Scenic Pakistani valley falls to Taliban militants

by Nahal Toosi
AP

ISLAMABAD, Pakistan – Taliban militants are beheading and burning their way through Pakistan's picturesque Swat Valley, and residents say the insurgents now control most of the mountainous region far from the lawless tribal areas where jihadists thrive.

The deteriorating situation in the former tourist haven comes despite an army offensive that began in 2007 and an attempted peace deal. It is especially worrisome to Pakistani officials because the valley lies outside the areas where al-Qaida and Taliban militants have traditionally operated and where the military is staging a separate offensive.

"You can't imagine how bad it is," said Muzaffar ul-Mulk, a federal lawmaker whose home in Swat was attacked by bomb-toting assailants in mid-December, weeks after he left. "It's worse day by day."

The Taliban activity in northwest Pakistan also comes as the country shifts forces east to the Indian border because of tensions over last month's terrorist attacks in Mumbai, potentially giving insurgents more space to maneuver along the Afghan frontier.

Militants began preying on Swat's lush mountain ranges about two years ago, and it is now too dangerous for foreign and Pakistani journalists to visit. Interviews with residents, lawmakers and officials who have fled the region paint a dire picture.

A suicide blast killed 40 people Sunday at a polling station in Buner, an area bordering Swat that had been relatively peaceful. The attack underscored fears that even so-called "settled" regions presumptively under government control are increasingly unsafe.

The 3,500-square-mile Swat Valley lies less than 100 miles from the capital, Islamabad.

A senior government official said he feared there could be a spillover effect if the government lost control of Swat and allowed the insurgency to infect other areas. Like nearly everyone interviewed, the official requested anonymity for fear of reprisal by militants.

Officials estimate that up to a third of Swat's 1.5 million people have left the area. Salah-ud-Din, who oversees relief efforts in Swat for the International Committee of the Red Cross, estimated that 80 percent of the valley is now under Taliban control.

Swat's militants are led by Maulana Fazlullah, a cleric who rose to prominence through radio broadcasts demanding the imposition of a harsh brand of Islamic law. His appeal tapped into widespread frustration with the area's inefficient judicial system.

Most of the insurgents are easy to spot with long hair, beards, rifles, camouflage vests and running shoes. They number at most 2,000, according to people who were interviewed.

In some places, just a handful of insurgents can control a village. They rule by fear: beheading government sympathizers, blowing up bridges and demanding women wear all-encompassing burqas.

They have also set up a parallel administration with courts, taxes, patrols and checkpoints, according to lawmakers and officials. And they are suspected of burning scores of girls' schools.

In mid-December, Taliban fighters killed a young member of a Sufi-influenced Muslim group who had tried to raise a militia against them. The militants later dug up Pir Samiullah's corpse and hung it for two days in a village square — partly to prove to his followers that he was not a superhuman saint, a security official said on condition of anonymity.

A lawmaker and the senior Swat government official said business and landowners had been told to give two-thirds of their income to the militants. Some local media reported last week that the militants have pronounced a ban on female education effective in mid-January.

Several people interviewed said the regional government made a mistake in May when it struck a peace deal with the militants. The agreement fell apart within two months but let the insurgents regroup.

The Swat insurgency also includes Afghan and other fighters from outside the valley, security officials said.

Any movement of Pakistani troops from the Swat Valley and tribal areas to the Indian border will concern the United States and other Western countries, which want Pakistan to focus on the al-Qaida threat near Afghanistan.

On Friday, Pakistani intelligence officials said thousands of troops were being shifted toward the border with India, which blames Pakistani militants for terrorist attacks in Mumbai last month that killed 164 people. But there has been no sign yet of a major buildup near India.

"The terrorists' aim in Mumbai was precisely this — to get the Pakistani army to withdraw from the western border and mount operations on the east," said Ahmed Rashid, a journalist and author who has written extensively about militancy in the region.

"The terrorists are not going to be sitting still. They are not going to be adhering to any sort of cease-fire while the army takes on the Indian threat. They are going to occupy the vacuum the army will create."

Residents and officials from the Swat Valley were critical of the army offensive there, saying troops appeared to be confined to their posts and often killed civilians when firing artillery at suspected militant targets.

The military has deployed some 100,000 troops through the northwest.

A government official familiar with security issues estimated that some 10,000 paramilitary and army troops had killed 300 to 400 militants in Swat since 2007, while about 130 troops were killed. Authorities have not released details of civilian casualties, and it was unclear if they were even being tallied.

The official, who insisted on anonymity because of the issue's sensitivity, disputed assertions that militants had overrun the valley, but said a spotty supply line was hampering operations. He said the army had to man some Swat police stations because the police force there had been decimated by desertions and militant killings.

A Swat militant boasted that "we are doing our activities wherever we want, and the army is confined to their living places."

"They cannot move independently like us," said the man, who was reached over the phone and gave his name as Muzaffarul Haq. He claimed the Swat militants had no al-Qaida or foreign connections, but that they supported all groups that shared the goal of imposing Islamic law.

"With the grace of Allah, there is no dearth of funds, weapons or rations," he said. "Our women are providing cooked food for those who are struggling in Allah's path. Our children are getting prepared for jihad."

