The Dispensable Nation: American Foreign Policy in Retreat (39 page)

Iran and Pakistan were also at odds over Afghanistan. During the 1980s, Pakistan worked closely with Saudi Arabia and America to drive the Soviets out, and then Pakistan forged a partnership with the Saudis over its Taliban project in Afghanistan in the 1990s. Iran moved closer to India, and the two backed the Northern Alliance as it resisted the Taliban and therefore the Pakistani-Saudi plan for dominating Afghanistan.

Today, American efforts to peel India away from Iran are happening at the same time that Washington has been breaking with Islamabad over counterterrorism issues. That has created an opening for Iran and Pakistan—both of which resent the American presence in the region—to ponder working together in Afghanistan and over regional issues. But Pakistan still has close ties to Iran’s archrival, Saudi Arabia. There is as yet no clear strategic realignment with Iran, but there is a lot of jockeying for position. China could face difficulty managing the complex web of alliances and rivalries in this region—especially Saudi anxieties over Iran. For now, the souring of U.S. relations with Pakistan has created
grounds for improved relations and increased strategic coordination between Tehran and Islamabad, both of China’s allies.

Those alliances are powerful. In November 2009, when the Obama administration was busy pressuring Pakistan into cooperation on Afghanistan, Chinese and Pakistani officials gathered in Islamabad to celebrate the launch of a new high-level Chinese-Pakistani project: manufacturing up to 250 JT-17 fighter jets in Pakistan. It was a $5 billion deal, and only the first part of a broader joint initiative to develop military hardware.
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The project is significant, not only as a token of Chinese support for Pakistan in its military and strategic rivalry with India, but also in what it says about the depth of ties between China and Pakistan.
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Pakistani prime minister Yusuf Raza Gilani likes to repeat the Chinese ambassador’s cloying description of Sino-Pakistani friendship as “higher than the Himalayas and sweeter than honey.”
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Pakistanis also say that China is an “all-weather” friend as a way of suggesting that America is at best only a “fair-weather” friend.
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In the atmosphere of bitterness and recrimination that followed the discovery of bin Laden living in the very lap of its military establishment, Pakistan has fallen back on the old idea that China stands by Pakistan through thick and thin. Pakistanis will tell you readily of China’s critical assistance during the 1965 war with India (although Iran played just as supportive a role), or that China helped Pakistan during the 1971 war, the Kargil War of 1990, and even today: China is the only country to support Pakistan after the Abbottabad fiasco.
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China may be an “all-weather” friend, but China still does not like blizzards or tornados. China does not like it when Pakistan pushes too hard with India, or provokes American anger. China wants Pakistan as a strategic base, not a source of fresh headaches. Waves of extremists trained in Pakistan may stoke fires of separatism in Xinjiang, and, as happened before, countless Chinese engineers can be abducted by Pakistani tribesmen for ransom; yet China’s true anger at Pakistan is directed at its threat of a regional power play. China wants to use Pakistan to serve Chinese interests, and it will not be made a pawn in Islamabad’s regional games. So it was that even as China was stepping up its investment in Pakistan’s military capability, it was winding down its support for Pakistan on the Kashmir issue.
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China has been a source of moral support too, the country that Pakistan turns to when faced with Indian threats or U.S. pressure. Over the past decade, China has encouraged this feeling by deepening its strategic investment in Pakistan. Along with fighter jets, pipelines, a port, and bridges, China is building roads and power plants and has promised civilian nuclear reactors like the one going to Turkey. There are free-trade agreements that promise to expand commerce between the two countries to $15 billion by 2015. China already accounts for 11 percent of Pakistan’s imports.
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Chinese businessmen are ubiquitous in hotels in Lahore and Karachi, exploring investment prospects even in software companies. China Mobile has bought a controlling share of PakTel; Chinese arms manufacturers sell $7 billion per year in military hardware to Pakistan. In fact Pakistan accounts for the bulk of China’s weapons sales worldwide, and China is Pakistan’s largest defense supplier. Beijing sells it aircraft (including those that can deliver a nuclear payload), ships, and advanced warning systems. There are plans for the sale of submarines. China is helping Pakistan build an indigenous military-industrial complex through joint projects that cover not only fighter planes but also tanks, guided-missile frigates, ballistic missiles, and even satellites for communication and remote sensing.
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China clearly wants a strong Pakistani military—and in particular a strong Pakistani navy—as a strategic asset in West Asia.

The cooperation also extends to Pakistan’s controversial nuclear weapons program. The infamous A. Q. Khan, father of the Pakistani A-bomb, openly acknowledged Chinese assistance in the form of weapons-grade uranium, technical drawings of nuclear weapons, and tons of uranium hexafluoride that Pakistani centrifuges could spin into yet more weapons-grade uranium.
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Pakistan grew closer to, and warmer toward, China while General Pervez Musharraf was president, but now the ties between the two countries have a distinct business component. President Zardari travels to China twice a year. He says it is “to learn,” but the wealthy Zardari is also known to have personal investments in China. He is showing the way, as it were, to tighter business ties that complement the growing military and development ties between the two countries.

