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S E C R E T SECTION 01 OF 03 ISLAMABAD 003339 
 
NOFORN 
SIPDIS 
 
E.O. 12958: DECL: 10/22/2018 
TAGS: PGOV PK PREL PTER
SUBJECT: ZARDARI EXPRESSES DELIGHT WITH CHINA VISIT, LOOKS 
TO FRIENDS FOR HELP ON CHALLENGES 
 

Classified By: Anne W. Patterson, Reasons 1.4 (b), (d) 
 
¶1. (S/NF) Summary: In a wide-ranging discussion with visiting  SCA Assistant Secretary Boucher, President Zardari expressed  complete satisfaction with his just concluded visit to China,  reviewed planning for the Friends of Pakistan, and reiterated  his determination to press the fight against extremism and  the militancy in the tribal areas.  He linked his ability to  sustain the counter-insurgency fight to progress on  addressing Pakistan,s economic woes, however, and chastised  the IMF for only wanting to &take away8 in its  negotiations.  Zardari alerted Boucher to Iran's offer of  concessional oil for Pakistan, an offer he did not believe he  could refuse.  Boucher reminded him of the Deputy Secretary's  recent caution not to allow Iran to gain a toehold in  Pakistan.  End Summary. 
 
¶2. (SBU) Visiting Assistant Secretary for South and Central  Asian Affairs Richard Boucher called on President Zardari at  the Aiwan-e-Sadr, October 18.  He was accompanied by the  Ambassador, DCM (notetaker), and SCA Senior Advisor Hayden. 
Minister of Information Sherry Rehman joined Zardari. 
  China Visit 
------------- 
 
¶3.  (S/NF) Zardari told Boucher his visit to China was 
&great.8  He confirmed that the Chinese had committed to  building two additional nuclear power plants for Pakistan )  Chashma 3 and 4.  He noted, however, that construction would  not start until the completion of the Chashma 2 reactor,  which he anticipated would require an additional five years. 
Commenting that the Chinese were providing only old  technology, Zardari said that Pakistan had no choice but to  accept &junk.8  Boucher told Zardari we would examine the  implications of the new nuclear deal vis--vis the  International Atomic Energy Agency and let the Pakistanis  know if we anticipated any problems with the deal. 
 
¶4.  (S/NF) Zardari also told Boucher that the Chinese had  committed to providing assistance to Pakistan,s security  forces.  Arguing that China was Pakistan,s only affordable  option for needed security items, Zardari said the government  plans to acquire armored vehicles, body armor, and small arms  from China.  The Chinese also plan to provide large scanners  to Pakistan to help check the contents of trucks.  Boucher  and the Ambassador reminded Zardari that the U.S. is working  with the Frontier Corps on a comprehensive train and equip  program.  (Comment: Embassy is preparing a letter to Zardari  reviewing the details of the U.S. government's extensive  support to the Frontier Corps.  End Comment) 
 
¶5.  (C) Although silent on the question of possible Chinese  balance of payments support to Pakistan, Zardari lauded  Chinese &out-of-box8 thinking about business investment in  Pakistan.  As an example, he described a project to build a  dam that would irrigate land that Zardari would then grant to  women, who would grow flowers on the land for export to the  Emirates.  The Chinese will manage the marketing for the  project. 
  Friends of Pakistan 
----------------------- 
 
¶6.  (C) Zardari confirmed that he wants to formally change  the name of the group to Friends of Democratic Pakistan.  In  response to Boucher's question about the Saudi position, he  provided Boucher with a convoluted description of his  discussions with Prince Turki bin Abdullah, who requested  Zardari,s participation in the Interfaith Dialogue that the  King is organizing in New York.  In exchange, Zardari expects  that the Saudis will be full participants in the Friends  group (see septel). 
 
¶7.  (C) As for other possible additions to the Friends group,  Boucher suggested that Spain and the Scandinavians might be 
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  good additions.  Zardari assented, and asked Boucher if the  U.S. would support Libya's inclusion, to which Boucher  agreed.  Zardari suggested to Boucher that he would like  China added to the steering group.  Boucher was open to the  idea but noted that the steering committee needed to remain  small. 
 
¶8.  (C) Boucher reminded Zardari that the Friends group is  not a &checkbook8 organization.  He noted that we need to  sit with the steering group and consider issues like  membership and the role of the UN.  We are hoping that the UN  will help drive the process by providing a secretariat  function.  After the next meeting in Abu Dhabi, the U.S.  vision would be to launch a series of experts meeting that  would consider Pakistani policies and initiatives in a  sector-by-sector review. 
 
