What's with Brits getting all uptight about the word Paki?

Where I come from ( Australia) we shorten everything.

Australians=Aussies.
Brittish = Brits
South Africans= Safas
Pakistani = Pakis

When we used to play Pakistan in the cricket even the commentators referred to the team as the Pakis. It is not meant to be derogatory at all. Until Prince William came on holiday here and kicked up a stink about it.

People need to lighten up. I mean if you go around giving people names based on their skin colour or make fun of their culture fair enough. But shortening the name of someones country is hardly offensive!!!