Pakistan is unlikely to take on Lashkar-e-Taiba any time soon, since this could drive it into a dangerous alliance with the Pakistani Taliban and other al-Qaeda linked groups, security officials say.

That is a problem for India, which believes LeT not only runs its own sophisticated operations like the 2008 attack on Mumbai but is now encouraging disaffected Indian Muslims in the “Indian Mujahideen” to launch small-scale bomb attacks in Indian cities.

Security officials in Pakistan say the country needs to focus first on defeating Pakistani Taliban fighters in its tribal areas on the Afghan border rather than opening up a new front in its heartland Punjab province where Lashkar-e-Taiba is based.

“If you are so up to your neck in the tribal areas, would you like to open another front?” asked one security official.

Unlike other militant groups, LeT has been careful to avoid attacks within Pakistan itself, focusing on India and Indian Kashmir, and as a result has been left largely alone.

“LeT continues to operate almost with impunity in Pakistan,” said Rifaat Hussain, who heads the Department of Defence and Strategic Studies at Quaid-i-Azam University in Islamabad.

LeT — once nurtured by the Inter-Services Intelligence (ISI) agency to fight India in Kashmir — is estimated to have between 2,000-3,000 gunmen and another 20,000 followers, many trained to fight and who could be mobilised against a crackdown.

The group could ultimately become a major risk for the West — LeT’s charitable wing has wide support and funding from the Pakistani diaspora — and even threaten Pakistan itself if it decided to try to impose its Islamist views across the country.

Yet Pakistani security officials argue success in its battle against militants depends on its ability to isolate the enemy.

“Do not do anything where all the threat comes together,” said one security official. “If we open a front against LeT in central Punjab what would happen? What political support would be there? What is your capability? If you do it, would you overcome the militants or would the militants take over?”

Instead, as with other Punjab-based militant organisations, Pakistan prefers to monitor their activities closely rather than take action which could drive them further underground and create splinter groups which could prove even more dangerous.

“We know who they are, and we try to keep an eye on them,” said another security official. “There is no official support.”

“KARACHI PROJECT”

Others, however, say its suits Pakistan to retain an organisation which could be used against India in the event of war, or, some say, to repay in kind what it sees as Indian support for separatists in its Baluchistan province.

Indian security officials and analysts question whether Pakistan would really go after the LeT, regardless of timing, given what they see as close ties to the Pakistani security establishment.

After a lull following the Mumbai attack, analysts say LeT is again using the Indian Mujahideen — an organisation they say it has nurtured for years — in a fresh wave of small-scale urban bombings in India in recent months.

“The recent bombings in Bangalore and before that in Pune appear to have borne out fears that the Lashkar was facilitating the regrouping of the Indian Mujahideen,” said Praveen Swami, an Indian journalist who has extensively researched both groups.

This could prove an obstacle to a resumption of talks between India and Pakistan, broken off after the Mumbai attack.

“If we’re going to see a heightened bombing offensive leading into the Commonwealth Games (in Delhi in October), there’s obviously going to be a problem, even if the scale of the attacks do not precipitate an India-Pakistan crisis per se,” he said.

Some analysts have dubbed the new campaign the “Karachi project”, named after the Pakistani city where they say disaffected Indian Muslims are brought for training.

“The purpose of the project is to deploy Indian Muslims to carry out attacks in India using locally available bomb material so that the attacks are not traced back to Pakistan,” wrote Indian analyst Animesh Roul this month in the CTC Sentinel, published by the Combating Terrorism Center at U.S. military academy West Point.

Pakistani officials say India is blaming Pakistan for “home-grown terrorism” fueled by anger over communal violence in which the majority of victims have been Indian Muslims. For example, several thousand Indian Muslims died in 2002 in riots in the state of Gujarat.

Analysts in both countries also see it as part of a propaganda campaign — mostly aimed at Washington — in which India and Pakistan try to prove the other is the main cause of problems in the region.

SPLINTERING INTO AFGHANISTAN

Along with its alleged support for the Indian Mujahideen, LeT is believed to have fighters in Afghanistan’s Kunar and Nuristan provinces, where U.S. forces have taken a beating from a scrum of different militant groups working together.

LeT has a history of involvement in Kunar and ran Kashmir training camps there for years, said Stephen Tankel, a U.S. researcher who is writing a book on the group.

“It’s questionable whether LeT is running its own operations there,” he said. “Its people are, however, taking part in training, recruiting, logistical support and fighting alongside other insurgent operations in and around Kunar.”

The group has also been linked to al Qaeda and, by Indian analysts, to February’s attack on Indian interests in Kabul.

Pakistani officials dismiss such talk as Indian propaganda and say any former LeT fighters involved in Afghanistan, or linked to al Qaeda, belong to splinter groups.

This argument about splintering is often offered by Pakistani security officials, and is commonly used to explain the Mumbai attack which they say was not endorsed by LeT founder Hafez Saeed.

It is an argument, however, that can cut both ways.

“You don’t get splintering in small organisations,” said Hussain at Quaid-i-Azam University. “You begin to splinter only when you are sprawling, when you are trying to become too big.”

(Editing by Chris Allbritton and Sanjeev Miglani)

(For more coverage of Afghanistan and Pakistan, see: http://www.reuters.com/places/afghanistan-pakistan)