FACTBOX: Pakistan political prospects as coalition splits

ISLAMABAD (Reuters) - Former Pakistani prime minister Nawaz Sharif pulled his party out of the ruling coalition on Monday over disputes with his main partner over the judiciary and who should be the next president.

The split came a week after the coalition celebrated the resignation of Pervez Musharraf as president.

The coalition is headed by the Pakistan People's Party (PPP) of assassinated former prime minister Benazir Bhutto, which has nominated its leader and Bhutto's widower, Asif Ali Zardari, to replace Musharraf as president.

Following are some implications of the latest developments.

GENERAL ELECTION SCENARIOS

* The departure of Sharif's Pakistan Muslim League (Nawaz) from the coalition will not force an election, analysts say, as the PPP should be able to gather enough support to rule. But it will make it more difficult for the PPP to marshal a two-thirds majority in parliament, needed to amend the constitution.

* However, Sharif looks set to gain in popularity by standing firm on principle on the judges, whose sacking was regarded as the major decision that turned public opinion against Musharraf. That could help make Sharif and his Pakistan Muslim League (N) party the favorites when an election is ultimately held.

BATTLE OVER JUDGES

* The PPP is reluctant to restore the judges, partly because of concern the deposed chief justice might take up challenges to an amnesty granted to Zardari and other party leaders from graft charges last year, analysts say.

* Before Musharraf sacked them the judges were also quite willing to challenge his government on the legality of various decisions, a tendency the PPP may not view with enthusiasm now that it effectively controls government.

* Lawyers have called for protests to press for the restoration of the judges.

BATTLE OVER THE PRESIDENCY

* Pakistan will hold a presidential election on September 6 with members of the country's four provincial assemblies and the national parliament voting.

* Sharif said his party will field its own candidate, a former chief justice, Saeeduzzaman Siddiqui, though Zardari looks likely to win.

* Sharif wants to make the presidency a ceremonial post after what it views as the Musharraf dictatorship, by stripping the president of powers, in particular the power to dismiss parliament. The PPP has been coy about whether and when it would agree to strip the presidency of powers.

* The stance of Sharif and his party is again likely to win popular points with those who saw the presidency's strong powers as enabling Musharraf's strongman rule.

ECONOMIC AND SECURITY IMPLICATIONS

* The various squabbles divert government attention from economic and security problems, critics say, to the dismay of investors and allies. Pakistani stocks and the rupee strengthened initially last week in hope Musharraf's resignation heralded an end to political uncertainty but they later fell sharply, with traders citing the coalition's inability to get its act together as the main factor.

* An intensifying insurgency in Afghanistan is pressuring Pakistan to act quickly to stop Taliban attacks from sanctuaries on its side of the border and control other militants.

However, some fear a tough stance spurs tit-for-tat suicide attacks. Pakistani Taliban said that was the motive for the most deadly strike yet against the military, which killed at least 67 people in blasts outside a defence industry complex on Thursday.

(Writing by Jerry Norton; Editing by Robert Birsel)