Interview
Hillary Rodham Clinton
Secretary of State
Serena Hotel
Islamabad, Pakistan
October 21, 2011


MR. PIRZADA: As salaam alaikum. On your behalf, all of you the civil society members who are in this hall, and on behalf of the countless millions of Pakistanis who are watching this on live television, I extend a warm welcome to United States Secretary of State, Mrs. Hillary Rodham Clinton. Secretary Clinton, without exaggeration, is a household name and face in Pakistan. And why not? She has invested significant tremendous political capital. She has been the principal architect of renewed U.S.-Pakistan relationship in the Obama Administration.

This is Secretary’s fourth visit to Pakistan after assuming office. During her second visit in July 2010, 15 months ago, I had the privilege, the opportunity to moderate a similar interaction with civil society and media. And the relationship between Pakistan and U.S. looked so good, it looked so smooth, so comfortable at that time that I was finding it difficult to coin a sentence to describe it. So while introducing her, I said, “Secretary, I’m sorry, I’m afraid you’re coming to a very boring Pakistan. There are no rumors, there are no conspiracy theories, there are no fears, no suspicions.” And she laughed wholeheartedly and she said, “Moeed, boring is good.” (Laughter.)

But, Secretary, I am afraid this is not true anymore. In the last nine months, the U.S. and Pakistan relationship has seen many difficult and tense moments. There has been a barrage of accusations, fears, suspicions, doubts. But fortunately, we have seen and the whole world has seen that in the last few weeks, the United States and Pakistan have reemerged from the difficult spot, from the difficult corner. It may not be completely, but it will not be unfair to characterize that the worst is over.

This is precisely how the Secretary Clinton is here today to reconcile (inaudible) relationship, and let me say a few words. The whole world has seen that the United States and Pakistan’s relationship may be complex, may be very difficult, may be very tiresome. But this is an enduring relationship that is based on mutual interest, mutual interdependence, and shared goals in the region. And this is precisely why today Secretary Clinton is standing here next to me.

Her biographer, Carl Bernstein, which I liked tremendous when I read her biography, had described her as mind-conservative and heart-liberal. Mind-conservative and heart-liberal. But I see her as an American politician, a reality politician, a realistic American politician who believes in the school of realism in American foreign policy, American diplomacy. Many people afraid when she talks tough. But I must tell you, that if she can talk tough in Islamabad, in Pakistan; she also has the ability to talk tough on behalf of Pakistan in Washington.

With these words, I invite the Secretary to speak. (Applause.)

SECRETARY CLINTON: Thank you so much. Well, I am absolutely delighted to be here with all of you, and I thank you so much, Moeed, for your introduction and for once again taking on the responsibility of helping to moderate this interaction.

I think this is my eighth visit to Pakistan in 15 years. One very long and memorable visit in 1996, where I remember so clearly how easy it was to travel around Islamabad and Lahore. The memories of that visit, which I took with my daughter, are incredibly poignant and vivid in my memory. Three short visits as a senator and now my fourth visit as Secretary of State. And I am here because I believe the relationship between our two countries is so important, it is worth getting right. And I am certain it is possible, although it will take a great deal of work to do so.

It is easy to forget amidst all the noise that our goals overlap in critical ways. We share a vision of a sovereign, self-sufficient, and democratic Pakistan; a Pakistan at peace and trading with its neighbors and full of opportunities for both men and women. That is a vision that I carry with me as I do the work I currently do now as Secretary of State. We also share a threat that has claimed the lives of thousands of our citizens. And we believe strongly that is a challenge neither of us can walk away from.

So the question before us is not whether we should work together; the question is how. And as you just heard, it is no secret that our relationship of late has not been an easy one. We have seen distrust harden into resentment and public recrimination. We have seen common interest give way to mutual suspicion. Americans, who believe they have done a great deal over the last years, and in fact $2 billion in civilian aid has been delivered from American taxpayers to the people of Pakistan in the last year, are understandably frustrated when they see what comes across as anti-American sentiments. And many in our Congress ask whether this relationship is still worth investing in. And I know that many Pakistanis have questions of their own.

Like any successful partnership, this one needs to be a two-way street where each of us acts to secure our shared interests in an atmosphere of mutual respect and mutual understanding. I’d like to touch briefly on three issues in particular: our joint efforts to create opportunities for the people of Pakistan; Pakistan’s role today and tomorrow in the region; and our shared fight against violent extremism.

First, I want to be clear that the United States is committed to helping Pakistan meet the economic needs, the social development needs, of the Pakistani people. Now, we are not doing this out of some definition of charity, and we are not trying to purchase friendship. We actually believe that a prosperous, peaceful Pakistan is more likely to be a stable, secure Pakistan, and we think that is good for everyone, first and foremost Pakistanis, the region, and the world, including Americans.

And we have heard the desire from government officials and private business leaders and citizens alike to move from aid to trade, and we share that goal. So we are working with Congress to create an enterprise fund designed to jumpstart Pakistani businesses and a bilateral investment treaty designed to attract trade, investment, and create jobs. Our programs have been focused on building Pakistan’s capacity: helping you grow and make more reliable your electric grid; to build roads; to irrigate hundreds of thousands of acres of farmland; and fund scholarships. And when the flood waters rose, America rushed in to save lives, help communities recover, at the cost of about $900 million.

