ISLAMABAD: Nearly a month after Pakistan`s worst ever natural disaster flooded a fifth of the country and hit 20 million people, the spectres of social unrest and Islamist extremism are stalking the nation.

Torrential rains have had a catastrophic impact on the impoverished, nuclear-armed nation, causing economic losses that could see Pakistan default on an IMF loan and leaving eight million people dependent on aid for survival.

While the international community has now donated almost 500 million dollars, domestic anger is mounting at the civilian government, which has staggered from crisis to crisis in the 30 months since its election.

Flood survivors camping out in miserable conditions -- up to six million of them still without shelter -- have staged angry, if isolated, protests against the government, shutting main highways and forcing police to mobilise.

Devastation to farmland and transport links mean that food prices have rocketed, fanning frustration among the masses already struggling to make ends meet and discontent among millions who have lost everything.

Inflation is already a burden for many. Pakistan has suffered an electricity crisis for years, but now the flood waters have forced power stations to close, exacerbating energy cuts and leaving entire communities without power.

"Alienation towards the government has increased and in the long run it can create internal instability. The opposition can cash in on that and in the long-term, Islamist militants can benefit," said analyst Hasan Askari.

"If the opposition joins (in protests), the unrest can be powerful, nobody knows what can happen," said Askari.

Pakistan`s relatively free media has castigated the government response in chat shows, scathing editorials and a series of damaging news reports including allegations that Prime Minister Yousuf Raza Gilani visited fake relief camps.

An official prime minister`s relief fund has collected just 17.5 million dollars, with many reluctant to donate to an administration widely painted as corrupt and bogged down in red tape and infighting.

So far opposition leader Nawaz Sharif and his Pakistan Muslim League-N (PML-N) party have yet to agitate en masse against the government.

As the PML-N heads the government in Punjab, Pakistan`s breadbasket, its most heavily populated province and one of the worst hit areas, some observers believe the mainstream opposition could also come unstuck over the disaster.

In Muzaffargarh, one of the worst-affected districts of southern Punjab -- a region notorious as a Taliban recruiting ground -- officials openly admit it is beyond their capability to reach out to the 2.5 million local victims.

"People are blocking roads, looting food trucks and protesting for not getting relief," said Jamshaid Dasti, a local MP from the Pakistan People`s Party (PPP) led by the hugely unpopular President Asif Ali Zardari.

"The situation could get out of control at some point."

In the southern province of Sindh, where flooding has ravaged valuable rice and cotton crops and killed livestock, Qaiser Bengali, an advisor to the chief minister, acknowledged the dangers.

"There is a great social risk. Food prices are really high, lots of crops have been destroyed and lots of cattle died, so if we don`t pay attention to these issues, there will be huge demonstrations," he said.

"Pakistan is so fragile that the government can be threatened as soon as there is social unrest. It`s less a matter of the government than a matter of stability of the state."

Concerns have been widely raised that in the long term hardline Islamic charities, which are exploiting the aid vacuum to provide welfare, could mirror patterns in Lebanon with Hezbollah and in the Gaza Strip with Hamas.

"People will say religious groups deliver, the state does not, so the power of the mosque and of the madrassa will get stronger," said Bengali.

Zardari warned last week, after witnessing anger first hand from flood survivors in Punjab, that "negative forces" could exploit the tragedy.

"They would take babies who become orphans and then put them in their own camps, train them as the terrorists of tomorrow," he said.

BDST: 10:09 HRS, August 22, 2010