VZCZCXRO6057
PP RUEHDBU RUEHIK RUEHYG
DE RUEHBUL #0997/01 0860256
ZNR UUUUU ZZH
P 270256Z MAR 07
FM AMEMBASSY KABUL
TO RUEHC/SECSTATE WASHDC PRIORITY 7074
INFO RUCNAFG/AFGHANISTAN COLLECTIVE PRIORITY
RUEHZG/NATO EU COLLECTIVE PRIORITY
RHEHAAA/NATIONAL SECURITY COUNCIL WASHINGTON DC PRIORITY
RUEAIIA/CIA WASHINGTON DC PRIORITY
RHEFDIA/DIA WASHINGTON DC PRIORITY
RUEKJCS/OSD WASHINGTON DC PRIORITY
RUEKJCS/JOINT STAFF WASHINGTON DC PRIORITY
RHMFIUU/HQ USCENTCOM MACDILL AFB FL PRIORITY
RUCNDT/USMISSION USUN NEW YORK PRIORITY 3842

UNCLAS SECTION 01 OF 04 KABUL 000997 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
STATE FOR SCA/FO GASTRIGHT, SCA/A 
STATE PASS TO USAID FOR AID/ANE, AID/DCHA/DG 
NSC FOR HARRIMAN 
OSD FOR SHIVERS 
CENTCOM FOR CG CJTF-76, POLAD 
 
E.O. 12958: N/A 
TAGS: PGOV PTER ECON MARR AF IR
SUBJECT: PRT HERAT: SIX MONTH REPORT 
 
¶1. (SBU) SUMMARY:  Herat Province is a region of significant 
but still unrealized economic potential.  During the past six 
months, the security situation has deteriorated, as has 
confidence in GOA institutions and leaders.  Key sectors, 
such as the judiciary, require reform, and additional police 
forces are necessary to stabilize the province.  Herat is 
ably led for the most part by the Governor and Provincial 
Council (PC), but they face huge challenges.  Shindand 
District in the south remains volatile.  END SUMMARY 
 
Shindand District: Need for Stabilization 
----------------------------------------- 
 
¶2. (SBU) The most urgent problem facing Herat Province over 
the past six months has been the stabilization of Shindand 
District following the violent assassination of Pashtun 
warlord Amanullah Khan last fall.  More than 500 police are 
now deployed to Shindand from the Special Police Reserve in 
Kabul.  There is a need for firm but creative leadership at 
the local level. Amanullah Khan's death left a vacuum from 
which the local leadership is still struggling to recover. 
The former Shindand district governor has resigned in 
frustration.  The warring Noorzai and Barakzai Pushtun tribes 
have apparently reconciled, but this may be short-lived. The 
local police have divided loyalties in an area that has 
traditionally been outside central government control.  The 
various new police forces (civil-order, auxiliary) are in a 
nascent stage and are unprepared to assume the mantle of 
authority in order to fulfill their mandate.  The fact that 
the Iranian border is so close further complicates the 
district's problems. 
 
GOVERNANCE 
 
Political Parties Speak Up 
----------------------------- 
 
¶3. (SBU) Political parties in Herat are frustrated with the 
current political process.  Many fear a balkanization of the 
country along ethnic and religious lines.  In Herat, the Shia 
minority has become a reckoning factor since the Ashura riots 
last year.  The DIAG process is widely considered 
ineffective.  Corruption is pervasive.  The past year has 
witnessed a rise in Taleban activity, including a number of 
IEDs and VBIEDs in Herat which are highly unusual for this 
normally placid city. 
 
Ethnic Issues 
------------- 
 
¶4. (SBU) In some ways, the central government has exacerbated 
ethnic tensions in Herat by its appointments to office.  The 
Governor is a Hazara and the Regional Police Commander is 
Uzbek, with the new ANP Police Chief and the new ABP 6th 
Brigade Commander both Pashtun, leaving the Tajik majority 
disgruntled.  Iranian influence in the West and in Herat, in 
particular, has resulted in increased Shia awareness, which 
is fanned by Iranian intelligence elements.  The Iranian 
objective seems to be to limit coalition control of the 
province. 
 
