. Mike Mullen took a whirlwind trip to India, Pakistan and Afghanistan this weekend, where he urged a crackdown on militant groups like Lashkar-e-Taiba and the Haqqani Network, toured NW Pakistan by air, and expressed the U.S. commitment to Afghanistan and support for President Karzai's plan to reconcile some Taliban elements (VOA, RFI, CNN, ToI).

In a ceremony marked by VIPs, humor, and some regret at the way his career ended, Gen. Stanley McChrystal retired from the U.S. Army on Friday in a ceremony at Ft. McNair (LAT, Wash Post). And a new study of 15 months of data from Afghanistan has concluded that McChrystal's restrictive rules of engagement curbing air strikes and operations led to a drop in insurgent violence in some areas of Afghanistan (BBC).

Drones, drones, drones

Two suspected U.S. drones struck a house in the Angoor Ada area of South Waziristan Saturday, killing at least 16 fighters of unknown nationality (ET, BBC, AJE, CNN). Three subsequent strikes occurred Sunday, one in Shaktoi just inside South Waziristan, another the other near Miram Shah in North Waziristan, killing at least 19 fighters, and a third also reportedly struck targets in South Waziristan (BBC, AP, Dawn, WSJ). These strikes would mark 101 under Obama, and 50 this year.

Elsewhere, Pakistani forces claim to have killed 34 militants in bombing raids in Kurram and Orakzai agencies, while in the Naushehra district of Khyber-Pukhtunkhwa province, the Taliban allegedly killed the son of the province's Information Minister, who was openly critical of the group (Dawn, AP). A suicide bomber struck near the minister's home Monday, killing at least seven but missing the minister, who was not home at the time (AP, Dawn, AJE, ET). Partisan killings continued this weekend in Pakistan's financial capital of Karachi (Dawn, Daily Times, Geo TV). And Pakistani officials separately acknowledged that failed Times Square bomber Faisal Shahzad met with Pakistani Taliban leader Hakimullah Mehsud and other leading figures (AFP).

At least 30 Pakistanis have been killed in flooding in the southwestern province of Baluchistan, while the AP reports on Pakistan's worsening water crisis (CNN, AP).

Peace through fruit

Secretary of State Hillary Clinton's offer last week to help Pakistan export mangos to the U.S. is only the latest instance of using mangoes to bridge gaps between Pakistan and others (ABC). The U.S. will help finance a $21 million program to upgrade Pakistan's mango farming and processing infrastructure, though it is unclear if that will help the image of the U.S. in the country.

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Behind-the-scenes help of the Taliban includes training, medical treatment and bribes

Iran is engaged in an extensive covert campaign to arm, finance, train and equip Taliban insurgents, Afghan warlords allied to al-Qaida and suicide bombers fighting to eject British and western forces from Afghanistan, according to classified US military intelligence reports contained in the war logs.

The secret "threat reports", mostly comprising raw data provided by Afghan spies and paid informants, cannot be corroborated individually. Even if the claims are accurate, it is unclear whether the activities they describe took place with the full knowledge of Tehran or are the work of hardline elements of the semi-autonomous Islamic Revolutionary Guard Corps, ideological sympathisers of the Taliban, arms smugglers or criminal gangs.

The Iranian government has repeatedly denied accusations that it is aiding militants fighting to oust President Hamid Karzai's pro-western government. It blames the presence of western forces for Afghanistan's instability.

Summaries of classified diplomatic cables produced by the US embassy in Kabul, contained in the war logs, reveal high-level concern about Tehran's growing political influence in Afghanistan. Senior US and Afghan officials appear at a loss over how to counter Iran's alleged bribery and manipulation of opposition parties and MPs whom Afghan government officials dismiss as Tehran's "puppets".

If the war logs are to be believed, Iranian involvement in Afghanistan has steadily widened from 2004 to today, amid record levels of military and civilian casualties and spreading violence.

A threat report originated by Isaf (International Security Assistance Force) headquarters in February 2005, covering Regional Command South, classified secret, says for example that Taliban leaders and former officials of the Taliban government toppled by the US in 2001 are planning a series of attacks in Helmand and Uruzgan provinces.

"This joint group currently resides in Iran. The group consists of eight main leaders, all of whom travel with seven bodyguards," the report says. "The leaders travel into Afghanistan to recruit soldiers … Initially, the joint group will attack NGOs and GOA [government of Afghanistan] officials … If these attacks are successful, they will start to attack US forces. The group will use hit-and-run tactics using AK-47 assault rifles and IEDs."

In addition, the report claims: "The Iranian government has offered each member of the group 100,000 rupees ($1,740) for any Afghan soldier killed and 200,000 rupees ($3,481) for any government official."

In January 2005 it is reported that Iranian intelligence has delivered 10 million Afghanis ($212,000) to a location on Iran's border. In the language of the war logs, "Iranian intelligence" usually appears to be a reference to Sepah-e Pasdaran-e Enghelab-e Islami – the Iranian Islamic Revolutionary Guards Corps.

"The money was transferred to a 1990s model white Toyota Corolla station wagon … hidden with various foodstuffs. The Corolla was occupied by four members of the Hezb-e-Islami Gulbuddin [HIG] terrorist organisation [the al-Qaida-allied militia led by the former mujahideen leader and notorious warlord Gulbuddin Hekmatyar]. The money was transported to an unknown location," it is claimed.

The war logs refer to other covert Iranian or Iranian-backed activities. Whether they carry official blessing is unclear. In June 2006 it is reported that two Iranian "secret service" officers have arrived in Syahgerd village in Parwan province with false Afghan identities. The two have been previously spotted in Kabul. Their cover names are provided. Abdul Jalil is about 37 and has a "short black beard"; Ahmaddin is about 25, "tall, white complexion, long hair and brown eyes".

The report, sourced to "humint" (human intelligence), continues: "These two Iranians are tasked to instigate local Afghan people into making propaganda against the Afghan government authorities and CF [coalition forces] members. Also they are helping HIG and Taliban members in carrying out terrorist attacks against the Afghan governmental authorities and CF members, especially against the American forces." No evidence is offered to corroborate this statement.

This report also claims: "In Birjand, Iran, there is an important base where Iranian officials train Taliban and HIG members. From that location they use [sic] to send to Afghanistan explosive devices and vehicles ready to be used as SVBIEDs [suicide vehicle-borne improvised explosive devices]."

This is not the first time Iranian links to IEDs and suicide bombings have been alleged. In May 2006, a report from "Source NY-9013" claims Hekmatyar's men are equipping 200 vehicles to deliver IEDs after having bought the cars in Pakistan and Iran. "HIG members in Pakistan provide the remote control devices for these cars." In April, 2008, the Taliban are said to have received Iranian-made parts for 20 remote-controlled IEDs to be used against the British in Sangin.

If the war logs intelligence is to be believed, Iran is also ready to host Taliban leaders and their men, to offer treatment if they are injured in the fighting and act as a conduit for foreign insurgents anxious to join the fray. A report marked secret, and dated September 2005 , lists a number of Taliban commanders who have gathered in Mashhad, Iran, supposedly to plan future attacks. Another in October 2006 claims Iranians have "provided support on the ground by organising transports for injured people [meaning Taliban fighters] to Tehran". No corroboration is offered.

In March 2009 military intelligence reports that a party of more than 100 Afghan and foreign-born Taliban, including 15 Chechen fighters, have moved from Iran into Afghanistan with the intention of launching suicide attacks. In May 2009, General Stanley McChrystal, the then US and Nato commander, appears to refer specifically to this intelligence finding. "The training [of insurgents] that we have seen occurs inside Iran with fighters moving inside Iran," he said.

If some of the more creative reports are to be believed, Iranian subversion also extends to alleged plans to slip poison into the tea of Afghan government officials, supposedly a tidier method of assassination than suicide bombs; and the fomenting of political unrest in the relatively stable northern provinces.

Summaries of US embassy diplomatic cables and situation assessments contained and distributed through the war logs offer firmer ground than some of the raw intelligence data, given that they are evidently written by American officials and represent an official record, or official evaluation, of high-level meetings.

The cables reveal deep concerns among the western allies and Karzai's government about Tehran's parallel attempt to extend its political leverage in Afghanistan, in part by allegedly proffering lavish bribes.

The cables include accounts of consultations between British Foreign Office officials and senior US counterparts such as Eliot Cohen, US secretary of state Condoleezza Rice's then special regional representative, the Pentagon's Eric Edelman, and former US ambassador to Kabul Ronald Neumann. They discuss, among other things, how best to handle Karzai and promote national reconciliation without talking to the Taliban.

"Over the past several months Iran has taken a series of steps to expand and deepen its influence," says a secret cable sourced to the US embassy in Kabul and written in May 2007 by CSTC-A DCG for Pol-Mil Affairs [combined security transition command deputy commanding general for political and military affairs]. The cable cites the creation of the opposition National Front and National Unity Council, which it claims are under Iranian influence.

These worries notwithstanding, the cables also reflect the Afghan government's continuing perception that it must maintain friendly relations with Iran, in order to "marginalise" pro-Iranian groups in the country but also because of its own chronic weakness.

A "non-combat event" intelligence report dated April 2007 says that "the [Afghan] ministry of foreign affairs [MFA] wants to keep the issue of the Iranian-made weapons recently found in Kandahar under the radar screen in the lead-up to the visit of Iranian president Mahmoud Ahmadinejad to Afghanistan. According to MFA, President Karzai supports the plan to avoid additional friction with Afghanistan's neighbours". Anxious to avoid more problems with Karzai, the US apparently agrees to play along.

President Hamid Karzai on Tuesday reaffirmed his commitment for Afghan police and soldiers to take charge of security nationwide by 2014 and urged his international backers to distribute more of their development aid through the government.

Karzai spoke at a one-day international conference on Afghanistan's future that comes at a critical juncture: NATO and Afghan forces have launched a major operation to drive the Taliban out of their strongholds, and the insurgents are pushing back. Rockets fired at the Kabul airport Tuesday forced the diversion of a plane carrying U.N. Secretary-General Ban Ki-moon and Sweden's foreign minister.

Wearing a traditional striped robe and peaked fur hat, Karzai said that Afghanistan and its Western allies share "a vicious common enemy." But, he said, victory will come in giving Afghans as much responsibility as possible in combatting the insurgency within its borders. He was flanked by international diplomats including Ban and U.S. Secretary of State Hillary Rodham Clinton.

"I remain determined that our Afghan national security forces will be responsible for all military and law enforcement operations throughout our country by 2014" — more than three years after President Barack Obama's date for the start of an American troop drawdown, Karzai said.

Karzai's reference to a "vicious enemy" appeared at odds with his recent more reconciliatory stance toward the Taliban and willingness to hold peace talks to end the nearly nine-year war amid growing recognition that the insurgents are unlikely to be defeated militarily.

NATO Secretary-General Anders Fogh Rasmussen said the alliance will never allow the Taliban to topple the government of Afghanistan. "Our mission will end when — but only when — the Afghans are able to maintain security on their own," he said.

The prolonged conflict has hobbled development in the impoverished country, and Karzai expressed Tuesday his government's desire to take charge of more of its affairs. He asked his international partners to channel 50 percent of their foreign assistance through the government within two years, and align 80 percent of their projects with priorities that have been identified by Afghans.

"It is time to concentrate our efforts on a limited number of national programs and projects to transform the lives of our people, reinforce the social compact between the state and the citizens," Karzai said. "Let us together focus less on short-term projects."

Since the 2001 U.S.-led invasion that toppled the Taliban, 77 percent of the $29 billion in international aid spent in Afghanistan has been disbursed on projects with little or no input from the government, according to the Afghan Finance Ministry. That figure does not include funds for the training of security forces.

Many donor countries, and particularly the United States, have been reluctant to give an Afghan government infamous for corruption and bloated bureaucracy authority over funds — and so distribute most of their aid through international development groups or contractors. It is widely believed that graft feeds frustration with the Afghan government and boosts support for the insurgency.

Clinton noted that Karzai's administration had taken steps to fight corruption, but said more needed to be done.

"There are no short-cuts to fighting corruption and improving governance," she said. "On this front, both the Afghan people and the people of the international community expect results."

Obama has said he wants to begin withdrawing American troops in July 2011. Though he has stressed the timetable is dependent on security conditions, it has raised concerns in Afghanistan and the region that the U.S. is eager to exit the war.

Delegates will endorse the 2014 goal for Afghans to take charge of security, according to a draft conference communique obtained by The Associated Press — a reminder that Western countries expect to retain forces in Afghanistan for years to come. Even after the government takes over control of nationwide security, there will likely still be a large presence of international troops. Local forces formally took over security in the capital in 2008, for instance, but NATO troops continue to patrol its streets.

A military push in southern Afghanistan has seen violence and casualties rise in recent months. June was the deadliest month for U.S. and international forces with the deaths of 103 service members, including 60 Americans.

In the latest violence, a NATO service member was killed Tuesday in a bomb attack in the south. NATO said the dead service member was not American but did not provide the nationality or details on the death.

Also, a suicide bomber struck downtown Kandahar city, hiding explosives in a cart topped with bottles of juice for sale, said Fazel Ahmad Sherzad, the head of security for the provincial police force. The explosion blasted out the windows of a handful of shops and injured two civilians, Sherzad said. The attacker's legless body lay on the ground in front of one of the shops.

It was not immediately clear if the bomber had a specific target.

Security forces virtually shut down Kabul for the conference. Police added checkpoints throughout the already heavily fortified city and closed major intersections to traffic.

Even so, rockets fire prevented a plane carrying Ban and Sweden's Carl Bildt from landing at the airport Tuesday morning, officials said.

"Rockets hit the airport just as we were on our way to land," Bildt wrote on his blog. The plane was diverted to the U.S. Bagram base, outside Kabul, then the diplomats traveled aboard Blackhawk helicopters to the capital, Bildt said. The Swedish Foreign Ministry confirmed the account.

NATO forces confirmed rockets hit around the city overnight but would not say where.

Afghan and international forces raided a compound on the outskirts of Kabul on Monday night, killing several insurgents who were believed to be planning an attack on the conference, NATO forces said in a statement.

The international military coalition said its forces came under fire from men who were barricaded inside buildings in the compound. The statement said two people were arrested in the operation but not how many were killed. Spokeswoman Lt. Commander Katie Kendrick also declined to say how many people were killed in the operation.

Associated Press

KABUL, Afghanistan (Associated Press) - At an international conference on Tuesday, the Afghan government will ask donors to put 80 percent of aid money behind programs that the Afghans -- not foreign capitals -- deem important to development.

It's a high-stakes meeting for the Kabul government, which wants to show the world leaders attending that it's making strides toward running its own affairs.

Displaying a new streak of independence, Afghan officials are seeking to take the driver's seat to guide their nation out of three decades of conflict. Having spent billions and lost so many troops in nearly nine years of war, the international community remains uneasy about letting go of the wheel. Still, the U.S. and other donor nations believe that strengthening the Afghan government is the only way to end their military involvement in Afghanistan.

"If after the Kabul Conference, we do not embark on the delivery of the things that we promised to deliver, then the donors as well as everybody else has every right to complain about us and tell us we are not serious," said Afghan Finance Minister Omar Zakhilwal.

Staffan de Mistura, the top U.N. official in Afghanistan who is co-chairing the meeting, said there is much work to be done to increase the capacity of the Afghan government. "The ministers know it ... we all know it," he said. He called the conference a historic opportunity for the Afghan government to renew its commitment to the people of Afghanistan. "Realignment will not be overnight," he said. "It will be a process."

Zakhilwal and other key Afghan ministers, working with sparse staffs, have spent weeks writing papers, outlining a plan of action with benchmarks for agriculture, reintegrating insurgents back into society and economic and social development.

They are not only battling international skepticism, but must also prove themselves to the Afghan public who have little trust in their government.

The conference is "useless," said Bissullah, a 43-year-old man from the north end of Kabul who goes by only one name. "I am not hopeful that this conference is going to benefit us in any way."

Afghan lawmaker and political analyst Shukria Barekzai in the capital called the Kabul conference just another international meeting.

"They are only speaking about nice and wonderful reports and big promises," she said. "We, as a nation, are tired of the lip service. We are tired of having more casualties. We are tired of living in war."

Thousands of Afghan soldiers and police have been deployed to secure the capital during the one-day meeting. Officials worry that Tuesday's conference will draw a repeat of the violence seen at national peace conference in May when two militants were killed in a gunbattle with security forces and a rocket landed with a thud about 100 yards (meters) from the meeting site.

Just before noon on Sunday, a suicide bombing near a market killed three civilians and wounded dozens. On Friday night, a combined international and Afghan commando force captured a Taliban bomb-making expert in the capital.

Workers were busy sprucing up the city on Sunday, picking up trash, planting flowers and painting curbs red and white. A large banner has been hung near the airport to welcome U.N. Secretary-General Ban Ki-moon, NATO Secretary-General Anders Fogh Rasmussen, U.S. Secretary of State Hillary Rodham Clinton and delegations from more than 60 nations plus a host of other diplomats and representatives from international organizations.

The conference comes at a critical juncture in the war. NATO and Afghan forces are moving into areas controlled by the Taliban, and the insurgents are pushing back. June was the deadliest month for U.S. and international forces with the deaths of 103 service members, including 60 Americans.

In his inaugural address in November 2009, Karzai said Afghan security forces should take the lead in ensuring security and stability across the country by the end of 2014.

While those attending the conference are expected to adopt a paper that outlines how this turnover will occur, they were not expected to agree on where or exactly when Afghan forces would take over from coalition forces in certain provinces, said Mark Sedwill, the top civilian official with the NATO force.

The NATO summit in November in Lisbon, Portugal, is the earliest that the Afghan and international community will be looking to identify provinces where transition can begin to occur sometime in 2011, Sedwill said.

But readying Afghan security forces for such a handover is only part of the challenge in Afghanistan; the government must also take on more responsibility.

