The New Nation - Internet Edition

Strike shuts down Indian Kashmir on UN Day

Reuters, Srinagar

Shops, businesses and schools closed in Kashmir's main city on Friday after a strike by separatists to press for the implementation of a U. N. resolution requesting a referendum over the disputed Himalayan region.

The strike coincided with United Nations Day on Friday.

The United Nations adopted a resolution in 1948 calling for a referendum for Kashmir to determine whether the area should be part of India and Pakistan.

"I appeal to people to observe a complete strike on United Nations day to press for implementation of U. N. resolutions over Kashmir," hardline separatist leader, Syed Ali Shah Geelani, said in a statement.

The past two months have witnessed some of the biggest anti-India protests in Kashmir since a separatist revolt against New Delhi's rule broke out nearly twenty years ago.

The strike also closed banks and most of the government offices in Srinagar, Kashmir's summer capital, where roads were deserted except for security patrols.

Life in Srinagar, a city of 1.1 million people, is frequently disrupted by strikes and protests over separatist causes.

"We will never bow to the suppression and occupation of Indian rule, and I think today we should protest and remind the United Nations of its promise," said Abdul Hamid, a shopkeeper in Srinagar.

Tens of thousands of people have been killed since simmering discontent against Indian rule turned into a full-blown rebellion in 1989.

Violence involving Indian troops and separatist guerrillas has declined significantly since India and Pakistan, which both claim the region, began a slow-moving peace process in 2004.

But people are still killed in almost daily fighting between militants and soldiers.

Three militants were killed in separate gun battles with soldiers in the past 24 hours, police said.

Iraqi labour minister escapes suicide car bombing

AP, Baghdad

Iraq's labour minister escaped assassination Thursday when a suicide bomber rammed an explosives-laden SUV into his convoy, killing at least nine people in one of the safest areas of the capital.

The blast came on a day when the U.S. relinquished control of a province that includes much of the area south of Baghdad once known as the "triangle of death." Babil is the 12th of 18 Iraqi provinces to be placed under Iraqi control, paving the way for U.S. forces eventually to go home. Americans will stay in the area to help the Iraqis when needed.

The bomber drove his Toyota Land Cruiser into the convoy carrying Labor and Social Affairs Minister Mahmoud Mohammed al-Radhi as it passed near Tahrir Square in the busy Bab al-Sharji market area - not far from the U.S.-protected Green Zone. The blast left a 15-foot crater in the road and the smell of gunpowder in the air. The Shiite minister was unharmed, but three guards were killed, ministry spokesman Abdullah al-Lami said. "It is the latest in a series of criminal acts that are targeting development process in Iraq," al-Lami told Al-Arabiya television. He could not be reached for further comment, but an Iraqi police official later said al-Radhi's nephew was among the dead. The district has seen several bombings in past years, including one on March 13 that killed 18 people. But authorities have reinforced security with several checkpoints and concrete walls, and it had been relatively peaceful for months.

The area had been frequently targeted in the past because it was a transit route for convoys to and from the Green Zone, said Hadi Hassan, who was inside his camera store when the bomber struck nearby.

"The glass of my shop's door shattered inside and out and I was slightly wounded in my head and hand," he said.

The blast slammed shrapnel against the car of an Associated Press employee who was stopped at a traffic light about 50 yards away. He and others took shelter behind their cars until Iraqi security forces opened fire in the air and ordered them to evacuate the area.

AP Television News video showed a burned SUV and the charred hulk of the apparent car bomb surrounded by Iraqi security forces.

The Iraqi military said nine people were killed and 26 wounded in the blast.

Thailand, Cambodia agree to prevent further border clashes

AFP, Beijing

Thailand and Cambodia agreed Friday to prevent a simmering border dispute boiling over into further armed conflict, in a sign that tensions were easing after deadly clashes last week.

Speaking in Beijing after talks between Cambodian Prime Minister Hun Sen and his Thai counterpart Somchai Wongsawat, the foreign ministers of the Southeast Asian neighbours said the two leaders agreed to avoid future clashes. "The two sides have to advise our troops not to have confrontations any longer," Thai Foreign Minister Sompong Amornviwat told reporters, summarising the agreement made on the sidelines of a summit of Asian and European leaders.

Cambodian Foreign Minister Hor Namhong, standing alongside Sompong, echoed his counterpart, describing the talks as "very good, very friendly."

"We are moving in a good track. Not only to solve the problem of the borders between our two countries but also on a good track to improve our neighbourliness and cooperation," Hor Namhong said.

