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C O N F I D E N T I A L SECTION 01 OF 02 LONDON 002853 
 
SIPDIS 
NOFORN 
 
E.O. 12958: DECL: 11/10/2018 

TAGS: PREL MASS EAID PK AF UK

SUBJECT: PAKISTAN: UK ON FATA INTEGRATION, AF-PAK 
RELATIONS, EU TRADE, AND ZARDARI 
 
REF: STATE 119783   LONDON 00002853  001.2 OF 002   

Classified By: Acting Political Counselor Jim Donegan, reasons 1.4 (b/d ).  1. (C/NF) Summary. Following a conversation with Northwestern Frontier Province (NWFP) Governor Owais Ghani about reforming the Federally Administered Tribal Areas (FATA), HMG supports consultations and dialogue with the people of FATA to determine what FATA residents want for the future of FATA, FCO Pakistan and Afghanistan Team Leaders Laura Hickey and Tom Burns told visiting SCA/FO Senior Advisor Neil Kromash and poloff on November 6.  HMG is also looking at ways to deepen and institutionalize the dialogue between Afghanistan and Pakistan such that it could "survive political shocks and individual personalities," possibly designed after the durable India-Pakistan Composite Dialogue.  EU interest in Pakistan is increasing as other member states realize that Pakistan is "not just the UK's problem," according to Hickey.  HMG is pushing the EU to increase aid to Pakistan, and to consider the establishment of trade preferences along the lines of the U.S. Reconstruction Opportunity Zones initiative.  Hickey said Pakistani President Zardari has done "surprisingly well" and that HMG initially underestimated him.  HMG, however, assesses that Zardari will eventually become unpopular because "he promises more than he can deliver," though he may last a few more years.  Additionally, President of the Pakistan Muslim League-N (PML-N) party Nawaz Sharif should not be counted out of the political game.  End summary.  

Political Integration of the FATA ---------------------------------  

¶2. (C) In informal discussions on November 6 with visiting SCA/FO Senior Advisor Neil Kromash, FCO Pakistan and Afghanistan Team Leaders Laura Hickey and Tom Burns said that NWFP Governor Ghani had recently approached HMG to discuss FATA reform.  Ghani suggested that NWFP should incrementally absorb the FATA, starting in areas around Peshawar.  Hickey said Ghani's vision lacked an overarching framework and did not include a detailed plan to address the simultaneous political, development, and security elements that would be required to make such an approach workable.  In addition, Ghani's outlook presumed that one day the Tribal Areas will be integrated into the NWFP, as opposed to separate provincial status or some other semi-autonomous arrangement within the federal state.  Hickey suggested that while FATA reform is needed, it should be done in consultation and dialogue with the people of FATA to see what they want for the province's future.  Hickey said whatever approach is taken, it should be gradual.  Extension of the Political Parties Act to FATA and appointment of a Cabinet-level position to cover the portfolio were good starting places. Hickey also said HMG supports the creation of a "Frontier Trust Fund" which would serve as a useful mechanism for the UK's Department for International Development (DfID) and other donors - including the European Commission - to contribute to.  Hickey agreed that the Frontier Trust Fund, in order to be effective, required high-level Pakistani ownership in the form of an appointed cabinet-level Border Coordinator.  

Afghanistan-Pakistan Relations ------------------------------  

¶3. (C) Discussing ways to deepen Afghanistan-Pakistan relations, Burns said senior officials in both countries do not have ownership in the current discussions and the international community needs to do more to broaden the dialogue.  Making informal suggestions, Burns said HMG had considered proposing a mechanism similar to the India-Pakistan Composite Dialogue that would give Afghanistan and Pakistan a more institutionalized basis for policy discussions focused on deliverables.  The goal would be to create a dialogue deep enough to "survive political shocks and individual personalities," and Burns suggested that initial discussions could focus on trade and border security.   LONDON 00002853  002.2 OF 002   

Facilitating EU Trade ---------------------  

¶4. (C) HMG is looking to open trade with Pakistan, Hickey said, but it has to be done through the EU.  Hickey said EU interest in Pakistan is increasing, as other member states gradually recognize that with the EU's immigration policies, "Pakistan and security aren't just the UK's problems -- Pakistan affects all EU countries."  Hickey said that HMG was considering pursuing several options, such as trade preferences designed to give Pakistan greater access to EU markets, a free trade agreement, and/or a regional arrangement, possibly similar to the Qualified Industrial Zones (QIZ) initiative between Israel and Jordan.  Hickey admitted that all of these ideas faced political and legal obstacles within the EU.  Hickey said HMG is also pushing the EU to double its aid spending in Pakistan, and to host an EU-Pakistan Summit in 2009 (which could have a trade deal as its main deliverable).  

On President Zardari --------------------  

¶5. (C/NF) President Zardari has done "surprisingly well," Hickey said, confessing that HMG had initially underestimated him.  She said, however, that HMG still anticipates Zardari will eventually become unpopular because "he promises more than he can deliver."  While Zardari's political lifeline was unclear, Hickey said HMG now assesses that he will be in office for a few more years.  HMG has not counted Nawaz Sharif out of the political game and thinks his star may rise again.   Visit London's Classified Website: XXXXXXXXXXXX
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