Since the 2001 U.S.-led invasion that toppled the Taliban, 77 percent of the $29 billion in international aid spent in Afghanistan has been disbursed on projects with little or no input from Afghan government officials, according to the Afghan Ministry of Finance's 2009 donor financial review.

While grateful for massive international aid, Afghan officials lament that money spent since 2001sometimes has financed temporary programs or unsustainable projects that will not make a long-term difference in the daily lives of Afghan citizens.

At a January meeting in London, donor nations agreed to increase the amount of development aid delivered through the Afghan government to 50 percent in two years.

On Tuesday, Karzai will ask the international community to restate this commitment and to align at least 80 percent of development and governance assistance over the next two years to a list of more than 20 national priority programs being introduced at the conference.

In return, for getting foreign assistance directed to Afghan priorities, Karzai's government will pledge among other things to improve its financial management system, improve collection of revenues, fight corruption and adopt policies governing bulk cash transfers, according to a draft of the conference communique obtained by The Associated Press.

"The Afghans have made progress in some areas, there are other areas where they are going to make commitments," said Sedwill, the top civilian NATO official. "There are other areas where all of us would have like to see more achieved. "

But Sedwill said there are several areas that the international area has to address too, especially in the way it awards contracts, which both sides acknowledge has contributed to waste and corruption. The U.S. and NATO have set up anti-corruption task forces to address complaints that massive international contracts have led to too much subcontracting, which leaves little at the end for the Afghan people and undermines efforts to build up the Afghan government and private sector.

Asia

China's growth rate slowed to 10.3 percent.

Philip Morris recognized "serious issues" after the release of a report that accused the cigarette maker of purchasing tobacco from Kazakh farms that used child labor and forced families to work.

An explosion in Pakistan's Swat Valley killed four.

Middle East

Iranian scientist Shahram Amiri, who returned to Iran after defecting last year, now alleges that he was tortured by CIA.

An Iraqi court ordered a manhunt for a suspect in the murder of a British aid worker in 2004.

The United States handed the last prison under its control over to Iraqi authority.

Americas

Argentina became the first country in Latin America to legalize gay marriage.

Mexican President Felipe Calderon fired Interior Minister Gomez Mont, who had overseen the war on the drug cartels.

Two earthquakes shook central Chile, but no damage has been reported.

Africa

Ugandan President Yoweri Museveni vowed to eliminate Somalia's al-Shabab terrorist group for its role in the Kampala bombing on Sunday.

Approximately 40,000 people in northeast Congo fled their homes due to fighting.

A leading Rwandan opposition official, who had been missing for a day, was found dead.

Europe

The Vatican released new instructions to speed up the handling of sex abuse cases.

German police raided 13 Credit Suisse offices in a tax fraud investigation.

Spain raised $3.85 billion in a bond sale, easing concerns over the economically embattled country's ability to finance its debt.

Chris Hondros/Getty Images

In mid-June, an article in the New York Times revealed to the world something that many Afghans already knew: Afghanistan sits on about $1 trillion-worth of minerals.

Afghans are now hoping the news will help the government attract much-needed foreign investment.

On July 20, the Afghan government will host the first International Conference on Afghanistan in Kabul. At the conference, Afghan officials intend to outline a national development strategy to international participants, including regional and international bankers and private-sector representatives. The government's development strategy is organized around five clusters. Economic growth is one such cluster, focusing on poverty reduction, job creation, and sustainable development.

The key to achieving each of the above objectives is the extraction and export of Afghanistan's natural resources to global markets. This would be the fastest way to earn the revenue the country needs in order to fuel long-term economic growth. The list of known mineral deposits in Afghanistan is a long one, including copper, iron, chromium, magnesium, rubies, emeralds, lapis lazuli, nickel, mercury, gold, silver, lithium, and uranium

At the conference, Afghanistan's ministers of finance and mines are expected to outline their reform agendas, featuring measures to promote mutual accountability and transparency. The reforms will aim to enhance aid effectiveness and foster a friendly and safe environment for capital investment.

Afghanistan's Ministry of Mines and Industries hosted an exhibition in London on June 25 to promote investment opportunities, as well as answer questions about the country's legal framework covering the development of natural resources. Minister of Mines and Industries Wahidullah Shahrani noted that investment in Afghanistan's mineral sector would entail work in developing Afghanistan's transportation infrastructure. Such projects would be needed to get extracted minerals to international markets. But they would also serve as an important job-creation mechanism.

In a recent interview with the British Broadcasting Corp., Minister Shahrani sought to address concerns that a massive influx of investment in Afghan minerals could lead to increased corruption. "We have improved our legislation, the procedures have been upgraded and we have been getting a tremendous amount of support from our international partners," he said.

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"Whatever contracts would be awarded, all the information will be published, to make sure that all the relevant stakeholders, civil society and media and parliament, will have access to the information; to make sure we will have sufficient amount of the safeguards; to make sure that we will achieve the high standards of transparency," Shahrani said.

Bureaucratic bottlenecks have been known to impede the conduct of business in Afghanistan. In addition, there are security issues related to the ongoing insurgency carried out by Islamic militants. Nevertheless, investors in Afghanistan enjoy some advantages not found elsewhere in the region. Domestic and foreign corporations, for example, do not have to compete with subsidized government-owned businesses. In addition, the Afghan Investment Support Agency (AISA) serves investors as a one-stop shop for licensing and corporate support.

Foreign investment that spurs job creation could prove a powerful weapon in the effort to defeat the radical Islamic insurgency. Under the existing conditions of economic stress and uncertainty, some Afghans have inevitably turned to the Taliban for wages and some have joined factional militias merely for food and shelter. Still others engage in opium poppy cultivation to ensure the survival of their families.

Those opting to become insurgents and poppy growers comprise less than 15 percent of the Afghan population.  It would be possible to win a significant percentage of these people over to the government side, if officials could offer them decent jobs. And for the roughly 85 percent of Afghans who already support the government, as well as approve of the international troop presence, foreign investment and job creation would go a long way toward reinforcing their faith in the reconstruction process.

Already, some countries have recognized the lucrative opportunities that are available in Afghanistan. For example, India has invested $1.3 billion in transportation, healthcare, education, hydro-electricity and electrical transmission. And China has won a $3.5-billion bid to develop Afghanistan's giant Aynak copper mine.

The government and people of Afghanistan see the country's abundant mineral wealth as a way to secure and rebuild their war-ravaged homeland. Afghans are proud of a historical tradition of commerce and cultural exchange that dates back to the era of the Silk Road. With each economic opportunity that is fulfilled, the people of Afghanistan could move one step closer to reconnecting with the global economy and securing a stable and prosperous future. Foreign investors can play a major role in helping us fulfill this national destiny.

By. Ashraf Haidari

Source: ISN Security Watch

Here are my Top 10 links from around the Internet at 10 to 2 pm. I welcome your additions and comments below or please send suggestions for Wednesday's Top 10 at 10 via email to bernard.hickey@interest.co.nz

1. The squeaky (old) wheel gets the health grease - Gareth Morgan comments in the NZHerald on the coming competition for public funds in the health sector and how the winners will be those who shout loudest, rather than those who should get it. This will become a debate we hear a lot more about. As competition for scarce public funds become more intense, allocation decisions will get political very fast. And guess who will win? The baby-boomers, who have a lot more clout...for now.

Because of the lack of a coherent and consistent framework for allocating resources - across conditions, patients and regions - we have an ugly situation where the loudest get served first. Put bluntly, it's an obscene abuse of universal health care.

Politicians tried, of course, to implement a rationing system via then-health minister Simon Upton's ill-fated core services committee of 1992, but its approach - to ask the public what it wanted the public health system to provide - was as flawed as asking an infant in a candy shop which sweeties they wanted. They wanted it all and they wanted it now - what a surprise.

Over the subsequent 18 years the problem hasn't gone away; there are still unmet health needs despite the boom in health sector spending. And the official forecasts are for that demand to keep soaring so the health spend rises from 9.6c in every dollar earned (GDP) to 18c.

Morgan then dips his toe into some hot political water and asks the question about rationing which no politician will even ask let alone try to answer. Good on Gareth.

In a world where all needs cannot be met, society has to decide what "greatest need" is. How do you decide between a 92-year-old and a 10-year-old in need of the same knee operation? Personally they both have equal need so that gets you nowhere, and the limited resources mean you have to make the choice. The 92-year-old has paid more taxes, the 10-year-old has more taxes to contribute, so that doesn't help decide either.

But we must make a decision, we must decide who it will be. This is the reality facing society and the reality several generations of politicians have run away from. The answer is very clear but we must have the courage to declare and stick to it. The 10-year-old gets the nod because from this point of time society will benefit more from them being fixed - they have far more quality-adjusted life-years to contribute to society than the 92-year-old has.

From society's perspective it's a no-brainer investment.

At least if it was clear, everyone would know that their entitlements would be diminishing as they age and so they would plan for that in their financial affairs. They would insure or self-insure or accept that being able to do the high jump when you're 92 is unrealistic.

But we're guilt-ridden; as a society we are too gutless to make that decision explicit. So we abdicate that responsibility and leave it to the ad hoc process, outlined above, to make it for us. The squeaky wheels get their heads in the trough and leave it dry for those without those advocates.

There is nothing equitable about that, nor is it anything that society should be proud of. It has to be changed

2. No bank tax - Ian Verrender at the Sydney Morning Herald makes the point that Australian bank lobbyists have won some big gains from the Australian government in recent weeks, including getting the Australians to work with the Canadians to put the kibosh on the idea of a global bank tax at the G20.

It is with some surprise that the federal government, facing an election and desperately keen to shore up a budget deficit, leapt in to the frontline to oppose the tax. Perhaps it figured taking on one powerful opponent was more than enough.

Swan successfully argued that a global policy was not appropriate. Australia's banking system had emerged not just intact from the crisis of 2008-09 but with rude good health. Taxpayer funds hadn't been used to bail them out.

3. 'We trashed a wonderful inheritance' - British baby-boomer Francis Beckett writes at The Guardian's excellent Comment is Free site about how politically powerful Baby Boomers are loading debt onto their children so they can have a nice life now. HT Rob Mackintosh via email.

Beckett makes a wider point about how today's Baby Boomers are actually more restrictive on their children than their own parents.

Not sure I agree with it, but interesting change in the tone of the debate. He also makes a potent point about the Vietnam War vs the Afghan and Iraq wars.

We are the first generation in which pretty well everyone can read and write fairly fluently. We had the freedom that comes from not having to fear starvation if your employer fires you: there were other jobs to go to, and a welfare state to fall back on. These things made possible the freedom of the 60s. And what did we do with this wonderful inheritance? We trashed it.

We created a far harsher world for our children to grow up in. It was as though we decided that the freedom and lack of worry which we had inherited was too good for our children, and we pulled up the ladder we had climbed. Most capital expenditure for education and health no longer comes from the present-day taxpayer, but from the next generation, because the baby boomers have been too stingy to pay for it.

This trick is done by means of the private finance initiative (PFI), a scam for getting the cost of public buildings such as schools and hospitals off the present government's books, and placing them on the books of governments 10 or 20 years hence. Harold Wilson saved the baby boomers from having to fight alongside young Americans in Vietnam.

When the baby boomer generation formed a government, its prime minister, Tony Blair, told lies to the young so that he could send them to fight alongside the Americans in Iraq. Opinion polls show that the now elderly baby boomers will use their increasing voting power to ensure that when the bad times come, the young are hit first, even though it is by a chancellor of the exchequer who was not even born until the 60s were over.

4. Mr Elliott Wave waves us lower - Bob Prechter's prediction yesterday of a massive slump in global stocks in line with his Elliott Wave theory certainly got people talking. Here's more, including a juicy chart. Click on the chart or this link to go to a fuller link to the embedded videos.

5. 'It's who you know in China' - John Garnaut from the Sydney Morning Herald reports that Chinese-Australian citizen Stern Hu is behind bars in China, convicted of taking bribes, while the well connected Chinese businessmen who paid the bribes are out and about buying a golf course north of Beijing. Garnaut's story is well worth a read for those wondering what really goes on behind the scenes in Chinese political/business circles, which are circles we will need to know and love in coming years.

Since admitting to bribing Rio Tinto's Wang Yong to the tune of $US10 million ($11.9 million), mostly via Macau casinos, the billionaire Du Shuanghua has not only avoided prosecution and indulged his passion for golf but also reversed the Shandong government's theft of his Rizhao Steel factory and set up a 3 billion yuan ($525 billion) private-equity construction fund.

At one stage it had looked like Du - worth 35 billion yuan in 2008 and a business partner of the cousin of the President, Hu Jintao, in Hong Kong - had been set up as one of the key targets of this investigation. It is now clear that he paid his bets wisely and has come out in front. In fact there has not been so much as a slap on the wrist for any of the 20 steel makers and traders on the bribe-paying list.

One year on, the Rio Tinto case shows how China can be simultaneously more sinister, more complicated and less effective than imagined.

6. Rising funding costs - The Australian reports Bank of Queensland saying funding costs are rising in Australia, which could force banks there to pass on mortgage rate hikes independent of a rise in the Official Cash Rate over there. We are hearing similar things behind the scenes over here. The European crisis is pushing up funding costs. This is starting to bake in higher margins in a way that means variable mortgage rates stay cheaper than fixed for a long time yet.

I wonder if people really understand what the Global Financial Crisis meant. It meant higher lending margins and lower bank leverage. It meant less debt-funded growth and more de-leveraging-driven slowdown.

The cost of wholesale borrowing for banks has come under renewed scrutiny after Westpac last week issued new five-year debt at a risk premium higher than some expected, highlighting fresh strains in the market on the back of Europe's debt crisis. Having enjoyed some improvement during the first six months of the year, risk aversion has returned to investors and an improvement in funding costs isn't expected in a hurry, said Bank of Queensland chief operating officer Ram Kangatharan

"All of the banks are starting to feel the pinch in terms of deposit margins." The net result of the rising pressures will likely prompt the major banks to raise their own lending rates, irrespective of whether the Reserve Bank of Australia moves the official target.

"As the pressure continues on the majors, they would want to move outside the RBA rates. I think what's holding them back is election year," Mr Kangatharan said.

7. 'It's different this time' - The research done by Kenneth Rogoff and Carmen Reinhart into episodes of deleveraging after financial crashes is proving to be very influential. It dominates my thinking on the inevitability of deleveraging and its effect on growth. Their book 'This time it's different' is a must read. This New York Times profile is well worth a read as a primer for their work and the book itself, which they started researching in 2003. Their conclusion is that growth slows by 1% per annum once public debt rises over 90%. It essentially says deleveraging is unavoidable.

Rogoff and Reinhart have been lauded for mining data to make their case, rather than just dreaming up a theory. Here is their academic paper.

 Microeconomics — the field that focuses on smaller units like households and workers, as opposed to big-picture questions about how national economies function — has embraced real-world data-mining. (Think “Freakonomics.”)

Macroeconomics has been slower to change, but the popular success of “This Time Is Different” and related work seems to be changing how macro practitioners approach their craft. It has also changed how policy makers think about their own mission.

Mr. Rogoff says a senior official in the Japanese finance ministry was offended at the suggestion in “This Time Is Different” that Japan had once defaulted on its debt and sent him an angry letter demanding a retraction.

Mr. Rogoff sent him a 1942 front-page article in The Times documenting the forgotten default. “Thank you,” the official wrote in apology, “for teaching the Japanese something about our own country.”

8. 'They're gettin' nervous' - Foreign investors and creditors are starting to ask more questions about Australia's housing market and the exposure of the big four banks to that housing market, BusinessDay reports. This may explain the rising funding costs for the Australian (read ours too...) in recent weeks. That and the non-trivial matter of the European financial crisis.

“It’s a constant question,” said Macquarie senior economist Brian Redican of his interactions with European and American investors.

“There are just lingering concerns about household debt levels and whether house prices are going to hold up in Australia.”

Overseas investors held A$645 billion in Australian wholesale debt and deposits in May, on Reserve Bank data, with local banks getting nearly 30 per cent of their funding from global markets. Should global markets for housing debt become stressed – if, for example, there is another leg to the Europe’s sovereign debt crisis - or should Australia’s household debt be singled out by global investors, the ability of banks to lend could be squeezed.

Tighter access to credit could reduce loan sizes, which would weigh on housing prices. Total outstanding mortgage debt in Australia was about $1.1 trillion in April, while other personal debt, including credit cards, stood about $141 billion, according to the RBA.

“Australia’s reliance on wholesale markets and offshore elements needs to be taken into account because you are more exposed to how other markets perceive the relative risks of Australia to other alternatives,” said Standard & Poor’s managing director rating services Fabienne Michaux.

“They’re not looking at Australia individually but in terms of their portfolio,” she said.

Hence, US-based investment fund GMO founder Jeremy Grantham, on a visit to Sydney in June, said interest rate rises will inevitably pop an Australian housing bubble.

9. Even Bloomberg has noticed - Nichola Saminather from Bloomberg has written a big long piece about Australian housing affordability for Bloomberg and BusinessWeek. Some people might work out what the elephant in the room is in this part of the world... Let's hope they don't look too close. She quotes Jeremy Grantham. I think his June 15 comments may be a signpost we look back on as the day the rest of the world woke up.

Grantham, chief investment strategist at Boston-based Grantham Mayo Van Otterloo & Co., says higher rates may pop Australia’s housing bubble. The nation’s home prices need to fall 42 percent to “return to trend,” he said, without giving a timeframe or by how much interest rates would have to rise before that happens.

“It’s like a time bomb, just waiting for the rates to become increasingly impossible to support,” he said at a media briefing in Sydney on June 15. “All bubbles break, they’re the only thing that matter. They break because we live in a mean reverting world. Things go back to normal, even Australian housing prices.”

