Bhutto sees Musharraf army role disappearing

LONDON (Reuters) - Former Pakistani leader Benazir Bhutto said on Wednesday she expected the obstacle of President Pervez Musharraf's role as head of the army to disappear before presidential elections.

Asked whether Musharraf would leave the army before elections expected in the coming months, Bhutto told Reuters: "It's not an obstacle any more. It's my assessment it will be before the presidential elections."

"I can say that (Musharraf) wants to make the people of Pakistan happy on the uniform issue," she said in a telephone interview.

The former prime minister, who has lived in self-exile since 1998, has been holding talks in London with Musharraf's representatives about a power-sharing deal.

Bhutto also said a deal had been struck to drop charges against former Pakistani politicians, many of whom including herself and former prime minister Nawaz Sharif stand accused of a range of charges including corruption and fraud.

"The issue of immunity has been overcome -- all parliamentarians between 1988 and 1999 against whom charges have not been proven will be immune from further prosecution," she said.

Musharraf, whose popularity has plummeted in recent months, aims to get re-elected president for another five years between mid-September and mid-October, before his term as army chief expires at the end of the year. He seized power in a bloodless coup in 1999.

A pact with Bhutto, whose Pakistan People's Party is the country's single largest, could save him. But Bhutto wants a package of issues agreed including the removal of a ban on her serving a third term as prime minister and stripping the president of power to dismiss parliament and the government.

Asked about the discussions on the balance of power between president and parliament, Bhutto said: "This is one of the issues that is not yet resolved."

"We feel it's important to follow the parliamentary tradition where members of parliament can through a vote of no confidence remove the prime minister."

She said her party was discussing a constitutional package with Musharraf.

"We're looking at how we can defuse the political situation so there is a peaceful transition. We would like to see the moderate forces strengthened."

Bhutto is due to meet her party leaders in London on Friday and wants terms agreed by then, so her party can decide whether it will be for or against Musharraf.