Pakistan's Musharraf may quit army for votes - paper

ISLAMABAD, Aug 28 (Reuters) Pakistan's embattled President Pervez Musharraf may quit as army chief in return for support from political parties to re-elect him for another term, a newspaper reported today.

The offer is being discussed by Musharraf's aides with self-exiled former Prime Minister Benazir Bhutto in London as part of a power-sharing pact, the Dawn newspaper said.

Musharraf, who has seen his popularity plummet in recent months, wants to get re-elected president for another five years between mid-September and mid-October, before his term as army chief expires at the end of the year.

Under his plan, a general election will then be held at the end of the year or early next year.

But US ally Musharraf faces opposition -- legal challenges on constitutional grounds and perhaps even street protests -- raising concern about stability in the nuclear-armed country seen as vital to efforts to tackle terrorism and pacify Afghanistan.

An agreement with two-time prime minister Bhutto, whose Pakistan People's Party is seen as the country's most popular party, would help Musharraf secure another term.

But Bhutto is insisting he stand down as army chief before he runs for re-election.

''President Musharraf has offered to doff the uniform even before the presidential elections,'' the English-language Dawn reported.

''But in the trade-off, he wants all political parties to agree to elect him president ... after the new assemblies come into being following the next general election.'' A cabinet minister declined to comment except to say Musharraf had made up his mind on his uniform.

''The uniform is no longer an issue,'' said Railways Minister Sheikh Rashid Ahmed, a close ally of the president's.

''The president has made up his mind on his uniform and he'll make an announcement at an appropriate time,'' said Ahmed, who held talks with Musharraf yesterday.

IMMINENT CHALLENGE Musharraf and liberal-minded Bhutto are seen as natural allies.

They met for talks in Abu Dhabi last month.

The United States, keen to ensure Pakistan's continued cooperation in the war on terrorism, is also keen to see the two leaders cooperate.

As well as demanding that Musharraf resign from the army, Bhutto, who has corruption charges hanging over her, wants immunity from prosecution and the lifting of a ban on a prime minister serving a third term.

She has said any deal would depend on Musharraf taking confidence-building steps by the end of August.

Musharraf has seen his popularity evaporate since he tried to dismiss the country's top judge in Marach and analysts say it is at his weakest since he seized power.

He is also facing an imminent challenge from another exiled former prime minister, Nawaz Sharif, who was ousted in a 1999 coup and later sent into exile by Musharraf. The Supreme Court ruled last week that Sharif should be allowed to return.

After the coup, Musharraf co-opted the rump of Sharif's Pakistan Muslim League to form his political base, and analysts say that could splinter if Sharif were to return.

In an ominous sign for Musharraf, a junior cabinet minister resigned yesterday over the president's plan to contest the presidential election in uniform.

Both Bhutto and Sharif are meeting party colleagues in London this week to work out strategies.

REUTERS RC PM1357