NY bomb might explode in Pakistan

Just when it became a bit safe to use the R word; the
ecovery process of Pakistans economy has started being overshadowed by a fresh wave of pessimism.
First, Hakimullah Mehsud came back from the dead in an uncanny Batman-styled sequel. Two days later, a would-be Times Square bombing, by what FT reported could be Pakistans first MBA terrorist, created a scare which is being hyped to the scale of the famed 9/11.
If an attack like this was successful, "there would be very severe consequences", Hilary Clinton, the US Secretary of State, quickly warned in an interview to CBS Television.
Later, Newsweek editor Fareed Zakaria labelled Pakistan the "epicenter of Islamic terrorism", in a sharply critical interview to CNN.
Quoting the British government, Zakaria alleged that about 80 percent of the terror threats that the UK receives have a Pakistani connection.
The assessment coincided with the Russian governments allegation that up to 40 camps housing terrorists operate along the Pakistan-Afghanistan border area.
In an interview to the Times of India, the Russian ambassador to India, Alexandar Kadakin said the findings about the terror camps were based on Russian intelligence and satellite imagery.
These developments imply that the do more mantra would be gaining currency; senior US officials have already called for it, saying that either you (Pakistan) do it, or we do it.
In turn, this means that if Pakistan fails to meet Americas do-more standards, then the remaining portion of the pending CSF reimbursements and the aid under the Kerry-Lugar Bill might be in jeopardy, whereas FoDP pledges may also stop. Surely, Pakistan can ill afford that.
If these inflows don materialize, the countrys already tight liquidity situation would be squeezed further. As a consequence, development spending, being the usual scapegoat, would be much lower in FY11 than what is being currently proposed.
In addition, Pakistans bid to raise funds through international bond markets may become bleak in the wake of the New York incident, considering the countrys CDS spreads have shot up in the last week.
Other far reaching consequences include potentially more barriers to business travellers - hence businesses - lower foreign investments and overall drop in economic confidence, especially if theres an increase in number of drone attacks.
For a bomb that never went off, the shockwaves might be felt for long.