Economic death and millionaire taxes

by David Sirota
San Francisco Chronicle

For most of us, Benjamin Franklin's words in 1789 still apply: "Nothing is certain but death and taxes."

However, millionaires, by definition, are not most of us. While they can't stave off the grim reaper, they can persuade lawmakers to shield them from the taxman and balance budgets on the backs of everyone else.

That's what's going on in revenue-starved states right now: governors are preparing to slash middle-class programs and are resisting calls to raise taxes on the wealthy. Nowhere is this class war more pronounced than in New York - the home of the financial thieves who killed the economy. Having halved its top tax rate over the last three decades, New York today faces a $15.4 billion deficit. In response, Gov. David Paterson, a Democrat, might have asked his state's Gordon Gekkos to pay higher taxes, especially considering the idea's popularity in polls and the news that Wall Street's elite are still swimming in money. Indeed, according to CBS News, the allegedly beleaguered financial industry is so flush with cash it plans to dole out $14 billion in executive bonuses this year.

Yet, far from forcing robber barons to pay their fair share, Paterson told the New York Times that taxing millionaires is "the last place you want to go." Instead, he proposes to punish Joe and Jane Six-pack by hiking the taxes and cutting the programs that disproportionately impact them. Specifically, he wants to increase sales taxes, college tuitions and licensing fees and slash education and low-income health programs.

Paterson defended his proposals by telling PBS' Bill Moyers "that when you tax the wealthy in the downturn of an economy, you have an automatic link of a loss of job opportunities and then a loss of population." The rationale sounds intelligently pragmatic - until you peruse the relevant data.

When New Jersey recently raised taxes on the wealthy, Princeton University researchers found that most of those who later left the state moved to places with higher taxes, meaning there is no causative link between levies on the rich and residential flight. Likewise, when New York temporarily raised high-income taxes after 9/11, the state added 127,000 jobs, meaning no link exists between higher taxes on the rich and job loss.

During times of surpluses, governors could get away with the unsubstantiated nonsense Paterson is peddling. But now, 43 states confront shortfalls, and because states cannot run deficits, the dollars and sense of these arguments matter. Lawmakers must choose what policy will create the best chances for economic recovery: spending cuts or tax increases, and if the latter, on whom?

The answer isn't rocket science. As Nobel Prize-winning economist Joseph Stiglitz says, "Reductions in government spending on goods and services (are) likely to be more damaging to the economy in the short run than tax increases focused on higher-income families."

That's because government cuts automatically decrease the consumptive spending programs that broadly stimulate the economy whereas tax increases, when aimed at the wealthy, more often impact funds socked away in savings.

"The more that the tax increases (are) focused on those with lower propensities to consume (i.e., the rich)," Stiglitz notes, "the less damage is done to the weakened economy."

Incredibly, Paterson acknowledges how destructive his budget is, admitting that his own "education cuts are draconian, the health care cuts are prohibitive [and] the taxes that are being levied ... are not fair."

So why would he - or any governor - nonetheless try to legislate such idiocy? Because millionaires are the ones who finance gubernatorial candidacies, and their campaign contributions buy tax protection. The result is what another New York royalist promised.

"Only the little people pay taxes," said Leona Helmsley - a doctrine that will exacerbate this recession if states keep making it true.

Bush Insider Who Planned To Tell All Killed In Plane Crash: Non-Profit Demands Full Federal Investigation

WASHINGTON, Dec. 20 PRNewswire-USNewswire -- Michael Connell, the Bush IT expert who has been directly implicated in the rigging of George Bush's 2000 and 2004 elections, was killed last night when his single engine plane crashed three miles short of the Akron airport. Velvet Revolution ("VR"), a non-profit that has been investigating Mr. Connell's activities for the past two years, can now reveal that a person close to Mr. Connell has recently been discussing with a VR investigator how he can tell all about his work for George Bush. Mr. Connell told a close associate that he was afraid that George Bush and Dick Cheney would "throw [him] under the bus."

A tipster close to the McCain campaign disclosed to VR in July that Mr. Connell's life was in jeopardy and that Karl Rove had threatened him and his wife, Heather. VR's attorney, Cliff Arnebeck, notified the United States Attorney General , Ohio law enforcement and the federal court about these threats and insisted that Mr. Connell be placed in protective custody. VR also told a close associate of Mr. Connell's not to fly his plane because of another tip that the plane could be sabotaged. Mr. Connell, a very experienced pilot, has had to abandon at least two flights in the past two months because of suspicious problems with his plane. On December 18, 2008, Mr. Connell flew to a small airport outside of Washington DC to meet some people. It was on his return flight the next day that he crashed.

On October 31, Mr. Connell appeared before a federal judge in Ohio after being subpoenaed in a federal lawsuit investigating the rigging of the 2004 election under the direction of Karl Rove. The judge ordered Mr. Connell to testify under oath at a deposition on November 3rd, the day before the presidential election. Velvet Revolution received confidential information that the White House was extremely concerned about Mr. Connell talking about his illegal work for the White House and two Bush/Cheney 04 attorneys were dispatched to represent him.

An associate of Mr. Connell's told VR that Mr. Connell was involved with the destruction of the White House emails and the setting up of the off-grid White House email system.

