Tomorrow is Pakistan's republic day. It's a sonorous moment in the country's history - a celebration of 53 years of republican existence and a public holiday replete with military parades - but it's a moot point if everyone will be taking a little holiday in their hearts. It won't be a particularly enjoyable day for the country's leader, President Asif Ali Zardari, who has seen his hold on power shaken internally by groups opposed to him and externally by pressure from Washington and London.

He might have managed to bypass the embarrassment posed by the freedom marchers organised by his main opponent Nawaz Sharif, leader of the Pakistan Muslim League-N (PML-N), but he had to bow to their main demands, namely the reinstatement of the popular chief justice Iftikhar Mohammed Chaudhry and several other deposed judges who will be returning to their jobs on the bench in Islamabad today. It's no secret that this about-turn had less to do with Sharif's noisy blustering and more to do with Western diplomats getting Zardari in a headlock.

For a leader who vowed that Chaudhry would never again resume office, this has been a humiliating climb-down. Elected president seven months ago in the aftermath of the assassination of his wife, Benazir Bhutto, it has been a rough ride for the man known locally as "Mr Ten Per Cent", a not so sophisticated allusion to his past career as a shady businessman. Until late last week the only glimmer of optimism available to him was that Sharif remained debarred from office along with his brother Shahbaz - another reason for the demonstrations they have been fomenting in the streets of Lahore. That hope was swiftly extinguished when the supreme court decided to review the ban on Friday, thereby opening the way for the PML-N leader to return to Islamabad from his political heartland in the Punjab.

None of this is good news for Zardari, who has made a rapid transition from democratically elected leader (something of a rarity in Pakistan) to lame-duck president (an altogether too familiar failing in Islamabad). At a time when the country is facing political turmoil and a determined resurgence by the Sharif brothers, he is now perceived as being too interested in hanging on to office while neglecting the administration of the country.

He's also seen as Washington's stooge, never a good position to occupy in an Islamic country, as his predecessor, General Pervez Musharraf, found to his cost. Again, the accusations cover familiar territory. Zardari was forced to make concessions over Chaudhry's reinstatement, a sure sign that he was no longer in charge of his own political destiny, and at the same time he has been powerless to make any protest against the US decision to extend its attacks on suspected Taliban and al-Qaeda targets in the frontier province of Baluchistan.

Although President Obama has promised to review the situation US military commanders have insisted that they have firm evidence of terrorist targets in the area and intent using unmanned drones to launch missile attacks against them. There have also been hints that the US intends to introduce covert operations against the"Quetta shura", the Taliban council suspected of using the Baluchistan capital as its main operating base.

From a strictly military perspective, these moves cannot be faulted, and they are being balanced by an upsurge in US reconstruction activity in southern Afghanistan. But counter-insurgency campaigns of this kind involve delicately balanced operations. It's essential to decapitate the opposition leadership, but if the actions produce collateral damage by killing innocent civilians, they quickly become counter-productive. That's what has been happening in the tribal areas, with Zardari the target for some anger.

And there's the wider picture. Across the border in India, Pakistan is now regarded, if not as a failed state, then as a failed-state-in-waiting. There are now fears in Delhi that any further destabilisation could lead to tensions along the border. Considering that both armies possess nuclear weapons that's a terrifying thought.

In the midst of the mayhem, one man could emerge as a key player - Pakistan's chief-of-staff General Ashfaq Kiyani, who is thought to have engineered Chaudhry's comeback. So far he's kept in the background, but with his US links he could be the country's next kingmaker. And his protégé? Step forward Narwaz Sharif, who to everyone's surprise has surfaced from this latest row smelling of roses, and might well be one of the few to enjoy tomorrow's celebrations.