But that said, we understand completely that it is the Pakistani people yourselves who hold the key to your own prosperity. Only Pakistanis can remove barriers that stifle entrepreneurship. Only Pakistanis can take the tough political decisions to bring your energy crisis to heel. And only Pakistanis can make clear that when just 2 million people out of 190 million pay income taxes, that is just not a broad enough base to sustain serious investments in Pakistan’s needs.

Pakistan’s economic and political success also depends on closer links with your neighbors. And that is my second point: Pakistan’s critical role in this region. We believe that over time, Pakistan could and should become a hub that connects South and Central Asia on what we are calling a New Silk Road that binds together a region held back by rivalry and war.

Over time, India could become the largest market for Pakistan. Closer economic ties with Afghanistan could contribute to growth and stability on both sides of the border. We recognize that Pakistan has legitimate interests in Afghanistan, and Pakistan has the opportunity to show regional leadership by helping to end the insurgency on both sides of the border, and help bring about peace and reconciliation.

My third point is one we ignore only at our peril. For too long, violent extremists have been able to operate too freely here in Pakistan, and Pakistanis have paid a terrible price in the fight against terrorism. Nearly 30,000 Pakistanis have been killed or injured over the past 10 years – worshippers at mosques, shoppers at markets, soldiers, police, even children in their classrooms. And we recognize, too, that Pakistan’s military has been bravely fighting pockets of terror throughout your country.

But no policy that draws distinctions between so-called good terrorists and bad terrorists can provide long-term security. This year alone, more than 500 Pakistanis have been killed by improvised explosive devices made right here inside Pakistan. I believe the United States and Pakistan can work together to root out all of the extremists who threaten both of us, including the Haqqani Network.

Now, I was introduced by saying that I am a realist, and I know that every country decides for itself what is in that country’s own interests. Pakistan does. So does America. We could not, should not, expect any different. And it is no secret that our relationship today has challenges. But for all the reasons I have briefly mentioned, I would argue that our two nations have far more powerful common interests in improving our cooperation. And now we have to chart that pathway forward together.

And much like our relationship, I hope this town hall is a two-way street as well. I look forward to a good give-and-take, and to your questions, in the time we have together. And I thank you very much for the interest you are showing in our relationship by your presence here today. Thank you. (Applause.)

MR. PIRZADA: Will you clip yourself the mike?

SECRETARY CLINTON: Yes, I will.

MR. PIRZADA: I was told that you would do it yourself.

While the Secretary clips the mike, let me repeat, once again, when you ask the question, you must – I will ask the first question (inaudible). When you ask the question, you must identify yourself with your name and the institutional affiliation. There are two runners here – Azu here, Abdullah there. Try to ask your question or comment limit within a minute or so, so then the Secretary can respond. And then the mike will reach the next person. We’ll also try to take one question from left side and one question from right side, and try to have a gender balance in the questions.

Secretary, can I ask the first question?

SECRETARY CLINTON: Please.

MR. PIRZADA: Charity begins at home. My question, since I’m asking – (laughter). The view in Islamabad is that, whereas Pakistan is trying to achieve a broad-based reconciliation with all kind of insurgent groups, including the Haqqani Network, your Administration, the Obama Administration, is trying to pick and choose between one group or the other group, you’re not ready for broad reconciliation. What is your view on that?

SECRETARY CLINTON: Well, I think that our position now, having thought deeply about this, consulting with many friends, including Afghan and Pakistani, is that we want to work on a process that is open to those groups or elements within them that are willing to sit across the table, and discuss a way forward that is committed to peace and reconciliation. And with respect to Afghanistan, the groups must be willing to renounce violence, as you should in any political process; cut all ties with al-Qaida, which is something that is important to us; and state a willingness to abide by the laws and constitution of the state of Afghanistan, including protection for minority groups and women.

So our position is that we have been exploring different channels and different offerings. But given what just happened with professor, former President Rabbani in Afghanistan, where he believed he was meeting with an emissary from the Taliban to discuss this process and instead was murdered, we want to make it clear that all are invited and welcome to this process, but we have to, in effect, see the seriousness and sincerity of their willingness to be part of it.

MR. PIRZADA: Since you mentioned Professor Burhanuddin Rabbani, since Professor

Burhanuddin Rabbani’s assassination, President Hamid Karzai has been saying Pakistan needs to bring the Taliban around for negotiation. What is your view? You expect Pakistan to militarily tackle the Haqqani Network? Will you expect Pakistan to force them to come to the negotiation table?

SECRETARY CLINTON: It’s more the latter. I’m well aware of the military challenges that the Pakistani military has faced and the great sacrifice, as I referenced, of soldiers and civilians. But we do believe, as does our Afghan partners, that this must be a tripartite process, that Pakistan has to be a full partner in this effort, because we think that Pakistan, for a variety of reasons, has the capacity to encourage, to push, to squeeze – in General Kayani’s term – terrorists, including the Haqqanis and the Afghan Taliban, to be willing to engage on the peace process. So that is what we’re looking for.

MR. PIRZADA: Thank you, Secretary. Let’s take the first question. The gentleman here.

QUESTION: Hi. My name is (inaudible), and I graduated from Lahore University of Management Sciences. I believe you’ve been there. I have a simple and small question: Is there any Blackwater, or currently known as Xe Security, presence in Pakistan?

SECRETARY CLINTON: Well, there’s no Blackwater, because they no longer exist. They’ve been disbanded, and certain functions have been purchased or merged into other organizations. Xe is still a private contracting group that does have some previous association with, through personnel, what was Blackwater. I cannot tell you, sitting here, whether they are or not a contractor here in Pakistan, but I will tell you that they are – that we use private security contractors to protect our embassies, to protect our diplomats, all over the world. So it wouldn’t be anything that would be unique to Pakistan.