Mr. Connell handled all of John McCain's computer work in the recent presidential campaign. VR has received direct evidence that the McCain campaign kept abreast of the legal developments against Mr. Connell by reading the VR dedicated website, www.rovecybergate.com.

VR demands that the Ohio Attorney General and the United States Justice Department conduct a complete investigation into the activities of Mr. Connell and determine whether there was any foul play in his death. VR demands that federal law enforcement officials place the following people under protective custody pending this investigation. Heather Connell who

is the owner of GovTech Solutions, Randy Cole, the former President of GovTech Solutions, and Jeff Averbeck, the CEO of SmartTech in Chattanooga, Tennessee. Both GovTech and SmartTech have been implicated in the rigging of the 2000 and 2004 elections and the White House email scandal. Our prior request to have Mr. Connell protected went unheeded and now he is dead.

Political establishment trashed consumer protections - and look what we got

by David Sirota
San Francisco Chronicle

Please, forgive me for saying it. I know it's a tad annoying, but it has to be said to America's ruling class in this humble column space. Because if it's not said here, then you can bet it won't be said anywhere else, and it needs to be said somewhere on behalf of the millions of citizens who were right.

We told you so.

In the slow-motion train wreck that became the economic meltdown, our bipartisan political establishment and the sycophantic punditburo have been wrong over and over and over again. They told us that eviscerating consumer protections would unleash the market's benevolent power and boost the economy. They told us that a trillion-dollar Wall Street bailout would solve a credit crisis. They told us that bailout would be subjected to intense oversight and scrutiny. Wrong, wrong and wrong - and when critics predicted just that, sneering commentators and congressional leaders berated us as know-nothing Luddites, conspiracy theorists or both.

But with the release of three new reports, there's no debate anymore. The studies prove that the critics were right and the ideologues of Washington were wrong.

When in 2005 Congress overwhelmingly passed a credit-card industry-written bill gutting bankruptcy laws, progressives were right to try to stop it - and not just because it was an immoral move to legalize usury. We were right because as the New York Federal Reserve Bank reports, the bill played an integral role in the foreclosure surge that crushed the economy.

In the past, bankruptcy laws made sure debtors first and foremost continued paying their mortgages so that they could stay in their homes. But the 2005 legislation effectively compels debtors to first pay off their credit cards, meaning many then have no money left to pay their mortgages. The Fed's report estimates that the bankruptcy bill is causing 32,000 more foreclosures per quarter than the economy would have already generated.

We told you so.

When almost every media voice in America was sounding the alarm of financial panic and demanding a Wall Street bailout plan, when bailout opponents were roundly ridiculed as "irresponsible" by politician and pundit alike - those opponents were nonetheless right to say then what a study from the Minneapolis Federal Reserve Bank says now: that the case hadn't been made.

While reporters and the Bush administration frantically insisted that bank-to-business lending had ceased, inter-bank lending had stopped, and short-term "commercial paper" loans had dried up, the Minneapolis researchers tell us that "all three claims were false" and continue to be false; that "nobody has explained how the money system has frozen when the data says it has not"; and that "a trillion-dollar intervention warrant(ed) a bit more serious analysis."

We told you so.

When lawmakers said the bailout included strict oversight measures, skeptics were right to say that claim was patently untrue. According to a new analysis by federal officials at the Government Accountability Office, nonexistent oversight means "taxpayers may not be adequately protected" and that the bailout's stated goal of fixing the economy "may not be achieved in an efficient and effective manner."

Yes, we told you so.

And so now, even though these damning reports have garnered scant news coverage, perhaps there will be a change. As we - the pragmatic progressive majority - demand tough new financial regulations; job-creating investments in public infrastructure; labor law reforms; universal health care; revised trade policies; a repeal of the odious bankruptcy bill and an end to Wall Street welfare - maybe our humiliated rulers will start listening.
To read the reports

For the underlying documents, go to:

Federal Reserve report on the effect of the bankruptcy bill.

Federal Reserve report on the myths of the credit crisis.

GAO report on the oversight of the bailout. (PDF)

Mumbai gunman's confession sheds light on massacre

by Ramola Talwar Badam
AP

MUMBAI, India – The gunman captured in last month's Mumbai attacks had originally intended to seize hostages and outline demands in a series of dramatic calls to the media, according to his confession obtained Saturday by The Associated Press.

Mohammed Ajmal Kasab said he and his partner, who massacred dozens of people in the city's main train station, had planned a rooftop standoff, but abandoned the plans because they couldn't find a suitable building, the statement to police says.

Kasab's seven-page confession, given to police over repeated interrogations, offers chilling new details of the three-day rampage through India's commercial center that left 164 people plus nine gunmen dead.

He said the assault, which started Nov. 26, was initially set for Sept. 27, though he doesn't explain why it was delayed. The gunmen had been told by their handlers to carry out the attacks during rush hours when the station is teeming with commuters.

After reaching Mumbai, Kasab and his partner, Ismail Khan, the group's ringleader, headed to the train station by taxi.

"Ismail and myself went to the common toilet, took out the weapons from our sacks, loaded them, came out of toilet and started firing indiscriminately toward the passengers," Kasab told police.

