Benazir Bhutto and Nawaz Sharif signed the Charter of Democracy in London on May 15. This is a politically significant step as it signals the coming together of two important parties that together gained 36.5 per cent of the popular vote and hold 72 seats in the current 342 member National Assembly of Pakistan. All political parties including the MMA have welcomed the Charter. The military government, however, has been critical of the alliance and said in a statement that this is a political gimmick of parties that have failed the people and democracy in Pakistan.

The TATA investment of US$3 billion in Bangladesh, by far the largest foreign investment in the country, has run into rough weather over the pricing of gas. Dhaka rejected Tata's initial 2004 offer of $1.10 per unit of gas to be supplied over a twenty-year period, seemingly favouring the price to be at par with international prices. As per the new proposal submitted in April 2006, the price that Tata has offered is $3.10 for thousand cubic feet (MCF) of gas for its fertiliser plant and $2.60 per MCF for its proposed steel plant.

The killing of Kasula Suryanarayana, an Indian telecommunications engineer working for a Bahrain based firm in the Zabul Province of Afghanistan raises important questions on the emerging challenges to India's efforts at reconstruction and stabilization of a "nascent democracy". Suryanarayana was reportedly abducted by the Taliban on April 28 and his abductors linked his safe release to the withdrawal of all Indians working in Afghanistan.

Despite the King's proclamation and the subsequent end to the 19-day anti-Monarchy protests by the seven party alliance (SPA) on April 25, 2006, Nepal is still not sure of peace and stability. The difference between the SPA and the Maoists on the new constitution seems to be the biggest challenge before the Koirala Government. Although the Maoists have declared a three-month ceasefire, they have refused to surrender their weapons before or during the elections to a Constituent Assembly.

Nepal is witnessing relative political calm after the Maoists declared a three month ceasefire to facilitate a political solution to the insurgency, which has been marked by unabated violence, threatening peace and stability in the Himalayan Kingdom. The Maoist insurgency, which originated ten years ago in April 1996, has reached a new phase. After several rounds of unsuccessful negotiations to resolve the political crisis posed by the Maoists in the past, the current situation is characterized by anxiety and hope. The anxiety is over whether a peaceful solution can be reached.

Afghan President Hamid Karzai's four-day state visit to India from April 9-12, 2006 was the fourth since he was appointed Chairman of the Afghan interim administration in December 2001. His visit assumes significance in the backdrop of heightened violence in Afghanistan, the inclusion of Afghanistan in SAARC with India's facilitation, the recent political row between Afghanistan and Pakistan over the issue of cross-border terrorism, and the March 2006 visit of President Bush to the Subcontinent.