Christopher Wood, chief equity strategist at Hong Kong- based CLSA Asia-Pacific Markets, said the first-home buyer incentives in 2008 and 2009 -- at a time when interest rates were at a half-century low -- may have put Australia on the path to its own version of the subprime mortgage crisis.

“In the long term, that policy will boomerang back on the Australian economy and the government because all they’ll have succeeded in doing is incentivizing people to buy houses who can’t afford them -- very similar to the subprime issue in America,” Wood said.

10. Ambrose is fearful - This is a must-read from Ambrose Evans Pritchard at The Telegraph on the debate facing policy makers oop north. Should they print or not? He says yes and pronto to avoid another depression.

Investors are starting to chew over the awful possibility that America's recovery will stall just as Asia hits the buffers. China's manufacturing index has been falling since January, with a downward lurch in June to 50.4, just above the break-even line of 50. Momentum seems to be flagging everywhere, whether in Australian building permits, Turkish exports, or Japanese industrial output.

On Friday, Jacques Cailloux from RBS put out a "double-dip alert" for Europe. "The risk is rising fast. Absent an effective policy intervention to tackle the debt crisis on the periphery over coming months, the European economy will double dip in 2011," he said.

It is obvious what that policy should be for Europe, America, and Japan. If budgets are to shrink in an orderly fashion over several years – as they must, to avoid sovereign debt spirals – then central banks will have to cushion the blow keeping monetary policy ultra-loose for as long it takes.

The Fed is already eyeing the printing press again. "It's appropriate to think about what we would do under a deflationary scenario," said Dennis Lockhart for the Atlanta Fed. His colleague Kevin Warsh said the pros and cons of purchasing more bonds should be subject to "strict scrutiny", a comment I took as confirmation that the Fed Board is arguing internally about QE2. Perhaps naively, I still think central banks have the tools to head off disaster.

The question is whether they will do so fast enough, or even whether they wish to resist the chorus of 1930s liquidation taking charge of the debate. Last week the Bank for International Settlements called for combined fiscal and monetary tightening, lending its great authority to the forces of debt-deflation and mass unemployment. If even the BIS has lost the plot, God help us.

11. Totally relevant video - I'm happy to cite a Marxist when he/she says something interesting. This video of a cartoon of a speech about the crises of capitalism is well worth a read/listen/watch. "Capitalism never solves its problems. It just moves them around a bit."

A subcommittee of the United States house of representatives has blocked $3.9 billion in aid requested by the Obama administration for Afghanistan, citing ongoing corruption in the war-torn country.

Nita Lowey, chair of the House sub-committee on aid appropriations, said the aid would be reconsidered after the subcommittee holds hearings to review anti-corruption measures taken by the government of Prime Minister Hamid Karzai. Explaining the sub-committee’s decision, Lowey said that “I do not intend to appropriate one more dime for assistance to Afghanistan until I have confidence that US taxpayer money is not being abused to line the pockets of corrupt Afghan government officials, drug lords and terrorists.” The subcommittee has also requested US government auditors to audit all US aid to Afghanistan over the last three years.

The sub-committee’s decision comes hours after General David Petraeus was confirmed as commander of international forces in Afghanistan by a vote in the US senate. Petraeus will replace General Stanley McChrystal, who was stripped of his command after his criticisms of the Obama administration were published in Rolling Stone magazine. Petraeus warned at his senate nomination hearing Tuesday that fighting in Afghanistan “may get more intense in the next few months”, before the situation starts to improve.

The openSecurity verdict: The sub-committee’s decision comes as public attention has been briefly re-focused on the nine-year-long conflict after the sacking of McChrystal. Corruption has long been a sore point in relations between alliance members, particularly the US, and the Karzai administration. In response to accusations of corruption, the Afghan government says that the issue is being blown out of proportion. Najib Manalai, a government spokesman, said that corruption is not prevelent at levels alleged by the US.

What’s more, corruption is not – as Manalai argues – just a government problem. According to Al Jazeera, the Afghan finance ministry says that, although over 20 billion USD in aid was given to Afghanistan over the last four years, only four billion USD of that was channelled through the government itself. The rest was given to foreign aid and development agencies or security contractors, over which the Afghan government exercises little control. Manalai has called for a joint investigation into corruption.

According to US officials, the move will not affect military or humanitarian aid, which is legislated for independently. However, according to critics, the block will negatively impact on crucial infrastructure initiatives such as an electrification project in Kandahar province.

Some observers believe that the decision of the sub-committee on aid appropriations symbolizes changing public sentiment in members of the Nato-led alliance. Canada, Poland and the Netherlands, three alliance members, have already announced plans to withdraw their troops from Afghanistan. The new British foreign secretary, William Hague, today announced that he would be “very surprised” if Afghan forces could not take responsibility for their own security by 2014. After the US’ bloodiest month of combat since the invasion began in late 2001, with 102 American soldiers killed in June alone, it appears that public support for this war is wearing thin. Analysts are now waiting to see how the sub-committee’s decision may affect the mood in Congress prior to a forthcoming vote on a separate request from Obama for $33 billion in military aid and 30,000 additional troops.

While the subcommittee’s decision may send a strong message to Kabul about corruption, it may ultimately jeopardise the alliance’s efforts to earn the support of the Afghan civilian population if it cuts off funding for services – a crucial element of Obama’s Afghan strategy.

Burundi elections slammed by opposition

Key opposition leaders in Burundi have branded Monday’s presidential elections, in which incumbent Pierre Nkurunziza was re-elected for a second five-year term, a “masquerade”.

After years of civil war, Burundi has recently been touted as a democratisation success story. It has a burgeoning civil society, an independent media and over forty political parties. But allegations of fraud and intimidation have cast a shadow over the recent elections.

Opposition politicians accused Nkurunziza’s National Council for the Defence of Democracy of rigging local elections held in May, despite the fact that these elections were described by independent observers as largely fair.

However, in recent weeks opposition parties have been banned from meeting, and many opposition politicians have been arrested. One week before polling began, key challenger and former rebel, Agathon Rwasa, disappeared, claiming in a statement released from a secret location that the government wanted to arrest him.

A series of grenade attacks has rocked Bujumbara, the Burundian capital, in recent weeks, including an attack just hours before polling closed on Monday. These attacks are, according to analysts, an attempt to discourage voting.

The opposition has refused to recognise the outcome of Monday’s election, which gave Nkurunziza 92 percent of the vote. Most have also said they will not participate in parliamentary elections scheduled for later in the year. Pancrace Cimpaye, spokesman for the Front for Democracy, one of the country’s largest parties, described the election as “a joke”.

Analysts are rightly concerned that a political crisis in Burundi or a descent into one-party rule may destabilise what is already a very volatile region. The Great Lakes region has long been shaken by conflict on ethnic lines and destabilised by the presence of rebel groups from neighbouring Democratic Republic of Congo and Rwanda. Already there are fears that Burundi may now set a negative example for other countries in the region such as Uganda, which is due to hold presidential elections early next year.

Russia and US scramble to play down spy arrests

Russian officials have backtracked on an earlier announcement that the arrest of ten suspected spies in the United States was “baseless and improper”, in what analysts are describing as a careful attempt not to derail the ‘reset’ in relations between Moscow and Washington.

When the US justice department announced on Monday that ten alleged Russian spies had been arrested in the eastern seaboard region of the US, analysts were quick to point out echoes of the Cold War. However, since Monday, both sides have sought to downplay possible tensions in the relationship. A Russian official, speaking on condition of anonymity, said that Russia expects the incident “will not negatively affect Russian-US relations”. PJ Crowley, a state department spokesman insisted that Washington was going to “work as hard as we can to move beyond this”.

Meanwhile, the eleventh suspect in this case, Christopher Robert Metsos, a Canadian believed to be the ring’s money man, has disappeared in Cyprus, breaking the terms of his bail. 

Seventeen left dead in Turkey Kurdish clashes

Clashes between Turkish security forces and Kurdish rebels left seventeen people dead last night in the Siirt province of Turkey. Twelve members of the banned Kurdistan Workers’ Party (PKK), two soldiers and three members of a pro-government militia were killed in the clashes, according to sources in the Turkish military. The PKK has yet to confirm or deny the deaths.

According to army reports, PKK rebels attacked a military unit and ambushed a government-paid militia in Siirt late on Wednesday night. The fleeing rebels were then attacked by government helicopters, leaving twelve rebels dead.

Violence has been escalating in recent weeks in south-eastern Turkey, with dozens killed in clashes, despite government concessions last year. The clashes come just a day after four Turkish soldiers were injured in a PKK attack in Van, also in the south-east of the country.

The PKK’s leader, Abdullah Ocalan, announced from prison earlier this year that he had given up hope of a dialogue, and the PKK have since called off its one-year ceasefire. Since, there have been renewed attacks against military targets.

Meanwhile, the Turkish state news agency, Anatolian, announced that 400 Kurdish rebels had been detained in Syria. The government of Prime Minister Recep Tayyip Erdogan, which has faced public anger over its attempts to placate Kurdish rebels, has overseen an improvement in relations with Syria and had previously called on allies to stop funding the rebels and to extradite rebel suspects to Turkey.

The PKK began its armed struggle for autonomy in south-eastern Turkey over 25 years ago. After hopes that the conflict was winding down, recent attacks and bombings do not bode well for security, either in Turkey's major cities or the south east.

Offensive moves

Afghan and international forces reportedly captured the Taliban district commander for Naw Zad in Afghanistan's southern Helmand province last night, after a four hour gunfight in the northern part of the province (AP, ISAF). Some 30 Taliban fighters were also reportedly killed (AFP).
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U.S. Marines have reportedly launched Operation Cobra in Helmand's Marjah, site of a coalition offensive earlier this year whose slow progress has worried many observers, to "drive insurgents sheltering in rural areas to the east and west of Marjah into even more sparsely inhabited areas" (FT). In Sangin, another area of Helmand, the Taliban are reportedly using children as young as five to plant roadside bombs; of the 44 IEDs in Sangin in the last few months, a fifth were carried out by kids, according to the Telegraph (Tel).

The Journal has today's must-read describing how new legislation in Afghanistan would put local village defense forces, which initially caused concern that the anti-Taliban militias could spin out of control, under the supervision of local police chiefs and ultimately, the Ministry of Interior in Kabul, which would issue weapons and wages (WSJ). Afghan President Hamid Karzai is expected to enact the legislation in the next few weeks.

Officially yours

Britain's defense secretary, Liam Fox, warned yesterday against a "premature" British withdrawal from Afghanistan, a few days after prime minister David Cameron said he wanted to bring British forces home by 2015 (Times, Guardian, McClatchy). Speaking at a conservative think tank in Washington, Fox said an early withdrawal would be "a shot in the arm to jihadists everywhere;" Downing Street insisted it had approved his speech beforehand and denied any policy disagreements between the defense secretary and the prime minister.

The NYT considers the futures of the top U.S. civilian officials in Afghanistan, Amb. Richard Holbrooke and Amb. Karl Eikenberry, and their relationships with incoming Afghanistan commander Gen. David Petraeus, who was confirmed 99-0 yesterday by the Senate and is en route to Kabul now (NYT, AJE, AFP, Reuters, Pajhwok). At a stop at NATO headquarters in Brussels earlier today, Gen. Petraeus said that while he has no plans to changes current rules of engagement in Afghanistan, which limit the use of force to prevent civilian casualties, he would look into the application of the rules and protect the Afghan population (BBC).

As U.S. attorney general Eric Holder met yesterday with Afghan President Hamid Karzai and other top Afghan officials to discuss anti-corruption and narcotics investigations, Karzai and his finance minister Omar Zakhilwal pushed back against allegations of government corruption, saying the international community is responsible for some of the pervasive graft in the country (Wash Post, AP). 

Measuring up

Michael Leiter, the head of the National Counterterrorism Center, estimated yesterday that there are "more than 300" al-Qaeda leaders and fighters in Pakistan, a rare public assessment that, when taken with last week's assertion by CIA director Leon Panetta that there are "50 to 100" al-Qaeda fighters in Afghanistan, suggests fewer than 500 total in the border region (NYT). Leiter told an audience in Colorado that while al-Qaeda is "weaker today than it has been at any time since 2001...weaker does not mean harmless."

The Post's big story today is that Afghanistan has agreed to send between "a handful and a few dozen" military officers to Pakistan to receive training, a move which has "enormous symbolic importance" as the first visible result of talks between the Afghan government and the Pakistani military and intelligence (Wash Post). More than 300 Afghan soldiers are currently already being trained in other countries, including Turkey and India.

A Taliban spokesman has reiterated the movement's unwillingness to enter into talks with "anyone -- not to Karzai, nor to any foreigners" unless international forces withdraw from Afghanistan (BBC).

Checkmate?

Pakistan's military has declared the northwestern tribal agency of South Waziristan, site of a major anti-Taliban offensive last fall, cleared of militant hideouts, and stated that infrastructure development and refugee resettlement is underway (ET, Dawn). Pakistan has proposed a law that, if approved by the National Assembly, would ban live media coverage of militant attacks as well as "anything defamatory against the organs of the state" (Reuters). Offenders could be fined up to 10 million rupees or sentenced to three years in jail.

The AP profiles the emergence of a new militant group in Pakistan called the Ghazi Force, made up of relatives of those killed in 2007's Red Mosque incident and reportedly responsible for several attacks previously attributed to the Taliban (AP). The leader of the group, which is reportedly headquartered in Orakzai agency, is believed to be Maulana Niaz Raheem, and there are close ties between the Ghazi Force and the Tehrik-i-Taliban Pakistan.

Journalism job opportunity

Al-Qaeda has launched its first online English-language magazine this week, called "Inspire," run by the group's Yemen affiliate (AP, CNN, Fox, Atlantic). Yesterday's debut did not go smoothly, however; only the first three of the publication's 67 pages were viewable, while the rest appeared as computer gibberish, according to SITE Intelligence Group, a jihadist website monitoring service.

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There are plenty of adjectives that can be used to describe U.S. foreign aid overseas: messy, sporadic and fragmented, to name just a few. And unfortunately, as a new Oxfam report makes overpoweringly clear, 'transparent' isn't high on that list.

It's common to think about transparency as a principally Western street — i.e., how much do donor governments reveal to voters and critics back at home. The fact is, though, that it's also a crucial two-way enterprise between donors and governments receiving aid. And after an exhaustive series of 200 interviews with aid stakeholders in countries from Afghanistan to Rwanda, Oxfam finds that too often, it isn't just U.S. voters and reporters who don't have even a cloudy notion of where aid's going — it's local officials on the ground, too.

You'd think that at the start of any aid project, U.S. officials would apprise local government about what they're planning to spend, where they're spending it, for how long, how and why. That way, governments can absorb this information into future plans, right? Not exactly.

Take Kenya, for example. In 2008, the U.S. funneled some $502 million into the country to fight HIV/AIDS. The bad news is that that's about all the Kenyan government knows about the U.S. project. "I’ve been asking for a list of partners, where they are working, how much they are spending, on what — but I can’t get it," says one member of the Kenyan Ministry of Public Health. "I’m supposed to be supervising these activities, but I don’t have the information."

And Kenya's no exception. In Afghanistan, the Ministry of Finance notes that because the Afghan government wasn't involved in the siting of local schools and health clinics, many U.S.-funded facilities have ended up simply getting used as barns and storage units. Less than 20% of the total $32 billion pledged by the U.S. to Afghanistan is currently being monitored in the government's aid database — so for Afghan officials, the rest of the $26 billion the U.S. is spending in their country is a mystery. Meanwhile in Cambodia, local officials have puzzled over where to locate the pricey technical advisors funded by the U.S., whose salaries in 2006 accounted for fully half of all U.S. aid to the country.

Not surprisingly, out of those Oxfam surveyed, 45% say the U.S. is less transparent than other donors. (And no, that doesn't mean the majority thinks the U.S. record on transparency beats out other donors — 26% of respondents believed that the U.S. had just a middling approach, and that donors in general aren't very transparent.)

As Ranil has previously written here on Global Poverty, when it comes to effective aid and development, transparency can be a somewhat overheated cause célèbre. But there's no question that the U.S. does its reputation and projects no favors by keeping aid recipients (deliberately or not) in the dark.

Photo Credit: rob lee

Asia

• Thai Prime Minister Abhisit Vejjajiva survived a no-confidence vote in parliament brought on by his handling of the recent Red Shirt protests. 
• The Pakistani government has declared victory over the Taliban in the Orakzai tribal region, near the Afghan border. 
• A "peace jirga" hosted by Afghan President Hamid Karzai was disrupted by Taliban attacks. 

Americas

• Landslides caused by Tropical Storm Agatha have killed around 180 people in Central America, mainly in Guatemala.
• Jamaican Prime Minister Bruce Golding pledged an all-out assault on the island's drug gangs as he narrowly survived a no-confidence vote in parliament. 
• The mayor of Cancun, Mexico has been charged with ties to drug trafficking. 

Middle East

• Iraq's Supreme Court ruled in favor of the country's Sunni/secular alliance in a legal dispute over the March 7 parliamentary elections. 
• During a visit to Brussels, Iranian Foreign Minister Manouchehr Mottaki warned that further international sanctions would lead to confrontation. 
• Human rights groups are condemning the execution of 18 foreigners in Libya.    

Africa

• The U.S. Supreme Court ruled that Somalis living in the U.S. can sue former Prime Minister Mahamad Ali Samantar, now living in Virginia, under anti-torture laws. 
• Liberia deported seven people on cocaine smuggling charges.  
• A former Nigerian governor was convicted of money laundering in Britain. 

Europe

• Germany's parliament approved new regulations on speculative trading. 
• Poland has released the flight recorder transcript from the plane crash that killed President Lech Kaczynski. 
• Balkan countries began E.U. membership talks in Sarajevo. 