As a police officer opened fire, the two militants retaliated with grenades before entering another part of the station and randomly shooting more commuters.

The men then searched for a building with a rooftop where they had been told to hold hostages and call a contact named Chacha, whom Kasab identified as Zaki-ur-Rehman Lakhvi, the suspected mastermind behind the attacks.

Chacha, which means "uncle" in Hindi, would supply phone numbers for media outlets and specify what demands the two should make.

"This was the general strategy decided by our trainers," Kasab said.

Taking heavy fire from police, the two had trouble finding a "suitable building" and stormed a hospital they mistook for an apartment building. There, they searched for hostages and traded more gunfire with security forces. It's unclear if they ever held hostages.

When they left, a police van pulled up and the two tried to take shelter behind a bush during the shootout. Kasab was hit in the hand as Khan returned fire.

"They got injured and the firing from their side stopped," he said.

Police have confirmed the van was carrying top police officials, including the head of the anti-terror squad who was killed.

In the confession, Kasab, 21, describes his conversion from an aspiring street criminal to a loyal soldier for Lashkar-e-Taiba, the terrorist group banned by Pakistan in 2002 and blamed by India in the attacks.

He came to the organization last year while looking to buy guns to commit robberies after quitting a low-paying job at a catering business. The search led him to several Lashkar "stalls" at a bazaar in the Pakistani city of Rawalpindi, he said.

Kasab went on to receive rigorous training in weapons handling and other skills, attending at least six Lashkar camps and visiting his parents twice during breaks, he said. Lashkar operatives even lectured recruits on India security and intelligence agencies, and taught them how to evade pursuing security forces.

He said they were shown "clippings highlighting the atrocities on Muslims in India," images of Mumbai locations on Google Earth, and film footage of the train station.

"We were instructed to carry out the firing at rush hour in the morning between 7 to 11 hours and between 7 and 11 hours in the evening," he said. The attacks ultimately started around 9:30 p.m.

After Kasab and nine others were picked among a group of 32 recruits, they headed to Karachi in September and practiced traveling on speed boats.

On Nov. 23, the group was transported to a ship called the Al-Huseini far out at sea.

Shortly after boarding, "each of us was given a sack containing 8 grenades, one AK47 rifle, 200 cartridges, two magazines and one cell phone for communication," he said.

The Al-Huseini's crew, he said, later hijacked an Indian vessel, killing all but one crew member who was temporarily kept alive and held at gunpoint to guide them into Mumbai's coastal waters.

"When we were at some distance from the shore, Ismail and (another militant) killed the Indian seaman" before the group boarded a dinghy and came ashore "per the instructions received earlier."

Police said Saturday that Kasab, who's facing a criminal case in the attacks, has written to Pakistani officials to request legal help.

In a letter written Thursday, he asked for "legal aid" from the Pakistani consulate and requested a meeting with a consular representative, said Rakesh Maria, Mumbai's chief investigator.

The letter was forwarded to India's government to relay to Pakistani officials, but it was unclear whether it had been delivered, Maria said.

Pakistani officials were not immediately available for comment.

A number of Indian lawyers — including a prominent group of Mumbai attorneys — have refused to defend Kasab against criminal charges amid outrage over the attacks.

Kasab is being held on 12 offenses, including murder and waging war against the country, but has not yet been formally charged.

Islamabad has refused to acknowledge Kasab's nationality, complaining that India has yet to furnish any evidence.

Let's Give Pakistan the Attention It Deserves

The Mumbai attack is the latest wake-up call.

By BERNARD-HENRI LEVY
WSJ

"The world is decidedly poorly made," Asif Ali Zardari, widower of Benazir Bhutto and president of Pakistan, must be saying to himself. The French expression Le monde est décidément mal fait sums things up quite nicely.

For it was at the very moment that Mr. Zardari was attempting to modernize his country -- to break with the equivocations of the Musharraf years and move forward with a peace process with India for which he took the initiative -- that the tragedy of Mumbai occurred.

But what's done, unfortunately, is done. And if the authors of the carnage are, as it seems, linked to the Pakistan-based terrorist group Lashkar-e-Taiba, we can already draw a certain number of appalling and unquestionable conclusions.

The Lashkar-e-Taiba is one of the jihadist groups with which I became familiar while working on my book "Who Killed Daniel Pearl." This group is, without a doubt, based in Pakistan.

It is likely that the Lashkar-e-Taiba has within India ideological or religious "correspondents" in the vast Muslim community that sees itself (not without reason) as discriminated against by the Hindu majority. Still, there is very little doubt that the initiative, strategy and money for the assault on Mumbai came from terrorist leaders inside Pakistan.

Far from concentrating only on the cause of Kashmir's independence, and most of all, far from existing only in the notorious and officially ungovernable "tribal zones" on the border of Afghanistan and Pakistan, the Lashkar-e-Taiba is an all-terrain group with great political influence. It includes militants in every city of the country: Peshawar, Muzaffarabad, Lahore and even Karachi (Pakistan's economic capital).

