While the Opposition welcomed the statement by Karamat, most government functionaries and leaders from Sharif's Pakistan Muslim League (N) Party were silent on the statement which was issued through the army's public relations department on Monday night. Majeed Malik, a retired general and a minister in Sharif's Cabinet, told newsmen in Islamabad that the matter was ``serious''. He said, ``I have not read the statement and will not make a comment now.''

In an address to a military college in his hometown Lahore, Karamat proposed the formation of a national security council to institutionalisedecision-making in the country. Karamat was critical of the Sharif government and said that Pakistan can't afford ``insecurity driven policies''. He said that it can't afford ``polarisation and vendettas''. The council should be backed by a think tank of experts to institutionalise decision-making, he added.

``Primarily, the Pakistan army chief is looking for a role for the armed forces in the decision-making process,'' said one observer.

The Pakistan army chief said that the government should be addressing what it sees as the biggest threat, namely the economy, which appears on the verge of collapse. The remarks by Karamat come at a time when the Pakistan prime minister is in the midst of a corruption scandal, in which a London newspaper accused the prime minister and his family of evading taxes and siphoning off millions of public dollars into private accounts.

Sharif responded by saying that he would not sue the paper. After much criticism, a director in Sharif's family holdings said that they wouldsue if the paper did not print its denial. This move is being seen as a face saving tactic since the paper had already agreed to print the government's retraction.

The differences between Karamat and Sharif came to surface after the US air strikes against Afghanistan in August. While the prime minister said that he had not been informed about the air strikes, the Pakistan army chief came out with a public statement that the PM had been told in advance of the strikes. This caused Sharif embarrassment at home and abroad.

Many observers say that while Karamat supported Sharif in the constitutional crisis, which plagued Pakistan in November 1997, he may not do so this time round as there is an increasing criticism of Sharif's government on many fronts: the army chief pointed out the need for a clean government, focus on the economy, relations with Iran, China, India and Afghanistan, the sectarian situation, the internal situation in the Sindh province, and the fears of the smaller provinces against Punjab. Oflate, the Pakistan prime minister has been referred to as the ``prime minister of Punjab,'' because of policies openly partial to his home province.

The remarks by the army chief at this time may also indicate that the army is unhappy with the state of affairs, including the way the prime minister is choosing the next chief of the army within a few months. Journalists say that Karamat's choice is being cast aside by the prime minister for one which is being selected on purely non-professional grounds.

At a time when Pakistan is negotiating a resumption of funding by the IMF, the army chief's remarks are seen as ``very alarming'' by both Opposition and members of the government. ``This is a last warning call to the government,'' says Naveed Qamar, a member of the Opposition Pakistan Peoples Party and a close aide of former prime minister Benazir Bhutto.

The Opposition has already been strengthened by the inclusion of many former allies of the government including the Awami National Party of Wali Khan, apotent force in the Frontier province. Even allies MQM have asked the prime minister to step down after not ``fulfilling the bargains'' that they had promised.

Karamat, who has been reluctant to interfere in domestic politics, may be drawn in either to take complete control or impose an interim regime that would steer Pakistan towards some semblance of stability, says one observer.

But bringing back Benazir Bhutto is next to impossible say observers. Bhutto and her husband have been indicted in corruption cases.

There is a possibility that the cold war between the prime minister and the army chief may intensify as the army chief's tenure draws to a close. ``Whatever he has said, he will have to be seen to make an effort at working towards that,'' says an Islamabad-based journalist, adding ``and this would put him on a collision course with the PM.''