Speculation swirls of Musharraf resignation deal

Speculation swirled in Pakistan yesterday that a deal would be reached shortly enabling President Pervez Musharraf to resign without fear of prosecution, avoiding a divisive impeachment process.

Talk of resignation by former army chief and firm US ally President Musharraf has been mounting since the coalition government, led by the party of assassinated former Prime Minister Benazir Bhutto, said this month it planned to impeach him.

Prolonged jockeying and uncertainty over Mr Musharraf's position has hurt Pakistan's financial markets and raised concern among the US and other allies it is distracting from efforts to control violent militants in the nuclear-armed nation.

Saudi Arabian representatives were trying to broker a deal to protect and save face for Mr Musharraf, a senior security official told Reuters.

"Some dignitaries have arrived here to mediate. A Saudi Royal Air Force plane is parked at Chaklala (air base) so the matter could be a day or two," said the official, who asked not to be identified.

Reports Saudi Arabia - a key political and financial backer of fellow Muslim country Pakistan - was mediating have been denied by both sides of the controversy.

Coalition officials have been hoping President Musharraf would quit to avoid impeachment while some allies have said he should at least answer charges brought against him before stepping down.

The President's spokesman has insisted Mr Musharraf would not resign but would face the accusations.

However, coalition and other sources are adamant negotiations have been going on, adding that US and British representatives have also been involved despite denials.

Western countries appreciate Mr Musharraf's efforts to contain Islamic militants who have provided shelter for the Taliban and al Qaeda near Pakistan's border with Afghanistan.

The ruling coalition has prepared impeachment charges against Mr Musharraf focusing on violation of the Constitution and misconduct. There have also been reports it is looking into possible misuse of funds in Mr Musharraf's foreign travels.