Internal Government Relations 
----------------------------- 
 
¶5. (SBU) The Provincial Council (PC) is still finding its 
way.  Because of resource constraints, they are not well 
known as community leaders yet.  In particular, in rural 
areas awareness of the PC's efficacy is limited.  Governor 
Anwari does engage the PC and seems to enjoy cordial 
relations; he tries to include select PC members on his 
community outreach excursions to outlying districts. 
Provincial development plans are not well coordinated. 
Relationships between Parliamentary leaders and provincial 
officials are also slowly being coordinated.  There is a 
steep learning curve.  During 2006, many Heratis lost 
patience and confidence in their elected leadership because 
of unrealistic promises unfilled or abuses by local 
 
KABUL 00000997  002 OF 004 
 
 
authorities.  Based on anecdotal reports from embedded 
trainers, ANA and ANP rank and file have reportedly on 
several occasions abused and mistreated citizens, leading to 
estrangement. 
 
THE ECONOMY 
 
The Private Sector 
------------------ 
 
¶6. (SBU) Because it has access to electricity 24 hours a day 
and seven days a week, Herat is the economic engine of the 
western region.  The Ring Road has been a strong catalyst for 
growth.  However, 2006 was not a stellar economic year for 
the region.  Local business leaders are complaining that 
Iranian export subsidies have begun to erode industrial 
capacity in Herat.  Producers say they cannot match the 
subsidized Iranian prices and claim that products from Iran 
have forced Herati producers to reduce their own production. 
The two hardest hit industries have been marble and canned 
tomato producers.  The central government appears unwilling 
or unable to help Herati businessmen.  For example, the 
Ministry of Commerce has granted local industries an import 
duty exemption for 3-6 years on raw materials imported for 
domestic manufacturing.  The Ministry of Finance, however, 
applies a 2.5 percent import duty on imported raw materials 
in addition to a four percent surcharge.  The local MOF 
Director has stated that his responsibility is to raise 
domestic revenue.  (Comment: Companies that enjoy tax 
holidays were formed before the 2004 enactment of the 
Investment Law that does not provide for any investment 
incentives.  End Comment) 
 
The Drug Trade Impact 
--------------------- 
 
¶7. (SBU)  The lack of new construction is directly tied to 
the absence of more effective drug elimination and 
eradication efforts, according to the Chamber of Commerce. 
The drug trade is now dominated by a few key players who have 
connections to the highest levers of power in the province 
and the country.  The local farmer is no longer at the center 
of the drug supply chain.  In fact, many Heratis argue the 
most significant factor in the growth of the trade is the 
government itself.  This is in contrast to the growing areas 
in Helmand, Farah and Kandahar provinces.  Reportedly, an 
increase in demand for imported durable goods is direclty 
related to a wealth effect among drug dealers.  In addition, 
many of the new buildings and much of the new investment in 
the city are connected to increased profits from drug 
exports. 
 
¶8. (SBU) The number of officials directly benefiting from the 
lucrative drug trade continues to rise as the role of the 
narco-economy expands and fuels the local economy.  Endemic 
unemployment in Herat is a factor in the evolving 
narco-economy, since many feel they have no choice but to 
join the illicit economy in the absence of tangible 
alternatives.  The number of internally displaced persons in 
Herat has also increased, partially because of the continuing 
drought.  People in search of work continue to look to Iran 
for employment, whether they go legally with a visa or simply 
try to slip across the border. 
 
¶9.  (SBU) Unemployment is growing again, resulting in 
increased population shifts to Iran and Pakistan.  Several 
NGO's have reduced operations, with some letting go about 30 
percent of their local staff in recent months.  Skilled 
laborers who were employed in the construction sector have 
lost their jobs.  Winter in particular was a very slow time, 
compounded by drought conditions that led to an increase in 
competition for jobs since so many people fled to cities like 
Herat. 
 
The Salma Dam 
------------- 
 
 
KABUL 00000997  003 OF 004 
 
 
¶10. (SBU) Salma dam is the major large-scale construction 
project in the province, located in Chiste Sharif district, 
close to the Ghor Province border.  It is being financed by 
India and is scheduled for completion in 2008.  Security is 
weak and residents suffer from the continuing drought.  The 
road to Chiste Sharif is in bad condition.  The Indians feel 
that inadequate security represents the greatest threat to 
the dam project and they are concerned about possible 
sabotage against the dam. 
 
