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Yahoo! My Yahoo! Mail More Yahoo! Services Account Options New User? Sign Up Sign In Help Yahoo! Search web search Home Singapore Asia Pacific World Business Entertainment Sports Technology Weekend Edition Singapore Asia Pacific World Islamic party quits Pakistan govt over minister Reuters - Wednesday, December 15 Send IM Story Print * No government collapse expected but will face strains * Government already under pressure from militancy * Blow to government comes during struggle for IMF tranche By Kamran Haider ISLAMABAD, Dec 14 - An Islamic party said on Tuesday it was pulling out of Pakistan's ruling coalition after the dismissal of one of its members as a minister, but the government was not expected to fall. Jamiat-e-Ulema-e-Islam is a small coalition partner but its withdrawal will raise fresh questions over political stability in Pakistan, which the United States regards as a strategic ally in its war on Muslim militancy. The governing coalition, which faces an array of challenges including homegrown Taliban militants and a fragile economy, now holds 181 out of 342 seats in parliament, nine more than the 172 needed to maintain its majority. "It is impossible to stay in the coalition. We are saying goodbye to the government" JUI leader Fazal-ur-Rehman told reporters after a party meeting. His party's name translates to "Party of Islamic Clerics". The decision to withdraw was taken after Prime Minister Yusuf Raza Gilani sacked two ministers including one from JUI, Muhammad Azam Khan Swati, the minister for science and technology, for publicly trading accusations of corruption. <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ For more Pakistan stories click [ID:nAFPAK] or see http://link.reuters.com/kac58m Pakistan blog: http://blogs.reuters.com/pakistan/ ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^> Gilani's government, struggling to implement reforms needed to secure the sixth tranche of an $11 billion International Monetary Fund loan keeping the economy afloat, could now be distracted by political turbulence. The IMF's programme, agreed in November 2008, is increasingly critical for nuclear-armed Pakistan as it grapples with a widening fiscal deficit. Fauzia Wahab, spokeswoman for the ruling Pakistan People's Party, said the government would attempt to persuade the JUI to reverse its decision. "In politics, you have such ups and downs. But Maulana Fazal-ur-Rehman is an old friend of ours and we hope to win back his support." Asked whether the government sees any danger of collapse, she said: "Not so far." Two other JUI members of the cabinet -- the ministers of tourism, and housing -- have presented resignations, an official in the prime minister's office said. Pakistan plans to seek an extension of the IMF loan programme to win more time to implement the reforms needed to secure the next tranche, a Finance Ministry official has said. The main issue is Pakistan's slow implementation of a reformed general sales tax , a key condition for the possible release of the sixth tranche, amounting to $1.7 billion. "With JUI quitting the coalition, the approval for RGST will become even more challenging," said Asif Qureshi, director at Invisor Securities Ltd. The government introduced a bill in the National Assembly last month on the RGST, which had been scheduled for implementation on July 1. Analysts expect it to pass because the country needs IMF funding to secure additional external assistance especially after the devastating summer floods that cost about $10 billion in damages. Rehman said his party would vote against the RGST. Pakistan is under intense international pressure to broaden its tax-to-GDP ratio, currently around 10 percent, one of the lowest in the world. The country's most popular politician, Nawaz Sharif, has said his opposition Pakistan Muslim League-Nawaz party, will oppose any imposition of the RGST because it could fuel inflation. The former prime minister can easily stir up street protests. "The government will find it difficult to sustain itself unless it manoeuvres to find a new partner," said political analyst Hasan Askari Rizvi. (Additional reporting by Zeeshan Haider and Augustine Anthony, and Sahar Ahmed in Karachi, Writing by Michael Georgy) (For more Reuters coverage of Pakistan, see: http://www.reuters.com/places/pakistan) Recommend Send IM Story Print Related Articles US-BUSINESS Summary Reuters - 36 minutes ago Wall Street pares gains as banks weigh Reuters - 36 minutes ago Wintry storm hobbles Canada auto output Reuters - 46 minutes ago GE sees solid earnings growth in 2011 Reuters - 47 minutes ago Australia state govt sells power assets for $5.3 bln Reuters - 48 minutes ago News Search Top Stories Fed holds spending plan amid slow recovery Fed expected to draw breath after stimulus move US retail sales start holiday season with a bang ECB calls for bigger eurozone emergency fund Berlusconi's fate on a knife-edge as MPs vote More Top Stories » ADVERTISEMENT Most Popular Most Viewed Most Recommended Bernard Madoff will not attend son's funeral: lawyer Nissan delivers first Leaf in San Francisco Peak viewing for 'shooting stars' meteor show Ireland blocks 40 million euros in bank bonuses Obama presses angry allies on tax deal More Most Viewed » NASA finds new form of life... on Earth Defiant Obama defends tax cuts, eyes 2012 More Most Recommended » Elsewhere on Yahoo! 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