More Speculation on Pakistan

By Sara

Spending time running Google News on Pakistan and related subjects has finally paid off in the form of interesting announcements of what appears to be the deal to end all deals that will make Cheney spit wooden nickles. 

It is about a proposed pipeline, one that makes sense in terms of National Interests of all the involved States and that cuts the US, the Brits, and the Gulf Arabs totally out of the action.  It is so strange that our press is focused on the NIE and the FATA and the Pakistani-Afghani border, and this other deal is not being mentioned above the radar. 

Apparently Iran, Pakistan and India have agreed to build a Natural Gas pipeline that will move Iranian, and perhaps Turkmenistan Natural Gas from Iran, across southern Pakistan, and into India where it will tie into the existing Indian pipe grid, making possible, for instance, the operation of the Enron built white elephant of a power plant near Bombay.  But the pipeline will also serve cities in the Ganges Valley.  Pakistan will be able to buy gas from the system for several of its larger cities.  In addition, a LNG facility is to be built at the new Chinese developed port at Gadar, and another smaller port in SE Iran now being built by a joint Iranian-Indian venture.  And who does the finance? -- Russia has announced that Gasprom, their mostly Government Owned Oil and Gas concern will finance a major part of the project.  In otherwords, after 200 years of trying, Russia will have an outlet into the Indian Ocean.  Doing LNG will mean gas can be moved to China and Japan, and any other SE Asian country that can pay.  And yes, India, Russia and Iran plan to finance a railroad alongside the pipeline that will run up into Turkmenistan, and connect to the Russian Rail System.  All this was being announced while we focused on the NIE and the battle of the Islamabad mosque.  No one announcement was put out by all the partners, rather they each announced the agreement, and their part in it. 

Apparently the real reason Musharraf finally sent troops into the Red Mosque was because of Chinese demands.  The attacks on Chinese workers in Peshwar, on the women in the massage parlor, and now car bombs directed at fifty Chinese Engineers working at Gadar apparently provoked the Chinese Officials to demand Musharraf bring the Islamists under control.  The announced route of the pipeline benefits Baluchistan and Sind, but not the FATA or NWFP, the Pashtoon areas.  It looks as if Russia's Gasprom is the major financer, with marketing rights to the LNG, with India involved as a major, but lesser partner, though India probably will be the major consumer of the gas.  Of course Iran gets a means for selling its Natural Gas, of which it has a huge supply.  Turkmenistan also is rich in Gas -- who knows whether they will finally develop a working state, but essentially it puts Russia back in the economic drivers seat there. (Can't you just see Dick Cheney tracing the plan on to his maps, and realizing all of this will be outside the control of the US, The British, the Gulf Arabs, not serviced by Halliburton?)  Musharraf will have to make a good deal with the Baluchi state government and the tribes in the region, but far better than the US giving him cash to deal with FATA and NWFP -- this deal will depend on his gaining control in the sense that the Chinese mean control, for the sake of their investment.  It also engages him in a joint venture with India that will also change the political dynamics regarding Kashmir and the historic use of militant islamists in that dispute.  From the reports, all of this was negotiated without Washington getting word of it till the agreements were complete.  By the way, there is no one source for this story -- it is buried in Indian and Pakistani newspaper articles, a few from China, some from Iran and several from financial papers in Singapore and Taiwan.  It is announced, but they are playing it well under the radar.  In effect, while Bush and Cheney and much of Congress have been engaged in the Surge Debate, this thing has been put together on the basis of national self interest and clear economic advantages.  No one is raising an army -- no one is establishing foreign bases, but without Question Pakistan is being told to use its own resources to control its own crazies.   

Will this cause Musharraf to survive?  I think it is designed with or without him.  Since the Pakistan Army is the largest owner of productive capacity in Pakistan, I would imagine the deal assumes they are well cut in, and that President or not, Musharraf has a position.  He might be just as glad to step aside for Bhutto (a Sindi) to gradually take Pakistan back to some sort of Democracy and take responsibility for dealing with NWFP and the Tribals, and perhaps finding bin Laden. 

