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RUEHLH/AMCONSUL LAHORE PRIORITY 6160
RUEHPW/AMCONSUL PESHAWAR PRIORITY 4987
RUEKJCS/SECDEF WASHINGTON DC PRIORITY
RUMICEA/USCENTCOM INTEL CEN MACDILL AFB FL PRIORITY
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C O N F I D E N T I A L SECTION 01 OF 02 ISLAMABAD 003186 
 
NOFORN 
SIPDIS 
 
E.O. 12958: DECL: 08/04/2018 
TAGS: PREL PTER PGOV PK
SUBJECT: TOUR D'HORIZON WITH ZARDARI 
 
Classified By: Anne W. Patterson, for reasons 1.4 (b)(d) 
 
¶1. (C)  Summary:  In a discursive conversation with President  Zardari on October 2, Ambassador again encouraged the  appointment of a czar for the Federally Administered Tribal  Areas (FATA).  She stressed that the federal and provincial  governments were not working well together to confront the  issues of relief and development.  Zardari said he was  inclined to retain Northwest Frontier Province Governor Owais  Ghani but Awami National Party (ANP) leader Asfundyar Wali  Khan had been ""a disappointment.""  Zardari advised he would  soon be appointing businessman Shaukat Tarin as Minister of  Finance; Finance Minister Naveed Qamar would then be solely  in charge of privatization.  Zardari repeated his now  familiar request for financial help from Saudi Arabia, the  UAE, and Kuwait, including asking for deposits in the Central  Bank and concessional oil sales.  Zardari again recounted the  significant investment opportunities in steel and cement in  Pakistan.  Zardari noted he would be willing to ""take the  political heat"" of a cross-border raid if a really important  high value target was captured.  He was appreciative of his  briefings and meetings in New York. 
 
¶2.  (C)  Zardari was particularly pleased that ISI chief  General Nadeem Taj had been reassigned.  ""See, I told you,""  he said, ""that we would begin to make progress on ISI and  political consolidation.""  He indicated he would not confront  Nawaz Sharif's control of the Punjab government immediately  because it would cause problems with his management of the  federal government.  But he was certain the Sharifs were  trying to undermine the Pakistan People's Party in the  Punjab. 
 
¶3. (C)  On October 1, Prime Minister Gilani asked Ambassador  for a pull aside at a reception.  He asked her to convey to  President Bush that ""he had kept his word"" at the Oval office  meeting.  His government was fighting terrorism in Bajaur and  Swat and would continue to do so.  He wanted to be clear that  ""it was Pakistan's war.""  End summary. 
 
¶4.  (C)  Ambassador called on President Asif Zardari October 
¶2.  Zardari was pleased with his meetings in the U.S.  Zardari was disappointed, however, that the Saudis had not  attended the Friends of Pakistan meeting.  He said perhaps  the GOP had made a mistake in not being the first to invite  the Saudis.  He noted that Pakistan needed American help in  obtaining Central Bank deposits from the Arabs, as well as  oil at less than market prices.  Ambassador asked about  progress on the government's economic plan.  Zardari said he  was replacing Finance Minister Naveed Qamar with Shaukat  Tarin, a former head of the Habib Bank and well respected for  overseeing successful privatization efforts.  Zardari  revealed he was going to Saudi Arabia soon, as well as to  China, where he would request financial assistance.  Zardari  was eager to participate in the next ""Friends"" meeting in the  UAE. 
 
¶5.  (C)  Ambassador pressed for the assignment of a FATA  Czar, to serve the coordinating role that General Nadeem had  undertaken during the earthquake relief.  Zardari said he  would discuss this with Chief of Army Staff (COAS) General  Kayani and ANP leader Asfundyar Wali Khan, whom he described  as ""a disappointment.""  Ambassador said the federal  government was not working well with the provincial  government and there was not a responsible point of contact  to address such issues as relief for internally displaced  persons.  Zardari said Northwest Frontier Province Governor  Ghani ""could do the job.""  Despite his initial reservations  about the Ghani as a ""Musharraf man,"" Zardari was impressed  with him.  Ambassador said we had worked well with Ghani but  we needed someone to focus more on project implementation. 
 
¶6.  (C)  Zardari said he would soon be seeking military  assistance from the French, particularly a new attack  helicopter, at below market prices.  Ambassador reminded him  that we were providing Cobras under the FMF program.  She  asked if they were going to buy more Alouettes.  Ambassador  pointed out that the U.S. was the only country providing  military assistance to Pakistan - although some countries did  offer favorable payment terms - and this meant that U.S. 
  ISLAMABAD 00003186  002 OF 002 
 
  military assistance was indirectly subsidizing commercial  arms purchases from other countries.  Zardari said the French  were trying to sell Mirages to Pakistan, but he did not need  them since Pakistan had F-16s.  He was going to try to secure  armored personnel carriers from the UK.  (Note: It was clear  that we need to provide more details on our military  assistance programs.  End note.) 
 
¶7.  (C)  Zardari mused about his desire to retain former  Musharraf national security advisor Tariq Aziz to handle the  India account, possibly by appointing him ambassador to  India.  But Zardari said he had found COAS Kayani resistant  to this proposal.  Ambassador expressed surprise: Tariq Aziz  and Kayani had always seemed to have gotten along well. 
Zardari replied that Tariq Aziz used to be the ""big boss"" as  the advisor closest to Musharraf but now Kayani was on top  and reluctant to relinquish that position.  Ambassador  suggested NSA Durrani would also be an effective player on  the India account.  The conversation moved into a discussion  of Indian activities in Balochistan, with Zardari saying he  knew Indian intelligence was operating in Balochistan, and it  had to stop.  Zardari said he was working with the tribes and  reaching out to the Bughtis to reduce tensions. 
 
¶8.  (C)  Ambassador asked if Zardari was going to move  against the Pakistan Muslim League-Nawaz in the Punjab and  bring down Shahbaz Sharif's government.  Zardari said he was  not - implying at least not immediately.  (Plans to do so are  already well advanced as Embassy will be reporting septel.)  He was afraid the Sharifs would turn on him immediately in  the National Assembly.  Zardari (grinning) said he was going  to invite Nawaz to reopen a dialogue with him.  He noted that  Nawaz has been silent on terrorism and had been conveniently  out of town after the Marriott bombing. 
 
¶9. (C)  Comment:  In press interviews October 6, Zardari  ambitiously announced he wanted USD 100 billion in foreign  aid from Pakistan's friends.  We expect Zardari and Gilani to  announce additional cabinet ministers and perhaps some  ministerial swaps this week, after the joint session of  parliament that Zardari called for October 8 to address the  terrorism threat.  According to the media, Zardari will be in  China October 14-24; PM Gilani will join him for celebrations  of the Asia-Europe Summit on October 23-24; COAS Kayani just  returned from a counterparts visit in Beijing.  Embassy will  follow up to offer Zardari a detailed briefing on current  U.S. military assistance programs in Pakistan.  End comment. 
PATTERSON  "	

 (C)  Summ...