The China-Pakistan Axis: Asia's New Geopolitics (21 page)

In October 2008, Asif Zardari was on his first visit to China as Pakistan’s head of state. This was an issue in its own right—the Chinese had not been at all happy that he had failed to follow tradition and make China his first overseas destination.
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Claims that trips to Dubai, London and New York were not official visits didn’t cut much ice, and his subsequent attempt to over-compensate by turning up every six months was an even greater hassle for over-worked Chinese officials.
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The Chinese government was already suspicious of him. The PPP, Zardari’s party, was the creation of Zulfiqar Ali Bhutto, who had taken on a leading role in the early days of upgrading Sino-Pakistani relations, but the Chinese tended to see his daughter Benazir Bhutto, whose assassination catapulted Zardari into the presidency, as inclined in a more pro-American direction.
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None of this made for an auspicious set of circumstances for a visit in which Zardari would be asking for several billion dollars to help cover Pakistan’s balance of payments crisis.
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China, which had been lobbied by the United States not to give Pakistan the money,
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didn’t need that much persuading—Beijing also thought it would be more helpful if Pakistan were forced to go through an IMF programme, and China had no history of financing Pakistan on that sort of scale. Zardari got a frosty reception from Hu Jintao, who was reported to have reacted with incredulity to his requests for such lavish assistance.
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Overshadowing the trip, however, was the fact that another two Chinese engineers had been kidnapped.

On 29 August, Long Xiao Wei and Zhang Guo, two engineers who worked for ZTE, had been repairing a telecommunications tower in Lower Dir, a district in Swat Valley, and were on their way home when they were abducted along with their driver and security guard.
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The Pakistani Taliban soon claimed responsibility: “Our aim is to hit the government’s interests wherever they are. We kidnap everyone irrespective of whether he’s Pakistani or Chinese and we’ll continue to do this until they stop killing our people,” said the spokesman, Muslim Khan.
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He went on to say that the military operation against the Red Mosque was launched under pressure from the Chinese and indicated that the Taliban would take revenge for the martyred students. Yet again, China had found itself caught in the middle of a confrontation between the Pakistani government and the militants, this time in a part of the country that was once a tourist haven known as the “Switzerland of Pakistan”.
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Violence in the region had been on the increase for several years. Maulana Fazlullah, the “Radio Mullah” who ran Taliban operations in Swat and would later become the leader of the Pakistani Taliban, had set up illegal FM radio stations in which he demanded the imposition of
sharia
law.
¹⁵⁷
Following the Lal Masjid operation, Fazlullah urged his supporters to launch a
jihad
against the Pakistani government, and formed an alliance with militants operating in FATA.
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Swat saw an alternating sequence of talks, truces and battles between the Pakistani army and the Taliban. In the early months of Zardari’s coalition government, which took power after the February 2008 elections, talks with the militants broke down. Zardari assumed the office of the presidency days after the kidnappings had taken place.