The sad world in which we are living today, as we’ve just disrupted this plot against the Saudi ambassador in our own country, is that people who should be safe pursuing diplomacy anywhere in the world are now targets. So yes, we do protect them, and we protect our facilities, but I can’t tell you exactly who has the contract. But we do try, and we certainly have learned over the years, to have certain expectations and contractual obligations that we expect everyone who is working for the United States Government to abide by.

MR. PIRZADA: Yes. Let’s take the second question.

QUESTION: Yeah. My name is (inaudible). I am from (inaudible). I have some interactions with your Embassy public affairs office.

SECRETARY CLINTON: Sir, could you pick the microphone --

QUESTION: Yeah.

SECRETARY CLINTON: Thank you.

QUESTION: I have some interactions with your Embassy’s public affairs office, especially with the community engagement component of that office. And I must say it was great to work with them or understand their things.

I would like to ask one thing. What is the U.S. Government doing to help organic voices inside Pakistani society and community against violent extremism, to protect Pakistani citizens, army, and law enforcement personnel?

MR. PIRZADA: Thank you. Thank you (inaudible).

SECRETARY CLINTON: That’s an excellent question, and I thank you for your kind words about our Embassy and about our interactions with you. And I think your question leads to really a reference I want to make to civil society here in Pakistan and to our Embassy and our efforts out of the State Department.

We have, for many years, worked to support civil society in Pakistan. But I have reached the conclusion we must do even more, and we need guidance and direction and suggestions from civil society itself. If you look at the vibrancy of the Pakistani culture, there is so much interaction, and this is certainly not a shy society, as I have learned over the years. You have a very dynamic free press. You have a lot of people who are speaking out on all kinds of issues.

But I worry about the intimidation factor from the extremists. People should be able to express, in a democracy, competing views. And you may disagree and take that person to task, but it should not be the reason for murder. It should not be, as I tragically saw, the death of Governor Taseer and Minister Bhatti and others who have a right, as Pakistani citizens, to express their views. So if civil society gets intimidated and your space shrinks, the society suffers, not just the individuals.

So our ambassador, Ambassador Munter, and I were actually talking about this just yesterday, and we are going to be seeking advice from you about what more we can do to support civil society and differing points of view within your country.

MR. PIRZADA: Let me take a question here. Yes.

QUESTION: Good evening and welcome to Pakistan, Secretary Clinton. My name is (inaudible) and I’m an entrepreneur and a development activist. And like your fellow panelist over here, there are several interactions that I’ve been a part of, and the development work that the consulate and the Embassy is doing, it’s wonderful. And just like you, I get puzzled with the anti-American sentiments that some of us may harbor in the country.

Now my question to you, again, drawing from your comments about the critical role that Pakistan has in the region, the recent comments about the Af-Pak policy of the U.S. defines the three Ds – I’d like your comments on that – deterrence, development, and dialogue – because to a lot of us, these three Ds seem to be in contradiction with each other. How can there be dialogue if there’s deterrence, and how can there be development if there is deterrence? So I’d like your comments on that, please.

MR. PIRZADA: Thank you, (inaudible).

SECRETARY CLINTON: Thank you. I will certainly admit that much of what we see that needs to be done in the region may, at first, appear inherently contradictory. So for example, when we say that with respect to the terrorists and the peace process, we want to fight and talk simultaneously, well, that seems contradictory. But it has been our experience over many years that unfortunately, it is both simultaneously that will convince some to come to negotiations and will remove others who are totally opposed to peace and want to continue their violent attacks.

So with respect to our policies, yes, we feel strongly about development, but we are shifting our focus, as I said, from aid to trade. And the fact that you’re an entrepreneur is very encouraging because we want there to be more entrepreneurs, which means there has to be more market access, which means there has to be more trade, first in the region and then beyond.

And so I think that it may appear to be somewhat contradictory, but we live in a very complex world today, and therefore, we have to be very clear-eyed about all the different challenges we face and we have to work across them. And sometimes we will be promoting our defense relationship and supporting the need for deterrence of terrorist attacks while we’re trying to build up development so that there will not be fertile ground for terrorists and extremists to take root. So it may not be an easy concept, but it is how we see the many different pressures that we’re trying to respond to.

MR. PIRZADA: Secretary, in the last two days in a couple of talks here, you must have had some kind of discussion on the issue of fight – fight, talk, talk in Islamabad.

SECRETARY CLINTON: Yes.

MR. PIRZADA: And the view over here is that it’s not really working. What is your view? Do you think this fight, fight, talk, talk simultaneously is giving you results?

SECRETARY CLINTON: Well, I don’t think that we’ve really gotten to the talk, talk phase yet. I believe that – and this is certainly my perspective – we’re only now at the talk, talk stage because there has been a reversal of Taliban momentum in Afghanistan. President Obama’s decision that he had to make upon taking office to increase our military presence in Afghanistan to reverse the momentum of the Taliban, I think, has laid the groundwork now to be able to see if there is anybody willing to talk.

And I have to be very candid with all of you. We’re not sure, that there may be no appetite for talking on the other side, that for ideological reasons or whatever other motivations, there may be no willingness. And there have been about 3,000 fighters inside Afghanistan who have left the battlefield and have been reintegrated into their villages and into Afghan society, but whether it gets beyond the foot soldier level up to the leadership level, that’s what we have to test now. So that’s what we are trying to urgently put forward.