Tensions between the two neighbours flared in July when an ancient temple on their border was awarded United Nations World Heritage status, rekindling long-running tensions over ownership of land surrounding the temple.

The situation quickly escalated into a military confrontation, with up to 1,000 Cambodian and Thai troops facing off for six weeks, although both sides in August agreed to reduce troop numbers in the main disputed area.

Shots were exchanged last week between soldiers stationed on disputed land near the temple, which belongs to Cambodia, leaving one Thai and three Cambodian soldiers dead.

Negotiations between military leaders in northern Cambodia on Friday sounded a similar note, with senior Thai officials insisting that talks with their Cambodian counterparts were easing the border tensions.

The Thai commanders, led by Lieutenant General Wiboonsak Neeparn, said there was a "friendly atmosphere" in the talks with the Cambodians but insisted Thailand's soldiers would stand firm.

"The Thai side strongly reiterates that the position of our troop deployments is clearly inside Thai territory," said a statement from Thai commanders released as the meetings began.

Thailand's terms of negotiation must be approved in parliament on Tuesday before the two countries can hold further border talks.

Cambodian and Thai military officials agreed to joint border patrols a day after last week's clashes. But Cambodian commanders have since backed out, saying such patrols are not possible in disputed areas.

The Cambodian-Thai border has never been fully demarcated, in part because it is littered with landmines left over from decades of war in Cambodia.

Italian chopper crash in France kills eight

AFP, Metz

All eight people on board died when an Italian military helicopter crashed and burst into flames on Thursday in a field in eastern France, local officials said.

Firefighters pulled the bodies out of the chopper after dousing the fire near the town of L'Isle-en-Barrois, they said.

"There were eight people on board the aircraft and none survived," a spokesman for the French regional authorities said, adding that a crisis cell had been set up to deal with the crash aftermath.

The helicopter went down at around 4.30pm (14h30 GMT) in a field far from any residential zone.

Weather conditions were excellent at the time of the crash, officials said.

There was no immediate information on what caused the accident. An inquiry into the cause of the crash will be carried out, French officials said.

The Italian defence ministry said the aircraft was a Sikorsky HH3F Pelican engaged in manoeuvres alongside the French military.

It was en route with another Italian helicopter between the French towns of Dijon and Florent-en-Argonne when it went down, said the ministry in Rome.

Pakistan facing 'disaster,’ says Imran Khan

AFP, London

Cricketer-turned-politician Imran Khan warned Thursday that Pakistan is heading for "disaster" and lacks any plan to get through its current economic crisis. Khan, chair of the Pakistan Movement for Justice, added there was "no victory" in sight for US-led forces fighting in Afghanistan and threw his weight behind Barack Obama and Joe Biden in the US presidential election.

"I go as far as to say that where Pakistan stands today, we cannot go on as we have been going on," Khan told the International Institute for Strategic Studies (IISS) think-tank in London.

"Unless we change, we are heading towards a disaster. The only way we can change is if we have an independent judiciary checking the abuse of power." He added: "We have muddled through and always somehow we felt that Pakistan was going to get out of the crises it faced. This time the reason it's different is that never have we had such an economic crisis."

Khan said there was "no strategy" for tackling the problems, adding: "No-one knows how we are going to get out of this."

Pakistan has held discussions with the International Monetary Fund and needs up to 4.5 billion dollars (3.5 billion euros) in the next month to deal with a balance of payments crisis.

Khan warned the United States, which has faced controversy over its aerial attacks in Pakistan's tribal areas in pursuit of suspected militants linked to insurgency in Afghanistan, was failing to win hearts and minds in his country.

He said the way the United States was trying to tackle extremism was like fighting "fire with gasoline" and that the aerial attacks were "the worst way to deal" with the issue.

"Unless there's a change of strategy, in my opinion there's no victory in sight for the US," he said, calling for dialogue with militants.

"Certainly the biggest casualty out of this is going to be Pakistant (We are) heading the way Cambodia did during the Vietnam war where Cambodia was accused of sending in insurgents and Cambodia was bombed, destablised and you had the killing fields there."

Backing the Democrat Obama-Biden ticket, he expressed strong admiration for the vice-presidential candidate and described the pairing as "much more suitable" than Republicans John McCain and Sarah Palin.

Khan also predicted more suicide bombings in Pakistan following a devastating attack at the Marriott Hotel in Islamabad last month which killed at least 60 people.

Obama tops new national polls

CNN, Washington

Three national polls of Democrats show Sen. Barack Obama is the front-runner for the nomination. But what's behind this latest momentum?

