ID: 60762    4/17/2006 16:38    06ISLAMABAD6647    Embassy Islamabad    SECRET        "VZCZCXRO5444 OO RUEHLH RUEHPW DE RUEHIL #6647/01 1071638 ZNY SSSSS ZZH O 171638Z APR 06 FM AMEMBASSY ISLAMABAD TO RUEHC/SECSTATE WASHDC IMMEDIATE 5541 INFO RUEHBUL/AMEMBASSY KABUL IMMEDIATE 5066 RUEHNE/AMEMBASSY NEW DELHI IMMEDIATE 8180 RUEHKP/AMCONSUL KARACHI IMMEDIATE 0624 RUEHLH/AMCONSUL LAHORE IMMEDIATE 8454 RUEHPW/AMCONSUL PESHAWAR IMMEDIATE 6248 RHMFISS/CDR USCENTCOM MACDILL AFB FL IMMEDIATE RUEAIIA/CIA WASHDC IMMEDIATE RUEKJCS/SECDEF WASHINGTON DC IMMEDIATE RHEHNSC/NSC WASHDC IMMEDIATE RUEHUNV/USMISSION UNVIE VIENNA IMMEDIATE 0078"    "S E C R E T SECTION 01 OF 03 ISLAMABAD 006647

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E.O. 12958: DECL: 04/14/2016 TAGS: PREL, PTER, IN, IR, MNUC, PK SUBJECT: WITH SENATOR HAGEL, FOREIGN MINISTER KASURI PUSHES FOR CIVIL NUCLEAR TRANSFERS AND WARNS THAT A MILITARY ATTACK ON IRAN WOULD MEAN DISASTER FOR PAKISTAN

Classified By: Ambassador Ryan C. Crocker, Reasons 1.4 (b) and (d)

1. (S) Summary: In a meeting with Senator Hagel, Foreign Minister Kasuri urged that the United States help Pakistan address its civilian nuclear power needs. He argued that “transparent mechanisms” now governing Pakistan's nuclear program would prevent the kinds of abuses associated with AQ Khan. Kasuri admitted that the India civ-nuc deal had been briefed to Pakistan in advance. On relations with India, Kasuri reported that “no major differences” remained on Siachen and Sir Creek; Indian PM Singh was expected to visit between July and September, and he expected an agreement would be reached by then. He urged the U.S. to engage in a dialogue with Iran, warning that a military attack would be a disaster for Pakistan. As a perceived U.S. “stooge,” an attack would embarrass Pakistan in the Muslim world -- and it would inflame sectarian tensions. Kasuri maintained that Iran's enrichment announcement was a publicity stunt and now that the Iranians had “declared victory,” it created an opportunity to “humor them” and convince them to go no further. End Summary.

2. (U) Foreign Minister Kasuri briefed visiting Senator Hagel (R-NE) on April 13 on Pakistan's perspective on nuclear issues, India and Iran. Kasuri had participated in a preceding meeting with President Musharraf (septel) and used the opportunity to reinforce points made by Musharraf.

Nuclear Power -------------

3. (S) Kasuri began by questioning the Civil Nuclear Initiative's exclusive focus on India. Pakistan didn't understand U.S. motives or why it was in U.S. interests to entirely rule out transfers to Pakistan relating to its civilian nuclear power needs. Pakistan would have to do whatever it had to do; any government would act similarly. The only consequence, from an American point of view, he said, was that Pakistan would have to buy from someone else, “of course, under IAEA safeguards.” Why was it in the U.S. interest to let the Chinese or some other country garner that goodwill?

4. (S) Nor did Kasuri understand the focus on AQ Khan. Khan had operated with virtually no oversight. There had been suspicions that he was living beyond his means, but the prevailing assumption had been that he was “skimming” from program funds. The reality (that he was selling technology) didn't emerge because Khan had been given considerable autonomy in the days when Pakistan's program was covert. He could order pickups and deliveries of shipments without anyone asking questions. Kasuri said that Musharraf told him that before 1998 the program was strictly on a need to know basis, and even Musharraf, who was Director General of Military Operations (DGMO) at the time was unaware of operational details. That had changed when Pakistan declared its program in 1998, and Pakistan had moved to “transparent mechanisms.” Kasuri argued that Khan was a lone proliferator, explaining that of the many areas that could have been affected, proliferation only occurred in those areas under Khan's authority. Khan was currently under house arrest, Kasuri added.

5. (C) Kasuri was clear that Pakistan had not been misled on the U.S.-India Civil Nuclear Initiative. “We were told about the deal in advance,” he said, however one factor that had changed was that Pakistan was now realizing that its own need for nuclear energy was much higher than it had previously estimated.