I am reminded of some observations Steven Coll made in Ghost Wars regarding the Chinese.  They too were deeply involved in the war in Afghanistan against the Soviet Invasion, but unlike the US and the Saudi's they did not hand over cash and pray.  They set up precise accounting systems for every arm and bullet they furnished, did not depend on the ISI to train, but demanded to do it themselves.  If one of their mules was reported dead taking material into Afghanistan, they wanted detailed reports.  I suspect with Putin's Gasprom and Chinese investment -- this thing will not be run along Pushtoon rules. 

   

Comments

[Poicephalus]

Sara,
thank you so much!

[pdaly]

Wow!

I wonder what Cheney is saying today (isn't he acting President for real today while Bush is undergoing a colonoscopy?)

[JEP]

the geopolitical realignment implications and scenarios here are mind-boggling.

Are we watching an new South-Asian energy market giant emerge, the likes of OPEC? The fact that Pkistan and India agree on ANYTHING is good news for the non-proliferation hopefuls among us. India may just parlay this agreement with Pakistan into something for the ages...

We are all so focused on China as the next potential threat to our lone-wold superpower delusion, maybe we should consider India in the running, also.

A half a billion vegetarians, with disposable income... now there's a real threat to these Texans...

[orionATL]

this is extremely well-put together and so informative.

i wonder if what is happening here would have any bearing on one of my pet interests - the u.s. getting completely out of iraq militarily and letting nations in the region deal with the iraq conflict?

in any event, some might see what you have described as taking place in this region as a great threat to the u.s.

maybe so,

but i don't look at it that way at all.

increasingly, this is just the way the world is going to work -through intersecting regional interests.

to have power in this new world,

you need respect and trust, not just munitions,

diplomats as well as generals.

we might do well to invest more effort in our two "regions" - the americas and europe - and less flailing our arms hither and yon in the middle east.

it would also give the u.s. a great advantage long-term if we began moving with extreme urgency to an economy that was less dependent on oil.

though we probably have enough coal in north america to meet our needs for decades,

that is really not a long term option for us,

just as carbonated fuels are not a long-range option for the indians or the chinese.

it would be nice to see the united states moving lithely diplomatically and economically,

staying one step ahead in the energy-economics game

instead of slogging along with tanks and 80 pounds of body armour.

[Mimikatz]

I remember reading a couple of years ago that places like India and China were quietly making economic and security relationships that had nothing to do with the US and we weren't even aware of, because we are always so centered on our own country and problems. Looks like this is part of that effort brought to fruition.

The best hope for this country is to get out from under the burden of "the world's only superpower" and learn to live with others. There's not a GOP candidate I would trust to be able to do that.

[kin]

thank you
Great job.
This is the first time I have ever written a pat on the back comment about any blog entry, and it is well deserved.

This explains so much and open so many new questions. I will chew on this for a long while.

Keep up the good work

[kin]

thank you
Great job.
This is the first time I have ever written a pat on the back comment about any blog entry, and it is well deserved.

This explains so much and open so many new questions. I will chew on this for a long while.

Keep up the good work

[larue]

First, MAJOR kudos to Sara for a really important read about a major development!!
Well done, Ma'am!!

Second, here are some random thoughts, having READ Sara's post:

1) The US was cut out of an Afghanistan Pipeline deal by the Taliban, before 911.
I forget who the principals were, but I vaguely recall Russia, China, France, Germany. I'd have to google up, but for SURE, Cheney went to VISIT the Taliban, and was booted. Then 911 happened, and we went after Afghanistan/Taliban. Curious, no? What will be the BoyKings Crime Syndicate response to THIS affront to their integrity, given the Middle East now looks like a power play by The Bush Family to control oil and keep Russia/China out of it in a direct manner?

2) What WAS Putin's intent and actions in his visit with BoyKing earlier this summer/spring in VA? Did he cut in the Bush Family to this deal somehow? Did he THREATEN Bush with retaliation if USA acts militarily against Iran in any way?