JACK GUEZ/AFP/Getty Images

Follow the rupees

Azam Tariq, a spokesman for the Tehrik-i-Taliban Pakistan (TTP) has again denied that his militant group was involved in training failed Times Square car bomber Faisal Shahzad, saying, "We don't even know him," while praising his actions (CSM, Daily Times, ET, CBS, Times, AP). Carlotta Gall and Sabrina Tavernise describe how the TTP has been influenced by al-Qaeda's global agenda, reporting that al-Qaeda's number two, Ayman al-Zawahiri, met with then-TTP chief Baitullah Mehsud in 2008 in South Waziristan (NYT).
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Shahzad was reportedly inspired by the online sermons of the Yemeni-American cleric Anwar al-Awlaki, who had contact with Ft. Hood shooter Nidal Hasan and failed underwear bomber Umar Farouk Abdulmutallab (Wash Post, NYT). And though Shahzad claims to have met with TTP leader Hakimullah Mehsud, some officials believe the failed bomber had at most "incidental contact" with militants, who may have suspected him of being a CIA spy (Guardian, Tel, McClatchy, Wash Post). Pakistani's interior minister continues to say he has seen no evidence of TTP involvement (AP).

The timing of Shahzad's radicalization trajectory remains murky; the Post reports it "was a gradual thing that started years ago," according to an intelligence official, while CNN writes that Shahzad appears to have become more religious over the last year, which the Times corroborates (Wash Post, CNN, NYT). U.S. investigators are chasing down leads about who may have helped Shahzad finance his plan, and have traveled to Pakistan to interview several alleged members of Jaish-e-Muhammad (AP, ET). The AP profiles a mosque in Karachi run by Jaish, and Karin Brulliard considers how the agenda of traditionally Kashmir-focused militant groups has shifted and converged with the TTP's focus as Pakistani state support waned (AP, Wash Post).

Shahzad's attempted bombing has reignited a debate about the presence of U.S. troops in Pakistan, where they are extremely unpopular; officials say some Pakistani officials will likely be more willing to accept more U.S. trainers following the failed attack (NYT).

Details about the drones

More details are emerging about the CIA's reported new tactic of targeting a wider range of militants with drone strikes in the country's northwest, fueling the ongoing debate about the range of civilian fatalities in the attacks (AJE, Reuters). Officials claim that 500 suspected militants have been killed since the summer of 2008, when the program picked up speed, including 14 "top-tier" targets and 25 mid- to high-level organizers.

Militants attacked a police checkpoint in Mansehra district, about 120 miles north of Peshawar, earlier this morning, killing four Pakistani policemen (Geo, AP, ET). The attack has not yet been claimed, but Taliban fighters frequently target security forces across Pakistan.

All eyes on Kandahar

Afghan authorities have arrested 16 would-be Haqqani network suicide bombers and Hizb-i-Islami Gulbuddin rocket attackers, including six Pakistanis, in recent weeks (AP). The threat from roadside bombs in Afghanistan continues to rise, as 60 percent of the some 400 attacks in Afghanistan last week were the result of IEDs (Reuters). During yesterday's 75-minute meeting in the Situation Room with U.S. President Barack Obama's war council, top commander in Afghanistan Gen. Stanley McChrystal told the president that his strategy in the country is making "slow but steady" progress (AFP).

As U.S. officials admit that there are not enough competent local officials to take control in Marjah, site of a coalition operation in southern Afghanistan earlier this year, NATO has reportedly decided to try and work with Afghan President Hamid Karzai's controversial half-brother, Ahmed Wali Karzai, a powerful figure in Kandahar, the expected site of the next major coalition offensive (AP, LAT, Times). Wali Karzai met with top U.S. commander, Gen. David Petraeus, over the weekend, and says they discussed his role in the province; a senior coalition official estimated that the "Karzai cartel" makes a billion dollars a year from turnover on coalition contracts for security, construction, food, fuel, and convoy protection.

Eric Schmitt has a must-read describing the interrogation of Mullah Baradar, the captured second-in-command of the Quetta Shura Taliban, who is reportedly providing "useful information" about the structure of the group's leadership and Mullah Omar's strategy for negotiations with the Afghan government (NYT). An official confirmed the "useful information" claim again yesterday (AFP).

Raid in Afghanistan

Afghanistan's agriculture ministry has launched an anti-insect drive in Panjshir province following complaints from orchard owners who were bugged by the critters destroying their crops (Pajhwok). The pests will be dealt with over the course of ten months.

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Drones, protests, and special operations

The first alleged U.S. drone strike in northwest Pakistan in about two weeks has killed as many as 13 people in a village about 12 miles west of Miram Shah, the main town in the tribal agency of North Waziristan (AP, Geo, AFP, Geo). Pakistani security officials claimed between three and five of the dead were militants, and that the target was the house of a local militant commander, Tariq Khan. In a rare incidence of recognizing civilian casualties, Pakistani authorities have doled out some $125,000 to families of 71 victims killed in Pakistani airstrikes in Khyber, near the Afghan border, over the weekend (AP, Reuters).
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As the package of constitutional reforms is being debated in the upper house of Pakistan's parliament, protests against the proposed renaming of the North-West Frontier Province to Khyber-Pukhtunkhwa continue in Abbottabad, where residents are clamoring for a separate Hazara division for the Hindko speakers (AJE, Dawn, Daily Times, The News, Dawn, Express Tribune). If the bill passes the upper house, as is expected, it will go to Pakistani President Asif Ali Zardari to be signed into law.

Reuters reports that U.S. Special Operations Forces are playing a larger role than previously disclosed in training Pakistan's paramilitary Frontier Corps in counterinsurgency training (Reuters). And a study released yesterday by Harvard and the Nuclear Threat Initiative found that Pakistan's nuclear stockpile faces "immense" threats and is the world's least secure from theft or attack, charges that Pakistani officials promptly rebutted (AP, AFP, The News, Guardian).

Nabbed in Pakistan

A fourth suspect, a citizen of Pakistan, in Najibullah Zazi's foiled plot to bomb New York City subways after allegedly receiving training at camps in northwest Pakistan in 2008, was reportedly arrested in Pakistan several weeks ago in connection with the case (AP, AFP, NYDN). The suspect, who has yet to be identified, could be extradited to and charged in Brooklyn's federal court, a process which could take months (NYDN).

Kidnapped French journalists

In a video posted yesterday on a Taliban website, two French journalists who were kidnapped in the mostly French-patrolled Afghan province of Kapisa in December said their Taliban captors would execute them if the video was not played on French television and a prisoner swap arranged (AFP, CNN, Reuters). France 3 television ran footage of the video with the faces of the hostages blurred at the request of the families, and the Taliban have threatened to kill the journalists' driver and translator too.

Three Afghan women were killed earlier today after being struck by mortar fire targeting the local district government headquarters in Kapisa, and four Afghan policemen were killed in a roadside bombing in Faryab (AP). The Post reports on Afghan President Hamid Karzai's frustration with civilian casualties in Afghanistan, a day after international forces killed at least four Afghans traveling in a passenger bus outside Kandahar city (Wash Post).

The Washington Post and the LA Times check in on different facets of the southern Afghan town Marjah, the site of a recent coalition military offensive: Rajiv Chandrasekaran describes "one of the most novel U.S. attempts to crack down on" Afghanistan's lucrative opium trade (Wash Post); and Tony Perry and Laura King report that government presence in Marjah "is pretty thin," writing that Taliban fighters are still planting roadside bombs and intimidating residents (LAT).

Corruption remains at the top of the list of Afghan concerns, and Kazakhstan has agreed to allow military overflights, providing a faster route for U.S. supplies to reach the Afghan theater (McClatchy, NYT). The AP reports that 77 percent of international aid spent in Afghanistan since 2001 has been disbursed with little or no input from Afghan officials, according to the Afghan finance ministry, and Afghan officials are seeking greater involvement (AP).

Bootlegging, Pakistan style

Although alcohol has been illegal in Pakistan since the 1970s, a shadowy network of bootleggers is thriving across the country (NYT). However, due to the added costs and delivery risks, a beer can cost as much as $8, and bottles of whiskey range from $25 to $50.

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• Airbus refuelling craft can't be used in war zone
• Five-year delay will raise cost by hundreds of millions

A £10bn defence deal turned into a "bureaucratic nightmare" after the government insisted on using private finance to keep the cost off the national balance sheet, according to a highly critical National Audit Office report out today.

The Ministry of Defence signed the deal for a fleet of multi-role RAF tanker and passenger aircraft – which has been delayed for more than five years – without properly considering any alternative option, parliament's financial watchdog concludes.

Affordability, rather than value for money, led the MoD to negotiate a PFI deal for the future strategic tanker aircraft, says the National Audit Office. As a result, it says it is unable to conclude that the ministry achieved value for money in procuring the aircraft.

It warns there could be years of further delays, at a likely extra cost of "several hundreds of millions of pounds", if the MoD decided the aircraft should be "retro-fitted" with flight deck armour and other protective equipment to enable them to operate in Afghanistan.

Delays in the planned redevelopment at the RAF base at Brize Norton in Oxfordshire could lead to even more delays, the NAO warns.

When it first drew up plans for a new multi-role tanker aircraft, the MoD did not envisage the aircraft flying into such "high threat environments" as Afghanistan, the report notes.

The deal with the AirTanker consortium is to provide 14 Airbus A330-200 aircraft. The first is due to enter service in October next year, and the rest of the fleet by 2016. AirTanker's shareholders and subcontractors include EADS, Rolls-Royce, Thales, VT Group and Cobham.

The 27-year contract is due to end in 2035 and amounts to £10.5bn, but the overall cost to the MoD is estimated to total £12.3bn, according to the report.

Delays have meant the RAF has had to rely increasingly on old and unreliable Tristars and VC10s to carry out air-to-air refuelling and to transport troops to and from Afghanistan. The ministry has had to spend £23.5m replacing flight management systems and cockpit displays on the Tristars.

The report criticises the MoD for failing to carry out a "sound evaluation of alternative procurement routes". It says there had been the "assumption" in the ministry that the aircraft would be provided through a private finance deal – thus keeping them off the balance sheet – due to "affordability pressures and the prevailing policy to use PFI wherever possible".

Edward Leigh, Conservative chairman of the commons public accounts committee, which oversees the work of the NAO, strongly criticised the use of PFI and said the MoD should have foreseen the aircraft would need to operate in warzones.

"By introducing a private finance element to the deal, the MoD managed to turn what should have been a relatively straightforward procurement into a bureaucratic nightmare," he said.

"It is hard to believe that, when drawing up the original specification for this tanker and transport aircraft, the MoD didn't envisage that they might have to be used in high-threat areas."

Liam Fox, shadow defence secretary, said: "Because the contract was shrouded in secrecy, it is only now that we learn that the planes will not even be fitted with defensive aids to enable them to fly into war zones." He described it as "one of the most absurd procurement decisions taken by this Labour government".

Bob Ainsworth, defence secretary, yesterday confirmed a further batch of procurement projects, the third such package within 10 days.

He said A400M partner nations had reached agreement with Airbus Military for a revised contract for 22 of the military transport aircraft, rather than the 25 ordered initially. The MoD has also signed a £120m contract with BAE Systems to maintain the UK's Hawk T Mk2 aircraft,the Advanced Jet Trainer, and an interim Partnering Agreement with MBDA in the UK to develop future air-launched weapons, known in the MoD as the "complex weapons" programme.In timing denounced by Fox as politically-motivated, the MoD last week announced plans to build armoured vehicles and light tanks for the army in a deal potentially worth £9bn.

At a glance: the main measures announced by Alistair Darling in his 2010 Budget

Alistair Darling's statement in full
Budget documents from the Treasury

Economy

• The impact of the economic crisis has meant the UK economy has shrunk by about 6% over the recession

• Growth forecast for 2011 revised down to between 3% and 3.5%. Predicted growth of 1-1.25% in 2010 in line with forecasts

• Borrowing will be £11bn lower this year, at £167bn. It should be £163bn next year, £131bn in 2011-12 and £110bn in 2013-14. It will reach £74bn in 2014-15, £8bn lower than forecast in December

• The reduction in the deficit will go from 11.8% of GDP to 5.2%, more than halved over four years

Taxes

• Tax on bank bonuses raised £2bn in 2009-10, twice as much as forecast

• More systematic tax on banks is needed. It should be internationally co-ordinated

• Doubling of stamp duty allowance, from £125,000 to £250,000, funded by 5% stamp duty for properties worth more than £1m

• Inheritance tax threshold frozen for next four years

• Tax information agreements with Dominica, Grenada and Belize

• Business rates cut for one year from October, so 345,000 businesses will pay no rates at all

• No further announcements on VAT, national insurance and income tax

Jobs

• For older workers, an extension of tax credits

• Length of time over-65s have to work to receive work credits is reduced

• For next two years, no one under 24 will need to be unemployed for longer than six months before being offered work or training

• Total of 15,000 civil servants relocated, including 1,000 Ministry of Justice posts moved out of London

Drinks, cigarettes and fuel

• Duty on cider will increase by 10% above inflation from Sunday. Duty on beer, wine and spirits will increase as planned from midnight Sunday

• Tobacco duty will rise immediately by 1% above inflation this year, then 2%

• Increase in fuel duty to be staged. Fuel duty to rise by a penny in April followed by a further 1p rise in October and the remainder in January

Businesses

• RBS and Lloyds will provide £94bn in new business loans, nearly half to small and medium-sized businesses (SMEs), over next year

• A new credit adjudicator will fast-track complaints from smaller firms who say they have been unfairly denied credit

• Faster licensing process for new banks to boost competition

• Increase of 15% in the number of central government contracts going to SMEs

• A new national investment corporation, UK Finance For Growth, will streamline and improve government help to

SMEs

• New growth capital fund to provide capital for fast growing firms

• Investment allowance for small firms doubled to £100,000

Jobs

• A £2.5bn one-off growth package paid for by switching spending in some areas, with the extra proceeds from the tax on bank bonuses, announced last year

• Number of civil servants in London to be reduced by a third, with 15,000 posts relocated outside the capital within five years

• Public-pay settlements will be held at a maximum of 1% for the two years from 2011

Education

• A £35m university enterprise capital fund to support university innovation and spin-off companies

• A £270m fund to create 20,000 university places in subjects such as science, maths, engineering

Banking and savings

• Everyone to have a basic bank account, bringing an extra million people into the banking system over next five years

• From next month the annual Isa limit to rise from £7,200 to £10,200, and Isa limits to increase annually

Defence

• Over £4bn next year for operations in Afghanistan

Infrastructure and environment

• £100m set aside for repairs to local roads, £285m for improvements to motorways

• A £2bn green investment bank, using £1bn of public cash matched with private funds

• £60m to develop ports hosting manufacturers of offshore wind turbines

Tax credits and allowances

• Parents of one- and two-year-old children to get an increase of £4 a week in child tax credit from 2012

• The pensioners' higher winter fuel payment of £250 and £400 for the over-80s, guaranteed for another year

Savings

• From October next year, the most expensive properties will be excluded from the housing benefit calculation in each area, which will, added to anti-fraud measures, save £250m a year

• Departments will publish details about how to achieve £11bn of new savings.

Hannah Allam

Posts from McClatchy reporters and editors covering Washington, Jerusalem, Afghanistan and beyond. Go to http://blogs.mcclatchydc.com

Middle East Diary

Posted by Hannah Allam, March 10

Election Day is over, and now comes the hard part: getting all of Iraq's disparate groups to settle on a new sovereign government that, one hopes, will not drain the treasury through corruption, allow death squads to operate in state-owned vehicles, turn the country into a battlefield for proxy wars or lapse into the authoritarianism and inefficiency of most other Arab states.

Here's just a handful of things to watch as results come in and the tense business of bargaining and coalition-building begins, as no one group or bloc is expected to win an outright majority:

• Iran – Early results and projections from various polling/monitoring groups show that the mostly Shiite Muslim alliance made up of parties backed by Iran didn't do that well, even in the majority-Shiite south. However, that doesn't mean we can say for certain that Iran loses just because Iraqis strayed from the religious parties. If Iran doesn't have a place at the table in the formation of the next government, Tehran could set conditions for a very uncomfortable exit for U.S. forces, who are scheduled to withdraw by the end of next year.

• Goran – The upstart Kurdish reformist movement, whose name is the Kurdish word for "change," is viewed as a serious threat to the balance of power up north, where the two traditional parties known by their acronyms, KDP and PUK, are keeping a close eye on the splinter group.

• President – Will the Kurds keep the presidency? Or will Sunni Arabs stake a claim? This is a biggie as long as the presidential office retains veto power, but it looks as if that's going to be gone this time around (I've been told there's no constitutional guarantee of the veto). Still, it's an important ceremonial position that comes with a lot of the trappings of power, if not actual influence.

• Prime minister – Many Iraqis are taking a devil-you-know attitude toward incumbent Nouri al-Maliki, supporting him not because they're thrilled at his decidedly mixed track record on security, corruption, sovereignty and services, but because the other contenders could be so much worse. One name that's cropping up: Bakr al Zubeidi. Doesn't ring a bell? He's the current finance minister, who went by Bayan Jabr when he was the interim interior minister and was dubbed "minister of civil war" for what's described as either complicity or criminal negligence relating to the days when death squads terrorized Iraq using ministry-issued guns, vehicles, and handcuffs. Funny thing is, the killings stopped as soon as Jabr left the post.

• Big Six ministries – Interior, defense, finance, justice, foreign affairs, oil. These are the cornerstone of the government, and there will be long, drawn-out battles for each post. Sunnis in particular are hoping for more Cabinet positions this time around, after they boycotted the last parliamentary polls in 2005 and found themselves sidelined and virtually powerless.

POTUS' wish: 'Luck of the Irish'

Planet Washington

Posted by Margaret Talev, March 17

President Barack Obama, speaking on St. Patrick's Day at the annual Friends of Ireland Luncheon at the Capitol, said he'd been thinking lately about one of his favorite memories of one of Congress' most prominent Irish Americans, the late Sen. Ted Kennedy.