The South Waziristan incident in 2004 had been dealt with in less than a week. By the time Zardari arrived in Beijing, the Chinese engineers in Swat had been in captivity for one and a half months. In some respects, the Pakistanis were operating under more constraints on this occasion: Beijing made it clear that it did not want to see any of the hostages killed, reducing the scope for a repeat of the commando raid four years earlier, and the Pakistani army had poor intelligence anyway on the location where they were being held.
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China was not, however, convinced by Pakistan’s response, comparing it unfavourably with Musharraf ’s, and even raising the prospect of curtailing all of its other economic projects if the situation was not effectively addressed.
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The men were not freed after a military operation. The two hostages escaped
shortly after Zardari’s return from Beijing, though one of them—who slipped and broke his leg in the escape—was recaptured.
¹⁶¹
After extended negotiations with tribal elders, contacts with the Chinese embassy brokered by former ISI chief Hamid Gul, and Chinese offers to the Pakistani Taliban to pay a ransom, he would finally be released as a “goodwill gesture” on the eve of Zardari’s next visit to China. Muslim Khan, the Taliban’s spokesman, claimed that this was as a result of the Pakistani government’s agreement to support the imposition of
sharia
law in parts of Swat.
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In practice, the deal involved money—paid for by the ISI—and the release of twenty militants, which had been bargained down from the original demands for over 130.
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Zardari was not the only one to feel the heat. The army chief Ashfaq Kayani had been in Beijing in September 2008, his own first overseas trip since taking the position.
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Although the new president received much of the stick, Beijing knew perfectly well that the responsibility for the slow response to the hostage crisis didn’t lie with the civilian government but with Pakistan’s security services. The man in the firing line was the Director General of the ISI, Nadeem Taj. Under Taj, the ISI had been directly tied to the bombing of the Indian embassy in Kabul and was believed to be either complicit in practices such as ISI warnings being provided to militants before drone attacks, or unwilling to stop them. Pressure from Washington to remove him had been intense, and Kayani was keen to replace Musharraf ’s appointee with his own man anyway.
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Chinese unhappiness at the intelligence services’ slow response to the kidnappings, conveyed during his visit, provided additional reinforcement.
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Days after Kayani returned from Beijing, Taj was kicked upstairs to take over a more senior but less powerful position as commander of the Gujranwala Corps, and replaced by Shuja Pasha.
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Zardari’s difficult first year of relations with China cast a long shadow over economic ties between the two sides during his time in office. The kidnappings, alongside ETIM’s seeming return to the scene (detailed in the previous chapter), certainly deepened Beijing’s security concerns. But the slow response to the kidnappings was also a broader symbol of the new government’s diminished capacity to exercise power, and of China’s own trouble working out what levers it needed to pull to get things done after Musharraf ’s fall.
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Virtually all the major economic initiatives between the two sides had been set in motion under Musharraf ’s tenure and very few of them made significant progress after
he had gone. The “mega-projects”—Gwadar, the KKH expansion, and the enormous new hydro-electric dams among them—appeared to go into a state of suspended animation. As one former Chinese diplomat put it, if projects “are threatened by insecurity, it’s easy: we stall them”.
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Security problems alone are not responsible for the weakness of the economic relationship, which long predates the rise of the TTP, the Red Mosque crisis, and the PPP government. Neither are they solely responsible for the broader difficulties that face the Pakistani economy overall, which—in addition to being hit by the global economic crisis—has struggled with problems ranging from energy shortages and infrastructure problems to corruption and the central government’s painfully small tax revenue base. Moreover, the protection mechanisms that were put in place for Chinese workers in the aftermath of the Swat Valley kidnapping proved relatively successful. There were a couple of near-misses: a group of Chinese engineers narrowly escaped the Mehran naval base attack,
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though they were not the target, and there are suspicions that a bombing in Karachi was directed at the Chinese consulate.
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But during the remainder of the PPP’s term in office, the only confirmed attack took place against a Chinese woman, Hua Jiang, who was shot by the Taliban in Peshawar’s bazaar in February 2012 with her interpreter.
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Variously described as a “student” or a “tourist”, and inevitably suspected to be an intelligence operative, she was travelling without the battery of protection that had become common for Chinese moving around the country.
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But after the events of 2007 and 2008, it took a long time for Beijing to recover enough confidence to make big economic bets on Pakistan again. Arms sales and heavily protected nuclear plants were one thing, infrastructure projects and normal commercial investments quite another. In 2011, China’s largest private-sector miner, Kingho Group, pulled out of a $19 billion deal that would have been the country’s largest, citing security concerns for its personnel following bombings in Pakistan’s major cities.
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Chinese officials routinely noted that the viability of the proposed transport and energy corridor to connect Xinjiang through to the Arabian Sea
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is contingent not just on the stability of Balochistan, or the safety of specific contingents of Chinese workers, but on security in much of the rest of Pakistan too.
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While China strenuously insisted that Pakistan should not be bracketed with its war-torn neighbour, in reality they were also looking with growing nervousness at
developments across its western border, and the ripple effects of the militant resurgence there for Pakistan itself. And a new term entered the vernacular among Chinese policymakers, and started to be used with ever-greater frequency: “Talibanization”.

Now, we’re all talking about Syria. [By the] second half of next year, the most important topic will be Afghanistan
.

