Army plays down Musharraf report

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President Pervez Musharraf has met Pakistan's army chief, Gen Ashfaq Pervez Kayani, amid growing concerns over political and economic problems.

An army spokesman also confirmed reports that some key military officials hand-picked by President Musharraf have been transferred.

Mr Musharraf has resisted calls by his political rivals, who won in February's elections, to resign.

The political stand-off is adding to the country's economic woes.

Pakistan army spokesman Maj-Gen Athar Abbas called both the army chief's meeting with President Musharraf and the redeployment of some key Musharraf appointees as a "routine" matter.

He was reacting to a media report which said the army chief's meeting with President Musharraf was aimed at persuading him to quit.

The report said the army had also removed a Musharraf loyalist from the command of the Rawalpindi-based 111 Brigade, which defence analysts say would play an important role in any military takeover or the sacking of a civilian government.

The army had also replaced a security contingent of President Musharraf that was hand-picked by him, it said.

'Relic of the past'

The moves come as President Musharraf faces stiffening resistance from the judges he sacked on 3 November when he imposed emergency rule in the country.

The president's opponents want sacked judges to be restored

They are supported by the Pakistan Muslim League-Nawaz (PML-N) party, which emerged as the second largest party in February's elections and now shares power with the country's largest party, the Pakistan People's Party (PPP).

The PML-N pulled out of the federal cabinet earlier this month when the PPP refused to agree to restore the sacked judges without constitutional reforms to back the move.

Its leaders blamed the PPP for being soft on President Musharraf and favouring a working relationship with him.

But in a rare outburst last week, PPP chief Asif Zardari called Mr Musharraf a "relic of the past", and someone who stood "between the people and democracy".

Observers say this change of heart follows from President Musharraf's resistance to the PPP's reforms package that aim at clipping the president's powers and restoring the judges.

A number of US lawmakers who visited Pakistan earlier this week have also criticised the US administration's dependence on President Musharraf.

One of them, Senator Russ Feingold called for the restoration of judges as essential to constitutional reforms.

The country's stock market has responded to this ongoing crisis by shedding nearly 3,000 points in trading in two months.

The Pakistani rupee has also lost more than 10% value during the last two weeks. Meanwhile, the gap in trade balance has exceeded $10bn, due to a rising oil bill.

In a meeting with members of the Karachi Stock Exchange in Islamabad on Wednesday, Mr Zardari said the government would focus on economic issues once the political issues were out of the way.