Obama recalled it as being a St. Patrick's Day, most likely in 2005, and Kennedy cornered him on the Senate floor seeking support on some legislation. Obama said he'd vote yes but didn't think it had the votes to pass. When it did pass, then-Sen. Obama asked Kennedy how he'd done it. "I said, 'How did you pull that off?' And he just patted me on the back and he said, 'Luck of the Irish!' " As Obama works over reluctant Democrats this week one by one to help House Speaker Nancy Pelosi wrangle the votes to pass his health care overhaul, he's obviously hoping for similar luck to strike.

After all, posited the multiracial, multi-ethnic president, he does have "a little Irish blood" in his veins.

"Prime Minister (Brian) Cowen was born in County Offaly, and I can trace my ancestry on my mother's side there as well," Obama told the luncheon.

"I believe it was my great-great-great-great-great grandfather. This is true. He was a boot maker, if I'm not mistaken."

Obama said his Irish lineage was uncovered during the presidential campaign. "My first thought," he said to laughs, "was why didn't anyone discover this when I was running for office in Chicago? I would have gotten here sooner.

"I used to put the apostrophe after the 'O' but that did not work."

Margaret Talev

Hannah Allam

Posts from McClatchy reporters and editors covering Washington, Jerusalem, Afghanistan and beyond. Go to http://blogs.mcclatchydc.com

Middle East Diary

Posted by Hannah Allam, March 10

Election Day is over, and now comes the hard part: getting all of Iraq's disparate groups to settle on a new sovereign government that, one hopes, will not drain the treasury through corruption, allow death squads to operate in state-owned vehicles, turn the country into a battlefield for proxy wars or lapse into the authoritarianism and inefficiency of most other Arab states.

Here's just a handful of things to watch as results come in and the tense business of bargaining and coalition-building begins, as no one group or bloc is expected to win an outright majority:

• Iran – Early results and projections from various polling/monitoring groups show that the mostly Shiite Muslim alliance made up of parties backed by Iran didn't do that well, even in the majority-Shiite south. However, that doesn't mean we can say for certain that Iran loses just because Iraqis strayed from the religious parties. If Iran doesn't have a place at the table in the formation of the next government, Tehran could set conditions for a very uncomfortable exit for U.S. forces, who are scheduled to withdraw by the end of next year.

• Goran – The upstart Kurdish reformist movement, whose name is the Kurdish word for "change," is viewed as a serious threat to the balance of power up north, where the two traditional parties known by their acronyms, KDP and PUK, are keeping a close eye on the splinter group.

• President – Will the Kurds keep the presidency? Or will Sunni Arabs stake a claim? This is a biggie as long as the presidential office retains veto power, but it looks as if that's going to be gone this time around (I've been told there's no constitutional guarantee of the veto). Still, it's an important ceremonial position that comes with a lot of the trappings of power, if not actual influence.

• Prime minister – Many Iraqis are taking a devil-you-know attitude toward incumbent Nouri al-Maliki, supporting him not because they're thrilled at his decidedly mixed track record on security, corruption, sovereignty and services, but because the other contenders could be so much worse. One name that's cropping up: Bakr al Zubeidi. Doesn't ring a bell? He's the current finance minister, who went by Bayan Jabr when he was the interim interior minister and was dubbed "minister of civil war" for what's described as either complicity or criminal negligence relating to the days when death squads terrorized Iraq using ministry-issued guns, vehicles, and handcuffs. Funny thing is, the killings stopped as soon as Jabr left the post.

• Big Six ministries – Interior, defense, finance, justice, foreign affairs, oil. These are the cornerstone of the government, and there will be long, drawn-out battles for each post. Sunnis in particular are hoping for more Cabinet positions this time around, after they boycotted the last parliamentary polls in 2005 and found themselves sidelined and virtually powerless.

POTUS' wish: 'Luck of the Irish'

Planet Washington

Posted by Margaret Talev, March 17

President Barack Obama, speaking on St. Patrick's Day at the annual Friends of Ireland Luncheon at the Capitol, said he'd been thinking lately about one of his favorite memories of one of Congress' most prominent Irish Americans, the late Sen. Ted Kennedy.

Obama recalled it as being a St. Patrick's Day, most likely in 2005, and Kennedy cornered him on the Senate floor seeking support on some legislation. Obama said he'd vote yes but didn't think it had the votes to pass. When it did pass, then-Sen. Obama asked Kennedy how he'd done it. "I said, 'How did you pull that off?' And he just patted me on the back and he said, 'Luck of the Irish!' " As Obama works over reluctant Democrats this week one by one to help House Speaker Nancy Pelosi wrangle the votes to pass his health care overhaul, he's obviously hoping for similar luck to strike.

After all, posited the multiracial, multi-ethnic president, he does have "a little Irish blood" in his veins.

"Prime Minister (Brian) Cowen was born in County Offaly, and I can trace my ancestry on my mother's side there as well," Obama told the luncheon.

"I believe it was my great-great-great-great-great grandfather. This is true. He was a boot maker, if I'm not mistaken."

Obama said his Irish lineage was uncovered during the presidential campaign. "My first thought," he said to laughs, "was why didn't anyone discover this when I was running for office in Chicago? I would have gotten here sooner.

"I used to put the apostrophe after the 'O' but that did not work."

Margaret Talev

If your impression of an Afghan woman is of a shapeless, frightened form engulfed in yards of heat-trapping fabric, you haven't met Shafiqa Quraishi.

Make that Colonel Quraishi, who earned her title as one of 900-plus female members of the Afghan National Police.

Quraishi, who today is director of gender, human and child rights within the Afghan Ministry of the Interior, was one of nine women in Washington, D.C., to receive the International Women of Courage Award from Secretary of State Hillary Rodham Clinton.

She and fellow Afghan award recipient Shukria Asil sat down Thursday for lunch and conversation with members of the U.S.-Afghan Women's Council to discuss ways to help women and children struggling for rights and security.

Whatever you think you know about Afghanistan, the reality is probably far better – and far worse. And though burqas are still worn by many, they are less visible these days as women assume new roles.

The two women reiterated a dominant theme that was repeated over and over during several days of events honoring brave women around the world:

"We are not victims."

Yes, many have been victimized by brutal regimes in some cases, or by cultural forces, or by men who have hijacked religion to justify actions that would be treated as crimes in our part of the world. But these women are not seeking restitution; they are seeking empowerment.

This is a crucial distinction that underscores the courage they display in the routine machinations we call everyday life. Female judges kiss their families goodbye in the mornings and make peace with their maker just in case they don't return. Parents send their daughters to school despite incidents such as the acid attacks on schoolgirls in 2008.

I heard the "not victims" refrain a day earlier from another group of women – from Bahrain, Afghanistan, Pakistan, Kenya, Brazil and Haiti – here to be honored by Vital Voices Global Partnership, a nongovernmental organization that works to empower female leaders and social entrepreneurs around the world.

Vital Voices, which grew out of the U.N.'s Fourth World Conference on Women in 1995, focuses on advancing women as a U.S. foreign policy goal. Translation: Empowering women will lead to greater prosperity and world peace.

One cannot sit and talk with these women and escape inspiration. On one end of the spectrum is Afnan al Zayani, a CEO from Bahrain who leads the Middle East and North Africa Businesswomen's Network. On the other is Rebecca Lolosoli, matriarch of Kenya's Umoja Village, an all-women's community she created to support women, girls, orphans and widows who had been abandoned by their families or were fleeing domestic violence, forced marriage or genital mutilation.

It sort of puts that bad hair day in perspective, doesn't it?

But, again, they refuse to be victims.

Roshaneh Zafar, who founded the first microfinance organization in Pakistan focusing on low-income women, is adamant on this point. She doesn't want to be rescued (nor does she have any interest in apologizing for her religion).

"Like all women everywhere, we want to be empowered."

That means jobs, money and security and government protection. But before women can become professionals of any sort, they have to be educated. From people like those who comprise the U.S.-Afghan Women's Council and Vital Voices.

If you can spare a dime, you could save a girl. Save a girl, save the planet.

Press Roundup provides a selected summary of news from the Iranian press, and excerpts where the source is in English. The link to the news organization or blog is provided at the top of each item. Tehran Bureau has not verified these stories and does not vouch for their accuracy. Please refer to the Media Guide to help put the story in perspective. You can follow our
news feeds on Twitter.

The last meeting of the Expediency Council in 1388 | photos

Radan says 'Rigi sang'

Tabnak | March 5, 2010

Iran's Deputy Police Chief Brigadier General Ahmad-Reza Radan said Abdolmalek Rigi, the notorious Jondollah ringleader, 'warbled like a nightingale en route from Hormozgan Province to Tehran'.*

"Following the post-election incidents [in Iran], in order to project an atmosphere of insecurity in Iran, the Americans came up with a new mission for Rigi. In order to brief him, [the Americans] wanted to transfer him to their base in Bishkek," Mehr News Agency quoted Radan as saying on Thursday night.

"In order to keep his identity a secret, the Americans moved Rigi from one country to the next but when they attempted to transfer him from Dubai to Kyrgyzstan, our war planes, in a complex operation, took off and forced Rigi's plane to land in Hormozgan."

Turning to the post-election incidents in Iran, he said: "Today the sedition has been countered to some extent and the game played by the seditionists has become clear for the people to some extent. The seditionist started by crying vote fraud and on Ashura they showed the height of their anti-religious fervor."

"In order to make the atmosphere hazy, they send word to a person in prison asking him to get $50,000 and say he had been raped or say he had been sexually abused, if he is embarrassed [to say he was raped]. When we told that gentleman [Mehdi Karroubi?] that this was the truth of the situation [regarding jail rapes] and why did you make such claims [about detainees being raped in jail] he said, "Thank God that this blot was removed from the reputation of the establishment."

* This Persian expression means he gave away the information he had with or without the use of force.

Prison chief: Kahrizak result of negligence

Asr Iran | March 5, 2010

The Head of the Prisons Organization said that the Kahrizak incident was a result of negligence.

"The final verdict must be passed by the judges presiding over the [Kahrizak] case. But the executive officials are of the opinion that the whole incident was the result of negligence," said Gholam Hossein Esmaili.

"The Kahrizak case consists of three parts: the main part is being reviewed at the Armed Forces Judicial Organization; one part is being reviewed by the Council for government employees and the third part is being reviewed at the Judges' court."

On another subject, he said that regulations governing temporary leave from prison would be changed to bar those [convicted of] "crimes such as armed robbery, mugging, snatching, espionage, drug-related offenses, scarring by acid and kidnapping and acting against national security" from taking advantage of it.

Behzad Nabavi granted 5-day leave from prison

Tabnak | March 5, 2010

Behzad Nabavi was temporarily released from prison on Wednesday night.

According to a website close to the Islamic Participation Front, Nabavi was released on the eve of the anniversary of the birth of the Prophet of Islam and he will be returning to Evin Prison on Monday, March 8, 2010.

In late November, Nabavi was released for 10 days after posting an $800,000 USD bail.

The Revolution Court has sentenced Nabavi to six years in prison.

MP: BBC's dorm film had nothing new

Asr Iran | March 5, 2010

The spokesman for the Majlis National Security and Foreign Policy Commission said the BBC film of the raid on the Tehran University dormitory contained nothing new.

Kazem Jalali said that lawmakers had watched the film and discussed its content.

"After reviewing the film broadcast by the BBC on the Tehran University dorm, the National Security and Foreign Policy Commission concluded that it contained nothing in addition to what was announced to the public following the occurrence of the incident," he said.

"At the time authorities probed the Tehran University dorm incident and the Supreme National Security Council and Majlis Speaker [Ali Larijani] tasked lawmakers on the National Security Commission, headed by deputy speaker Mr. [Mohammad Hossein] Abu Torabi, to closely investigate the matter. At the time, reports prepared on the matter were presented to authorities and judicial officials began the legal prosecution process."

Jalali went on to say that airing the film after the 22 Bahman demonstrations and while the country was engaged with its nuclear issue as well as arresting the terrorist Abdolmalek Rigi, was aimed at influencing Iranian public opinion.

"We advise the UK to change its policies, as seen reflected in the BBC [programs], toward Iran."

Judiciary deputy tells of new moral restriction law

Khabar Online | March 5, 2010

The first deputy of the Judiciary said the government had prepared legislation for Majlis that would legalize public surveillance.

The name of the legislation is "a call to virtue and dissuasion from vice."

"The government wants to send this legislation to Majlis as soon as possible because 'a call to virtue and dissuasion from vice' needs a system [to work] and this system is in the form of legislation that, if approved by Majlis, will be a good approach for the country," said Hojjatoleslam Seyyed Ebrahim Raiisi.

"What has been done so far to revive 'a call to virtue and dissuasion from vice' was necessary but not enough and we need a system to be presented in order to legalize public surveillance," he said.

Behzad Nabavi granted 5-day leave from prison

Tabnak | March 5, 2010

Behzad Nabavi was temporarily released from prison on Wednesday night.

According to a website close to the Islamic Participation Front, Nabavi was released on the eve of the anniversary of the birth of the Prophet of Islam and he will be returning to Evin Prison on Monday, March 8, 2010.

In late November, Nabavi was released for 10 days after posting an $800,000 USD bail.

The Revolution Court has sentenced Nabavi to six years in prison.

Karroubi's son barred from leaving Iran

Saham News | March 5, 2010

Opposition cleric Mehdi Karroubi's [second oldest] son Mohammad-Taqi was stopped at the Imam Khomeini International Airport (IKIA) and prevented from leaving Tehran for London.

IKIA authorities confiscated Mohammad-Taqi Karroubi's passport and informed him that he is banned from leaving the country. Mohammad-Taqi Karroubi is a lecturer and the author of one book on international law. He was traveling to London to finish research for his upcoming book.

Ahmadinejad calls Sept 11 'big fabrication'

Reuters | March 6, 2010

Iranian President Mahmoud Ahmadinejad on Saturday called the September 11 attacks on the United States a "big fabrication" that was used to justify the U.S. war on terrorism, the official IRNA news agency reported.

Ahmadinejad, who often rails against the West and Israel, made the comment in a meeting with Intelligence Ministry personnel.

Ahmadinejad described the destruction of the twin towers in New York on September 11, 2001 as a "complicated intelligence scenario and act," IRNA reported.

He added: "The September 11 incident was a big fabrication as a pretext for the campaign against terrorism and a prelude for staging an invasion against Afghanistan." He did not elaborate.

Iran summons Italian envoy over arrests

AP | March 5, 2010

Iran's foreign ministry has summoned Italy's ambassador in Tehran to protest the detention of two Iranians accused by Italian police of involvement in a plot to sell weapons to Iran in defiance of an international embargo.

Ministry spokesman Ramin Mehmanparast says the ambassador was asked for an explanation of the arrests, according to state TV.

Italian police said Wednesday that two Iranians and five Italians, including Iranian state TV's Rome correspondent Hamid Masouminejad, were detained in the case, and warrants were issued for two other Iranians. Police described the Iranians as spies.

Italy's ambassador summoned by Iran FM over arrests

Fars | March 5, 2010

Pointing to the arrest of two Iranians in Italy, [Spokesman Ramin] Mehmanparast said that the Italian ambassador to Tehran has been summoned to the foreign ministry.

Fars: The spokesman of the foreign ministry has pointed to the arrest of two Iranians in Italy adding that Rome's ambassador to Tehran has been summoned to the foreign ministry. He said, "the issue is very much on our agenda."

Quoting foreign ministry information and public relations bureau, a Fars correspondent reported that Ramin Mehmanparast has pointed to the arrest of correspondent Masouminejad in Italy, saying, "The news that has reached us is indicative of a new game being played. This game has the objective of causing particular side-issues with an ambiguous bias."

He added, "We have summoned the Italian ambassador with the aim of receiving explanations on the aspects of the matter at hand and we are pursuing the matter with vigor."

Iranian nucleus rounded up in Italy reportedly part of larger network

Corriere della Sera | March 5, 2010

A platoon of businessmen, small companies in the north, four agents -- some under cover -- international contacts, and the eternal Dubai acting as financial back-up. The significant Milan investigation confirms, in every detail, the modus operandi of the Iranian secret services in Italy. The nucleus that has been rounded up is just one of the many nucleuses created by Tehran to get hold of arms and banned technology. A "business" which has been going on -- almost undisturbed -- since the 1980s, and which has its heart in northern Italy.

According to our information, he followers of Khomeini act on three levels, which sometimes collaborate, and which, on other occasions, keep away from each other. The first level is the one which gravitates around Iran's diplomatic offices and institutions. It is very cautious, because it knows it is under observation, although Iran's intelligence agents have, in the past, enjoyed a certain impunity in the name of economic interests. The second level brings together Iranians resident in Italy, small firms run by Italians, and elements close to the pasdaran or intelligence services of Khomeini. For years we have recounted the activities of an individual who has only been caught up in passing in the investigations: an Iranian, called "The Professor," also involved, amongst other things, in a plan to acquire dangerous toxins. The third front is more "political": men who have the trust of the regime -- often traders -- and intelligence agents keep an eye on exiles. It is interesting to note that often the mullahs have built up excellent ties with right-wing and left-wing Italian extremists, in the name of hostility to the US and to Israel. Legitimate ties, which have concealed other ties that are less clear, and less geared towards clandestine operations.

In light of this organization, it is clear that the valuable work of the public prosecutor's office in Milan, and of the Finance Police, has an impact on a world that is as ambiguous as it is important. Thus Italy finds itself in a position already experienced by allied governments. The United States, Britain, France, and Germany have arrested traffickers and hitmen in the pay of Tehran. People caught red-handed. But the ayatollahs do not care. And they immediately took their revenge with the system of hostages. They identify Westerners, they accuse them of spying or backing the reformist movement, and they turn them into pawns in a despicable game. If you want them free -- this is the blackmail -- then release our men.