MR. PIRZADA: There’s a question here, I think. There’s a lady who has a mike here. Yes.

QUESTION: Hello. I’m Tara Uzra Dawood. I’m a JD from Harvard Law School as well as president of the Dawood Global Foundation and LadiesFund.

The question I have is: Because we have awards for women entrepreneurs, networking opportunities and training for women entrepreneurs, we’ve indentified incredible talent in Pakistan, and those are the headlines I would like to see and we’d like to see internationally. Furthermore, with virtual businesses and technology, could you perhaps share your opinions and guide us how we can get Pakistani women or Pakistani entrepreneurs and American entrepreneurs working hand in hand in entrepreneurship rather than in isolation? Thank you.

MR. PIRZADA: Thank you.

SECRETARY CLINTON: Well, that is music to my ears, because one of our principal programs in the State Department the last two-plus years has been to promote global entrepreneurship around the world, with an emphasis on women and with an emphasis on Muslim majority countries, because we think entrepreneurship, small business, medium-sized business development is key to economic growth and prosperity, and that parts of the world that have not been growing and providing inclusive prosperity over the last decade are now poised in part because of technology to do so.

Therefore, we have held entrepreneurship summits in Egypt, in Indonesia, in Washington. The next one is in Turkey. And we want to be sure – we’ve had Pakistani participants, and we want to be sure that the two messages of what it takes to promote entrepreneurship, because there are still legal and regulatory barriers. There are difficulties in many countries in starting businesses and growing businesses. We want to identify those, work with governments, work with business to try to eliminate them, and we also want to mentor. So we have websites, we have programs where we’re bringing entrepreneurs – in particular, women entrepreneurs – to work with counterparts.

So we want to do all of that, and we view Pakistan as a place with such potential. Pakistan is a country of small businesses, and there’s so much more that could be done and that can be linked to the global economy. And so therefore, we will redouble our efforts to reach out to Pakistani entrepreneurs and make sure that as many as possible are connected into what we’re doing globally.

MR. PIRZADA: I see more businessmen here on the third row.

QUESTION: Madam Secretary Clinton, my name is Ibrahim Qureshi. I’m founder of Raffles Computer, and a participant to the Presidential Summit on Entrepreneurship by President Obama. It was a great event. In the summit, there were four countries put in top priority list in terms of entrepreneurship development. It was namely Egypt, Palestine, Indonesia, and Pakistan. And one of my recent engagements in D.C., I was told that Pakistan is no more on that priority list of engagements in terms of entrepreneurship development. And my question is: What triggered that? Why Pakistan is not on that priority list of four countries anymore?

And secondly, I believe that – and I think that a lot of us believe here – that terrorism is financially motivated and not really justly motivated, and with the youth we have, if there are any serious efforts going on to really bring in development entrepreneurship in Pakistan like you’ve done in Egypt and in Palestine and in Indonesia. Thank you.

SECRETARY CLINTON: Well, I am not aware of what you have just told me, and I will certainly check into that, because our original planning, as you know, was for Pakistan to be one of our four priority countries. I obviously believe it should be, and so let me look into whether a decision has been taken that I’m not aware of, and see what we can do about it.

MR. PIRZADA: That’s a great thing. Here’s a question here on the first row.

QUESTION: Good afternoon. I’m (inaudible), and I’m a student at National University of Science and Technology. I want to ask: You already mentioned that you think that we have anti-American sentiment here. But how do you expect the people of Pakistan not to have anti-American sentiments when day in and day out we hear about drone attacks that kill more innocent people than militants? You yourself mentioned that we have had so many losses of innocent lives. How do you explain that?

MR. PIRZADA: Thank you.

SECRETARY CLINTON: Well, first let me say that I do not believe that there is any basis for your comment, but I will say this: There has been a lot of focus on doing what is necessary to protect Pakistan, to protect Afghanistan, and to protect Americans, which is important for both of our countries. And I think that the difficulties we face with the safe havens that I referenced is that very often they are embedded in areas where people are going about their daily business, and we try to make sure that, in working with the Pakistani military and intelligence services, that any person who has committed a terrorist act or is about to be committing a terrorist act can be intercepted. And there are many ways of doing that. And I do not believe – and I actually think it is one of the real successes of the relationship between our two countries.

MR. PIRZADA: Secretary, I want to pick on this question of the anti-Americanism in Pakistan, the United States being the hyper-power that shapes the world has influenced everywhere. And countries and people like Pakistan, which are at the receiving end of the American power because America has to pursue its regional influences, have a reaction towards it. What people in Pakistan, the serious analysts see, there is a rising tide of anti-Pakistanism in the United States. And I think the American media, the way it reports the events – for instance, the leaks by unnamed officials, sometimes from State Department and sometimes from CIA, sometimes from the Pentagon, they build up a picture as Pakistan being the enemy, the Pakistanis are the enemy. Recently after Mike Mullen’s comments, (inaudible) of The New York Times has published a story in International Herald Tribune which was inaccurate. The U.S. Embassy officials, many diplomats privately told me, and they were outraged themselves about how inaccurate the story was. She accused the Pakistani army of deliberately conspiring to kill the American soldiers in 2007, which was investigated by a U.S. military general in Islamabad and found that no one was really involved. It was a soldier that got berserk, a reactionary, as it happens in Afghanistan all the time.

