The incoming administration of President-elect Barack Obama [Images] has two options to deal with the fallout of the 26/11 terror attacks on Mumbai [Images]: (1) To support, and to garner international backing for, Pakistan's democratically elected leadership in order to enable it to act firmly against terrorist groups on its soil or (2) To designate Pakistan as a state sponsor of terrorism under United States law -- a designation that will involve considerable sanctions on a country that the outgoing George W Bush [Images] administration had named a 'major non-NATO ally'.

The contrasting policy options were made by specialist in South Asian Affairs Alan Kronstadt of the Congressional Research Service, in a report on 26/11 prepared by the CRS for the United States Congress.

The relevance of the document stems from the fact that the CRS is the policy research arm of the Congress. The House and Senate use the CRS to prepare extensive policy papers on issues of paramount importance; these reports then form backgrounders as relevant House and Senate committees discuss and frame necessary legislation.

The Kronstadt paper, extending to over 10,000 words and with exhaustive annotations, toes the generally accepted narrative in describing the attacks themselves. It is when discussing the fallout that the paper offers up original analysis and commentary.

Kronstadt defines US policy in South Asia as focused on preventing interstate conflict that could destabilize the region and lead to nuclear war, coupled with a more recent and inter-linked goal of fostering stability in Afghanistan.

From this, Kronstadt postulates that the to-do list for the 111th Congress, which will come into effect January 20, includes creating legislation that fosters greater US-India counterterrorism relations. And with regard to Pakistan, the report suggests that Congress needs to impose conditions on any further US assistance on quantifiable progress in the war against terrorism.

The report is scathing on the poor quality of India's response to the immediate threat, pointing out that then Home Minister Shivraj Patil [Images] only ordered India's elite National Security Guard commandos to the scene 90 minutes after the attacks began, and then through a series of bungles the commandos only landed on site 10 hours later, thus handing a tactical advantage to the militants. As a result, the report points out, two days elapsed between the initial engagement with, and final subjugation of, the terrorists.

Kronstadt goes into annotated depth to link the Lashkar-e-Tayiba [Images] to the attacks, and to underline the theory that the Jamaat-ud-Dawah is no more than the LeT flying under an assumed name, following its banning in the wake of the attack on India's Parliament.

Interestingly, while the LeT-JuD link is being denied by Pakistan, Kronstadt points out that Hussain Haqqani, Pakistan's current Ambassador [Images] to the United States, has in recent times commented upon Pakistan's "state sponsorship of jihad against India" and has described the LeT as "backed by Saudi money and protected by Pakistani intelligence services."

The reports cites a 2005 book by Haqqani in which the diplomat writes that earlier in the decade, the Inter Services Intelligence provided significant "severance pay" to jihadi leaders in return for their promise to "remain dormant for an unspecified duration."

Kronstadt writes: 'Among the alleged recipients of this ISI largesse were the LeT's Mohammad Hafeez [Images] Saeed and Masood Azhar, chief of the Pakistan-based, FTO-designated Jaish-e-Mohammed (JeM).'

Discussing the motivation behind the attacks, the report cites sources to suggest that it marks an escalation of the "war for Pakistan": 'an ongoing and essentially civil-level battle to determine whether Pakistan will be a moderate or an extremist state.'

The report also suggests that the attack is part of a "goal-oriented" effort to advance an overall strategy to defeat the US military and restore Taliban [Images] rule in Afghanistan -- a strategy the LeT is assumed to have bought into.

It also suggests that LeT's current goals transcend the Kashmiri separatism that has been its primary motivation, and are aimed at crippling the Indian state and conducting global war against a perceived "American-Zionist-Hindu" axis.

Arguing that the US intention of engaging with India more deeply in counter-terrorism is now established policy, the Kronstadt report says the Mumbai incident has elicited vocal calls for taking such cooperation to the next level.

While admitting that mutual distrust exists between the intelligence communities in both countries -- exacerbated by recent clandestine US efforts to penetrate Indian intelligence agencies -- the threat of Islamic terrorism spurs the need for more robust bilateral intelligence sharing and other official exchanges, including on maritime and cyber security.

The report, currently before the US Congress, was among the study materials for Senator John Kerry, who is scheduled to take over as chair of the Senate Foreign Relations Committee replacing Vice-President Elect Joseph Biden. Kerry, along with Biden and senior Republican party members of the committee, are reportedly visiting the sub-continent this week, though for security reasons their schedule has been kept under wraps.