Iranian foreign minister urges proactive, innovative diplomacy

Press TV | March 5, 2010

Iran's Foreign Minister Manouchehr Mottaki urges the country's envoys to foreign states to adopt proactive diplomacy and innovative approaches in their interactions with other nations.

Addressing the Iranian ambassadors at the wrap-up ceremony of the annual meeting of Iranian envoys abroad on Thursday [4 March], Mottaki lavished praise on the Foreign Ministry's experienced and qualified members, citing them as Iran's major achievement over the past years.

The change in the West's attitude towards Iran's nuclear case which went from the obligation to shut-down our nuclear facilities to the talk of a nuclear fuel swap is an equivocal indication of the country's major foreign policy accomplishment during Tehran's eighth and ninth administration, the foreign minister maintained.

Mottaki also urged the ambassadors to address the problems and issues that concern the Iranian expatriates living abroad.

Japan, US agree to cooperate on Iran nuclear issue

Kyodo News Service | March 5, 2010

The United States and Japan are "very well coordinated" in dealing with the Iranian nuclear standoff, visiting US Deputy Secretary of State James Steinberg said Friday after his talks with Japanese Foreign Minister Katsuya Okada, as moves have intensified to impose fresh economic sanctions on Tehran.

On the thorny bilateral issue of where to relocate a US Marine base in Okinawa, Steinberg only told reporters in Tokyo that "both sides are working very productively." Sources close to bilateral ties have said that Tokyo has told Washington that it will not go through with a relocation plan the two countries agreed on in 2006, despite Washington's call to stick to the plan, which took years to reach.

The Foreign Ministry said in a press release that Okada and Steinberg reaffirmed the importance of the Japan-US security agreements and agreed to cooperate on various global issues including the Iranian nuclear standoff as well as in dealing with North Korea.

Before coming to Japan on Thursday, Steinberg and other US officials visited China, where they are believed to have sought China's backing for fresh sanctions on Iran over its nuclear program. China has been reluctant to support the move.

Saying Japan has a critical role to play in resolving the Iranian nuclear issue because of its support for the nonproliferation regime and influence over Iran, Steinberg told reporters in Tokyo, "I think we have a very well coordinated and common approach to this critical question." "The international community now expects Iran to take unequivocal steps to come into compliance with its international obligation, so there clearly will be consequences," he also said.

Clinton Fails to Win Brazilian Support for UN Sanctions on Iran

Bloomberg | March 4, 2010

Secretary of State Hillary Clinton's visit to Brazil failed to win support for tougher United Nations penalties on Iran's suspected nuclear weapons program.

While Brazil and the U.S. differ over whether sanctions are the best approach, both countries "do not want to see Iran become a nuclear weapons country," Clinton told reporters in Brasilia yesterday after meeting Foreign Minister Celso Amorim.

Brazil, which holds a temporary voting seat on the UN Security Council, has said it takes Iran at its word that its nuclear program is for energy and medical purposes. Like Turkey, which also holds a rotating seat and China, a permanent Security Council member with veto power over resolutions, Brazil has resisted a U.S. and European push to squeeze Iranian commercial and financial transactions as a way to force Iran to the negotiating table over its nuclear program.

"Brazil is a global player with an independent mind, just as the United States is," Clinton said at a later event in Sao Paulo. "Every country has to make a judgment about what is in their core interests, in their security interests."

China, Russia Urge More Iran Talks as France Seeks Sanctions

Bloomberg | March 4, 2010

China and Russia said negotiations with Iran remain the best way to resolve the dispute over the purpose of its nuclear program, after a French envoy said the time has come to adopt tougher United Nations sanctions.

"There is still room for further diplomatic maneuvers," Chinese Deputy Ambassador Liu Zhenmin told a Security Council meeting on Iran's compliance with the previous three sets of sanctions. "The door to contact and dialogue has not closed."

Russian Ambassador Vitaly Churkin, whose government has said it is open to supporting new penalties, said there is "still a horizon" for negotiations aimed at an agreement to defuse tensions by enriching uranium for a research reactor outside Iran.

"Time is up," French envoy Nicolas de Riviere said. "We cannot let ourselves be put off. We have no other choice than to seek the adoption in coming weeks of new Security Council measures."

Civilized nations do not need atomic bomb: Iranian president

Press TV | March 4, 2010

Iran's President Mahmoud Ahmadinejad declares that nations that possess culture and civilization do not need to make atomic bombs.

"I have repeatedly said that our atomic bombs are our youth and athletic heroes. A nation that possesses determination, intellect, culture and civilization doesn't need to make atomic bombs," IRNA quoted President Ahmadinejad as saying on Thursday [4 March].

"Those who suffer from an inferiority complex and lack a historical background are the ones that claim they need atomic bombs," he added.

Iran: Jail term for president's critic commuted to three years

GVF | March 4, 2010

According to reports received by Green Voice Freedom (Green Voice of Freedom), the initial sentence of reformist economist Sa'id Laylaz has been commuted to three years in prison after an appeal. It was previously nine years, which means that the court has reduced his sentence six years.

Iran grand ayatollah denies fatwa for executions

ISNA | March 5, 2010

Denying the rumor of a Fatwa for the death sentence; Grand Ayatollah Naser Makaram-Shirazi said: those youngsters who have under the influence of [recent] unrest perpetrated acts of violence should benefit from amnesty if they do not belong to corrupt groups.

Grand Ayatollah Makaram-Shirazi has denied having issued a Fatwa for execution spread by some websites.

The office of Ayatollah Makaram-Shirazi pointed to the rumors spread by some websites using recent statements by him to claim that those who acted offensively during the Ashura unrest [27 Dec 2009] would be regarded as "Combatants against God" and thus deserving the death sentence.

He added that there is a wide abuse by typical individuals whom would never lose an opportunity to undermine the sacred institution of the sources of emulation. The views of Ayatollah Makaram-Shirazi are excerpted below:

"We have never given such Fatwa on these individuals [protestors] and this is a mischief by some websites. God-willing everyone will act according to the edicts of Islam and will make no hasty judgements. God shows mercy towards everyone of his flock. We are aware of the fact that some youngsters, under the influence of recent unrest, have resorted to violence. They have to be guided and taught. If they do not belong to any particular corrupt groups belonging to the aliens; they have be granted amnesty."

Ejei: negotiations with Mousavi useless

Asr Iran | March 5, 2010

Prosecutor General Gholam-Hossein Mohseni-Ejei said he tried negotiating with Mir Hossein Mousavi but the opposition leader insisted on his illegal demands.

"Following the riots and the seditionist moves after the election I [tried to] negotiate with Mousavi in order to bring these matters to an end but he continued to persist with his illegal demands," Ejei said at the Crime Prevention Summit held in Mashhad on Thursday.

"A person like Mousavi, who was once the Prime Minister, has today joined the counterrevolutionary movements in order to achieve his objectives with illegal actions."

He went on to say that various groups and academics from across the country had sent petitions demanding that the heads of sedition be brought to justice.

He pointed to the post-election incidents and the actions of the opposition leaders and their cohorts in causing the incidents that followed the 10th presidential election and said, "If a day comes when the establishment is not able to try an individual or individuals for their criminal activities or prosecute them due to their affiliation with certain figures, it [the establishment] has definitely deviated [from the righteous path]."

Alamolhoda: Saying death to SL means disregard for everything sacred

Khabar Online | March 5, 2010

Mashhad Friday Prayers Leader Hojjatoleslam Seyyed Ahmad Alamolhoda said the enemy was attacking Iran's Leader Ayatollah Seyyed Ali Khameni because of its inability to attack Islam and the Quran.

In this week's sermon, Alamolhoda said after the passing of the Prophet of Islam and in the absence of the 12th Shiite Imam (Mahdi), the Shia's Just Jurisprudent (Iran's Leader) has the responsibility to disseminate religion

"The enemy who cannot attack Islam and the Quran due to the large number of people who love the Prophet and Islam, attacks the Rule of the Just Jurisprudent (the Islamic Republic's system of governance). This is not a complicated philosophical issue rather it is a matter understandable with common sense."

"The slogan 'death to those against the Rule of the Just Jurisprudent' means death to those against the Prophet of Islam. Imam Ali, Fatimah and Imam Mahdi, which can all be shortened in one sentence because any one against the Rule of the Just Jurisprudent is against all of the above and opposed to being a servant of God. Submission to God is only possible through submission to the Just Jurisprudent."

"Unfortunately, in this country, one political element for his political gains brought on the chants of the slogan of 'Death to the Rule of the Just Jurisprudent' which means death to everything sacred. We must differentiate between those loyal to the Revolution and counterrevolutionaries."

Iran's airport police seize 737 kg of drugs in one year

Press TV | March 5, 2010

Iran's Airport Police Chief Brigadier General Nabiollah Heydari says 737 kilograms of various kinds of drugs have been seized this year.

"Iranian airport police has seized a total of 737 kg of various kinds of drugs in the country's airports this year," IRNA quoted General Heydari as saying on Thursday [4 March].

"There has been a twelve-fold increase in comparison to last year's figures which was just 63 kilograms," he added.

According to General Heydari, the seized drugs included 472 kg of crystal meth, most of which was discovered at Imam Khomeini International Airport (IKIA).

"Some 4,898 people involved in drug smuggling have also been arrested at Iranian airports this year," he went on to say.

"Airport police is to equip the country's airports with 10 body scanners which will help in uncovering drugs and nabbing smugglers," he asserted.

Jeff Rubin: When do smart prices get dumb?

As they say in stock brokerage, find a strong enough wind, and even pigs can fly. Pay 19 cents per kilowatt hour for power, and you can let the wind turn on the lights. But at that price, how long will you leave them on?

The larger the contribution wind power makes to tomorrow’s grid, the less power you will be able to afford to draw from it—the same way triple-digit oil prices, which will pull tomorrow’s oil supply out of Alberta’s tar sands, will translate into pump prices that’ll force millions of drivers right off the road.

It’s not how many megawatts of additional power new sources like wind add to the grid that counts. Rather, it’s the amount of power demand that a 19-cent–per-kilowatt-hour price will kill that’ll have a far greater effect.

Utilities' transition to smart grid has promise, but potholes, too

The deployment of smart grids, applying digital technology to the nation's electricity network, is intended to help utilities better manage the flow of electricity, avoid failures and, for the first time, give consumers details on how they consume energy so that they can cut use and perhaps costs.

The existing grid "wastes too much energy; it costs us too much money; and it's too susceptible to outages and blackouts," Obama said last fall in announcing $3.4 billion in smart grid stimulus funds.

But the smart grid rollouts will take years and are likely to evolve in fits and starts, as thousands of utilities nationwide add technologies and regulators weigh the proposed benefits against costs that may be borne by ratepayers.

Crude Oil Surges the Most in Four Months as the Dollar Drops

(Bloomberg) -- Crude oil surged the most in more than four months as the dollar fell against the euro, bolstering the appeal of commodities as an alternative investment.

Oil rose 3.9 percent as the euro rebounded from the lowest level against the dollar in nine months yesterday. Commodities and stocks also gained after manufacturing in the New York region grew at the fastest pace in four months as companies boosted payrolls in anticipation of growing orders.

Energy Company Mergers Are Expected to Rise

Energy companies are on the prowl again.

After a two-year slowdown in mergers and acquisitions in the industry, companies are once again looking for ways to use their checkbooks to expand their reserves, buy new technology or snap up promising oil and gas fields.

Russia moves to strip BP venture of giant gas field

MOSCOW (Reuters) - Russia stepped up pressure on BP's Russian oil venture TNK-BP with environmental watchdog RosPrirodNadzor recommending on Wednesday to strip the firm of its giant East Siberian Kovykta gas field.

Total Refinery Workers on Strike Over Plant Closure

(Bloomberg) -- Total SA refinery workers began a 48-hour strike to protest the planned permanent closure of crude processing at an idled plant near Dunkirk in northern France.

The disruption is affecting all six of Total’s French refineries with a “massive following” and will lead to lower output and shipments, Christian Votte, a representative at the CGT union, said today by phone from the Gonfreville plant. Meetings will be held to determine whether to extend the action, the union said in a statement.

Iran leader accuses U.S. of "war-mongering"

TEHRAN (Reuters) – Iran's supreme leader accused the United States on Wednesday of war-mongering and of turning the Gulf into an "arms depot", hitting back at U.S. accusations that the Islamic state was moving toward a military dictatorship.

The comments by Ayatollah Ali Khamenei were the latest sign of growing tensions between Tehran and Washington, which are embroiled in a long-running and escalating row over Iranian nuclear work the West suspects is aimed at making bombs.

Govt plays down Argentina's Falklands shipping move

LONDON (AFP) – The government played down Tuesday Argentina's latest move in a row over oil drilling in the Falklands, after Buenos Aires ordered ships headed to the disputed islands through its waters to seek its permission.

"Regulations governing Argentine territorial waters are a matter for the Argentine authorities," said the foreign ministry in a statement.

"This does not affect Falkland Islands territorial waters which are controlled by the island authorities."

Kuwait Oil Signs Technical Service Accord With Shell

(Bloomberg) -- State-run Kuwait Oil Co. signed a service agreement with Royal Dutch Shell Plc to help develop natural-gas fields in the north of the Persian Gulf country.

“Shell will deploy technical experts to Kuwait to support KOC in its management of the ongoing development of the Jurassic gas fields,” Shell said in an e-mailed statement today. “This project is both complicated and challenging, due to unconventional geological formations, difficult reservoir conditions and complex gas compositions.”

Stephen Leeb: Positioning in Gold, Oil for the Months Ahead

This is a curious time to be talking about peak demand for oil. Renewable energies account for a very small fraction of overall energy supply. No one expects oil demand in China and other developing countries to peak anytime soon. Even China’s most ambitious renewable plans will lead to rising oil demand for another generation.

Could the Saudis have really meant peak “production”? Could they really be preparing for a time in which their own production will start to decline? In the same press release, the Saudis also mentioned in passing that they will begin to inject carbon dioxide into their largest source of oil – the giant Ghawar field. Ghawar is not only the main source of Saudi oil but the biggest oil field in the world. Injecting carbon dioxide is something you do to keep production from collapsing after you have tried everything else.

Carbon conundrum

Some will argue that new reserves of oil and minerals will be found, but these reserves are likely to prove much more expensive to access and therefore the costs will be high. Moreover, there is no guarantee that we will be able to develop the technologies to access them.

Is this certain depletion of natural resources not a stronger basis than the uncertain climate change argument for trying to change the structure of our economies and altering the way we live? Whichever way you look at it, eventually we are going to run out of these raw materials upon which our current lifestyles are based. Oil, gas, coal, copper and platinum do not just replenish themselves and once they are gone, they are gone. Let us not talk about mining the moon and the planets – we can’t even afford another manned mission to the moon.

Yet Another Energy and National Security Myth

VetVoice.com (a project of VoteVets.org) recently launched a $2 million television campaign supporting the Clean Energy and American Power Act. In all, there are eight television ads that essentially claim that oil money finances terrorism and that we need to wean ourselves off of foreign oil to be more safe and secure. (The red herring in one of the ads is Iran, which does support terrorist groups, but the groups it supports – Hezbollah and Hamas – are threats to Israel, not the United States.) The ads feature veterans of the conflicts in Iraq and Afghanistan and target members of Congress who oppose comprehensive energy legislation and who have taken political contributions from oil companies. Once again, energy and national security have been mistakenly conflated.

Shortage of Rare Earth Elements Could Thwart Innovation

Silicon may represent one of Earth's more common elements, but it transformed Silicon Valley into a high-tech corridor and helped usher the world into the Information Age.

Now rare earth elements with exotic names such as europium and tantalum hold the key to hybrid cars, wind turbines and crystal-clear TV displays - that is, if a looming supply shortage doesn't stop innovation in its tracks.

The city is choking thanks to our idea of transport nirvana

At our behest, successive state governments have been pursuing a magnificent dream, to make Sydney a place fit for cars to be driven on all occasions. Now the Herald-commissioned independent inquiry headed by Ron Christie has exposed that dream for what it is: the wrong tram (forgive me).

It's not just a dream incapable of being realised, it's one that's made our present transport problems worse rather than better and offers no answer to the looming worsening of those problems.

Theolia Investors Said to Warn They May Oppose Plan

(Bloomberg) -- A group of investors in Theolia SA, the French wind-power producer trying to avert bankruptcy, may refuse to back a refinancing plan and seek to replace its board, according to a person with direct knowledge of the matter.

Oregon is first U.S. site for a wave-power farm

The search for clean, renewable energy is turning toward the ocean, but not without some waves of skepticism.

Construction has begun off Oregon on what would be the nation's first commercial wave-energy farm, said Sean O'Neill, president of the Ocean Renewable Energy Coalition, a Maryland-based trade association that promotes marine energy. It is planned to supply energy to about 400 homes.

Nuclear Industry Gets Lift, No ‘Renaissance’ From U.S. Loan Aid

(Bloomberg) -- Don’t call it a renaissance yet, says John Rowe, who oversees the biggest fleet of nuclear reactors in the U.S.

President Barack Obama’s announcement yesterday that the government will guarantee loans for the country’s first new nuclear plants in 30 years is a necessary move that won’t in itself spur a revival of the dormant industry, said Rowe, chief executive officer of Chicago-based Exelon Corp.

“We may see more and faster development of new plants now,” said Rowe, whose company operates 17 reactors. “We probably won’t see a full-blown nuclear renaissance in the next five to 10 years.”

Jordan, France to Sign Uranium Mining Accord Feb. 21

(Bloomberg) -- Jordan and France will sign an agreement on Feb. 21 on uranium exploration and mining in the Arab country to help it become more energy efficient, the head of Jordan’s Atomic Energy Commission said.

The accord, to be completed during a visit by French Prime Minister Francois Fillon to the kingdom, will help “introduce nuclear energy as a major part of the energy mix in Jordan for the next three decades,” Khalid Touqan said today by telephone.