Other Construction 
------------------ 
 
¶11. (SBU) Schools are under construction and many have opened 
in the province.  Health clinics are also being constructed 
by international NGO's and UN agencies.  The sole public 
hospital in the city is supplied regularly by the GOA and 
other international donations.  The needs however are great, 
practically insatiable, especially in the more remote 
districts.  A first-class hospital with adequate, 
professional medical staff is a priority for the city.  A new 
burn center has been financed by the USG and is almost 
completed.  The burn center will still require additional 
equipment. 
 
Transportation 
-------------- 
 
¶12. (SBU) Herat is renowned for having a greater number of 
paved roads and infrastructure relative to other parts of 
Afghanistan.  One key reason has always been Herat's key 
strategic location.  The Ring Road (the portion thus 
completed) has also been a major boon for development in the 
region.  Herat is the main crossroads from Afghanistan to 
both Turkmenistan and Iran.  The Iranian road extension to 
the border from the city has been very well received. Plans 
for a rail connection to Meshad, Iran from the city are well 
advanced.  When completed, the railroad will connect 
Afghanistan to Europe through Iran; thus it is expected not 
only to increase bilateral trade with Iran, but also expand 
Afghanistan's trade with Europe.  The Road to Badghis 
province should also be paved in the near future, which will 
improve traffic and travel times between these two western 
provinces. 
 
Electric Power 
-------------- 
 
¶13. (SBU) Herat is an exception in Afghanistan in terms of 
access to electrical power and a reliable supply.  The price 
per KVA is also reasonable.  Five out of fifteen districts in 
the province have regular electric power.  Three more 
districts in the province are due to be connected to 24 hour 
electric power access within the next six months.  The city 
power department does not have adequate equipment or 
financial resources for salary payments and other 
obligations.  Several of the outlying districts in the 
province that are not yet connected to the main electric grid 
are using GOA-provided diesel power generators that supply 
the district capitals with five hours of electricity every 
evening. 
 
SECURITY 
 
Need for More Police/Additional Training 
---------------------------------------- 
 
¶14. (SBU) Herat is a large and diverse province that requires 
additional police forces urgently.  The issue is even more 
acute in the outlying districts.  During evening hours, Herat 
is not adequately patrolled and is a time when many IED 
set-ups are conducted.  Crimes such as robbery increase 
greatly during the evening hours.  The new Regional Police 
commander has requested an additional 200 police from MOI. 
He would like to establish additional checkpoints in the 
volatile ZireKoh valley of the Shindand district.  Confidence 
in local courts is not high, although there are promising 
 
KABUL 00000997  004 OF 004 
 
 
signs that the new female Chief Prosecutor might begin to 
change this around.  The leading cause of dissatisfaction is 
the pervasive corruption that infects public institutions. 
Serious and concerted judicial reform remains a priority. 
Many disputes are handled by local elders; family issues are 
usually settled by Shuras in a non-violent manner. 
 
Confidence in Karzai 
-------------------- 
 
¶15. (SBU) Security and economic challenges dominate the 
concerns of ordinary Heratis.  Many feel Karzai is not up to 
the task.  His record of appointments also is not something 
that has inspired Heratis.  People are aware the 
international community has stepped forward to assist; they 
also understand that after five years of major contributions 
by countries such as the U.S., they are yet to tangibly 
benefit in their own villages and towns.  Unemployment and 
insecurity are the principal issues in Herat.  People often 
make unfavorable comparisons to the Taliban period.  The lack 
of accountability in the judiciary and other core 
institutions has compounded the lack of confidence by Heratis 
in their own elected leadership.  They feel that if AG 
Sabit's anti-corruption drive fails, the effect will be worse 
than having started at all. Some are already saying there is 
no bite to the bark.  Meanwhile, Iranians have backed their 
long-term commitment to the region with over USD 500 million 
in aid pledged.  Relations with sister-city Meshad go far 
beyond neighborly relations. 
 
COMMENT 
------- 
 
¶16. (SBU) Conditions in Herat are similiar to challenges we 
face throughout Afghanistan.  The security situation seems to 
be worsening, and reconstruction efforts are stymied as NGOs 
wind up their projects, which has led to even greater 
unemployment.  Five years after the fall of the Taliban, they 
still represent a threat to a city and province that has vast 
economic promise.  The province is stable but not fully 
secure.  Iran has achieved de facto status as the major 
regional power and has much sway over the intellectual, 
cultural and political elite in the province. END COMMENT 
NEUMANN