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New national polls show Sen. Barack Obama, right, trumping Sen. John McCain in November.

There's growing evidence that Obama is seen as more electable than Sen. Hillary Clinton.

If you average the "poll of polls"-AP-IPSOS, USA Today/Gallup and CBS/New York Times-Obama leads Clinton 50 percent to 40 percent, with 10 percent unsure. Here's something Democrats agree on even more: In two different polls, around 70 percent of Democrats polled believe Obama will get their party's nomination.

When Democrats were asked about the general election, the New York Times-CBS News poll showed Obama had the best chance of beating Sen. John McCain -- 59 percent to Clinton's 28 percent.

And it's not just Democrats.

The USA Today-Gallup poll asked Republicans which Democrat would McCain have a better chance of beating.

The answer: Clinton 66 percent, Obama 18 percent.

Republicans are just itching to run against her. Her response? She's heard it all before.

"I hear all these folks talking about who is or isn't electable. Well, they said the same thing about me when I started running in New York. t You know, nobody would vote for me, good grief. I was wasting my time and my money," Clinton recently said. "But I trust the voters, and frankly that's who matters."

All three national polls asked voters the electability question in a general election matchup.

They show Clinton in a dead heat with McCain-both coming in with 46 percent.

Obama, meanwhile, leads McCain by seven points -- 49 to 42 percent.

So why does Obama do better? Here's his answer:

"It's a choice between going into the general election with Republicans and independents already united against us, or running with a campaign that has already united Americans of all parties around the agenda for change. Now that's the choice," Obama has said.

Independents are crucial swing voters. They give McCain a solid lead over Clinton, according to the New York Times-CBS News poll. But independents abandon McCain for Obama.

If Obama's the alternative, McCain's support among independents drops from 52 percent to 36 percent.

The difference in electability looks small, and neither Democrat looks like a sure winner or a sure loser.

But the belief that Obama is more electable is taking hold.

Arab peace initiative is an opportunity: Peres

AP, Cairo

A long-stalled Arab peace initiative could bring peace to the Middle East - still riven by the Israeli-Palestinian conflict - the Israeli President Shimon Peres said Thursday, making his first endorsement of the proposal in an Arab country.

Egyptian President Hosni Mubarak, however, openly disagreed with Peres during a joint press conference, saying Palestinians and Israelis must reach a bilateral agreement before Arab states could consider normalizing relations with the Jewish state. Peres has recently been lobbying to jump-start a 2002 Saudi proposal offering pan-Arab recognition of Israel in exchange for withdrawal from Arab lands captured in 1967.

The plan has been endorsed by 22-member Arab League, but seen little progress since then. "In tandem with the bilateral negotiations with the Palestinians, we need to promote the Arab peace initiative," Peres told reporters after his meeting with Mubarak at the Red Sea resort of Sharm El Sheik.

Peres, a Nobel peace prize winner whose presidency is largely ceremonial, said the Saudi plan "needs to be negotiated" further, but that it was "correct," in spirit.

A U.S. ally, Egypt is a regional heavyweight and was the first Arab country to sign a peace treaty with Israeli in 1979, but Mubarak said discussions of wider peace agreement were off the table because the Saudi initiative is not "open for negotiations."

His spokesman, Suleiman Awwad, later said Mubarak dismisses the idea of all Arab countries holding talks together with Israel before the Palestinian issue is resolved.

On Sunday, Israeli Defense Minister Ehud Barak said Israeli leaders were seriously considering the dormant Saudi plan and that he had discussed it with Prime Minister-designate Tzipi Livni.

"There is definitely room to introduce a comprehensive Israeli plan to counter the Saudi plan that would be the basis for a discussion on overall regional peace," Barak told Israel's Army Radio.

Israel wants to retain some of the land captured in the 1967 war and objects to language in the initiative that appears to endorse a large-scale return of Palestinian refugees to lands inside Israel. Israel says a massive influx of Palestinians would destroy the country's Jewish character.

Peres and Mubarak said they also discussed the fate of Gilad Shalit, a kidnapped Israeli soldier, held in the Gaza Strip.

"Egypt will continue its persistent efforts to mediate and ensure success of a Shalit release deal and the Palestinian prisoners deal," Mubarak said.

Egypt has been brokering a potential prisoner exchange between Israel and Gaza's Hamas leaders. Hamas is holding an Israeli soldier, captured more than two years ago in a cross-border raid from Gaza into southern Israel.

Greenspan 'shocked’ at credit system breakdown

Reuters, Washington

Former U.S. Federal Reserve Chairman Alan Greenspan told Congress on Thursday he is "shocked" at the breakdown in U.S. credit markets and said he was "partially" wrong to resist regulation of some securities.