Since its creation 15 years ago, the Lashkar-e-Taiba has been linked to the ISI, the formidable Inter-Services Intelligence agency that operates like a state within a state in Pakistan. Obviously, this link is not widely publicized. However, from the kidnapping and murder of Daniel Pearl to the July 2005 attack on the Ayodhya Hindu temple in Uttar Pradesh, there is abundant evidence that the jihadist wing of the ISI has assisted the Lashkar-e-Taiba in the planning and financing of various operations.

Worse yet, the Lashkar-e-Taiba is, as I discovered while researching and reporting my book on Daniel Pearl, a group of which A.Q. Khan, the inventor of Pakistan's atomic bomb, was a longtime friend. Mr. Khan, one may recall, spent a good 15 years trafficking in nuclear secrets with Lybia, North Korea, Iran and, perhaps, al Qaeda, before confessing his guilt in early 2004. Later pardoned by Gen. Pervez Musharraf, Mr. Khan remains perfectly free to travel within Pakistan, as he was just admitted this Monday, under the protection of the ISI, to the most elite hospital in Karachi.

No, this is not a dream -- it is reality. Pakistan is home to a man both father of his country's nuclear program and known sympathizer of an Islamist group whose latest demonstration has netted at least 188 dead and several hundred wounded.

The Lashkar-e-Taiba is, ultimately, one of the constitutive elements of what is conventionally called al Qaeda. For too long we've told ourselves that al Qaeda no longer exists except as a brand; that it is only a pure signifier, "franchised" by local organizations independent of one another. Yet there indeed exists in our world what Osama bin Laden called the "International Islamic Front for Jihad against Jews and Crusaders," which is like a constellation of atoms aggregated around a central nucleus. These atoms find themselves, for the most part, clustered in this new zone of tempests that forms the whole of Afghanistan, Bangladesh and Pakistan.

Three days after the massacre, in a moment of anger and frustration that rings true, Pakistan's President Zardari said: "Even if these activists are linked to the Lashkar-e-Taiba, who do you think we are fighting?"

The problem, unfortunately, is beyond him. Like his predecessor, President Zardari lacks the means to break the back of criminal elements within the ISI and Pakistani military. To an even greater extent, he lacks the backing of those who associate it with the darker side of his own administration. And therein lies the challenge -- perhaps the most frightening of our era. After the bleeding of Mumbai, it is time the entire international community -- not just those in the region -- took notice.

Recession Trickles to India

by Jeremy Nahn
New York Times

BANGALORE, India — After years of being blamed for job losses in America and elsewhere, India’s high-tech companies and outsourcing firms are going through a downturn of their own. The global slowdown is forcing them to reduce hiring, freeze salaries, postpone new investments and lay off thousands of software programmers and call center operators.

While some industry insiders insist the global crisis will actually benefit companies here, as Western businesses seek to cut costs by moving jobs overseas, right now the sector is suddenly gripped by an unfamiliar sense of uncertainty.

“It’s certainly not irrational exuberance,” said Nandan Nilekani, co-chairman of Infosys, one of India’s best-known technology outsourcing firms. “There is a lot of introspection about what does this mean and when does it end.”

The downturn is exposing a deeper concern: India has become the world’s front office, handling customer service calls, and its back office, helping to process payments and run accounting and other computer systems. But it has not yet become the head office — making major new products, pioneering marketing techniques or helping to shape corporate strategy.

Rather than drowning American technology firms or work forces with a vast supply of cheap engineering talent, as some had feared, India — and Bangalore, its Silicon Valley — have continued to largely serve as the information economy’s version of manual labor.

“Historically, when it comes to innovation, Indian companies are relatively weak compared to the I.B.M.’s and Accentures of the world,” said Partha Iyengar, the head of research in India for the Gartner Group, which analyzes trends in the tech sector. “It has been their chronic Achilles’ heel.”

Last week’s coordinated terrorist attacks killed nearly 200 people and temporarily brought Mumbai, India’s commercial capital, to a halt. But long before that shock, the country had been suffering the effects of the global slump, losing capital as Western investors fled to the security of American Treasuries, undermining Indian banks and company balance sheets.

Infosys recently scaled back its projections for the year, telling investors that it now expects revenue to expand 13 to 15 percent, instead of the 19 to 21 percent it had forecast and far below the 30 percent annual expansion the company had been used to.

Like many of India’s outsourcing companies, Infosys is heavily dependent on the financial sector, deriving a third of its revenue from banks like Citigroup and Bank of America and other financial clients. Its fate is also closely tied to the American economy: two-thirds of its business comes from the United States. Neither factor bodes well for the company’s prospects.

Technology Partners International, a consulting firm that publishes an index of global outsourcing deals, says its index is at a 10-year low. “People think that outsourcing is a recession-proof industry. It is not,” said Siddharth Pai, a partner at the firm.

That realization has changed the boomtown atmosphere of this city. Young workers still flock to a rooftop terrace on Residency Road every Wednesday night to grind to house and hip-hop music. But lately, the crowds at NYKS, an upscale nightclub, are a little thinner. They drink a little bit less. They talk a little less loudly. “Now they are thinking twice before spending money,” said Supreeth Chandrasekhar, a 25-year-old disc jockey at NYKS.

Mr. Chandrasekhar also said that he used to perform at corporate events but that this business had largely disappeared.