So this is the growing fear in Pakistan, that when Pakistan is demonized, the public opinion changes, it puts pressure on Congress – both houses, the House and the Senate – which then put impediments in the relationship your Administration wants to help Pakistan. They restrict you. So you’re restricting your own way because of the demonization.

SECRETARY CLINTON: Well, but look, I think that we have the problem on both sides.

MR. PIRZADA: I agree.

SECRETARY CLINTON: I think that – I would respectfully say, I think that there’s been press articles on both sides that have been wildly inaccurate and wildly accusatory, to the detriment of the seriousness of what we are trying to do together. And I think, look, we both have democracies, we have people who are politicians who run for office who are responsive to public opinion. And so if the press and others are creating a public opinion attitude, then you’re going to have politicians responding to it, and then we’re into a vicious cycle.

Look, I’m here in part because I don’t think that’s useful. And we have real differences. We need to be sitting down and exploring those differences and trying to work through them together. And we do expect to find areas of cooperation that are mutually beneficial.

Now, I would hasten to add that in both countries, there is a lack of appreciation for the relationship that predates this Administration. It kind of comes and goes; it goes back and forth over time on both sides. But it’s not in anyone’s interest. I mean, we have real differences that we should respectfully discuss, but we have to get rid of all of the wild accusations and stories and incredible theories and conspiracies that afflict us. And therefore, I’m hoping by directly talking to the Pakistani people through this event and other events, we can clear away all of the chaff and let’s just focus on where we agree and where we don’t agree, as any two nations will, and look for ways that we can work together in the mutual respect and mutual interest that I seek.

MR. PIRZADA: Do you think something to be done to have better understanding to stop all this between the media accusations, the wild accusations?

SECRETARY CLINTON: When I became Secretary of State, I was told by our Embassy in Islamabad that they had just given up trying to respond to all the wild stories. There were so many every day and obviously, not just in the newspapers but in the – on the television and radio. And I urged them to keep trying to respond, don’t let accusations go unanswered when people make these outrageous claims, try to get in there and respond. But it is hard when you have a media. And of course, we have the same problems in our own country, with a vast media, now with the internet, where you can say anything about anybody without any verification. And so I think both of us in our democracies have to do more to try to clear the way for a factual basis for our conversation. We still may disagree, but at least let’s have a basis of evidence on which we discuss these matters.

MR. PIRZADA: Thank you. Let’s take a question from here. Who has the mike?

QUESTION: Hello there. My name is Afan Aziz and I’m the president of the Khyber Pakhtunkhwa Chamber of Commerce and Industries. I’m also an ex-student of London School of Economics --

MR. PIRZADA: Can you bring the mike a little close?

QUESTION: My question was regarding a friend of, actually, the U.S. and a good friend of Pakistan, had launched a discussion regarding the reconstruction opportunity zones. You talked about trade being better than aid, and trade, not aid. This was exactly on those lines. And frankly speaking, to tell you the truth, this was one single factor that had been launched, and had it included Pakistan’s specific product that we could produce. This was one factor that could have changed the landscape of this place and would have helped you entirely in this war. To quote you a figure, because I belong to the field itself of textiles, if we had produced about $2- to $3 billion worth of apparel in (inaudible), which was very much possible and very easy task, we would’ve given employment to about 1 million people. And 1 million people with an average family size of six people would’ve affected 6 million people, which is one-third of the population of the province.

So – and this thing did not happen. Your predecessor started this discussion in 2006, and then this conversation kept on taking place, and now it seems like it is a dead horse. I want to convince you that this is something that really would change things around. I challenge the belief, number one, that people say that this would cause a loss in jobs in the U.S. It is completely incorrect because Pakistan is in the commodity business, and the textiles in the U.S. are technical textiles; they are value-added textiles. The only redistribution of jobs if ever is going to take place is from China, Bangladesh, or (inaudible). Pakistan today only export $1.5 billion, and we are minnows, because U.S. imports 72 billion. China exports 27 billion. Vietnam exports – just give me a moment, because I believe this is a very, very important point.

And secondly, I also challenge the belief that people say that this can’t be done in Khyber Pakhtunkhwa. We have been a frontline state in the front line – of a frontline country. So you see, we have really suffered not over the last one decade but over the last three decades. We as – I’ll give you a figure to substantiate my point. We, as a percentage of the loan that was given out in Pakistan about 20 years ago, stood at 11 percent. Now these standards of population are at around 13 percent. Today, we stand at a paltry – at a paltry 1.7 percent. So you see of the entire loan that is disbursed. So there is no job creation in that area. And also, you see this something that needs to be targeted head on.

MR. PIRZADA: Afan, thank you.

QUESTION: So I would appreciate it if you could do something – (applause).

SECRETARY CLINTON: Well, I mean, you make a very strong argument, and there are many of us who agree that opening up our markets to your cotton, for example, would be a really big step forward in the economic growth of Pakistan, and also would have benefits in our relationship. We have a political system with different points of view. We have made the case – the prior administration plus this administration. It’s not the only issue that comes from the desire on the part of many of us to increase trade that doesn’t yet have a majority to pursue. But you’re not going to get an argument from me. It would be a very positive development.

And we believe strongly that the more we can move toward trade, the more you will have a sustainable base for economic growth. We do not think that much of the ongoing dispute over this, however, is Pakistan only. We have cotton problems with many countries, as I’m sure you’re aware.

So I can only reinforce your argument; it’s very sensible. And we want to see Pakistan grow so we’re making the case, trade not aid, and we’re trying to get the Congress to understand the importance of that.