New Renewable Fuel Standard A Mixed Blessing For Agriculture

The Environmental Protection Agency’s (EPA) recent final ruling on the national Renewable Fuel Standard (RFS) was met with mixed responses by farm state politicians and organizational leaders.

“This is a good news/bad news announcement for American agriculture producers,” Rep. Adrian Smith (R-Neb.) stated in a recent press release. “While I’m glad to see ethanol and biodiesel will qualify as advanced biofuels under the RFS, I have concerns with the international indirect land use portion of this final rule,” he added.

Pangestu Says Palm Oil May Stabilize Around $700-$750

(Bloomberg) -- Palm oil prices may stabilize between $700 and $750 a metric ton this year as China and India buy more of the commodity, Indonesian Trade Minister Mari Pangestu said.

“What we’re seeing is a very strong demand from China and India,” Pangestu said in an interview with Bloomberg Television from Jakarta today. “India is now a larger consumer compared with China because of the reduction in production of oilseeds. Prices of palm oil look like stabilizing around $700 and $750 a ton.”

3 big firms quit warming-bills lobbying group

Two of the nation's largest energy companies on Tuesday quit the lobbying alliance that has been the major force shaping anti-global warming legislation in Congress and claimed that the leading climate change bills don't do enough for oil and natural gas.

UN Emission Board Split on Renewable-Energy Projects

(Bloomberg) -- Regulators who oversee the world’s second-biggest emissions market are split on how to approve renewable-energy projects that receive subsidies from developing nations such as China, the board’s chairman said.

Climate skeptics exploiting scandal: US envoy

Todd Stern, the US special envoy on climate issues, downplayed recent revelations about a landmark 2007 study by the UN's Intergovernmental Panel on Climate Change (IPCC) that warned of dire consequences from global warming.

"What you do see sometimes is that people who have an agenda that is directed toward undermining action on climate change grab whatever tidbit they can find," Stern told reporters.

"What should not happen is that any individual mistakes, typos, whatever they might be, be taken to undermine the very fundamental record that exists from scientists all over the world and from observed data from all over the world that this is a quite serious and growing problem," he said.

Slow Trip Across Sea Aids Profit and Environment

In a global culture dominated by speed, from overnight package delivery to bullet trains to fast-cash withdrawals, the company has seized on a sales pitch that may startle some hard-driving corporate customers: Slow is better.

By halving its top cruising speed over the last two years, Maersk cut fuel consumption on major routes by as much as 30 percent, greatly reducing costs. But the company also achieved an equal cut in the ships’ emissions of greenhouse gases.

“The previous focus has been on ‘What will it cost?’ and ‘Get it to me as fast as possible,’ ” said Soren Stig Nielsen, Maersk’s director of environmental sustainability, who noted that the practice began in 2008, when oil prices jumped to $145 a barrel.

“But now there is a third dimension,” he said. “What’s the CO2 footprint?”

Foreign Secretary Nirupama Rao has held extensive discussions with Iranian leaders on bilateral relations between India and Iran during a two-day visit to Tehran that ended yesterday.

Among other issues, they exchanged views on the regional situation, including on Afghanistan, the menace of cross-border terrorism and other matters of regional and global relevance.

Ms Rao was in the Iranian capital for the 7th round of Foreign Office Consultations /Strategic Dialogue between the two countries at the invitation of her counterpart, Dr Mohammad Ali Fathollahi, Iranian Deputy Foreign Minister for Asia & Oceania.

An official press release from the Ministry of External Affairs said that, during her stay in Tehran, Ms Rao called on Iranian Foreign Minister Manouchehr Mottaki, Economy and Finance Minister Seyed Shamseddin Hosseini and Supreme National Security Council Secretary Saeed Jalili.

It said that the next meeting of the India-iran Joint Commission would be held in New Delhi at an early date.

NNN

Sri Lankan President Mahinda Rajapakse has won a second term in office, defeating former army chief Sarath Fonseka with 57.9% of the popular vote, according to the country's elections commissioner on Wednesday. President Rajapakse has reportedly received 6.01 million votes, 1.84 million more than his main rival General Fonseka.

In a move that appears to lend weight to fears of reprisals following Rajapakse's victory, government troops surrounded the hotel of General Fonseka. A Sri Lankan army spokesman said that the troops had been deployed at the Cinnamon Lakeside Hotel in Colombo following information that army deserters were among about 400 people inside. The government has said there are no plans to arrest the General, who led the campaign that defeated the Tamil Tiger rebels in May, before falling out with President Rajapakse and joining the opposition. However, officials said the General would face consequences for allegations he had made during the election campaign.

The opposition maintains that there are no deserters inside the hotel and that the presence of so many soldiers is intimidating and contributing to a tense atmosphere.

General Fonseka has reportedly rejected the results of the election, adding that he would petition the courts against it. Transparency International Sri Lanka however said it was satisfied the country's sixth presidential elections were ‘in general, peaceful,’ although it pointed to widespread abuse of the state media by the government during the campaign and on election day.

The openSecurity verdict: The presidential election is the first since government forces defeated a 26-year insurgency by Tamil Tiger rebels. Both Fonseka and President Rajapakse were the architects of a final assault on Tamil Tiger separatists last year that the UN says killed 7,000 civilians in Tamil areas. After the end of the conflict, which prompted allegations of war crimes, an estimated 300,000 displaced Tamils were detained in camps that were closed to the media and humanitarian groups. An estimated 80,000 people remain in such camps.

President Rajapakse now faces the challenge of providing resources to the displaced civilian population to rebuild their homes and livelihood to ensure long term security and prosperity in Sri Lanka. Rajapakse has promised to rekindle Sri Lanka's crippled economy by repairing the countries existing infrastructure and improving communication by building roads, particularly in the war-torn north. He ran under the slogan 'A Brighter Future'.

The run-up to the Sri Lankan elections has experienced spurts of violence and electoral violations. An independent election monitoring group, People’s Action for Free and Fair Elections, said there had been two bombings, four killings, twelve shootings and 137 injured in the lead-up to Tuesday’s vote. Early Tuesday morning, there were reports of explosions in the northern Sri Lankan city Jaffna.

In spite of such threats however, some 70 percent of Sri Lanka's 14 million-strong electorate turned out to vote. Turnout in the northern Tamil areas, where the fiercest fighting occurred during the conflict, was around 20 percent however. Many Tamils in the north did not vote because they were afraid of violence, unable to register, or had no transport to reach polling stations. In the Sinhalese majority south however, an 80 percent voter-turnout rate was reported. This boded well for the Rajapaksa camp as most of his supporters were from the rural south.

Yesterday, top Sri Lankan politicians vowed to block Fonseka from taking office if he won, as he was not registered to vote. The government argued that General Fonseka was therefore ineligible for the presidency, despite a strong statement to the contrary from the independent election commissioner. The general is a newcomer to party politics who quit the army in November amid suspicions that he had been plotting a coup d’etat.

Fonseka’s supporters included a group of Tamil parties known as the Tamil National Alliance, which was once seen as a front for the Tamil Tigers. Among the Tamil population however, there appeared to be little love for either candidate. According to reports from Tamil camps, it seemed, rather, that people calculated that a vote for Fonseka, who has said he will speed up the resettlement of the last of the refugees, was their best chance of a return to normality.

Election results show that only in districts in the northern and eastern parts of the country, where Tamils are more populous, did Fonseka claim substantial victories. Whilst Rajapakse courted the Tamil vote with promises of aid, the burning question will now be how the president will treat the Tamils who have been defeated militarily and now electorally. President Rajapksa may not feel inclined to reach out to those he has defeated, though for the sake of long term stability he would be wise to do so.

North and South Korea trade fire

North and South Korea exchanged artillery fire near their disputed sea border on Wednesday, highlighting the instability gripping the heavily armed frontier that divides the two countries. The South Korean media reported that the North twice fired artillery shells into the sea off the South's western coast. South Korean coastal bases responded to the first volley with warning shots, but no injuries were reported. The North said the firing had been part of an annual military drill, but Seoul said the action was 'provocative' and that the consequences of their response rest with the Northern side.

The latest clash is being seen as an attempt by Pyongyang to press home its demand for a peace deal that would open the way to international aid for its ruined economy.

Taliban moderates taken off UN sanctions list

The United Nations said on Tuesday that a Security Council committee has removed five senior Taliban officials from its sanctions list. The UN said that the decision made on Monday meant the five would no longer be subject to international travel bans and asset freezes. All were previously high-ranking members of the former Taliban government. They include the former foreign minister Wakil Ahmad Muttawakil, former deputy minister of commerce Fazal Muhammad, former Taliban press officer Shams-us-Safa Aminzai and former deputy minister of planning Muhammad Musa Hottak. The fifth, former deputy minister of frontier affairs Abdul Hakim, renounced the Taliban three years ago and is now serving as governor of the Uruzgan province. All five men were put on the UN blacklist in 2001.

Afghan president Hamid Karzai hopes to win international support at the London conference for a plan to offer money and jobs to persuade Taliban fighters to lay down their arms. The move is part of a wider effort to reintegrate moderate Taliban in to Afghan society. According to Al Jazeera, a meeting between representatives of the Afghan government and members of the Hezb-e-Islami group took place on the Maldives Islands on January 23-24. It is believed the aim of the talks was to set up delegations to mediate between the Afghan government and the Taliban.

Russia says US arms reduction treaty could be ready in weeks

Russian and US negotiators are likely to agree on a landmark nuclear arms reduction treaty within weeks, according to a Russian foreign ministry spokesman on Wednesday. Russia and the US have been negotiating a successor to the 1991 Strategic Arms Reduction Treaty, or START I, that expired last month. They had hoped to reach a deal before the end of 2009 but were prevented by ongoing differences. Forging a new pact with Russia is a key element of US President Barack Obama's efforts to mend ties between Russia and the US, which plunged to post-Cold War lows after Russia's war with Georgia in August 2008.

Russian President Dmitry Medvedev said on Sunday that negotiations were going well, with the two sides in agreement on '95 per cent of the issues.’ Both countries have set a goal of reducing their nuclear warheads stockpile to between 1,500 and 1,675 respectively. They have also agreed that the number of 'carriers' capable of delivering the warheads should be limited to between 500 and 1,100.

British court overturns freezing of suspect terrorists' assets

The British Supreme Court has ruled that special Treasury orders that freeze the assets of terrorist suspects are unlawful. The court allowed a challenge by five men who have had all their assets frozen under an order brought in by current Prime Minister Gordon Brown when he was Chancellor without a vote in Parliament. The judges at the highest court in Britain said the British government had exceeded its power by controlling the finances of the five suspects. The court said the government should have sought Parliament's approval for asset freezing measures.

Lord Phillips, president of the court, said Wednesday's ruling did not constitute a judicial interference with the will of parliament, but rather upheld the supremacy of the parliament in deciding whether or not such measures should be imposed. He added that 'we must be ... careful to guard against unrestrained encroachments on personal liberty.' A spokesman for the Treasury said that it would abide by the ruling but introduce fast-track legislation to ensure that there is no disruption to the government's asset-freezing powers.

US blames Nigeria for extremism

US Secretary of State Hillary Clinton has blamed failings by Nigerian leaders for increasing 'radicalisation' and alienation among young Nigerians. Responding to a question at a forum with state department employees, Clinton said that Nigeria's key indicators such as literacy were going in the wrong direction and that corruption in the country was 'unbelievable.' She also said she believed that the Christmas day bombing suspect Umar Farouk Abdulmuttalab was 'disturbed by his father's wealth.’ The Nigerian government has not responded to Clinton’s criticism.

The Taliban attacks on Kabul show that in Afghanistan's cycle of violence, murderers and victims become religious 'martyrs' alike

The Taliban's spectacular attacks in Kabul yesterday took place just as the new cabinet members were taking their oath of office. In a report posted online on the Taliban website, their spokesman Zabiullah Mujahid listed the ministries under attack: the ministry of mining, the ministry of justice, and the ministry of finance. The Taliban's message was clear: even though the ministers were taking charge of Hamid Karzai's cabinet, the power in control of Kabul was not Karzai but the Taliban.

The ministers might not be used to the idea of dual governments, but outside Kabul Afghans have long learned to live under two parallel regimes, a daytime government run by President Karzai and a nighttime one run by the Taliban and other local strongmen. Ministers living in Kabul had been spared this unsettling reality until now, hiding as they do in bullet-proof cars, on blocked roads and behind the protective walls of Kabul's green zone. But the reality outside the capital is otherwise and ordinary Afghans have learned to negotiate their daily routine around avoiding random violence by the Taliban and other troublemakers. Monday's attacks might have given the ministers a taste of what life is like for a majority of Afghans, especially those who live in restive regions.

After the attacks, Mujahid posted a report, written in broken English, on the Taliban's al-Emarah website. The report mentions the names of Taliban commanders who were in charge of the so-called martyrdom operations. Mujahed says that seven of them "gave their lives for Allah the Almighty, and embraced martyrdom".

Afghanistan is a curious place. Those who kill are called martyrs. Those who they kill are also called martyrs and the violence is apparently done for the sake of God. "God is everywhere in Kabul," said a friend who recently returned to the city. "It's like a dictatorship. There is no escaping God here." Those who kill do so for the sake of God. Those who die hope that God will punish those who kill.

Baharat, an Afghan woman who watched the violence on Monday from behind her office window told the BBC Farsi service: "I saw terrified stallholders caught in the middle of the crossfire. They didn't know whether to run for their lives, leaving the stalls unsupervised or to stay behind, and risk their lives." The stallholders had two choices, to risk losing their livelihood or to risk losing their lives.

But in his report on the "martyrdom operations", Mujahid made no mention of the terrified Kabulis caught in the crossfire. His report reads as if Kabul were an empty space, a frontline inhabited only by government soldiers and their Taliban enemies. There is no mention in the report of the children hiding in the cellar of the bank that came under attack. The terrified stallholders or the shoppers stranded in Qari Aman shopping centre do not exist in the Taliban report. The Taliban spokesman did mention the shopping centre, but only to claim that the blaze that burned down the building was the work of Afghan troops who had panicked, opening indiscriminate fire.

The spokesman then went on to mention that a "brave mujahid" by the name of Haji Massod had driven the explosives-filled ambulance to the Malik Azghar roundabout. Again there was no mention of civilians. The Taliban spokesman simply said that high-ranking officials and security personnel were killed in the "martyrdom explosion", as if a busy roundabout in a city of three-and-a-half million people had been empty that morning.

Judging by Mujahed's report, the Taliban are either in denial or regard Kabul's civilians as fair game. Either way, there's nothing new about the Taliban attacking Kabul. Their predecessors, who ironically also called themselves mujahids, began launching Sakar-20 rockets on Kabul in 1985. The people who fled the city and subsequently ended up in Pakistani refugee camps became known in the local language as Sakarbisti, the Sakar-20s.

Later, in the 1990s, Kabul turned into an open battleground under fire by various mujahedin factions "martyring" each other and the people of the city. But Kabul is not the only city of violent acts creating new martyrs. Afghanistan's soil is full of martyr graves, triggering questions as to how to avoid unintentionally polluting a grave when doing one's business outdoors. In the villages, parents warn their children to tread carefully and avoid soiling what might be an unmarked grave of one of the country's millions of martyrs.

But if the Taliban are in denial, so are the people of Kabul. Hence, reports of Monday's violence were soon followed by two sets of rumours. The first rumour insinuated that the attacks were orchestrated by Karzai's administration with the purpose of distracting public attention from the president's failure to come up with an adequate cabinet. The second rumour also held Karzai responsible by implying that by allowing the Taliban to carry out the attacks in the heart of the city, the president was trying to persuade the public that the Taliban simply had to be given government posts or else they would destroy Kabul.

Such rumours made the rounds even though the Taliban had not only claimed responsibility for the attacks, but also were making a point of describing their operations in detail and mentioning the commanders in charge of the attacks by their name. Needless to say, the commanders were either Mullah such-and-such or Hajji such-and-such – titles that indicate religious credentials.

Afghans are so used to violence and its justification that they rarely realise just how absurd their situation is. Hence when a fellow journalist recently asked the family of a victim of the Taliban's violence, he was given an ambivalent answer: "May God punish the enemies of Islam." The language of theology has become intertwined with the discourse of violence and the result is bewildering, with murderers and victims called martyrs alike.

• Suicide bombings and gun battles engulf Afghan capital
• Shopping centre, cinema, bank and hotel targeted

The daily business of government was already in full swing by the time a man wearing a white shalwar kameez walked towards the front gate of Afghanistan's central bank. Close by, deep inside his presidential palace, Hamid Karzai was finally getting round to swearing-in members of his new cabinet. It was just before 10 o'clock in the morning.

The guards at the central bank were already on high alert after recent intelligence warnings suggested a spectacular attack was on the cards and the man in white was behaving extremely suspiciously.

"He was about 10 metres away from the main gate of the bank and the guards told him to stop," said Ahmad, a plain clothes member of the elite counterterror group Task Force 24, who was at the bank at the time. "But he didn't say anything or explain himself, he just carried on walking and tried to climb over the barrier."

Convinced they were being approached by a suicide bomber, the guards opened fire. The man's device detonated, causing a huge explosion that narrowly missed killing a group of British bodyguards, sheltered from the main force of the blast by another vehicle.

That was the first assault of the day. efore too long a fire, triggered by two bombers detonating their explosive vests, ripped through a nearby shopping centre, sending a plume of smoke high into the sky above central Kabul.

And minutes after the foiled central bank attack, explosions and gunfire could be heard from the nearby ministry of justice, on the other side of Pashtunistan Square, as the insurgents mounted another attack. Either from there or from a nearby vantage point the attackers fired three rocket-propelled grenades into the ministry of finance, which hit reinforced shelters in its grounds where government security forces had taken cover.

