By Augustine Anthony
ISLAMABAD (Reuters) - Members of Pakistan's parliament andfour provincial assemblies began voting in a presidentialelection on Saturday to choose a replacement for PervezMusharraf, who resigned last month.
Asif Ali Zardari, the widower of former prime ministerBenazir Bhutto, whose Pakistan People's Party (PPP) heads acoalition government, is expected to win. The result is duelater on Saturday.
"God willing, the PPP has a clear majority and the PPP willwin. Mr Zardari will become president and will make thedemocratic and parliamentary system strong," PPP spokeswomanand member of parliament Farzana Raja said on her way in to theassembly to vote.
Investors hope the election by members of the two-chamberparliament and four provincial assemblies will bring somestability after months of political turmoil that helped dragstocks and the rupee sharply lower.
Whoever wins will have to contend with a host of problemsthat have raised fears for the prospects of the nuclear-armedU.S. ally, including surging militant violence and an economyin crisis.
Zardari, known as a polo-playing playboy in his youngerdays, was thrust into the centre of politics by his wife'sassassination on December 27.
A February parliamentary election win by their PakistanPeople's Party (PPP) made him one of the most powerful figuresin the country.
His decision in August to begin impeachment proceedingsagainst Musharraf led to the latter's resignation, and clearedthe way for Zardari to win the top job.
His two rivals for president are Saeeduzzaman Siddiqui, aformer judge, nominated by ex-prime minister Nawaz Sharif'sparty, and Mushahid Hussain Sayed, a senior official of theparty that backed Musharraf and ruled under him.
The PPP has the most electoral college votes and despitesome doubts about Zardari's suitability, party members willstick by him, making victory virtually a foregone conclusion,analysts say.
JAIL, DOUBTS
Zardari, 53, spent 11 years in jail on corruption and othercharges stemming from his time in government when his wife wasprime minister in the 1990s. He was never convicted and saidthe charges were politically motivated.
But in an indication of the doubts Zardari faces, a poll byGallup Pakistan found only 26 percent of about 2,000 peoplequestioned thought he should be president, while 44 percentdidn't want any of the three candidates.
Political uncertainty, exacerbated by a split in thePPP-led coalition last month, together with security andeconomic worries have sapped investor confidence and draggedPakistani stocks down 34 percent this year.
The main index rose 1 percent on Friday, helped by optimismthe vote will bring some clarity. The rupee has lost 20 percentto the dollar this year but firmed to 76.40/50.
Dwindling foreign reserves, a widening current accountdeficit and sliding rupee could result in a ratings downgradeas doubts mount over its ability to meet external debtobligations.
But it will probably avoid sovereign debt default as itsstability is such an important geopolitical factor institutionssuch as the International Monetary Fund will eventually help itmeet its obligations, analysts say.
Zardari is close to the United States and has repeatedlystressed Pakistan's commitment to the campaign againstmilitancy.
But he will take office as anger with the United States isboiling after a bloody incursion by U.S. ground troops into aremote village on the Afghan border this week.
Musharraf saw his popularity dive partly because he wasviewed as too close to President George W. Bush. Zardari willwalk a tightrope as he tries to assure Washington of hissupport on security while trying to calm public anger.
(Additional reporting by Kamran Haider; Writing by RobertBirsel; Editing by David Fogarty)