3) In a wierd way, this now pits Russia WITH the USA, in an Islamist Radical Eradication Effort, in a general struggle by all to control Middle East energy, be it oil OR gas.

4) Russia MUSH have untapped oil and gas reserves . . . you'd think China does, too. Yet, not a WORD in MSM about that issue (I've not looked to research that, would be REAL interesting to know).

5) The Chinese have been REAL silent mainstream wise, up to now, about USA in Middle East (for the most part). This puts THEM on the table of ACTIVE!!! Will, and HOW will, they leverage any of this on all that oil at stake in Iraq? And how will this damper BoyKing's plans to do Iran for the oil?

6) What does this new development mean for The Bush Family with respect to the BIG PICTURE Middle East plans in the long term?

Shutting down radical Islamist's in Pakistan is gonna raise a lot of Muslim blowback, especially in Afghanistan, won't it? . . . and have Iran's Mullah's signed off on a clamp down on the Islamist Extremists in Pakistan . . ?

It seems a lot of this is pitting forces SEEMINGLY on similar sides against one another . . . while bringing opposing forces together to get the Gas Deal done . . .

I'll defer to those in the know for answers, but I got a lot of questions!!!

Thanks Sara, once again . . . pulling together such a disparate amount of news sources to put it all together is one HECK of a research job!!!

[Sara]

Actually, this is an example of a four way partnership being constructed on the principle of National Self Interest, Interest narrowed to economic development considerations. What is so refreshing about it, at least in my mind, is that all the major weggies that currently confound us, (which brand of Islam, for instance) are just not part of the concept.

Let's take them one by one. Russia gets a major off shore investment in the world energy market. Pipeline and LNG facilities use Gasprom's capital, and given world demand for energy (at world prices) should generate huge returns. Russia also gets access to two deepwater ports on the Indian Ocean. With a rail connection, it can export and import free of Siberia or the Baltic in winter. But they will not have the expense of conquest or policing, as each port will be a partnership between India+Iran, and China+Pakistan. Russia regains economic influence in what it calls the Near Abroad, starting with Turkmenistan. (Can Kazak Gas and Oil be far behind?)

Iran gets access for its gas to world markets free of US or European sanctions. (China and Russia do not vote for sanctions very often.) A pipeline, railway-highway corridor in the East of Iran brings development and jobs to a profoundly under-developed region. One would expect such a corridor to eventually mature with many small industries needing access to power as well as transport into world markets.

Pakistan gets both Gas and an income from transit fees on the pipeline into India. Very large cities such as Karachi and Hyderabad get dependable power for domestic use and for industrial development. All this creates skilled and semi-skilled jobs. The pipeline route across southern Pakistan would become an extension of the development corridor N to S in Iran -- benefiting a most underdeveloped region of Pakistan. Pakistan might also develop a major truck transport link up into Western China via the Karakoram Highway built in the 60's and 70's as a joint Pakistani-Chinese venture. (Just think of all those Chinese consumers!!!)

India in many ways would be the big winner in all this. The pipeline apparently would mate up with existing systems beginning in Rajasthan, and connecting south into Mumbia (Bombay) where the Enron White Elephant is shuttered, but ready to start producing badly needed electricity once one gets a supply of Gas to it. The existing Indian pipe system also connects to Delhi and other major cities in the Ganges valley. India would probably also be a major consumer of LNG from its investment in Iran -- delivered by ship along its coastline.

China of course gets LNG in a dependable supply, based on overseas investment in a critical energy infrastructure -- a good way to unload the dollars they made supplying Wal-Mart. China probably also gets to build their own Wal-Marts in these partner countries. China can probably share in the profits of supplying LNG to Japan, Indonesia, maybe even Australia.

