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From SAPT.org:

Pakistan's slide towards state failure accelerated dramatically in year 2007, and the assassination of former Prime Minister Benazir Bhutto on December 27 was a sharp reminder that the country's progressive collapse was much more rapid and irretrievable than most had envisaged. In more ways than one, 2007 was a cumulative reflection on all of President Pervez Musharraf's errors of omission and commission since he took power in the coup of October 1999...

for full Pakistan assessment: http://satp.org/satporgtp/countries/pakistan/index.htm

Balochistan (excerpt)

The Balochistan province accounting for approximately 44 per cent of Pakistan's landmass is now afflicted by an encompassing insurgency. Currently, all 30 Districts of Balochistan are affected either by a sub-nationalist tribal insurgency or, separately, by Islamist extremism. Most of the violence in Balochistan is, however, 'nationalist' and there is no co-operation between pre-dominantly Pashtun Islamist militants in the North and the Baloch nationalist insurgents. Structural and constitutional biases prevailing against the provinces feed popular anger and the insurgencies, and militate against any possible solution to the Baloch problem, particularly given Islamabad's track record of intransigence.

On the face of it, it seems that the province has relatively calmed down after the assassination of Nawab Akbar Khan Bugti on August 26, 2006, by the military. The momentum of the Baloch insurgency declined relatively in 2007, as some leaders either fled Pakistan or were neutralized by the state. The operational capacity of the Balochistan Liberation Army (BLA), the most prominent insurgent group in Balochistan, was considerably reduced in 2007 and is expected to remain diminished in the immediate future. At least 450 persons, including 226 civilians, 82 soldiers and 142 insurgents, were killed in 772 incidents in 2006. Violence in 2007 was at relatively lower levels, with at least 245 persons, including 124 civilians, killed in the year. But, the insurgency continues to simmer, and there has been a steady stream of bomb and rocket attacks on gas pipelines, railway tracks, power transmission lines, bridges, and communications infrastructure, as well as on military establishments and Government facilities. The rebels are still capable of carrying out acts of sabotage on a daily basis across the province and a political solution to the insurgency is nowhere in sight. Acts of violence are, importantly, not restricted to a few Districts, but are occurring in practically all of them, including the provincial capital Quetta.

Still reeling under the loss caused by the assassination of Nawab Akbar Bugti in August 2006, the Baloch insurgents were dealt another significant blow when Nawabzada Balach Marri, purported chief of the Balochistan Liberation Army, was killed on November 21, 2007. Marri was reportedly killed along with his bodyguards in a clash somewhere inside Afghanistan, triggering widespread violence in Quetta and other parts of the province. Mystery shrouds Marri's killing, as some reports suggested he was killed in Afghanistan while others stated it was in Pakistan.

Adding to the Baloch insurgency are the Islamist militants concentrated in the north of the province, who are orchestrating violence on both sides of the Afghan border in their areas of domination. There were regular reports throughout 2007 of the presence of al Qaeda-Taliban operatives in Balochistan. In fact, Abul Haq Haqiq aka. Mohammad Hanif, an arrested Taliban spokesman, reportedly told Afghan intelligence in January 2007 that the fugitive Taliban chief Mullah Mohammed Omar was living in Quetta under the protection of the Inter-Services Intelligence.

The Federal Government's experiment of maintaining peace in Balochistan by converting the B' areas (where the Police do not operate) into A' areas (under Police jurisdiction) has failed to secure desired results, with the crime ratio in A' areas increasing alarmingly over the past three years. The Levies' Force policed 95 per cent of Balochistan five years ago, while just five per cent of the area was under Police control. The Government abruptly decided to abolish the centuries-old community-based Levies Force, replacing it with the Police. Presently, 22 districts of Balochistan are A' areas and eight B' districts are yet to be converted. Official statistics stated that as many as 1,170 people had been killed in Balochistan since 2004. The number of murder cases in levy-controlled areas was 542. More murders took place in 2005 (456) as compared to 2004 (373) in A' areas.