People in the South Asia region will be holding their breath in the new year.
If both nations fail to achieve a modicum of political stability and success against extremism and economic growth, the world will be faced with an expansion of Islamic extremism, doubts about the safety of Pakistan's nuclear weapons and major questions about US prestige and power as it withdraws from Afghanistan.
The challenges for both countries are deeply interlinked and enormous.
The primary task is whether both countries can work together with the Western alliance to roll back the Taliban and al-Qaeda threat they face.
That in turn rests on the success of the US and Nato's new strategy in both countries over the next 18 months as President Barack Obama has pledged to stabilise Afghanistan's political and economic institutions and start handing over Afghan security to the Afghan armed forces, starting in July 2011.
Karzai undermined
For that to happen much will depend on whether the West is able to find effective government partners in both Islamabad and Kabul.
So far the prospects are not all that hopeful.
President Hamid Karzai has emerged as the victor after intensely controversial elections that undermined his domestic and international credibility, while the Afghan army is still far from being able to take over major security responsibilities.
There will be renewed political wrangling as the West and the Afghans have to decide whether to hold parliamentary elections in the new year.
The Afghan army is still undermanned, undertrained and has yet to be equipped with heavy weapons and an air force.
The Afghan army also suffers from 80% illiteracy and a lack of recruits from the Pashtun belt, which are essential if the army is to be effective in the Taliban-controlled southern and eastern parts of the country.
In the midst of what will certainly be a hot and possibly decisive summer of fighting in 2010 between Western forces and the Taliban, the other primary tasks of providing jobs and economic development, while building sustainable capacity within the Afghan government to serve the Afghan people, will be even more important and difficult to achieve.
The Taliban strategic plan for the summer is likely to be to avoid excessive fighting in the south and east which is being reinforced with 30,000 new American soldiers.
Instead, the Taliban will try to expand Taliban bases in the north and west of the country, where they can demoralise the forces of European Nato countries that are facing growing opposition at home about their deployment.
The militants will also stretch the incoming US troops - forcing them to douse Taliban fires across the country - while they try to create greater insecurity in Central Asia.
Pakistan crisis
At the same time the Pakistan military, which now effectively controls policy towards India and Afghanistan, shows no signs of giving up on the sanctuaries that the Afghan Taliban have acquired in Pakistan.
Without Pakistan eliminating these sanctuaries or forcing the Afghan Taliban leadership into talks with Kabul, US success in Afghanistan is unlikely.
Pakistan itself faces a triple crisis
- acute political instability - President Asif Ali Zardari may soon be forced to resign, which could trigger long-term political unrest
- an ever-worsening economic crisis that is creating vast armies of jobless youth who are being attracted to the message of extremism
- the army's success rate in dealing with its own indigenous Taliban problem.
However, for the moment that appears unlikely while the army is hedging its bets with the Afghan Taliban, as it is fearful about a potential power vacuum in Afghanistan once the Americans start to leave in 2011.
Other neighbouring countries - India, Iran, Russia and the Central Asian republics - may start thinking along the same lines and prepare their own Afghan proxies to oppose the Afghan Taliban, which could result in a return to a brutal civil war similar to that of the 1990s.
Pakistan's fight against its own Taliban is going well but that is insufficient as long as the army does not move militarily or politically against the Afghan Taliban or other Punjab-based extremist groups now allied with the Taliban.
Impasse
Pakistani calculations also involve India - and the failure of both nations to resume the dialogue halted after the 2008 attacks in Mumbai (Bombay).
India fears that extremist Punjabi groups could launch another Mumbai-style attack and are demanding that Pakistan break up all indigenous extremist groups that fought in Indian-administered Kashmir in the 1990s.
Islamabad is refusing to do so until Delhi resumes talks with it.
The Obama administration has so far failed to persuade India and Pakistan to resume a dialogue or settle their differences and if that remains the case in the new year, Pakistan is more than likely to continue defying US pressure to help with Afghanistan.
There is growing anti-Americanism in Pakistan despite Washington's pledge of an annual $1.5bn aid package for the next five years.
With the present lack of security in Pakistan - and the volatile mood towards the US and India that is partly being fuelled by the military - it is difficult to see how US aid can be effectively spent or how other economic investments can take place.
At present there is an enormous flight of local capital from both Afghanistan and Pakistan that has increased since the Obama plan was announced.
The recent arrests in the US and Europe of suspects linked to the Afghanistan-Pakistan region indicate that the world could face a wider extremist threat if it fails to effectively stabilise Afghanistan and help Pakistan towards a quick economic and political recovery.
Ahmed Rashid is the author of the best-selling book Taliban and, most recently, of Descent into Chaos: How the war against Islamic extremism is being lost in Pakistan, Afghanistan and Central Asia.