Saudi Arabia Will Not Join China-Pakistan Economic Corridor, Islamabad Says

[Swordsmyth]

Pakistan's government has announced that Saudi Arabia will not join the China-Pakistan Economic Corridor, just days after saying the kingdom would be a strategic partner in the project, Dawn reported Oct. 3.

Pakistan's invitation for Saudi Arabia to join the CPEC was reportedly presented without first consulting China. The reason for this move is unknown, but it suggests that Pakistan's new government wants to diversify its financing options to reduce dependence on China.

More at: https://worldview.stratfor.com/situa...islamabad-says

[homahr]

if one were to pick between a 5000 year old civilization who have art/literature/science/philosophy and a bunch of desert barbarians who just have oil and $#@! for brains, i would pick the former.

[goldenequity]

My impression so far... is that the new PM Imran Khan
is using his political 'honeymoon' to renegotiate all former 'deals'
i.e. he's cutting and slashing contract terms and scaling things back
the commitments to China made by his predecessors...
(rebuilding the colonial era railway that still services the country for instance)
It's a novel idea... yunno... living within yer means. a lost art.

He will 'use' the Bolton/Pompeo courtship and string them along on Afghanistan.
(he's Pashtun... aka 'Taliban' roots)
He knows VERY well... that the Taliban want NO U.S. presence in Afghanistan. NONE. LEAVE.
but.... there's 'money to be made'.... so he/they will play them along/extract $$.
Khan's no idiot but he's on a political learning curve... probably will learn a lesson
from getting stung by KSA royals and hung out to dry.
Yeah he better learn it quick: If you want anything remotely resembling Sovereignty...
stay away from the West. Far away.

[homahr]

My impression so far... is that the new PM Imran Khan
is using his political 'honeymoon' to renegotiate all former 'deals'
i.e. he's cutting and slashing contract terms and scaling things back
the commitments to China made by his predecessors...
(rebuilding the colonial era railway that still services the country for instance)
It's a novel idea... yunno... living within yer means. a lost art.

He will 'use' the Bolton/Pompeo courtship and string them along on Afghanistan.
(he's Pashtun... aka 'Taliban' roots)
He knows VERY well... that the Taliban want NO U.S. presence in Afghanistan. NONE. LEAVE.
but.... there's 'money to be made'.... so he/they will play them along/extract $$.
Khan's no idiot but he's on a political learning curve... probably will learn a lesson
from getting stung by KSA royals and hung out to dry.
Yeah he better learn it quick: If you want anything remotely resembling Sovereignty...
stay away from the West. Far away.

He and his administration needs to keep reaching out to Russia and Putin. If he can get Putin to actually visit Pakistan, that in it of itself would be huge. Nothing big like the current India-Russia visit, but just something small to reiterate the partnership.

It Is Friendship With Russia, Not China, That Will Allow Pakistan to Cut the Cord With the US

With Afghanistan and Pakistan as the staging grounds, politics in South and Central Asia appears to be coming full circle with the making and breaking of alliances involving major regional and international actors.

The switching of goalposts by the erstwhile Cold War-era allies — keeping their converging and diverging geopolitical, geoeconomic, and geostrategic interests in mind — apparently indicates the beginning of a new “Great Game” in the region.

Russia’s re-emergence under Vladimir Putin; China’s vision of greater connectivity in Eurasia through Xi Jinping’s ambitious Road and Belt Initiative (BRI); America’s quest to safeguard its interests in the region by not losing the war in Afghanistan and containing China’s growing economic and military clout; India’s outreach to the world markets to compete Xi’s China; Pakistan’s struggle to retain its strategic importance by taking sides; and Afghanistan’s desire for lasting peace – these are some of the key drivers spurring the race.
While Afghanistan’s unending struggle to attain peace and stability is the epicenter of this contest, it is nuclear-armed Pakistan, with its population of over 200 million and looming economic, political, and security troubles, that is attracting the focus of the major powers. For Pakistan, while a shift from its old goalpost seems to be imminent, it is not going to be without hassles.

Bittersweet Frenemies

Pakistan has been allied with the United States since the era of SEATO (South-East Asia Treaty Organization) and CENTO (Central Treaty Organization). This alliance, though off-again-on-again, was further cemented following the 1978 Saur Revolution in Afghanistan, which paved the way for military intervention by the Soviet Union in December 1979.

More recently, Pakistan was given the status of a non-NATO ally of the United States following the 9/11 terrorist attacks.

That devastating event forced the world’s sole superpower to topple the Taliban regime in Afghanistan, from where the al-Qaeda terrorist network masterminded the attacks in Washington D.C. and New York City.

