'Washington is 200 per cent behind me,' Musharraf claims during crucial talks

As President Pervez Musharraf held crisis talks yesterday with a senior US envoy, the Pakistani leader robustly defended his decision to impose a state of emergency – saying Washington was privately "200 per cent" more supportive of him than in its public statements.

Pakistan's President also hinted strongly that while he may step down as head of the armed forces within a matter of weeks, elections scheduled for January will probably take place under a continuing state of emergency – circumstances that his opponents say mean such ballots cannot be free or fair.

"They are liking me because we are fighting terrorism together," Gen Musharraf, who yesterday met John Negroponte, the US Deputy Secretary of State, told an interviewer. "They show concern on the democratic front, they show concern over my uniform, but they are totally onboard on what we are doing on the terrorist front. They think what we are doing is the right directions."

Gen Musharraf's comments to the BBC about America's support for his anti-terror measures go to the very heart of the US relationship with Pakistan, a relationship that has seen Washington dispatch more than $11bn (£5.4bn) in aid since 11 September 2001. Pakistan's transition to democracy is a lower priority for the US than its involvement in the so-called war on terror, and Washington is deeply concerned that while the regime is preoccupied with the current political turmoil, militants in the north of Pakistan are gathering strength every day.

The focus for this insurgency is the Swat valley, previously a popular tourist destination known as the Switzerland of Pakistan, but now part of a swathe of territory controlled by militants headed by Mualana Fazullah. Mr Fazullah is an Islamic cleric who leads the Movement for the Enforcement of Islamic Laws, a Taliban-inspired group that has forced girls' schools and video stores to close. He routinely preaches via FM broadcasts, earning him the nickname Mullah Radio.

In recent weeks the military has been unable to stop the spread of the militants – increasingly described as the "Pakistan Taliban" – who have taken control of locations inside Pakistan "proper" and not simply in semi-autonomous tribal areas. There have been instances of the wholesale surrender of government troops.

Last week the government launched what it says is a major offensive against the militants, and there have been reports of dozens of fighters being killed. A sectarian element to the conflict also appeared yesterday, with 20 people reported dead in clashes between Shia and Sunni Muslims in a tribal area. But some experts believe the army's senior leadership, which of course includes Gen Musharraf, is distracted by the political crisis, with Mr Fazullah and his senior lieutenants happy to capitalise. "Rank-and-file militants [are not taking advantage], but the likes of Fazullah and people at the higher level certainly are," said a Western military official based in Islamabad. "They are smart enough to know the way these things work."

The threat from such militants has been the trump card Gen Musharraf has repeatedly played with the US over the past six years. But the truth is that he has been happy to work with the Islamists when it has suited him, and many within his intelligence services have links to them. Washington, however, has repeatedly failed to call his bluff.

"I don't think this [latest threat] is something which will break Musharraf. In fact, this is what strengthens him," said Ayesha Siddiqa, a military analyst and author of Military Inc. "This is probably how he has justified the emergency."

Another analyst, Khadim Hussain, an associate professor at Bahria University in Islamabad, said the militants' actions in Swat had destroyed tourism and destablised social and cultural institutions. "Musharraf probably wished that the situation in the valley would reach this intensity [to] help him keep in power. This will definitely make his support by the US stronger."

Yet in the past few days Washington has begun to change its tune. Ahead of the meeting between Mr Negroponte and Gen Musharraf, the US administration started dropping hints that, having concluded for years there was no "plan B", it was now starting to look beyond the general's tenure at the top.

Frustrated at the collapse of a power-sharing plan involving the former prime minister Benazir Bhutto, that they had spent two years putting together, US officials were also wondering whether the general was the only person who could deliver militarily. Indeed, the West has not tried to hide its admiration for Gen Ashfaq Kiyani, the deputy head of the armed forces and the man expected to move up if and when Gen Musharraf finally takes off his uniform. The Western military official said of Gen Musharraf: "Do we have to have him? As a military officer my opinion is no. He is not absolutely the only person who could head the country right now."

Gen Musharraf apparently told Mr Negroponte the emergency had been declared to allow elections to go ahead. Mr Negroponte may not buy that, but if elections do take place and if the general does quit the military, Washington may settle for that – hoping that with the political turmoil over, the leadership can again focus on the "war on terror".

But while Gen Musharraf appeared to make some concessions ahead of yesterday's meeting, such as releasing Ms Bhutto from house arrest, the country's two most popular news channels were shut down. Geo News and Ary One World, broadcast from hubs in Dubai, closed after Pakistan allegedly put pressure on the UAE. The US may believe it can read Gen Musharraf's hand, but the general has repeatedly shown he is no slouch when it come to playing the US.

Additional reporting by Omar Waraich in Lahore