He told the world his police force and army has been unable to control Islamic extremists in his country, warning Pakistan had under-estimated the strength of the Taliban. To judge just how bad the situation really is reporter Matthew Carney has travelled to key areas of Pakistan, teaming up with a senior local journalist to investigate the Taliban's expanding reign of terror.

For much of the past half century Pakistan has seen its major enemy in its region as India. Not anymore. Now it's clear the biggest threat facing Pakistan comes from within. In the past the Taliban and al Qaeda forces have used mountain bases in the north of the country to conduct a campaign of terror.

That campaign involves assassinations, bombings, beatings and the punishment of anyone who does not obey extremist decrees. The North Western region is not the only area under threat though. Now the Taliban has broken out of its strong -holds in an attempt to take over the country. At the same time Pakistani authorities are providing very little resistance.

As Inspector General of Police in Peshawar, Malik Naveed told Four Corners... "We don't have the resources, our country is a poor country and then our province is one of the poorest provinces in this country. Basically we need bullet proof jackets. We need transport, mobility, proper wireless system and equipment for collection of intelligence, tracking of mobile phones, tracking of vehicles, and aerial surveillance, so that we know what is happening in around the city and the peripheries."

Travelling to Peshawar, the city that forms the gateway to the north-west reporter Matthew Carney found a city under regular Taliban attack. He also discovered quickly it would be impossible to go beyond Peshawar himself. Instead he teamed up with a local journalist who took a camera deep into Taliban territory.

There the journalist spent time with a key fundamentalist leader, Hakimullah Mehsud. Hakimullah made it clear that the Pakistani government would pay a heavy price for siding with the United States. He told Four Corners... "...if the country's leaders were good we would not have been able to occupy this tribal territory, because of the harsh policy of the government and the army we have had to attack Peshawar ... and every corner of Pakistan."

Perhaps the most devastating insight into the Taliban campaign came in the Swat region. Formerly a holiday destination it is now controlled by the Taliban. There Matthew Carney discovered via his fellow reporter that the extremists had destroyed most of the regions' schools. Under the Taliban's rule girls education is forbidden and women are forced to stay at home.

This has effectively shut down local markets. As one child told the program... "We will not go to school again, even if we are given security because we are extremely scared. The Taliban are warning us they will bomb and destroy our school. The Taliban are very angry , the situation is getting worse every day." But what is even more worrying is the Taliban's infiltration of Pakistan's biggest cities.

Matthew Carney found the capital Islamabad a barricaded city. It is now considered more dangerous than Baghdad. In the huge port city of Karachi its slums have become a breeding ground for Taliban recruits. It was from here that the Mumbai terrorists boarded a boat to launch their killing spree.

In essence this confirms President Zardari's warning that his government is now involved in a life and death struggle with fundamentalist forces for control of Pakistan. The implications of this struggle have profound consequences for the country itself, the region and ultimately the peace and stability of the entire globe.