During this period of alliance, Pakistan remained dependent on U.S. largesse in military, economic, and developmental terms. Over the decades, Pakistani leadership successfully maneuvered to secure huge sums of money for their country’s services, whether in the CIA-sponsored (Reagan-era) anti-communist jihad or the Bush-era global war against terror, with its key focus on Afghanistan and al-Qaeda.

What Pakistan failed to do, however, was endear itself to the United States as an all-time trusted partner in the region. Instead, the relationship mostly remained transactional. Each bout of intimacy followed the emergence of a new security environment in the region and ended in a fiasco, leaving behind more doubts and animosities as soon as that particular security environment began to change.

The two countries’ diverging interests kept their alliance mostly transactional. The latest example is the United States’ 17-year-long war in Afghanistan. While the United States struggles to bring peace and stability by routing the Taliban, Pakistan believes the ousted militia offers the best guarantee for peace. The Haqqani Network, the most secretive group in the region, is the United States’ worst enemy. But Pakistan has its hopes pinned on this group’s survival, which Islamabad sees as the key to guaranteeing its strategic interests in the face of both anti-Pakistan sentiments in Afghanistan and perceived Indian encirclement.

Many in Pakistan’s security circles were disillusioned when then-U.S. Central Command chief Admiral Mike Mullen called the Haqqani Network a “veritable arm of Pakistan’s Inter-Services Intelligence” in September 2011, months after the killing of al-Qaeda chief Osama bin Ladin in a mid-night raid by Navy Seals in Pakistan’s garrison town of Abbottabad. The same year, then-Secretary of State Hillary Clinton, during her visit to Islamabad, gave a blunt warning to her Pakistani allies that “you can’t keep snakes in your backyard and expect them only to bite your neighbors.”
But the real bombshell came from none other than President Donald Trump on January 1, 2018 when he accused Pakistan of “lies and deceit” in a tweet. “The United States has foolishly given Pakistan more than 33 billion dollars in aid over the last 15 years and they have given us nothing but lies & deceit thinking of our leaders as fools,” Trump said. “… No more!”

As the Trump administration struggles to wrap up the war in Afghanistan by seeking Pakistan’s help and support, Pakistan looks the other way by expanding and further cementing its economic and military ties with Russia and China, both of which are seen as adversaries in U.S. policy circles. Pakistan will have to balance its acts while walking this tightrope.

Sweeter Than Honey

“Sweeter than honey” is the new jargon suffixed to Pakistan’s “deeper than oceans and taller than mountains” friendship with China. The depth, height, and saccharinity, however, mostly depend on China’s contentment with the strategic, political, and economic interests that Beijing attaches to Pakistan.

There is no such thing as a free lunch in the realm of economics, but when it comes to China, every single loaf has a cost. The $62 billion that China promised for infrastructure development in Pakistan under the BRI’s China-Pakistan Economic Corridor (CPEC) will require Pakistan’s commitment not only to China’s economic and commercial interests, but also its political and security considerations.
Pointing to the potential CPEC faultlines in South Asian security, the Stockholm International Peace Research Institute (SIPRI) says in its “The Silk Road Economic Belt” report that Pakistan’s Balochistan “remains a strategic area that could become a flashpoint for regional competition and is even referred to as the new epicenter of the ‘Great Game’ by some regional analysts.”

As a result, when a Pakistani official spoke about a review of the CPEC agreements, it sparked a flurry of meetings between Islamabad and Beijing in mid-September. Chinese Foreign Minister Wang Yi landed in Islamabad just a day after the publishing of Razak Dawood’s interview in the Financial Times. Then Pakistan’s army chief visited Beijing and met top civilian and military officials. Meanwhile, Dawood, in a face-saving statement, said that he was quoted “out of context.”

New Friendships

Several about-faces have been witnessed over the past decade and half as the U.S.-led global war on terror continues in Afghanistan. However, Pakistan’s becoming an ally of Russia and Iran’s rapprochement with the Taliban, both to the chagrin of the United States, are the most spectacular changes. Pakistan’s new closeness with Russia, at a time when the latter is engaged in indirect war with the United States both in the Middle East and Ukraine, is clear indication of a rift with Islamabad’s erstwhile ally the United States. Likewise, Iran and Russia’s closer links with the Taliban are being seen as a new stumbling block to U.S. objectives in Afghanistan and the region.