All this logical development has been evident ever since the break-up of the economic systems of the old Soviet period with their ideological cold war era coalitions. It leaves out the Euro-American West as well as the less productive and underdeveloped Arab world, though I would imagine both will want to invest in productive industry along the margins. Most important, it creates joint economic interests that will, over time, mitigate the attraction of military adventures. If it becomes a goose laying golden eggs, bombing the hell out of it will be unattractive. It leaves out troubled regions -- Kashmir and Afghanistan remain problems, but probably unattractive causes belli. It certainly tells the bin Ladens of the world that there is little interest in an 11th century Caliphate. It only works if several forms of Islam can work with Hindus and Sikhs, with Russian Orthodox, and with Chinese Buddhists, Taoists, Confucianism, etc. I think it creates the conditions for strong local control (policing) of any form of religious/ideological extremism, that might upset the egg laying goose. I actually think this is probably behind the Chinese demands placed on Musharraf vis a vis the Red Mosque in Islamabad. Musharraf afterall represents the Pakistani Army -- the owner of at least half of the industrial development in Pakistan. I think Musharraf and the army were forced to make a choice of interests (Taliban allies versus economic development) -- thus the spate of articles in the South Asian Press about this huge development plan which clearly had been in the planning stage for several years. (The Chinese just don't have any patience with kidnapping massage workers and blowing up engineers with car bombs.) I think Musharraf will have his hands full in the next months, but his incentive to get control is much more than just US subsidy payments to his Army -- he has a huge economic potential at risk if he does not succeed, and the Pak Army owns half of it.

It is interesting to note that all of these countries (except for the moment, Iran) are Nuclear Armed Powers, and thus to an extent have what we used to call in cold war days, deterrent capability. So long as none of them develop "first strike" capabilities, this probably makes this kind of agreement possible.

As to US interests. I sure to hell hope that people in MSM pick up on this story and its implications. I think it throws a total ringer into the concepts of the Neo-Con's and those who Cheney represents, and absolutely demands a Progressive critique in terms of what our own Capital institutions and Government should be accomplishing for the benefit of the American People. If ever there were a critique that the Democratic Party could use as a platform, it is this. Wrong Way Cheney versus pragmatic problem solving and development in the interests of Americans.

Does it get us out of Iraq -- don't know but think it is an argument for not throwing money down the black hole of an Iraqi Civil War.

[orionATL]

well said.

"i think it creates the conditions for strong local control (policing)of any form of strong ideological/religious extremism that might upset the egg laying goose.... "

that's the foundation,

that's the formula

for dealing with and getting past religious follies and ancient animosities -

each state (and, one would, hope, its people) gets something out of the deal they need or want. living standards creep up bit by bit.

in the contemporary american business deal-making vocabulary i think that is called, a "win-win" deal.

too bad our policies in the middle east of late have not show any susceptibility to the lure of win-win

and economic growth (as opposed to foreign aid)

and, as a consequence, have not been well-received or very successful.

but "well-received" cannot happen as long as

- israel is the tail that wags the american labrador

- threat and use of military force are the principle arrows in our quiver

and

- our middle east diplomacy is based on fear, fear of loss of oil supplies (and for the cheney's of the world, oil revenue).

[orionATL]

oh,

i forgot the thought that first came to mind when i read your comment just above,

a story which i think illustrates one of the deeper point implied in your commentary -

economic vs patriotic/military influence on events:

i seem to recall that when pakistan and india were talking nuclear this and that in the not too distant past,

american businesses depending on india to provide a stable supply of people or manufactured items or both,

called their indian compadres and said

"we read that things are heating up between india and pakistan,

we need stability for our businesses.

we can't afford to have a supply chain that is easily disreputable by indian-pakistani animosity,

let alone nuclear threats."

as i recall this story,

a number of indian businessmen then went to the p.m. (maybe one jayoti, i don't recall the exact name)

and said to him

"we need to cease telegraphing to the world the possibility of instability here,

of possible war between india and pakistan

in order to continue our overseas business ventures.

we are not happy with the "shouting and cursing" going on between official india and official pakistan."

if i am recalling the story right,

damned if the indian politicians didn't quickly quiet down with respect to rhetoric about pakistan

and business,

and jobs,

and income

continued to grow.

[Jon]

Great post, Sara!