6. (C) Pakistan shared U.S. anti-proliferation goals, Kasuri said. It did not want nuclear weapons capabilities to spread: “we are the only Moslem country and don't want anyone else to get it.”

7. (C) Senator Hagel noted that he did not speak for the Administration or Congress, but that to his knowledge no one was blaming President Musharraf for the AQ Khan business. Nonetheless, Pakistan should not underestimate the damage Khan had done. There was a deep perception in Congress that Pakistan had behaved irresponsibly and could not be trusted, and that perception would be difficult to overcome. Hagel also emphasized that it was important that the U.S.-India Civil Nuclear Initiative not be seen as marginalizing the relationship with Pakistan, which was “a really indispensable relationship.”

India -----

8. (C) Kasuri commented that many of Pakistan's problems were linked to relations with India, so it was very significant that relations were improving and that both sides were using a new vocabulary on Kashmir. Pakistan, in fact was now doing an about face, having recognized that its decades-long focus on international legality had not achieved anything. Kasuri cited former Indian National Security Advisor Dixit's statement that the sides needed to think out of the box. Prime Minister Singh, in his recent Amritsar speech had actually used Musharraf's language when he called for “pragmatic and practical” solutions. The difference was that Musharraf had begun to explain what he means. “It looks like the sides are getting closer,” Kasuri concluded, adding that Pakistan welcomed President Bush's mention of the Kashmir issue in Washington, New Delhi and Islamabad.

9. (C) Kasuri noted that the two sides had come a long way, “but have resolved nothing.” He remained hopeful, saying with regard to the Siachen and Sir Creek disputes, “I have a feeling we can resolve these.” Prime Minister Singh would likely visit Pakistan between July and September, and he expected there would be an agreement on Siachen and Sir Creek by then; “if not, it would be a major disappointment” because “we have no major differences.” It was important, Kasuri added, that after all these years there should be some definitive progress, however limited.

Iran ----

10. (C) Kasuri characterized Iran's enrichment announcement as “ridiculous.” Iran's nuclear program was launched under the Shah -- well before Pakistan's -- and their enrichment capabilities were “not a new thing.” The announcement had simply been a “PR stunt,” and might be the end of the story if the Iranians received appropriate attention. Kasuri advised that the U.S. “engage with them.” Iran had already declared a victory; the United States should “humor them” while ensuring that they go no further

11. (C) The nuclear program transcended political divisions within Iran, Kasuri said. Former Iranian Foreign Minister Kamal Kharrazi had told him that there were no differences on this issue, regardless of the government in power. It was a matter of national pride: “the Indians, the Israelis, the Europeans, the Chinese, the Russians -- all these countries had it.”

12. (C) Kasuri reiterated that Pakistan shared the U.S. interest in preventing the spread of nuclear weapons. President Musharraf had told Secretary Rice that he did not want Iran to acquire such a capability. But the only way out was through dialogue. Kasuri reported that during a visit to Pakistan, Ali Larijani, secretary of Iran's Supreme National Security Council, had asked Kasuri to talk to the Americans. Kasuri had said he would do so on one condition, that Iran's program had to be independently verifiable.

13. (C) “We dread military action,” Kasuri continued. Pakistan's nightmare scenario would be a U.S. attack, because Pakistan was seen as an American “stooge” and would be targeted by Iran for destabilizing activities -- along with Iraq and Afghanistan. A military attack would be Pakistan's “worst nightmare, an ultimate disaster.” Apart from the threat to political stability, the effect on oil prices could be catastrophic for Pakistan. “Don't scare the American people into feeling that America has to react militarily,” he concluded, “instead, engage them. This is nothing new.”

April 11 Karachi Bombing ------------------------

14. (C) Kasuri noted that one reason Pakistan dreads any military action against Iran is that Shias are am important domestic constituency, accounting for 10-15 percent of the population. The recent attack in Karachi illustrated a dangerous recent trend in sectarian violence. There had been sectarian tension for 200 years, but of a different kind. The current strain of violence dated from the mid 1980s. An attack on Iran would be widely viewed in Pakistan as “yet another American attack on an Islamic country,” but the reaction would be particularly violent among Shias. “And we are on Iran's border,” Kasuri added.

15. (C) Although the victims of the Karachi bombing were virtually all Sunnis, Kasuri said he didn't think Iran was behind the attack. He speculated that the perpetrators could have been from an extremist Sunni group opposed to the brand of “soft, Sufi Islam” espoused by the victims. Kasuri explained that the Sunni Tehrik group, whose leadership was decimated in the attack, had been “brought to combat the influence of outsiders” and to “reestablish the South Asian identity” of Islam in Pakistan.

16. (U) Codel did not have an opportunity to clear this cable.

CROCKER