Pakistan President General Pervez Musharraf [Images] is in a bit of a spot, ever since the bloody siege of the Lal Masjid in Islamabad and the Pakistani Supreme Court's rap on his knuckles over the sacking of the chief justice.

And now comes the report that he has held talks with archrival Benazir Bhutto in Abu Dhabi, United Arab Emirates, en route to Saudi Arabia on Friday.

Just what does that mean for India's nuclear neighbour? Read on to find out.

Why did Musharraf meet Bhutto now?

As is clear to the West as well, Pakistan is at the crossroads.

The Pakistan national assembly will be dissolved in November and elections should be held late this year or early next.

Musharraf's friends in the West -- namely the UK and the US -- are aware the military President is losing popularity and control at home. To quote London's [Images] Telegraph, 'Western diplomats hope that an alliance between Gen Musharraf and Ms Bhutto will produce a broad-based secular government that might stem Pakistan's rising tide of Islamic militancy.'

Bhutto, though she has been in exile since 1997, is deemed a popular leader in Pakistan.

It was their first meeting since Musharraf captured power in a bloodless coup in 1999.

Bhutto has said she will return to Pakistan in September.

Musharraf has seen quite a few politicians from his Pakistan Muslim League (Quaid-e-Azam) defect to Bhutto's Pakistan People's Party in recent weeks. It makes political sense to side with Bhutto in a front against radical Islamism � and it suits the West as well, to have Bhutto strengthen what it sees as a bulwark against fanatical extremism.

Did they strike a deal?

There are conflicting reports on that. Initially, they would not even confirm that they had met. After several newspapers reported that a deal had been struck between them, Bhutto told a television channel: 'We do not accept President Musharraf in uniform. Our stand is that, and I stick to my stand.' So, now, the headlines are saying that a power-sharing agreement is stuck on this point � Bhutto's demand that Musharraf step down as army chief.

Some reports also say Musharraf and Bhutto have agreed to an interim prime minister during the elections -- Hamid Nasir Chattha, a former parliamentary speaker.

But PML President Chaudhry Shujaat Hussain has claimed the Chattha story is just a rumour.

But doesn't Bhutto have cases against her?

Yes, and those cases are corruption charges. If she is to strike a deal with Musharraf, those cases will have to be dropped. Also, she has been prime minister twice, and if she wrangles a deal, the Pakistani constitution will have to be amended to allow one person to be PM more than twice.

What is the reaction of other Pakistani parties to the meeting?

Deputy Secretary General of the Muttahida Majlis-e-Amal and leader of the Opposition Maulana Fazal-ur-Rehman has called it a 'meeting of two dictators.'