MR. PIRZADA: Let’s take a question here.

QUESTION: My name is Shaddou (ph). I’m an entrepreneur. I was a part of Goldman Sachs 10,000 Women this year. My question is, since I’m not a politician or any analyst, from a common person perception in Pakistan, what is U.S. exit policy from Afghanistan? Because we feel that since 9/11 military operations, we don’t see any kind of improvement in terms of peace in Pakistan. And we, being in Pakistan, in fact, suffering a lot more than Afghanistan because you have a military operation there but we don’t have here. So what could be the possibility of dialogue rather than the option of military?

SECRETARY CLINTON: Well, I think that’s exactly what we are pursuing, and that’s why it’s so important that Afghanistan, Pakistan, and the United States all work together. And I was personally very encouraged to see the statement that came out of the All Parties Conference a few weeks ago. And the second item was give peace a chance.

MR. PIRZADA: Give peace a chance.

SECRETARY CLINTON: And that was a very important statement, because there needs to be an unequivocal signal sent by all of us that the fighters, the terrorists, the insurgents, now must give peace a chance. So your government, all of your political parties, have made that statement. The prime minister repeated it. Foreign Minister Khar repeated it today. And I hope that it is heard by many elements of these terrorist groups on both sides of the border, because that’s what we want.

We want the people who are willing to become peaceful, reconciled members of society on both sides of the border to hear that message. So we’re going to do the best we can. You can’t make somebody put down their gun unless you do so in a fight if they’re not willing to. But we want to give everyone a chance to give peace a chance in their own lives and in the border areas and the two countries.

MR. PIRZADA: The gentleman in the second row from the left. Also, if I could take the mike back first please. Go ahead please.

QUESTION: I am Azhar Saleem from Human Development Foundation. I think you’ve talked about various ways in which U.S. can help Pakistan. You’ve talked about entrepreneurship, talked about the ways through which U.S. can help us in trade. But I think the base of everything is education. And there is a lot that is needed in education, and not just at the level of primary education. I think we need to do something much bigger than that.

You talk of the Millennium Development Goals. They only talk of the primary level of education. I think we need much more, and that is education at all levels. I think we need to sit down and think of ways of how U.S. can help us in education. Because if education is made better in Pakistan, I think rest – everything will fall in place.

SECRETARY CLINTON: I agree with you completely, sir. I think that education is the base on which every modern economy and society must be based now, because there is just too much happening in the world and people will be left out. And you look at Pakistan; you have some of the most educated people in the world. I mean, it’s astonishing the quality, the extraordinary success of the elite education in Pakistan. But then you have a huge number of people, and particularly women, who are not educated. And we know that educating a woman is the best way of building a society, because that education is passed on. There’s so much evidence. A child will not read above the level of what his mother reads at unless there’s an extraordinary effort made to guide that child into education.

So if I had a magic wand, I would say education in Pakistan is absolutely necessary. Now, going back for a minute to our struggles with the terrorist groups, one of the things we see in Afghanistan – and President Karzai told me a story, a very poignant story, when I was in Kabul yesterday, that when he was recently in Kandahar and he met a little girl of about eight or nine, he said to her, “Well, are you in school?” And she said, “No, we cannot go to school,” because her family was intimidated by the Taliban and prevented from going to school. And the United States has helped to build dozens of schools, and the international community altogether has had to build hundreds of schools in Afghanistan, and many of them have been closed and many of them have been burned down because there are people who do not want to educate women here in our world today.

So let’s do what we can to make it socially unacceptable to deny boys or girls an education. And then let’s talk about how we can help support a system that begins to really deliver education, because that’s unfortunately missing in many parts of this region. And I would just end by saying that it is quite troubling that many young boys do not have access to good public schooling. They go to madrasas, which is fine, but very often they do not learn what they need to learn to go on to higher education, to go into a skilled trade, to be able to function effectively in a modern society.

So you’ve put your finger on one of the biggest problems, and certainly our Embassy will talk with you about what we can do. But much of it has to come internally. There has to be a demand by educated Pakistanis for all Pakistanis to be educated, and a particular movement to educate girls.

MR. PIRZADA: There’s a question here.

QUESTION: (Inaudible) Foundation. In recent past I have been to U.S. to attend one of the IV programs sponsored by the U.S. State Department on equal rights. Here I have a question you already mentioned in your speech – that the response in flood 2010 was very clear from the U.S. and we’re thankful for that. But the response in recent flood from the U.S., that is slightly slow. So what are the reasons behind why the response is not comparatively slower than in recent? Thank you very much.

SECRETARY CLINTON: Well, you know --

QUESTION: Many people ask this question.

SECRETARY CLINTON: Yes. Well, I have to say that right now in our Congress we are totally tied up in our budget negotiations. There’s not much money going anywhere for anything. And I don’t say that with any satisfaction. It’s quite distressing to me.

Because at the time of the first disastrous flood, as I said, we contributed far more than anyone else. And we not only contributed for emergency relief but also for family income support, and we were very proud to do that. And now we are – we don’t have that flexibility in our budget any longer. And so we will do what we can, but I don’t want to sit here and tell you that we can do much more at this time.

MR. PIRZADA: Secretary, there’s a question from the last row on the left.

QUESTION: Thank you, Madam, for being here. Your presence here is an endorsement that you believe in this strategic and synergistic relationship. My name is Ayla Majid. I am an elected director on the board of Islamabad Stock Exchange and I’m also working with different entrepreneurs and entrepreneurial development efforts.

