Short-Sighted U.S. Policy Towards Pakistan Imperils All of South Asia

The U.S. State Department and the Department of Defense both contain some of Washington's "best and brightest."

As massive bureaucracies, they also both contain a number of dimwitted people, who now ensconced in their well-paid bureaucratic sinecures, are solely concerned about moving up to the next pay grade, where the "Peter Principle" ultimately determines their ability to function.

To use a grim, black humor metaphor, a number of these suits have now well and truly 'drunk the Kool-Aid" as regards Pakistan.

There is simply no other explanation for the implications of Washington's potentially disastrous ratcheting up of its confrontations with Pakistan, as nothing good whatsoever can possibly come up it. Whoever in Beltwayistan decided that the "smart move" to pressure Pakistan to do more in the war on terror was to withhold $800 million, a third of nearly $2 billion in security aid promised to Pakistan, to show Washington's displeasure over Pakistan's removal of U.S. military trainers, limits on visas for U.S. personnel and other bilateral irritants should be promptly bastinadoed, handcuffed, blindfolded and promptly dispatched on the first available military transport to Guantanamo.

Washington's obtuseness in this instance is so breathtaking that it well and truly beggars belief.

Since 9/11, Washington has been obsessed with the war on terror.

And what exactly is the most horrifying weapon that those wishing America ill might use?

Nuclear weapons.

And the highly respected Stockholm International Peace Research Institute, or SIPRI, estimates that Pakistan now possess 90-110 nuclear weapons. SIPRI Director Daniel Nord noted earlier this month that south Asia is "the only place in the world where you have a nuclear weapons arms race."

Pakistan developed its nuclear arsenal as a deterrent to India, which Islamabad has regarded as its existential foe since the Raj fragmented in 1947. This was and remains at the core of Pakistani defensive thinking, but the last decade has seen Washington flooding Pakistan with billions of dollars in aid, along with demands that Islamabad reorient itself to align with American objectives in south Asia, which means Afghanistan - period. This has increasingly become untenable domestically, as the Zadari government is perceived as a U.S. "lackey," (to use a good Cold War term), while Washington cavalierly violates Pakistani sovereignty on a regular basis, raining Predator drone attacks on sites in the country's turbulent NorthWest Frontier Province, abutting the country's frontier with Pakistan. Today, three suspected U.S. missile strikes in north-western Pakistan's Waziristan district killed at least 38 alleged militants, according to Pakistani intelligence officials.

Does Washington really want to destabilize this nation?

And, what will the implications be for the energy community if relations between Washington and Islamabad continue to deteriorate?

First and foremost, the great dream of a Trans-Afghanistan-Pakistan-India (TAPI) natural gas pipeline to supply Turkmen gas to the booming Pakistani and Indian energy markets will most certainly die if Pakistan slides further into unrest. The Afghan leg of TAPI was always problematical at best, but no one is going to invest billions of dollars to build a pipeline through hundreds of miles of not Afghan, but possibly Pakistani, territory seething with unrest. As for Central Asian post-Soviet nations dreaming of exporting their energy riches via a blue-water port, unlikely.

The second potential consequence is that Pakistan will simply increasingly turn towards its traditional ally China as it further downgrades relations with Washington. Beijing has already invested heavily in building Pakistan's Gwadar port on the southwestern Arabian Sea coast of Pakistan at the mouth of the Gulf of Oman, gateway to the Gulf through which 40 percent of the world's oil passes. The strategic, warm-water, deep-sea Gwadar Port was completed in 2007.

China was a major investor in Gwadar and spent $248 million in the first phase of developing Gwadar port, whose eventual costs topped $2.2 billion. China also plans to invest $12 billion in multiple projects in Pakistan, including the country's largest oil refinery at Gwadar. Gwadar provides China with a transit terminal for crude-oil imports from Iran and Africa to China's Xinjiang region. About 60 percent of China's energy supplies currently come from the Middle East, and China has been anxious that the U.S., with its Fifth Fleet based in Bahrain, threaten these supplies.

China's "string of pearls" maritime strategy to protect these shipments sees Gwadar as one of the most lustrous elements of "string of pearls," which include facilities in Bangladesh, Myanmar, Thailand, Cambodia and the South China Sea.

So, the question arises - is Washington's snit over Islamabad downsizing its presence worth the risk? Pentagon spokesman Colonel David Lapan on Monday said the $800 million in U.S. aid could be restored if Pakistan increased the number of visas for U.S. personnel and reinstated the training missions.

Pakistani Defense Minister Ahmed Mukhtar said in an interview, "If Americans refuse to give us money, then okay. I think the next step is that the government or the armed forces will be moving from the border areas. We cannot afford to keep military out in the mountains for such a long period."

Later the Pakistani military said it could do without U.S. assistance by depending on its own resources or turning to "all-weather friend" China.

The handwriting is on the wall. Your move, Washington.

Send them their check.

By. John C.K. Daly of OilPrice.com