Wang Yi, Chinese Foreign Minister, 2013
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I think we all desperately hoped that British soldiers were dying for something more noble than helping Karzai’s drug dealing cousin to sell gas from northern Afghanistan to the Chinese
.

Former senior diplomat to Kabul, speaking to
The Telegraph
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The start of China’s latest round of adventures in Afghanistan was marked the same way the last couple ended—with a plane crash. Twenty minutes after its take-off on 24 February 2003, a clear sunny morning, a Cessna 402B twin-propellor aircraft plunged into the Arabian Sea 35 kilometres from Karachi, killing everyone on board.
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The nine passengers included Joma Mohammad Mohamadi, Afghanistan’s Minister of Mines and Industry, and Sun Changsheng, chief executive officer of China Metallurgical Group Corporation Resources Development, the giant Chinese company’s Pakistani subsidiary. Mohamadi had taken up his position in Afghanistan’s interim government the previous summer after a long career as an engineer at the World Bank, and a previous stint running the ministry of water and power in the 1970s. He was the third
federal minister to be killed in the first year of Hamid Karzai’s new administration.
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Inevitably for a suspicious plane crash in Pakistani territory, the rumours started up almost immediately. Mohamadi’s daughter suggested that it was her father’s unwillingness to extend the benefits of a new gas pipeline to the right people that resulted in his untimely death—“All I know is that my father and his top advisers were in Pakistan signing the final agreements for a $2.5 billion gas pipeline to be built across Afghanistan, a lucrative project that many people wanted a piece of. But my father wouldn’t sell out, and my brother once cautioned him, ‘You’ll be lucky if they give you a warning.’ But he wouldn’t listen.”
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A lawsuit brought by the young Chinese executive’s family described the accident as “of such a nature which in the ordinary course of things does not happen”.
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MCC, a Chinese state-owned engineering and construction conglomerate, had chartered the plane to fly the minister and a group of his officials out to see their new Pakistani venture, the Saindak gold and copper mine in the far west of Balochistan. Saindak was rumoured to be a location used by Chinese agents to maintain covert contacts with the Afghan Taliban after they fled the US invasion.
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That February morning, though, it was supposed to act as a showcase that would help MCC secure an even greater prize: the biggest mining contract in Afghanistan’s history. Aynak, in Logar province, is estimated by geologists to hold the world’s second largest copper deposit, worth as much as $88 billion.
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Afghanistan’s mineral riches had been uncovered by repeated geological surveys conducted by the Russians and the British over the preceding century, and Aynak, which had been used for copper-working since ancient times, was identified as one of the country’s two truly world-class deposits.
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The Soviet Union had made the most concerted attempt to get a mine on the site into operation, but its efforts were derailed by the
mujahideen
’s campaign.
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During the Taliban years, it was used as an Al Qaeda training camp, infamous for its elite training course whose alumni included one of the USS
Cole
attackers and four of the 9/11 hijackers.
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There would be a gap of nearly two decades before another effort was made to tap the rich seam of copper that lay beneath.

The Chinese embassy in Kabul resumed its functions in February 2002, almost exactly nine years after rocket attacks on the compound forced the withdrawal of all of its diplomatic staff.
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Afghanistan’s interim government was seeking sources of revenue that were indepen
dent of the Western aid that constituted the bulk of its financing, and the newly arrived Chinese officials had learned that it was considering making Aynak one of its first tenders.
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They tipped off their colleagues at MCC.
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A Korean conglomerate was already making a pitch for the mine and MCC would need to move quickly with its own proposal.
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From the perspective of Chinese resource needs, the appeal was obvious: twenty-five years of production at the mine would be equal to a third of China’s entire copper reserves.
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Like many state-owned companies, though, MCC was motivated by commercial considerations as much as any national goals. It was in the process of diversifying away from its traditional field of domestic steel mill construction, and planned to make the more lucrative avenue of natural resource development its new focus.
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The Afghan mining minister’s trip to Pakistan was part of a seven-year wooing campaign to make Aynak one of the jewels of MCC’s burgeoning corporate empire that ran from Australia to Argentina. The company’s ambitions in South-West Asia were being driven by the man who died with him in the plane, Sun Changsheng, but the crash derailed MCC for barely a few months.