We do understand that we do have challenges, we do have difficulties. I don’t need to reiterate that because we are very much on the same page. I can assure you on behalf of this very generation that we are practical people and we are very much wanting to work on this relationship. We have our odds, but we will have a working relationship when we both are looking forward in the same direction. So let’s continue to do that.

You mentioned about opening up of our borders for trade. So I would very much like your endorsement on this one to work with our policy makers. Because on behalf of private sector we are very open to these initiatives, and I would encourage the U.S. Government that whereas the G-to-G relation is important, it should be more G-to-B and B-to-B as well, and also work more with different entrepreneurs and young people of Pakistan. And we are very much hopeful to have the next entrepreneurial summit very much in Pakistan. Thank you.

MR. PIRZADA: Thank you very much.

SECRETARY CLINTON: Thank you. (Applause.)

QUESTION: Madam Secretary, from my view – (applause) – the strategic dialogue which you initiated yourself which was taking shape the last time we met in October, then because of the tensions in U.S.-Pakistan relationship after January, the strategic relationship was kind of suspended. Are we expecting its full-fledged resumption anytime soon now?

SECRETARY CLINTON: Yes. In fact, we agreed to a work plan between Minister Khar and myself this morning at our bilateral meeting, and we will be doing a complete analysis of where we made progress, what more needs to be done, and we’ve asked our teams to put that on a very fast track, because I will be in Istanbul for the regional meeting about Afghanistan. I know that Minister Khar, President Zardari will be there as well. So we hope to be able to get a report so we can start moving forward again.

QUESTION: What are you expecting, since you mentioned the conference? What outcomes are you expecting from Istanbul conference?

SECRETARY CLINTON: Well, that’s still a work in progress. There’s a lot of discussions and drafting of documents going on. I think that a commitment to the security of Afghanistan that is agreed to by all of the neighbors, because clearly, Afghanistan has long been used as a crossroads for competition and conflict – we want it to become a crossroads for economic development.

We want – for example, one of our projects, which we hope to get international support behind in the New Silk Road vision, is a pipeline that would carry natural gas from Turkmenistan through Afghanistan, through Pakistan into India. Imagine what that would do for electricity and for other power needs in the region. We want to look to see how we break down all of the barriers at the borders, and the young woman who was speaking about more trade all the time with everybody – there – if you look at the location of Pakistan between Iran and India, more goods in western Iran and eastern India should be going through Pakistan’s ports.

I mean, you think about just the geographic advantage that Pakistan has – and I’ve never been in Pakistan that a Pakistani businessperson has not said to me, “Talk to our government about opening up trade with India.” And I always say, “Talk to your own government about opening up trade with India,” because clearly – (applause) – what we now see happening with the good contacts between the two governments now – between the commerce secretaries, between the foreign ministries, even looking at most favored nation status – will be hugely beneficial to Pakistan. So I’m hoping that we’re at the brink of seeing a lot of positive developments in that area.

MR. PIRZADA: I assume that your staff is getting desperate for time so let’s take one or two quick questions. I know that you have pressure on your time.

Yes.

QUESTION: My name is Mohammed Esfarosen (ph). I’m the general secretary of Pakistan-U.S. (inaudible) Association, (inaudible) chapter. And the trust deficit is the real challenge for the – both governments. And for me, 9/11 incident, the tragic incident of 9/11, lasted in U.S. for one day only. But since last 10 years, we the Pakistanis are paying the price of this incident despite your best efforts, despite your huge investments in the development sector. This trust deficit is rising day by day. A common Pakistani is not ready to digest the efforts done by the Americans. This crisis of trust is the real challenge for the – both the governments. What is your input on this?

MR. PIRZADA: Thank you. Would you suggest we take another question from here to wind it up?

SECRETARY CLINTON: Sure, and then I’ll --

MR. PIRZADA: Yeah, let’s take another question quick. What’s the last – yeah, please go ahead.

QUESTION: My name is Shamama (ph). I’m representing the women chamber of Khyber Pakhtunkhwa. My question really more focused about my own province, of course. We all know that all of Pakistan is facing the brunt of whatever is happening and trying to cooperate with the U.S. And somehow, U.S. is like – is a mother-in-law which is just not satisfied with us and comes up with new ideas. (Laughter and applause.) So we are trying to please you, and every time you come and visit us, you have a new idea, so you tell us, “You’re not doing enough and you need to work harder,” and all. (Laughter.)

But I guess while Pakistan – the economy has taken a nosedive, but especially (inaudible) has suffered a lot. Our businesses have suffered a lot. So do you have – I would not call ROZ a failure right now, but yet it has not done what it was required to do. So do you have any backup plan or any other economic plan as a compensation to this part of the country?

MR. PIRZADA: Okay.

SECRETARY CLINTON: Well, now that I am a mother-in-law – (laughter) – I totally understand what you’re saying, and will hope to do better privately and publicly. I think that’s a great analogy I’ve never heard before.

I think the two questions are very much related, and yes, we agree that there has been and is a trust deficit. We talk about it with our counterparts. It is something we are trying to overcome. We think it goes both directions. We don’t think it’s just one or the other. We think that both of us have to work harder to understand more clearly the needs and the interests and the concerns of the other side, and I take that very seriously.