Nothing is more evident of these new arrangements than a meeting of the spy chiefs of Russia, Iran, China, and Pakistan in Islamabad in July this year to discuss Afghanistan and Central Asia. While Russia and Iran’s ties with the Pakistan-backed Taliban have only been recently disclosed, China has long been seen as a trusted country by the Taliban leadership.

Islamabad’s emboldened stance regarding nonconformity with U.S. demands partially stems from its increased military cooperation with Russia. This bond-making between Russia and Pakistan is not new; former military ruler Pervez Musharraf visited Russia in 2003. But the pace of exchanges has picked up remarkably in the past few years.

Raheel Sharif, one of Pakistan’s most celebrated army chiefs, paid a visit to Moscow in June 2015 following the Islamabad visit of Russia’s defense minister in November 2014. Within three months of Sharif’s visit to Moscow, Pakistan received four Mi-35 assault helicopters from Russia as part of a newly signed deal.

In December 2015, Pakistani and Russian naval forces jointly organized anti-narcotics exercises dubbed “Arabian Monsoon” in the Arabian Sea. In September 2016, for the first time Russian commandos participated with their Pakistani counterparts in “Friendship 2017” exercises. And in yet another first, a Russian military delegation visited Pakistan’s North Waziristan tribal district, once known to be a Taliban emirate, in March 2017.
Pakistan’s current army chief, General Qamar Javed Bajwa, visited to Moscow in April 2018, where, just days ahead of the U.S. decision to cancel training and aid for Pakistan’s military, Russia entered into a historic agreement allowing officers of Pakistan’s armed forces to receive training in Russia.

Already, there is no reversing Pakistan’s new friendship with Russia. The point here is how much Russia’s stepping in will cater to Pakistan’s military and economic requirements, particularly in terms of the space left vacant by the U.S. stepping back.
Meanwhile, Washington is tightening ties with Pakistan’s long-time rival, India. After a brief stop-over in Islamabad in early September, U.S. Secretary of State Mike Pompeo proceeded for the first-ever “two-plus-two” ministerial dialogue in New Delhi, where the two sides agreed to further enhance their security cooperation under the Communications Compatibility and Security Agreement.
India has already been given wider space in the U.S. National Security Strategy, while Trump’s South Asia Strategy recognizes an even bigger role for India in “Afghanistan’s stabilization.” These fresh measures will further distance Pakistan from its Cold War-era ally.

A Difficult Moment

While the United States is set to proceed toward an Afghanistan solution with or without support from Pakistan, it is a difficult moment for Islamabad. Pakistan must decide whether to take side with Washington by ditching the Taliban and Haqqani Network or continue to take sides with the two militant groups, to the annoyance of its long-term partner. As part of this decision, Pakistan will need to assess whether the Russians are capable of meeting the country’s defense needs if it continues to stay detached from the United States.

Another complicating factor is that action against individuals such as Hafiz Saeed and his group Jamat-ud- Dawa will also benefit India. By acting under U.S. pressure against such groups, Pakistan will lose its strategic assets, which are being used as a counterbalance against the much bigger neighbor India.

For Pakistan, it is tough to do it, but even tougher not to.

I would add that it is Russia, not China, that will finally push both Pakistan and India, bitter South Asian rivals to a detente/peace.

[goldenequity]

hmmmm.....

Saudi Arabia agrees (in principle) to invest in new oil refinery in Pakistan's Gwadar
https://www.reuters.com/article/us-p...-idUSKCN1ME1BN
(fun to read between the lines...)

[goldenequity]

------

https://twitter.com/Ozkok_/status/1049038719355969537

[goldenequity]

Pakistani Poker: Playing Saudi Arabia Against China
https://www.zerohedge.com/news/2018-...-against-china

Desperate for funding to fend off a financial crisis fueled in part by mounting debt to China,
Pakistan is playing a complicated game of poker that could hand Saudi Arabia a strategic victory
in its bitter feud with Iran at the People’s Republic’s expense.

►The Pakistani moves threaten a key leg of the USD60 billion plus Chinese investment in the China Pakistan Economic Corridor (CPEC),
a crown jewel of Chinese President Xi Jinping’s Belt and Road initiative.
They also could
►jeopardize Chinese hopes to create a second overland route to Iran, a key node in China’s transportation links to Europe.
Finally,
►they grant Saudi Arabia a prominent place in the Chinese-funded port of Gwadar
that would significantly weaken Iran’s ability to compete with its Indian-backed seaport of Chabahar.

Taken together, the moves risk dragging not only Pakistan but also China into the all but open war between Saudi Arabia and Iran.