In a country where most marriages are arranged by parents, the downturn has even taken a toll on the matrimonial prospects of those in technology outsourcing. “Because there is no job guarantees for I.T. people, for the last six months brides’ families have not been accepting grooms from this background,” said Jagadeesh Angadi, a matchmaker in Bangalore.

The Indian National Association of Software and Service Companies estimates that the country’s technology sector will create 50,000 fewer jobs in 2008 than last year, although it predicts the sector will still have added 200,000 workers by year’s end. India’s technology outsourcing companies have laid off about 10,000 employees since September, according to the Union for Information Technology Enabled Services, a labor group that represents technology workers.

Among the major players that have announced cutbacks in hiring is Satyam Computer Services, which slashed its recruitment plans to fewer than 10,000 from 15,000. Infosys, by contrast, has almost $2 billion in cash on its balance sheet, a significant amount that can help it weather the downturn. It said it intended to follow through on plans to hire 25,000 workers this year.

“We made offers to people, and we need to stand by them,” Mr. Nilekani of Infosys said.

But some companies that have hired recruits are postponing their start dates. The deferrals allow companies, which once hired in anticipation of future business, to better manage overhead by adding staff only when they have confirmed projects.

A few so-called captive outsourcing operations — those that serve only their parent company in Europe or the United States — have also cut back. American Express laid off some 200 of its 6,000 workers in India, and Goldman Sachs announced last month that it would dismiss about 10 percent of its Indian work force.

Still, for the moment, the industry has escaped large-scale job losses. Indian labor laws make it difficult for companies to drop workers, and mass firings can draw a political outcry. But outsourcing companies have begun pruning workers, citing poor job performance, a way to quietly reduce labor costs without attracting much public scrutiny.

The large outsourcing company Wipro dismissed 2.5 percent of its work force in the second quarter. Outsourcing companies are also shelving expansion plans. Wipro, for instance, announced it was postponing the opening of a major new software development center in Atlanta.

But India’s business leaders see opportunity in the downturn. “Once things settle down, people will start looking at their business operations and how to make them more efficient, and that is where we play,” Mr. Nilekani said.

Even consolidation on Wall Street, which may eliminate some Indian companies’ clients, could help Indian workers, outsourcing executives say. Mergers require technical skills to integrate disparate systems, and there is a potential for profitable outsourcing work in areas like regulatory compliance. Banks are likely to be under stricter government scrutiny given the sense that lax oversight contributed to the financial crisis.

Raman Roy, chairman of Quatrro BPO Solutions, an outsourcing firm based in New Delhi, says he has 300 employees reviewing legal documents as part of bank mergers. Copal Partners, a company that uses employees in India to help investment banks do the sort of deal-based research normally performed by the bank’s junior analysts, has continued to expand even during the downturn.

Critics say that will not change the local industry’s basic disadvantage: a creativity gap with Western competitors. Indian technology companies are too focused on increasing the efficiency of their systems, not improving their clients’ own industry-specific processes, according to Navi Radjou, an analyst with Forrester Research. “They are having trouble tailoring a technical application to a particular business need,” he said.

But India’s biggest tech outsourcing companies want to do as much as their European and American rivals, including expanding in Europe and the United States. And the downturn may allow them to acquire talent — and even whole businesses — on the cheap.

The changes may come too late for workers like Vikram Hathwar.

In July, Mr. Hathwar, a 22-year-old engineer, graduated from a technical college with a job offer from a software developer. But instead of starting his job — paying nearly $6,000 a year, a good starting salary in this country — Mr. Hathwar has been waiting for a letter from the company telling him when to report for work.

“I called them and they said they would be calling two or three months later, but still they have not informed me anything about when I should start,” Mr. Hathwar said.

In the meantime, he has begun looking for a temporary job. But he said most tech businesses are no longer hiring recent graduates. The few that are have begun asking applicants to intern for several months without pay and with no guarantee of a permanent position. “The recession has made for all these pressures on us,” Mr. Hathwar said. “It is very confusing to know what to do.”

This article has been revised to reflect the following correction:

Correction: December 5, 2008
An article on Thursday about the effect of a global slowdown on outsourcing companies in India misstated the buyer of the British consulting firm Axon Consulting. Axon was purchased by the Indian technology outsourcing firm HCL Technologies, not its rival Infosys.

Were the Mumbai Terrorists Fueled by Coke?

by Bruce Crumley
TIME

Did the jihadists who tore up Mumbai last week rely on party drugs usually associated with Western decadence to stay awake and alert throughout their three-day killing spree? Britain's Telegraph newspaper suggests that they did, citing unidentified officials claiming physical evidence shows the assailants used cocaine and other stimulants to sustain their violent frenzy. And if the notion of self-anointed holy warriors on a coke binge sounds incongruous, the report also maintains that the killers imbibed the psychedelic drug LSD while fighting advancing security forces.

"We found injections containing traces of cocaine and LSD left behind by the terrorists, and later found drugs in their blood," the Telegraph was told by one official, whose nationality and relation to the investigation were not specified. "This explains why they managed to battle the commandos for over 50 hours with no food or sleep." (See the terrorism in Mumbai.)

