Pakistan has repeatedly vowed action to stop militants, but analysts say denial and dithering and a seething resentment of the US among the Pakistani people have stymied effective policy.
Escalating violence by militants and the consolidation of their grip in some places, and infiltration into others, have raised fears about the spread of Taliban influence.
Nuclear-armed Pakistan falling under the sway of al-Qaeda-linked militants is a nightmare scenario for the US.
“There’s a great sense of angst, a sense of unraveling,” said Adil Najam, professor of international relations at Boston University. “It seems that everyone has lost control, including the military, of where things are going. I don’t think they’ve given up the fight, it’s just they don’t seem to know what they can do.”
President Asif Ali Zardari secured more than US$5 billion in aid last Friday after telling allies and aid donors in Tokyo he would step up the fight against militants. The pledges pushed up a stock market that has gained 33 percent this year.
But elsewhere the mood is grim.
Audacious attacks by militants in the eastern city of Lahore and blasts elsewhere over recent weeks have sapped confidence. A suicide car-bomber killed 25 soldiers and police and two passers-by in the northwest on Saturday.
As well as across the northwest, the Taliban are infiltrating into Punjab Province and Karachi, analysts say. The release on bail of a cleric who used to run a radical Islamabad mosque has added to a feeling that the militants are on a roll.
Rumours of attacks on schools have spread panic and embassies have warned citizens of the danger of attacks and kidnapping. Members of Pakistan’s moderate Muslim majority say they feel intimidated by a vocal and aggressive minority.
Compounding the unease is a sense that the government has been distracted by political wrangling and is in denial.
“The general impression and perception at this stage is the government lacks the will to assert itself,” analyst Hasan Askari Rizvi told Dawn television.
Policy has been flip-flopping between inconclusive military offensives and peace deals that critics say embolden the militants.
The International Crisis Group think tank says responsibility for counter-insurgency has to be transferred to civilians from a military that continues to have links with some militant groups it sees as tools in its confrontation with India.
“It’s inept in the way it conducts operations, it suffers huge losses and then it signs peace deals, it appeases the militants,” said the group’s Pakistan director Samina Ahmed.
Under the latest peace pact, authorities have virtually handed over the northwestern Swat region to the Taliban to end violence. But the militants have already pushed out and taken over a new area 100km from the capital.
“The implications of appeasement are obvious,” Ahmed said. “Peace deals have been signed from a position of weakness and the militants have gained ground. It is quite frightening.”
Optimists had hoped the end of military rule with a general election last year would see public support coalescing around a strong stand against the militants.
But while the Taliban have been taking advantage of grievances against corrupt courts and greedy landlords to win support, they have also been able to capitalize on widespread resentment of the US exacerbated by its attacks on militants with missiles launched from pilotless drones.