ROADS
Pakistan’s first move became evident in early September with the government’s failure to authorize disbursements for road projects,
already hit by delays in Chinese approvals, that are part of CPEC’s Western route,
linking the province of Balochistan with the troubled region of Xinjiang in north-western China.
In doing so, Pakistan implicitly targeted a key Chinese driver for CPEC: the pacification of Xinjiang’s Turkic Muslim population
through a combination of
►economic development enhanced by trade and economic activity flowing through CPEC
►as well as brutal repression and mass re-education.
The combination of Pakistani and Chinese delays “has virtually brought progress work on the Western route to a standstill,”.

RAILS
Pakistani Railways Minister Sheikh Rashid, in a further bid to bring Pakistani government expenditure under control
(that at current rates could force the country to seek a $US 12 billion bailout from the International Monetary Fund)
has cut $2 billion dollars from the $8.2B budget to upgrade and expand Pakistan’s railway network (a key pillar of CPEC).
Mr. Rashid plans to slash a further two billion dollars.
“Pakistan is a poor country that cannot afford (the) huge burden of the loans…. CPEC is like the backbone for Pakistan, but our eyes and ears are open,” Mr. Rashid said.


NEW PRIME MINISTER
The budget cuts came on the back of Prime Minister Imran Khan’s Pakistan Tehreek-e-Insaf (PTI) party that projected CPEC
(prior to the July 25 election that swept him to power)
as a modern-day equivalent of the British East India Company, which dominated the Indian subcontinent in the 19th century.
PTI criticism included denouncing Chinese-funded mass transit projects in three cities in Punjab
as a 'squandering of funds' that could have better been invested in social spending.
PTI activists suggested that the projects had involved corrupt practices.


SAUDIS
Pakistan’s final move was to invite Saudi Arabia
►to build a refinery in Gwadar
and
►invest in Balochistan mining.
The Chinese questioning of Pakistan’s move became evident
when the Pakistani government (suddenly) backed off suggestions that Saudi Arabia would become part of CPEC.

Senior Saudi officials this week visited Islamabad and Gwadar to discuss the deal that would also involve
►deferred payments on Saudi oil supplies to Pakistan
and
►create a strategic oil reserve close to Iran’s border.

"The incumbent government is bringing Saudi Arabia closer to Gwadar.... the hardline Sunni-Wahhabi state would be closer than ever to the Iranian border. This is likely to infuriate Tehran."


POKER
Pakistan’s game of poker amounts to
►a risky gamble that serves Pakistani and Saudi purposes,
►puts China whose prestige and treasure are on the line in a difficult spot,
►could perilously spark tension along the Pakistan-Iran border,
►and is likely to provoke Iranian counter moves.
It also
►risks putting Pakistan, Saudi Arabia and Iran, who depend on China economically in different ways, in an awkward position.

The Saudi engagement
►promises up to US$10 billion in investments
as well as
►balance of payments relief.
It potentially could
►ease US concerns that a possible IMF bailout would help Pakistan service debt to China.

A refinery and strategic oil reserve in Gwadar would serve Saudi Arabia’s goal of preventing Chabahar, the Indian-backed Iranian port,
from emerging as a powerful Arabian Sea hub at a time that the United States is imposing sanctions designed to choke off Iranian oil exports.

TARGET IRAN
A Saudi think tank, the International Institute for Iranian Studies,
(previously known as the Arabian Gulf Centre for Iranian Studies (AGCIS) that is believed to be backed by Saudi Crown Prince Mohammed bin Salman,)
argued last year in a study that
►Chabahar posed “a direct threat to the Arab Gulf states” that called for “immediate counter measures.”

Written by Mohammed Hassan Husseinbor, an Iranian political researcher of Baloch origin, the study warned that Chabahar
►would enable Iran to increase its oil market share in India at the expense of Saudi Arabia,
►raise foreign investment in the Islamic republic,
►increase government revenues,
►and allow Iran to project power in the Gulf and the Indian Ocean.



Sistan and Baluchestan
Mr. Husseinbor suggested Saudi support for a low-level Baloch insurgency in Iran could serve as a countermeasure.
that
►“Saudis could persuade Pakistan to soften its opposition to any potential Saudi support for the Iranian Baluch"
that
►"The Arab-Baluch alliance is deeply rooted in the history of the Gulf region and their opposition to Persian domination,”
Noting the vast expanses of Iran’s Sistan and Baluchestan Province, Mr. Husseinbor went on to say that
►“it would be a formidable challenge, if not impossible, for the Iranian government
to protect such long distances and secure Chabahar in the face of widespread Baluch opposition,
particularly if this opposition is supported by Iran’s regional adversaries and world powers.”

