South Asian chasm of mistrust awaits Obama's envoy

President Barack Obama listens as Richard Holbrooke, the U.S. envoy to Pakistan and Afghanistan, speaks at the State Department in Washington, January 22, 2009.

ISLAMABAD (Reuters) - Richard Holbrooke, President Barack Obama's troubleshooter for Pakistan and Afghanistan, will visit Islamabad on Monday before going to Kabul and New Delhi to devise a grand strategy to rid the region of Islamist militancy.

Inexperienced in South Asia, the veteran diplomat is arriving in an unfamiliar region at a time of flux.

Elections are due in India by early May, and in Afghanistan in August, while relations between Islamabad and New Delhi are fraught following an attack by Pakistani militants on the Indian city of Mumbai two months ago.

U.S. and NATO forces are struggling to quell a resurgent Taliban movement in Afghanistan, and the Afghan-Pakistan border is still regarded as the region where al Qaeda is most likely to hatch another September 11 plot.

Obama has upped the stakes with plans to almost double U.S. troop strength in Afghanistan to 60,000 within 18 months, but Vice President Joe Biden warned at a security summit in Munich on Saturday that "no strategy ... can succeed without Pakistan."

Pakistan knows it, and wants the U.S. military equipment it lacks to fight a spreading guerrilla war in its northwest, and money promised in a $15 billion package Biden had supported, and trade concessions for its ailing textile industry.

"Pakistan is pivotal," said Farahnaz Ispahani, a lawmaker from President Asif Ali Zardari's party and member of the National Assembly's foreign affairs committee.

"Our security concerns are not just ours, they impact India and Afghanistan too."

The trouble for Pakistan is that both India and Afghanistan reckon the cause of regional stability would be well served if Pakistan was persuaded to purge its intelligence agencies of all links to Islamist militants.

In a recent interview with the Council on Foreign Relations Bruce Riedel, a Brookings Institution South Asia expert, the former CIA officer said getting Pakistan's support to shut down militant sanctuaries would possibly be "the single hardest foreign policy challenge President Obama faces."

PAKISTANI FEARS

Holbrooke will be in Islamabad until Thursday meeting President Zardari, Prime Minister Yousaf Raza Gilani and Army Chief General Ashfaq Kayani, among others.

Pakistan's civilian government is less than a year old and still fragile, its army is struggling to contain an Islamist insurgency in the northwest, and the economy would have collapsed but for an International Monetary Fund bail-out in November.

Despite the internal threats, Pakistan's powerful army remains obsessed with India, and its generals fear New Delhi's friendship with Afghan President Hamid Karzai's government could lead to encirclement.

They believe Washington has paid scant attention to Pakistan's security concerns since becoming an ally in the war on terrorism more than seven years ago.

But if Obama and Holbrooke have any intention of trying to encourage India to reach an early settlement with Pakistan over the disputed Kashmir territory, the timing is all wrong.

India is seething with suspicion that Pakistan's Inter- Services Intelligence (ISI) agency has ties with the jihadis responsible for slaughtering 179 people in Mumbai.

Holbrooke and Karzai were both attending the conference in Munich, as were Indian Foreign Secretary Shivshankar Menon and Pakistani Foreign Minister Shah Mehmood Qureshi.

In Paris last week, Menon said the plotters behind the Mumbai carnage were "clients and creations" of the ISI.

Pakistan has denied any involvement by state agencies and has said it was investigating a dossier of information from India, to which it will reply this week.

India will want to see action against the culprits before it restarts a frozen 5-year-old peace process.

As for Afghanistan, Obama has made clear that it expects Karzai to show better governance, fight corruption and stop the country's slide toward becoming a narco-state.

(Editing by Sugita Katyal)