Despite concerns he had in 2005 that risks were being underestimated by investors, "this crisis, however, has turned out to be much broader than anything I could have imagined," Greenspan said in remarks prepared for delivery to the House of Representatives Committee on Oversight and Government Reform.

"Those of us who have looked to the self-interest of lending institutions to protect shareholder's equity (myself especially) are in a state of shocked disbelief," said Greenspan, who stepped down from the Fed in 2006.

Banks and other financial institutions need public support, such as the recently approved $700 billion bailout package, to avoid a serious reduction in credit, he said.

While Greenspan was once hailed as one of the most accomplished central bankers in U.S. history, the low interest rates during his final Fed years have been blamed for fueling

the housing bubble and eventual crash that touched off the current financial crisis.

The former Fed chair said stabilization of U.S. housing markets-a necessary precondition for the economy to heal-is "many months in the future." He said he expected the unemployment rate to jump.

At the heart of the breakdown of credit markets was the securitization system that stimulated appetite for loans made to borrowers with spotty credit histories, Greenspan said.

"Without the excess demand from securitizers, subprime mortgage originations (undeniably the original source of crisis) would have been far smaller and defaults accordingly far fewer," he said.

"The consequent surge in global demand for U.S. subprime securities by banks, hedge and pension funds supported by unrealistically positive rating designations by credit agencies was, in my judgment, the core of the problem," he added.

Former Treasury Secretary John Snow agreed that risk had been under-priced on a global basis. He said risks in mortgage markets were masked in part by accounting irregularities at Fannie Mae and Freddie Mac.

"A critical lack of transparency in secondary markets left policy-makers and regulators unable to discern the true nature and extent of the systemic risk that continued to build," he told the panel.

Greenspan urged that securitizers be required to retain "a meaningful part" of securities they issued. He said that regulatory reform will be necessary in the areas of fraud, settlement, and securitization to reestablish financial stability.

He also conceded he was "partially wrong" about his belief that certain derivatives, such as credit default swaps, did not need to be regulated.

Lawmakers, with one eye on a general election Nov. 4, lined up on both ideological sides of the debate. Democrats assailed gaps in rules and oversight while Republicans faulted government-sponsored mortgage finance enterprises Fannie Mae and Freddie Mac for contributing to credit market strains.

"For too long, the prevailing attitude in Washington has been that the market always knows best," Committee Chairman Henry Waxman, a California Democrat said. "The Federal Reserve had the authority to stop the irresponsible lending practices t But its long-time chairman, Alan Greenspan, rejected pleas that he intervene."

Turkish court says PM involved in anti-secularism

Reuters, Ankara

Turkey's top court singled out Prime Minister Tayyip Erdogan and a few allies for criticism on Friday when it explained why it had fined the governing AK Party for undermining Turkey's secular principles.

By specifically blaming Erdogan, Turkey's most popular politician, the Constitutional Court statement is likely to renew tensions in the EU candidate country at a time when it is trying to limit the impact of a global financial crisis.

"It was found that the head of the party Recep Tayyip Erdogan, member of the party and former parliament speaker Bulent Arinc, education minister Huseyin Celiktwere involved in determined and intense activities which were against the article 68 of the constitution," it said.

The Constitutional Court was referring to an attempt by the Islamist-rooted AK to lift a ban on Muslim headscarves at universities as it set out its reasons for its July ruling fining the party.

The lira currency, which has lost a third of its value against the dollar this month, opened stronger as Turkish markets focused on the global economic crisis rather than domestic politics.

Erdogan said on Thursday he might seek to trim the powers of the constitutional court after its June ruling overturning an amendment to lift the restriction on wearing headscarves at university.

In its latest 370-page statement, the court said the AK Party used people's religious sensitivities as an instrument for advancing "pure political interests" and blocked discussion of basic economic and social problems on the political arena.

The court imposed financial penalties on the party in July but dismissed the prosecutor's case to have the AK Party closed down and Erdogan and other leading members barred from party activity for five years.

The AK Party has been locked in a battle with Turkey's powerful secularist establishment, including judges and army generals, since it first came to power in 2002. Secularists say the party is seeking to bring back religion to public life, contrary to the constitution.

The AK Party, which includes former Islamists, conservatives and also pro-business liberals, won a sweeping re-election last year. It denies charges it has any Islamist agenda.

It has pushed wide-ranging reforms, including giving more rights to minorities and easing restrictions on free speech, as part of Turkey's drive to enter the European Union.