After the first blast all that was left of the attacker, says Ahmad, were his two legs lying on the ground. Attached to them were a pair of size 41 shoes that in Ahmad's view were clearly of a "Pakistani" design, hinting at the already widely held view among the country's counter-terrorism chiefs that this was a plot that originated from outside Afghanistan's borders.

Hanif Atmar, the softly spoken interior minister, added to that sentiment , saying: "There is no school for training suicide bombers in this ­country" – although there are plenty of radical madrasas that do so in the borderlands of Pakistan.

And, in his view, it was the quick-­wittedness of his security forces at the central bank that forced the team of insurgent gunmen and suicide bombers to leave and instead run amok in the nearby shopping centre, a far softer target.

"Our officer who was killed, he was the one who detected the first suicide bomber trying to enter the bank," Atmar said. "He detected him and before [the bomber] was able to get to the front gate he was killed. That detection forced the others to go and choose the shopping centre."

At a joint briefing with Afghanistan's other security chiefs Atmar said the day also saw attacks on the former Bamiyan hotel, an explosion near a mosque and fighting in the Ariana cinema. He said an intelligence agent was killed, two policemen, two civilians and a child. He said 71 other people were wounded, including 35 civilians and that most of the injuries were caused by insurgents triggering hand grenades.

For the hundreds of civil servants and international consultants trapped in the government buildings there was little to do but listen to the five hours of explosions and raging gun battles and hope that their offices had not been penetrated by insurgents. Security officials told them to lie on the floor and not look out of their windows.

Others did not have the advantage of such sensible advice. Khalid Stanekzai, 23, the boss of Afghanistan's main Nokia dealership, stood at his office window high up in the recently built Gulbahar shopping centre. He was captivated by the scene below him.

"I had never seen the face of the war before, but I could see it all from there," he said. "I took my phone and got a picture because it was amazing to me. I filmed it all on my mobile phone."

At around 11 o'clock, amid all the pandemonium, he noticed an ambulance approach his building. On the ground the security forces were suspicious after the driver failed to respond to their challenges. One of them was close enough to see that he had some sort of a detonation device strapped to his right leg, and yelled to his colleagues to dive for cover.

But Stanekzai did not hear the warning as the ambulance blew apart on the street below him, leaving behind a deep crater in the road.

"The soldiers were running and they were shooting at the ambulance and then it made a very big explosion," – the last thing he remembered as shrapnel and glass tore into his face.

Meanwhile the police force was rapidly shutting down the city, sending thousands of people streaming away from the epicentre of violence as shopkeepers ­rapidly boarded up their houses.

In Shar-e-Naw, a considerable distance from the fighting, cars turned back on themselves into the one-way system. People who tried to walk towards the fighting, including a few foreign photographers, had pistols waved angrily in their faces.

After it became clear that the attackers were using police uniforms, the Afghanistan National Army and the National Directorate of Security ordered the withdrawal of police from the centre of town and took over the counter-offensive, according to western officials.

They manned positions at the top of the ministry of finance from where they opened fire on the insurgents in the ministry of justice, across Pashtunistan Square.

It was only a matter of time before all the attackers were dead and the situation was brought back under control, leaving relatives to wait anxiously outside the city's hospitals for the wounded, many complaining bitterly about the government's failure to secure the capital.

By early evening Stanekzai was finally discharged from Kabul's Italian-run emergency hospital with 52 stitches in his left cheek and six in his right hand where he had been clutching his mobile phone in front of him.

He left for home sitting bare-chested in the back of a friend's car – the shalwar kameez that he had been wearing earlier reduced to a torn and crumpled mass of thickly bloodstained cloth.

Afghan security forces seal off Kabul city centre as up to two dozen Taliban militants attack ministries

Afghan security forces sealed off the centre of Kabul today as around two dozen ­presumed Taliban militants launched a wave of co-ordinated gun and bomb attacks against government ministries and other targets within the city.

A huge plume of smoke could be seen rising from the diplomatic district containing several ministries and the luxury Serena hotel, popular with foreigners, following a loud explosion. Sporadic gunfire could be heard.

"At least 10 people who are suicide bombers are in several buildings, including in banks and shopping centres," one security officer, Amir Mohammad, told Reuters.

A statement from Nato forces in the country said several small blasts had been reported near the Feroshgah e Afghan shopping centre, and the Serena hotel.

"[Afghan security forces] have secured all roads in the vicinity, and initial reports are they have killed at least two armed insurgents at the shopping centre after clearing the building," it added.

Workers inside the finance ministry, including seven British nationals among a group of overseas staff, told the Guardian they had been ordered to lie on the floor and not look out of windows until Afghan police and soldiers had retaken the area.

Security forces sealed off a large section of the city, ordering people on the streets to leave the area.

The attack appeared to begin after a suicide bomber blew himself up near the presidential palace. A Taliban spokesman told the Associated Press the organisation had sent 20 militants into the city centre to target the palace and other government buildings.

Militants and security forces fought in several locations, while grenades were thrown into a supermarket in a shopping centre, government officials said. The central bank was also apparently under attack, with a loud explosion followed by gunfire.

It is the latest brazen assault on the centre of the capital. In October, five UN staff were killed when gunmen stormed their guesthouse. The Serena hotel was also struck by a rocket in that attack, although it failed to explode.

The return of a tarnished presidential ally to run Afghanistan's counter-narcotics programmes, raises questions about how much Karzai has changed his ways, if at all

For the past three days, I've been travelling with David Miliband in Afghanistan, as the foreign secretary has sought to prepare the way for the London Conference on January 28.

The Miliband trip started in Helmand province, where there was an unusual supply of upbeat news. Poppy cultivation is down by a third, and 40,000 of Helmand's farmers have taken up the provincial government's offer of subsidised wheat seed instead.

Meanwhile, many of Helmand's district centres that were no-go areas until very recently are now relatively quiet. Lashkar Gah, the provincial capital, has not suffered a serious attack in months and the streets are full of bustle and commerce.

The province-wide improvement has a lot to do with the arrival of large numbers of US marines. The total is expected to reach 20,000 by spring, compared to the 9,500-strong British garrison. The Americans are much better equipped than their British counterparts (the 'Lash' base used to be fairly quiet at night. It now positively vibrates from the constant to and fro of US helicopters on night operations). Marine officers also have much more walking-around money to give out, to create instant employment in the villages.

The big question is whether Helmand's unaccustomed good news will last beyond the US surge, when the marines go home taking their money with them. A lot depends on whether the Afghan government will be able to fill the gap, and on this score the Kabul leg of Miliband's trip was mixed at best.

While the foreign secretary was in town, Pakistan's parliament rejected ten out on Hamid Karzai's 17 ministerial nominees on Saturday, further delaying the formation of a complete government. Miliband, however, was able to point out that the most important portfolios - interior, defence, foreign and finance, had been confirmed in the hands of "high quality" officials, and that the parliamentary vote was proof of a vigorous democracy.

More troubling was one of the handful of nominees parliament did confirm. Zarar Ahmed Moqbel once ran the interior ministry until about a year ago when Karzai was forced to sack him amid international uproar over his department's culture of corruption and incompetence. He will now lead the Afghan counter-narcotics effort, giving a new opiate twist to the old saying about foxes and henhouses.

When Moqbel was nominated, a British former law and order official described the interior ministry under his control as "a byword for corruption and incompetence".

This is particularly awkward for Britain. It is the 'lead' Nato nation on counter-narcotics, and Gordon Brown has pledged to turn off the tap on funding to Afghan institutions that fail to get a grip on graft. Asked whether that meant there would be no more British money for the counter-narcotics ministry, Miliband provided a carefully hedged answer.

We will look at every ministry and make sure that any support or engagement or funding we provide is going to be used for the uses intended, and that is for the benefit of the people of Afghanistan... Obviously counter-narcotics is important and we will liaise very closely with our allies, but British people should be assured their money isn't going to any uses it was not intended for.

In practice, Britain and other donors can work around Moqbel's new ministry which has become less central to the overall counter-narcotics effort. More money now goes through the agriculture ministry on crop substitution programmes. But it is hardly the image Karzai's international backers want him to portray at the London Conference, where the whole international venture in Afghanistan will once again be weighed against the lives and resources being spent there.

American intelligence contradicts foreign office line as Peter Moore arrives in UK

US intelligence is convinced that Peter Moore spent at least some of his 31 months of captivity in Iran, one of America's most senior military commanders said yesterday.

As Moore, a computer consultant from Lincoln, flew back to Britain yesterday, General David Petraeus, the head of US central command, confirmed the American assessment that Moore – seized with four bodyguards in Baghdad in 2007 – had "certainly" been taken across the border into Iran. The Iranian role in the abduction, reported by the Guardian on Thursday, suggests Tehran's influence in Iraqi politics is even more pervasive than previously thought.

Moore flew into RAF Brize Norton yesterday evening on board a plane belonging to International SOS, a global medical and security firm. He was accompanied by a Baghdad-based British consular official and was due to be reunited with his family last night.

His step-parents, Fran and Pauline Sweeney, issued a statement saying: "We are thrilled to have Peter back safely. We have a lot of catching up to do and would like to have time with Peter on our own. We would now ask the media to give us space and privacy."

The Foreign Office has repeatedly said that there is no evidence Moore was ever held inside Iran, dismissing the report as "speculation". But General Petraeus flatly contradicted the official British view at a Baghdad press conference yesterday.

"I am on the record as having said that our intelligence assessment is that he certainly spent part of the time, at the very least, in Iran – part of the time he was a hostage," the general, who commands the US military in Afghanistan, Iraq and across the Middle East, told journalists yesterday.

Questioned about the divergence of US and British views, a Foreign Office spokesman said that although the US shared its intelligence extensively with Britain, "it may be simply a case of the US military having a different interpretation of that same intelligence".

An investigation by Guardian Films found that the al-Quds force, a special unit of Iran's Revolutionary Guard responsible for covert foreign operations, was behind the seizure of the five Britons from the Iraqi finance ministry in May 2007. The captives were taken across the border into Iran on the first day and spent some of their captivity there, while an Iranian-backed Shia group in Iraq, Asaib Ahl al-Haq (the Righteous League), claimed responsibility for the abduction.

Speaking in Baghdad, Petraeus said it was "difficult to say" what role the Quds force had played. He was in Iraq to attend a ceremony to mark the formal end of the multinational coalition which has occupied the country since the March 2003 invasion. Since July, the US has been the only member of the coalition with troops stationed in Iraq. Yesterday, Petraeus said Iranian-backed militias still posed a threat to Iraq's security.

Iran has denied involvement in the abduction of the Britons, and state television in Iran has described the Guardian's reporting as "part of a psychological war against Iran".

Moore has been quoted as saying he was treated roughly during the first two years of his captivity, but that conditions improved dramatically in the final six months, when he was provided with an en suite bathroom, access to satellite TV, a PlayStation and a laptop.

Moore is said to have been unaware of having been in Iran – according to reports he believes he was only held in Iraq – and Iranian and Iraqi intelligence sources told the Guardian that the British captives were never made aware that they had crossed the border.

Yesterday Sharq al-Awsat, a London-based Arabic newspaper, quoted an anonymous source it described as a former Righteous League member as confirming the British hostages were taken into Iran soon after being seized.

"Iran was the only place where Peter Moore could be kept, because Iran is a safe haven for most of the leaders of the Righteous League," the source told the newspaper. "Iran is the country that benefited most from the kidnapping as it always likes to keep a card in its hand to apply pressure."

Moore's release came on the same day as the transfer of the head of the Righteous League, Qais al-Khazali, from US to Iraqi custody. British officials have strongly denied that an exchange deal had been struck, and General Petraeus said yesterday the transfer had been carried out according to an agreement with the Iraqi government by which the US had to release its detainees or hand them over to Iraq by the end of last year.

However, a representative of Asaib Ahl al-Haq, and an Iraqi member of the negotiating team that helped secure Moore's release, told Associated Press that Moore was not released until the group received confirmation that its leader had been transferred.

Iraqi officials have told the Guardian that the body of the last victim of the abduction, Alan McMenemy, is likely to be returned after the expected release of Khazali from Iraqi custody in the next few days. The remains of the other three bodyguards – Alec MacLachlan, Jason Swindlehurst and Jason Creswell – were handed over to British officials last year.

As part of its investigation into the abduction of the five Britons, Guardian Films interviewed members of Iraqi intelligence, which had trailed the kidnappers on the day of the abduction in May 2007 and witnessed the handover of the hostages at a brick factory near the Iranian border at Mehran.

The investigative team also talked to an Iranian defector with intelligence links and with an Iraqi government minister who had taken part in the hostage negotiations. "The kidnapping of the British was the work of the Iranian Revolutionary Guard," he said. "You don't think that Iraqis from Sadr City [a Shia district of Baghdad] are capable of carrying out an operation like that."

Peter Moore, 34, from Lincoln, was working as an IT consultant for BearingPoint when he was kidnapped. He was installing software which would have tracked millions of dollars of funds and aid money passing through Iraq's finance ministry – some of which was believed to be going to Iranian-backed militias.

Moore endured a difficult childhood after his parents, Graeme and Avril, split up when he was one. At seven he moved to Leicester when his mother married Patrick Sweeney.

In 2004 Moore travelled to Guyana to work for Voluntary Service Overseas – he had planned to return to the South American country following his work in Iraq.

After being kidnapped in May 2007, he appeared in a hostage video released by his captors on 26 February 2008. In it Moore called for Gordon Brown to release the prisoners wanted by the kidnappers. He said: "Nothing is happening. To Gordon Brown the deal is simple, release the prisoners, we can go, it's as simple as that, it is a simple exchange of people, that is all they want."

Moore appeared in a second hostage video released to the British embassy in Baghdad on 22 March. This recording has never been broadcast, but according to his mother, Avril Sweeney, who has watched the video, Moore looked well and said he would be home soon.

Alec Maclachlan, 29, a former paratrooper from Llanelli, was one of four GardaWorld security guards protecting Moore when they were kidnapped from a finance ministry building in Baghdad.

Maclachlan's was the third body to be released by the kidnappers to the British embassy, on 3 September this year. According to autopsy reports he had been killed between March and May 2008 by a single bullet to the head.

The former soldier was the son of Helen and Colin Maclachlan. He had a brother Ross and was father to Kyle.

Alan McMenemy, 34, from Milngavie in Scotland, was a paratrooper for eight years, serving in Africa and Bosnia, before joining GardaWorld as a security guard. He was four days away from finishing a three-month contract with the company when he was kidnapped. His father, Dennis McMenemy, was told by the Foreign Office that his son was killed at the same time as other bodyguards.

In a video released by the kidnappers on 19 July 2008, the former soldier spoke of his personal suffering, saying: "Physically, I'm not doing well. Psychologically I'm doing a lot worse." He was married to Rosalyn McMenemy and had two young children. Today, the foreign secretary, David Miliband, said the government had believed for some time that he was dead and demanded the release of his body.

Jason Creswell, 39, from Portlethen, Aberdeen, worked as a chef before joining the army at 16. He was based at St Omer barracks in Aldershot.

While working in Iraq as a security guard for GardaWorld, Creswell trained as a paramedic. Medicine became his passion. During his days off he treated injured soldiers and Iraqi civilians. He was due to take up a place at medical school on returning from Iraq.

Creswell's body was handed over to the British authorities in Baghdad on 19 June. A subsequent autopsy found he had been killed between March and May 2008 – there was evidence of gunshot as well as stab wounds. When news came through of his death his brother Jack Creswell, also in the army, was flown home from the front line in Afghanistan. Jason Creswell leaves a daughter, Maddi.

Jason Swindlehurst, 38, from Skelmersdale, Lancashire, was a former soldier who also went into security industry after leaving the forces.

He was shown in a video, dated 18 November 2007 and released by the kidnappers, flanked by gunmen with a sign reading: "the Islamic Shia resistance of Iraq". The video, which was broadcast on al-Arabiya TV, warned that one hostage would be killed unless British troops were withdrawn from Iraq within 10 days. Swindlehurst was pictured saying: "I have been now held for 173 days and I feel as though we have been forgotten. I miss my daughter and family very much and would like to be returned very soon – it seems here that time has no end."

On 19 July 2008 the kidnappers released another video claiming that he had killed himself – this claim was later proved to be false when his body was handed over to the British authorities in Baghdad along with that of Creswell in June of this year.

He is survived by his former wife, Kerry Wallace, and his eight-year-old daughter, Jaye.

Afghans will go to the polls again in May 2010 to elect their next parliament. According to Reuters, the vote is planned to go ahead on schedule, despite a funding shortfall and concerns that security will be too weak in most of the country for voters to cast their ballots safely and without fraud.

Under Afghanistan's constitution, a new lower house must be in place by June 22, and elections cannot take place less than 30 days before that date. Zekria Barakzai, the head of Afghanistan's Independent Election Commission (IEC) said that the president, chief justice and speakers of both houses of parliament agreed that the elections should go ahead in May.

"The only problem we have right now is how it will be funded. We are talking to the finance ministry to see if it can be funded from the Afghan budget," Barakzai said.

So far, wary international donors aren't rushing to fund an election that could be both unfair and violent. "There is nobody, I mean nobody, stepping up to the plate to fund elections without root and branch reform of the electoral system," one anonymous Western diplomat said.  "Our public back home simply won't accept it."

Even if the Afghan government had the will to push for serious reform, especially the removal of IEC members implicated in the widespread fraud of last August's presidential election, without international support it definitely doesn't have the capacity to minimize fraud and protect voters in the most insecure parts of the country.

In a post two weeks ago, I posited four scenarios for how the 2010 parliamentary elections could play out. Scenario no. 4 was the "hands off" scenario, with the international community largely disengaged from the process. Though some international support will almost certainly be given, the election is less than six months away and there are no indications yet that the international community will be as involved as it was in the last three national elections, or that any of the mistakes of those elections will be avoided this time around. And that's bad news for everyone.