INSURRECTION
Saudi militants reported (at the time the study was published) that funds from the kingdom
were flowing into anti-Shiite, anti-Iranian Sunni Muslim ultra-conservative madrassas or religious seminaries in Balochistan.

US President Donald J. Trump’s national security adviser, John Bolton, last year before assuming office,
at the request of Mr. Trump’s then strategic adviser, Steve Bannon,
drafted a plan that envisioned US support “for the democratic Iranian opposition,” including in Balochistan and Iran’s Sistan and Balochistan province.

All of this does not bode well for CPEC.

China may be able to accommodate Pakistan by improving commercial terms for CPEC-related projects and Pakistani debt as well as easing Pakistani access to the Chinese market.

China, however, is likely to find it far more difficult to prevent the Saudi-Iranian rivalry from spinning out of control in its backyard.

[Swordsmyth]

deleted

[homahr]

Pakistan and Saudi playing a dangerous game, will not bode well for Pakistan if it continues dancing with the Saudis at the expense of China/Iran.

[Swordsmyth]

Pakistan and Saudi playing a dangerous game, will not bode well for Pakistan if it continues dancing with the Saudis at the expense of China/Iran.

China is nobody's friend, Pakistan has to counterbalance them somehow.

[homahr]

China is nobody's friend, Pakistan has to counterbalance them somehow.

In international relations, there are no friends only interests.

When India and Pakistan gained independence; Pakistan reached out to India in hopes of creating a southern front against the bigger more powerful China. India rebuffed Pakistan as India wasn't too pleased that Pakistan even existed.

Pakistan then reached out to China and within a few years resolved their border disputes. China and Pakistan both gave up their territory to each other, with China giving Pakistan a bit more.

Since then, China has funded Pakistan's missile and nuke programs. You are right that China is no one's friend. But then again neither is Pakistan, nor India, nor the US.

There are only interests that matter.

[Swordsmyth]

In international relations, there are no friends only interests.

When India and Pakistan gained independence; Pakistan reached out to India in hopes of creating a southern front against the bigger more powerful China. India rebuffed Pakistan as India wasn't too pleased that Pakistan even existed.

Pakistan then reached out to China and within a few years resolved their border disputes. China and Pakistan both gave up their territory to each other, with China giving Pakistan a bit more.

Since then, China has funded Pakistan's missile and nuke programs. You are right that China is no one's friend. But then again neither is Pakistan, nor India, nor the US.

There are only interests that matter.

Absolutely true.

But because of that Pakistan needs to keep its options open and its relationships balanced.

[homahr]

Absolutely true.

But because of that Pakistan needs to keep its options open and its relationships balanced.

True. It has an interesting role to play. It's geography is its greatest advantage.

[Swordsmyth]

Pakistan's Prime Minister Imran Khan left for Saudi Arabia to attend an investment conference boycotted by other leaders over the death of journalist Jamal Khashoggi at the Saudi consulate in Istanbul.Khan told an interviewer before leaving he was concerned at Khashoggi's death but could not skip the conference because "we're desperate" for possible Saudi loans to shore up Pakistan's economy.
It is Khan's second visit to Saudi Arabia in just over a month, but he has not succeeded in securing significant financial assistance to stave off a looming balance of payments crisis.
Khan told the Middle East Eye in an interview published on Monday that he could not pass up the invitation to meet Saudi leaders again.
"The reason I feel I have to avail myself of this opportunity is because in a country of 210 million people right now we have the worst debt crisis in our history," he was quoted as saying.
"Unless we get loans from friendly countries or the IMF (International Monetary Fund), we actually won't have in another two or three months enough foreign exchange to service our debts or to pay for our imports. So we're desperate at the moment."

More at: https://finance.yahoo.com/news/imran...-business.html

[Swordsmyth]

Saudi Arabia has agreed to give Pakistan $3 billion in foreign currency support for a year and a further loan worth up to $3 billion in deferred payments for oil imports to help stave off a current account crisis, Pakistan's government said on Tuesday.The $6 billion total exceeds forecasts by analysts and will likely reduce the size of any bailout Pakistan it receives from the International Monetary Fund (IMF), with whom it is currently engaged in talks on a rescue package.
The Saudi agreement came as new Pakistani Prime Minister Imran Khan attended a Saudi investment conference that has been boycotted by several other leaders over the death of a dissident Saudi writer at the country's consulate in Istanbul.

More at: https://www.yahoo.com/news/pakistan-...153525832.html

[goldenequity]

oops... srry I double posted ya.