¶9.  (S/NF) In an aside, Zardari mentioned that Iran has  offered to provide Pakistan with concessional oil.  How could  he go to the National Assembly and tell them Iran had offered  the assistance and Pakistan had turned it down, he asked  rhetorically.  Boucher reminded him of Ambassador Haqqani,s  recent conversation on this issue with Deputy Secretary  Negroponte in which the Deputy cautioned against providing  Iran with a toehold in Pakistan. 
  Counter-Insurgency 
----------------------- 
 
¶10.  (S) Zardari stressed repeatedly his determination to  carry through with the fight against extremism and militancy. 
 &I don't believe in talking to the Taliban,8 he said. 
&We won't do it on our side of the border.8  He noted that  he has built a good relationship with the military and  praised the leadership of Chief of Army Staff Kayani, ISI  Director General Pasha, and Frontier Corps General Tariq  Khan.  To challenge the fundamentalists, however, Zardari  needs to gain the confidence of the Army, the National  Assembly, and the people.  To do that, he believes he must  address the economic situation and demonstrate that he can  deliver on his economic promises.  Zardari chastised the IMF  for just wanting to &take away8 from Pakistan in the  negotiations over a bailout package. 
  ¶11.  (C) In response to Boucher,s question about the  National Assembly debate on Pakistan,s counter-insurgency  strategy, Zardari expressed confidence that he would succeed  in winning from the Assembly a consensus resolution on the  government,s policy.  (N.B.: A day earlier, both National  Security Advisor Durrani and Information Minister Rehman  expressed skepticism that an acceptable consensus resolution  was achievable.)  Nawaz Sharif,s Pakistan Muslim League is  offering no help on Pakistan,s counter-terrorism policy,  Zardari opined.  Rehman added that Nawaz and Chaudhry Nisar  have a &good cop/bad cop8 routine.  Nawaz says good things  about his party's commitment to cooperation, but Nisar does  the opposite in the Assembly. 
  ¶12. (C) Describing his legislative strategy going forward,  Zardari said that proposed revisions to the Frontier Crimes  Regulations (FCR) are nearly ready to bring to the Assembly. 
He anticipates that the extension of the Political Parties  Act to the Federally Administered Tribal Areas (permitting  political parties to organize and campaign in the tribal  areas under the same regulations as apply to the rest of the  country) would be introduced within three months.  Zardari  also described a de-radicalization program he plans on  introducing in the Assembly.  Zardari will propose a criminal  regime for &small fries8 that would sentence them to seven  years in a &special prison8 to be constructed for handling  reforming militants.  While in the prison, the militants  would receive job training and would receive lenient  treatment, including conjugal rights.  &I won't stop  pressing,8 Zardari declared, &either he (the militant) dies  or he takes the option.8  Anyone caught a second time after  going through the reform program will be sent to prison for 
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  life, Zardari declared. 
  ¶13.  (S) Turning to the fighting in Bajaur, Zardari asserted  that the government needs a mechanism to get compensation  into the hands of the victims of the fighting, suggesting  that he thought one billion U.S. dollars might be sufficient. 
 Responding that we anticipate the financial requirement  would be less than that, Boucher and the Ambassador assured  Zardari we are looking for ways that we can help.  Zardari  asked if the Friends of Democratic Pakistan might be of help,  but Boucher reiterated that such assistance would likely fall  outside the mandate of the group.  Zardari then suggested  that the Saudis could provide the necessary funds, noting  that &the problem leads back to them.8  Rehman interjected  that the National Assembly members were asking how the  militants were getting their funds and raised the flow of  funds from the Gulf to extremists in Pakistan.  (DCM observed  that efforts to stop funding terrorist groups were not helped  by Pakistan,s obstruction of work in the UN 1267 Committee,  mentioning specifically the hold on Katrina.  Zardari  expressed surprise that Pakistan was playing such a role, and  Rehman made note of the issue.) 
  ¶14.  (S) As for the Pakistan-Afghanistan mini-jirga scheduled  for Islamabad in a week's time, Zardari expressed the hope  that it will re-occupy political space in the tribal areas. 
He expressed the hope that the jirga could re-consolidate the  government,s position among the majority of the tribes,  noting that the government,s greatest challenge in rooting  out the extremists is when they are able to shelter among the  population in the area.  As for leadership of the Pakistani  delegation to the jirga, Sherry Rehman noted that Asfandyar  Wali Khan, who had been proposed as the senior Pakistani,  will not be back in Pakistan in time for the meeting.  She  suggested that Asfandyar is in &bad shape8 following the  terrorist attack on his home near Charsadda.  Zardari  indicated separately that he is helping Asfandyar relocate  his family to Dubai and would provide him with an armored  vehicle when he returns to Pakistan. 
  Friends: the U.S. and the UK 
----------------------------------- 
  ¶15.  (C) Zardari mused about the need to reach out to the new  U.S. Administration after the elections and suggested that he  would like to organize a &road show8 to visit the U.S. and  explain Pakistan,s situation.  Boucher suggested that such  an effort could emphasize U.S.-Pakistani cooperation on the  border coordination centers, the Joint Military Operations  Coordination Center, and the Frontier Corps train and equip  program. 
  ¶16.  (S/NF) As for the UK, Zardari expressed some concern  that their support was getting wobbly.  He believes that  their views reflect their conviction that Zardari would fail  and would be replaced by Nawaz Sharif.  Boucher thought that  the concerns are more a reflection of attitude than policy. 
If Zardari achieves results, he asserted, then the British  will come around. 
  Comment 
- - - - 
  ¶17. (S/NF) Zardari was clearly buoyed by his visit to China  and in good spirits as he looks ahead to the serious  challenges that confront him and the country.  He ran through  numerous ideas for new initiatives to deal with the  political, economic, and security problems, nearly all of  which come with high price tags.  In that regard, Zardari  continues to express considerable optimism that, ultimately,  his friends will ride to his rescue despite little evidence  to support that view. 
 PATTERSON