The hallucinogenic and sensory-distorting effects of LSD make it an unlikely combat drug, even for kamikaze assailants who were, after all, seeking to kill as many people as possible before their own inevitable death. But the suggestion that the Mumbai jihadists may have amped themselves up on stimulants typically forbidden by their strict Salafist brand of Islam strikes some experts as plausible, particularly within the twisted jihadist logic in which holy ends justify impious means.

"We've never seen instances of operatives using drugs in attacks before, but we've also never seen the kind of open-ended, insurgent-style strike of civilian targets by Islamists prior to Mumbai," says Jean-Louis Bruguière, who retired this year as France's chief counterterrorism investigator to take a top post in the transatlantic Terrorist Finance Tracking Program. Bruguière had no information to confirm or deny the reported cocaine binge by the Mumbai assailants, but he believes that discounting it out of hand would be naive.

"Why wouldn't attackers do something forbidden by their religious practice — to take drugs or anything else — that could help them achieve what they consider the far more important goal of their plot in striking a blow for God?" Bruguière asks. "Adepts of the Takfir wal-Hijra sect will adopt what Islam considers impure behavior of enemy societies, like drinking alcohol, eating pork and wild living, to better prepare attacks for those same societies. That's what Mohamed Atta and the other 9/11 attackers did while plotting in the U.S. If terrorists feel jihad justifies impious acts to prepare strikes, why wouldn't that rationalization also apply to carrying attacks out?"

Independent French terrorism expert Roland Jacquard is a little more skeptical of the report, however, at least as far as it claimed some of the fighters had used narcotics to numb themselves to pain as death approached. Though he understands the strategic logic of assailants using stimulants to overcome fatigue as their attack wears on — conventional armies, including the U.S. military, have used stimulants to counter combat fatigue — he does not believe the stern Salafist prohibition of soporifics would be ignored as the end loomed.

"We're talking about people who think they're killing for God and who are certain they'll attain paradise by slaying innocent people. The most powerful drug they could ever find is already in their head before the attack starts," says Jacquard. "There's a very strong antidrug culture among Salafists — most don't even use tobacco. And extremists with any drug experience usually say Islam is what allowed them escape it."

The Telegraph story also quotes an official saying traces of steroids had been found in the bloodstreams of Mumbai attackers — something the unnamed source says "isn't uncommon in terrorists." If so, it's a well-kept secret that runs counter to jihadists' disdain of external "impurities" being used to attain physical fitness they often extol. But for Bruguière, wrangling over those kinds of details is simply a counterproductive attempt to create a precise, predictable stereotype of a terrorist in what is, in fact, a diverse, rapidly changing, amorphous milieu of extremists. (Read Mumbai's Terror Is Over, but Panic Persists.)

"It's now clear the Mumbai group was connected to the Pakistan-supported Lashkar-e-Taiba, but it takes a while before we know how close and structured that relationship was and how much autonomy the attacking unit was operating with," Bruguière says. "LeT is keen to export its fight throughout the region and world but will do so in loose relationships with myriad extremist movements out there. Some will use car explosions, others kamikaze bombers, and others insurgent terrorists who — just maybe — decide to use drugs to keep their strike going longer. If we want to prepare for the way we may be attacked next, we have to start considering all the ways we haven't been attacked yet, as well as the ones we know."

Pak TV channel says 26/11 hatched by Hindu Zionists

by Nandita Sengupta
TNN

NEW DELHI: Mumbai's 26/11 was actually a plan hatched by "Hindu Zionists" and "Western Zionists", including the Mossad, said a self-styled Pakistan security expert on a Pakistan news television show, uploaded on www.hotklix.com.

" Inki shaklein Hinduonwali hain, jis zabaan mein guftagoo kar rahein hain, woh zabaan koi Pakistani istemaal nahin karta hai (They look like Hindus. No Pakistani speaks the language they chatted in)," said Zaid Hamid while referring to the terrorists on the show Mujhe Ikhtilaf Hai (I differ) on Pakistan's News One channel. The sensationalist channel was launched in November last year.

Hamid said that it was a "badly planned" operation that had gone horribly wrong. "9/11 jo Americans ne kiya tha usko bahut khoobsurat camouflage kiya tha. Unhone media mein perception management bahut acchha kiya . Indians ne wahi game repeat karne ki koshish ki, lekin akal to hai nahin . In ahmakon ne complete disaster kiya isko handle karne mein . (The Americans executed the 9/11 attack perfectly. They managed the media very well. The Indians tried to repeat the formula but goofed up. The idiots made a complete mess of it).

He said that the attackers wore saffron Hindu Zionist bands, which no Muslim would tie. Hamid also said that within the first 5 minutes of the attack, the three ATS policemen investigating the network of terror within India's security agencies and radical right were killed.

That ensured that those investigations reach a dead end. Anchor Qudsia Qadri added that with their killings, the investigations into the Samjhauta Express carnage would be halted. The killings also immediately shifted attention from India's domestic terrorists to Pakistan, said Hamid.

Marvi Memon, glamorous Pakistan Muslim League member, on the same programme, was appalled at the Pakistan government's expansion of the "India-appeasement package" by initially agreeing to send ISI chief to India. "I just don't get it," she exclaimed in exasperation.