It's about as close to aperfect business development deal as one could imagine. It resolves economic, political and geopolitical interests with a built-in incentive to self-police and restrain the extremist elements that operate in the countries where the assets will lie.

[Sara]

Larue -- there actually were two Afghani Pipeline schemes. One was by Unical, which Clinton almost OK'ed until he came under much pressure from American Feminists distressed at the Taliban treatment of Women. Part of it was planned before the Taliban took over, but then it languished. The other one was a strange upstart Argentinan company, Bridis,(I have always thought that could be a false front for Bush and assorted American/Texas interests) and a Saudi company. This would have been the current offer on the table when Bush was installed in 2001. Both would have connected Turkmenistan Gas across Afghanistan into Pakistan, with an LNG terminal near Karachi, and another proposed connection on into India. The point of the design was to cut Iran out of the deal, as well as avoid any pipelines crossing Russia.

Yes, China has some undeveloped Oil and Gas reserves -- mostly in the NW and inner Mongolia. But it isn't much given the needs they have and will have. Ditto for India, though just last year they discovered a major Gas reserve on the E. Coast about one third of the way between Calcutta and Madras. Near Rajahmundry -- but not near any of India's existant pipelines. Of equal interest, Geologists have now surveyed Northern Afghanistan, and apparently there are siginificant Gas and Oil reserves there -- North of the Hindu Kush. But the point is the big consumer markets that pay world price are China and India, and to a lesser extent, Pakistan.

Iran has probably passed "peak oil" production -- estimates are they may have 20 years worth left for the export trade -- and unless they can build refinary capacity, they can barely supply domestic needs. What Iran has in huge supply is Gas. The Iran economic plan apparently is to sell the gas, and develop nuclear power generation capacity. (and who knows how they really plan this).

As to Russia -- Russia is totally lush with undeveloped Gas and Oil. Remember, Putin hired former German Chancellor Schroeder to head a joint venture bringing Artic Gas and Oil to near St. Petersberg, and then under the Baltic Sea to Germany and the EU Pipelines. Putin is a man who does business, and I would imagine if he said anything at all to Bush when he visited overnight in Maine, it was about business. If I were Putin I would not hire a twice failed oil guy who also mismanaged a major counterterrorism operation for any meaningful business -- but you never know. But yes, I would imagine the general scope of the emerging Iran, Pakistan, India, Russia and China deal would have been tabled.

But another point to consider -- if China is going to invest heavy duty in this sort of development, will they continue to buy US debt?

[RSPrice]

The Iran-Pakistan-India gas pipeline was not done quietly during the Surge, but announced with some fanfare in June 2005. It has gone nowhere as Iran is insisting that India pay 50% more than the originally agreed price of $3.215 per MMBtu while India insists that Iran honor the contract price.

[MarkH]

Fascinating stuff.

It really is a new Eastern energy-based economic pact/union and all developed quietly while Bush & Crazies continue this weird 9/11-begun thrashing.

Does this all mean it's finally over? That Bush & Crazies have completely failed and it's just a matter of some time before they leave (or are pushed out) and we can get back to reasonable international relations?

I mean, the Afghan oil & gas pipelines appear to have been a Western plan to compete with this new plan just announced and that it was being instituted with force rather than Free Market Economics. How hypocritical of the NeoCons.

What will it mean for the ultimate supply of oil to the world? Well, the Putin-Schroeder Arctic oil & gas lines are news to me too, so I'd have to guess there are going to be a lot more people around the world who have oil & gas. That has to be depressing to the oil industry execs who love low steady supply and higher prices.

Does it mean Bushie didn't really read Putie so well? It seems Putin did an end run around US and dealt with everybody else in the world before Bush & Co.

Amazing to hear this on a blog, but not on MSM (though not surprising I suppose).

America's next step? Get rid of Bush & Co. and maybe help Enron regain it's Indian refinery, so they can make some money. Get out of Iraq, so they can get back to settling their civil war and eventually producing more oil for the world. In other words, we all get to go on living and doing better as soon as we can get rid of the Bush mafia and it's legacy of destruction.

Happy days will soon be here again!