Peace agreement with pro-Taliban clerics has backfired in Pakistan.

The world's attention was focused on the pact between Pakistan's government and pro-Taliban cleric Sufi Mohammad which promised to reimpose sharia law in the country's war-torn Swat valley.

Swat, once known as the "Switzerland of Pakistan," had been consumed by a violent Taliban uprising and a tough government response that left 1,500 dead and sent 200,000 citizens fleeing. Under the terms of the agreement, the rebellion would end, the military would gradually withdraw, sharia law would be imposed, and the government would have a prisoner exchange. At least a dozen suspected Taliban have already been released.

Skeptics worried that the deal amounted to no more than a capitulation to militants; the Pakistani government insisted it could bring real calm. "There was a vacuum ... in the legal system," Amir Haider Khan Hoti, chief minister of the North-West Frontier Province (NWFP), told the Washington Post. "The people demanded this and they deserve it." Pakistani Foreign Minister Shah Mehmood Qureshi defended the move as a "quick dispensation of justice" and "not any appeasement towards militants."

One month later, it's clear that the deal is a disaster. The agreement was signed between Sufi Mohammed's militant group, Tehrik-i-Nifaz-i-Shariat-i-Mohammadi (or TNSM, meaning Movement for the Establishment of the Law of Mohammed), and the government of the NWFP, with the approval of the federal government. The two sides differ in their interpretation of it, and even as sharia courts began operating March 18, disputes over the judges remained. Violence continues, making the term "peace agreement" a misnomer. Worse, the pact has consolidated Taliban influence and set a dangerous precedent for further negotiation.

To be sure, the clamor for sharia was genuine. In the lawless environment, ordinary people readily considered appeasing the Taliban as a means of providing security for them and their families. And having served as the judicial code throughout the 1990s, sharia seemed to offer what the government (which controls no more than 20 percent of the region) never could: quick and fair justice for a community starved for exactly that.

Regrettably however, Pakistan signed the agreement from a position of weakness. The Army was hesitant to undertake another major counterinsurgency operation in Swat when two earlier ones had failed to dislodge the militants from their hide-outs. The secular Awami National Party in power in NWFP also preferred a negotiated settlement. And the population could hardly stomach further military action. Even if the deal meant significant compromises in their quality of life, people thought, peace would represent an improvement.

But the dispute over the deal's terms could be fatal. Sufi Mohammed has refused to accept the present panel of judges presiding over qazi, or sharia, courts. He has announced the formation of his own qazi courts, appointed nominees, and warned all lawyers to stay away. Many lawyers are reported to have fled the region on the threat. Far from compromising, the Taliban do not intend to integrate sharia into the existing judicial and bureaucratic structure. Their aim is nothing less than the transformation of the entire legal and administrative system.

Serious implications follow from the Swat deal. Already, Mullah Fazlullah, the son-in-law of Sufi Mohammed, has become a de facto ruler of the area -- the modern-day equivalent of the wali who ruled Swat until 1969 when the region became a province of Pakistan. Moreover, it will be impossible to prevent the demand for sharia from spreading to other parts of the country. If that happens, Pakistan could end up operating under two legal systems -- sharia in the west and civil code in the east. It is even possible that militant groups in Punjab will demand the right to impose Islamic law in their own strongholds.

Had the government been able to use the peace deal to secure a foothold in Swat, introducing a strong administrative structure that could provide a reasonable level of governance, the move could have been justified. But the opposite has happened. The militants have outsmarted both the government and the military. They have consolidated the Taliban's position. And this is only week four.

What are the implications for India, especially in the aftermath of 26/11, the US operations in Afghanistan and the forthcoming elections ?