She wondered how can you send the ISI chief to a " mulk jiske sath jang chal raha hai ...at a different level...," mentioning Kashmir and accusing India of blocking Pakistan's waters. Memon said, "They (Indians) are quite obsessed with anti-Pakistan speak and that unites them," she said. Memon also spoke about India's separatist movements and believed that India was only reaping the bitter harvest of the poisonous seeds it had sowed.

Blogger daily.pk writes in pakalert.wordpress.com, "India has been relapsing into religious extremism and numerous separatist movement have mushroomed due to official patronage ...I see the Mumbai bombings as the desperate move of separatists who want to blame everything on Muslims."

It's not only random voices railing against fingers pointing to Pakistan. Blogger and journalist Farrukh Khan Pitafi is miffed. "For years I have been advocating peace between India and Pakistan," he wrote. But he, too, says that India was out of its mind in naming Pakistan as the source of violence without identification of the perpetrators.

He wrote: "During such a long coverage of the mishap not a single outlet pointed out that Hemant Karkare... was the same man whose dismissal was Narendra Modi's biggest demand. Or that he was the man on the verge of uncovering the home-grown terror franchise of the Hindu extremists. No channel mentioned Colonel Purohit once during the live telecast, no not even CNN, BBC or CBS. It is sad."

India blames Pakistanis, calls for punishment

by Somini Sengupta and Robert F. Worth
New York Times

Mumbai, India

In a new sign of rising tension between two nuclear-armed neighbors, Indian foreign ministry officials summoned Pakistan's ambassador Monday evening and told him Pakistanis were responsible and must be punished for last week's terrorist attacks here, in which 173 people were killed over three days in the heart of India's commercial capital.

India also suggested that the planners of the attacks are still at large in Pakistan, saying India expected "strong action would be taken" by Pakistan against those responsible for the violence, according to a statement released by the Ministry of External Affairs. The 10 men who appear to have carried out the attacks are now dead or in custody.

The statement added tartly that Pakistan's actions "needed to match the sentiments expressed by its leadership that it wishes to have a qualitatively new relationship with India."

It was not clear whether India had supplied Pakistan with any proof of its claims. Pakistani officials have said that they are not aware of any links to Pakistan-based militants and that they would act swiftly if they found one.

The Indian government is facing strong criticism at home for its handling of the attacks, and with elections just months away, it could risk being accused of diverting public anger from its failures if it does not furnish evidence for its claims. But there is also a groundswell of popular anger in Mumbai against Pakistan.

The attacks have raised tensions between the two countries to a level not seen since 2001, when a suicide attack on the Indian parliament pushed them to the brink of war.

The ominous atmosphere poses a special challenge for the United States, a strong ally of India and also dependent on Pakistan for cooperation in fighting al Qaeda. Renewed tensions between India and Pakistan could distract Pakistan from that project.

President Bush has dispatched Secretary of State Condoleezza Rice to India, where she is expected to arrive on Wednesday.

Speaking in London on Monday, she called on Pakistan in blunt terms "to follow the evidence wherever it leads," adding, "I don't want to jump to any conclusions myself on this, but I do think that this is a time for complete, absolute, total transparency and cooperation."

The foreign ministry's claim that the attackers were all Pakistani echoes a claim by the one attacker who was captured alive, identified as Ajmal Amir Qasab, said Inspector Rakesh Maria, head of the crime control bureau at the Mumbai police. Qasab also said he was a member of Lashkar-e-Taiba, a militant Islamist group blamed for terrorist attacks in Indian-administered Kashmir and elsewhere.

However, no foreign identification documents were found, and some of the attackers had fake Indian papers, Inspector Maria added.

Maria also said there were only 10 attackers in all, denying earlier suggestions by public officials that more may have been involved. It remains unclear whether more attackers may remain at large, and whether the militants had at least some accomplices on the ground before the violence began on Wednesday night.

Some new details emerged Monday about the difficulties faced by the Indian police commandos who responded to the killings here last week. The attackers used grenades to booby-trap some of the dead bodies in the two hotels where they struck, the Taj Mahal and Oberoi hotels, Inspector Maria said.

That tactic made fighting the attackers more difficult, and significantly delayed the cleanup after the violence ended, he said. The last militants were routed on Saturday morning, but the Taj hotel was not returned to the control of its owners until Monday morning.

But those details seemed unlikely to blunt the rising public anger at the government's handling of the attacks, which have been widely described here as India's version of the Sept. 11, 2001, terrorist attacks in the United States. The ease with which the small band of attackers mowed down civilians in downtown Mumbai, and resisted police commandos for days in several different buildings, has exposed glaring weaknesses in India's intelligence and enforcement abilities.

On Monday, rising public outcry pushed the chief minister of Maharashtra State, Vilasrao Deshmukh, a member of the governing Congress Party, to offer his resignation. Party leaders were still considering his offer Monday night.

"I accept moral responsibility for the terror attacks," he said at a news conference.

Earlier in the day, his deputy, R.R. Patil, officially stepped down. The two gestures came a day after India's highest-ranking domestic security official, Home Minister Shivraj Patil, resigned, saying he took responsibility for the failure to forestall or quickly contain the three-day killing spree.