And it goes to this question about the price that Pakistan has paid, which I know is a very high one, not only in lost lives, but in lost economic productivity. One of the programs we’re still hoping for is the reconstruction opportunity zones, the so-called ROZs, which would target areas that have been particularly hard hit and try to provide more market access and entice investors – Pakistani, American, others – to come into those zones because of the preferential treatment they would get into the American market. And we’re still hoping to get Congress to agree to that.

So we do have some Plan Bs, but our Plan A is to overcome the trust deficit, but to be honest about it – not to pretend; to have a very clear-eyed view of where we agree and disagree; and then to have a work plan and to try to make progress together toward shared objectives. And I think that requires a lot of dialogue and a lot of work between us, which we have to be committed to. And there is frustration on both sides, which I recognize, but I personally believe this relationship is critical, important to us both, and therefore we cannot give it up.

And once a mother-in-law, always a mother-in-law, but perhaps mother-in-laws can learn new ways also. And I don't know what the proper other side of the analogy is, but I think there has to be that kind of give and take. And we need your ideas and we want to listen to you and we respectfully request you listen to us. And therefore, we are going to stay the course and do everything we can to try to overcome the difficulties that we have faced together, because we both have too much at stake. We cannot walk away. We have to stay committed.

MR. PIRZADA: Secretary, with your kind permission, this last question, Wahaj, the CEO for the Nayatel. This stop – we also – on time, I must – I’m being warned.

QUESTION: Thank you very much. I am Wahaj us Siraj. I am founder of a company, fiber-to-home company which is – which has provided direct employment to about 500 very talented Pakistani people.

My question is that this talk on war on terror and the Taliban and Haqqani group is great, but the number-one problem of 180 million Pakistani today is the corruption and the mismanagement of the government which is leading to the hyperinflation, loss of electricity and the gas, and the basic facilities to the common people. And the people believe that this does not require from the U.S. side to invest in $1 million in asking the government to make itself correct, efficient, and corruption-free. What the United States is doing towards that? (Applause.)

SECRETARY CLINTON: On these issues that you mentioned, particularly energy, which is the number-one concern – every time I see a poll of Pakistanis from all over the country, that is the number-one concern. And education and health and all the rest are right up there.

We have been consulting with and advising the government for the last two and a half years, and we are also investing in trying to put on line a thousand more megawatts of power, through American investment and American expertise. But we recognize, like you do, that ultimately, in any country, it’s the people themselves through their elected representatives who have to make the hard decisions. And there are hard decisions that have to be made in Pakistan.

I said earlier at my press conference that in a country of 180 million people, 2 million people pay income tax. That is just unbelievable because you can’t possibly deal with your electricity problems, deal with your education problems, or any other problem if you don’t have everybody in the society contributing the resources needed to fix the electric grid, to do all the things that are necessary. So you will certainly find a receptive audience in us because we want to see a lot of reforms on both the political and the economic side in Pakistan because we think it’s good for the Pakistani people.

But we don’t have a vote in Pakistan and we certainly don’t have a seat in the parliament, just like you don’t have a vote or a seat in our Congress. And so we have a lot of political problems in our own system right now, so I would not begin to advise you about your politics. We have to deal with our own politics. But the fact is that continuing a reform effort will be very important for your future.

MR. PIRZADA: Secretary, I’m so glad that you could take out time and sit with us to share for almost an hour. The time is almost over. We can’t. You heard these people, the whole of Pakistan. The time is almost over. We can’t --

QUESTION: (Inaudible), I know the time is almost end, but I’m from Balochistan and I think my question is very important. I’m (inaudible), working with USAID-assisted agricultural development project in (inaudible) area. So due to time constraints, my question is that we have a lot of projects which is assisted by USAID, but you know we have short-term project. Do you think – can U.S. Government help us for long-term projects, like 10 to 15 years, to bring a positive change in Balochistan?

SECRETARY CLINTON: Well, as you might remember, the Administration supported, and the Congress passed, the Kerry-Lugar-Berman Act nearly two years ago now. And it was to have a long-term commitment to Pakistan, and that is what we want to have. We are reviewing our aid programs now – that’s part of our work plan with your government – to try to figure out how we can invest in longer-term projects. So I would invite you to be sure to make your views known to USAID, to our Embassy, so that we can have the benefit of your suggestions.

MR. PIRZADA: Secretary, I’m so glad that you could outline, and you heard all these people, and thanks for the expanded media in Pakistan. All television channels showed it live across the country, so countless millions have seen and heard your message.

My one question to you last on behalf of all of these is: Would you be able to carry this voice in U.S. Congress?

SECRETARY CLINTON: Well, I intend to try. I am one voice of many voices, but my voice will certainly be heard. And what I have tried to do – and I appreciate what you said, Moeed, at the very beginning – I have tried to be a good friend and an honest friend. So you may not always – (applause) – you may not always agree with what I say. But it is in the spirit of trying to make sure that we stay on a path together, which I think is very much in both of our interests.

So I will be appearing before the Congress, I think, next week. I’m sure they will have a lot to say to me, and I will do my --

MR. PIRZADA: “(Inaudible) talking?” (Laughter.)

SECRETARY CLINTON: Oh, I’m sure, but I will do my best to make the case very clearly as to why we must continue to work together in both of our mutual interests. And I am one voice of many, but it is certainly my intention to be as strong a voice as possible.

MR. PIRZADA: Secretary, thank you so much.

SECRETARY CLINTON: Thank you.

MR. PIRZADA: Thank you.

SECRETARY CLINTON: Thank you so much. (Applause.)



PRN: 2011/T54-24