China also values Pakistan as a thorn in the side of India. Pakistani mischief preoccupies India, taxes its military resources, and could potentially deny India the security it needs to achieve its desired economic growth. China does not encourage war between India and Pakistan, but a credible Pakistani threat, backed by nuclear weapons, is an asset to China. India hopes to win China with promises of access to the vast Indian consumer market, but China sees India more as a rival in selling cheap exports and buying commodities than as a market for Chinese wares. And of course India is now America’s close strategic ally in the great game of containing China.

The strategic location of Pakistan—and a possible Chinese naval base at Gwadar—not too far east of the Strait of Hormuz is a fact of enormous importance to Beijing as it contemplates its strategy for West Asia and the Gulf region, and ponders how to counter U.S. and Indian strength in the area. As Robert Kaplan writes:

As trade in energy supplies and goods between East and West Asia as well as between Africa and Asia continues to grow, the figures cited by Kaplan will only increase as well.

India too, of course, sees the Indian Ocean basin as a strategically critical area. Set to become the world’s fourth-largest energy consumer (only the United States, China, and Japan are bigger), India will soon be importing 90 percent of its oil from the Persian Gulf, on a route that goes directly past Pakistan’s Makran coast. India also imports coal from Africa and Southeast Asia, and that too has to cross the Indian Ocean.
Even if India were to switch to natural gas, given its limited pipeline capacity, it would have to rely on tankers coming from the Persian Gulf or Indonesia.
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Gwadar is therefore a centerpiece in the “string of pearls” strategy, which would give China strategic control over Indian Ocean trade, as well as a staging ground for protecting its supply routes against pirates or more global rivals. Gwadar is for now a desolate place—more like an abandoned construction project than a bustling port—but then, the Chinese are in Pakistan for the long haul. Gwadar’s value will come into play down the road.

Iran is a long-term friend of China as well. It was among the first Middle Eastern countries to follow America’s lead and open up to China in the 1970s.
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But relations between the two ancient nations go much further back. As Iranian diplomats learned to their delight back in the mid-1970s, China to this day preserves priceless manuscript collections of classical Persian literature—some of it no longer extant in Iran itself—that go all the way back to the time of the Great Silk Road, when caravans hauled goods back and forth across Asia on the same route that took Marco Polo from Persia to China and brought the Mongols into the Middle East.

This historic bond is reinforced by a common view that not only as modern nation-states but as ancient civilizations, China and Iran deserve their respective places in the sun. Iranians swoon when Chinese leaders wax poetic about the rights of old nations, the travesty of the abuses that China and Iran suffered at the hands of Western powers, and the putative malign role of those same powers in continuing to block China’s and Iran’s rise to the top.

Iran’s leaders like the idea of a strong China as a balance against America. A bipolar world is a safer place for Iran. Iranian rulers fantasize about a world in which China would confront America, as did the Soviet Union at one point, shielding Iran from American pressure.

Chinese trade has kept the Iranian economy afloat despite severe Western economic sanctions, and Chinese arms sales and technology transfers have been critical to modernizing Iran’s antiquated military.
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But China has a long way to go to rival American power, and unlike the
Soviet Union, China is not gunning for confrontation with America. Beijing’s counsel to Tehran is to be supple and not to provoke Washington.

In Iran, China has both strategic and economic interests.
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Iran is a heavy hitter in the Middle East, a local power with a long history in a region full of “tribes with recently acquired flags,” and the influence to go with that status. The Soviet Union’s fall helped restore Iranian influence across a vast region, from the Caucasus through Central Asia. When the United States and NATO took down the Taliban after 9/11, Afghanistan too fell under renewed Iranian influence. Iran’s soft power on the Arab street waxed with anti-Israel bluster and extended westward into Iraq, Syria, and Lebanon. Iran’s economic zone now stretches from Herat in western Afghanistan west to Suleimaniya and Basra in Iraq.

That Iran has defied American wishes is not unwelcome to China. Beijing gets that its rivalry with America is global, and does not like seeing uncontested U.S. hegemony in any region. And the more China covets Middle Eastern oil, the more it feels keen to check American influence.

But China does not want to see Iran become like Iraq—so defiant and risk prone that it invites U.S. military action followed by U.S. control of the spoils. So the Chinese caution Iran, nudging it to talk to the West and to accommodate at least some Western concerns.
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Beijing has supported sanctions against Iran—and benefited from the effect of sanctions in driving away Western economic interests, leaving the field to China. In an ironic twist, it appears that China has supported sanctions in order to do more business with Iran and to tighten its own economic hold over the country. But as with North Korea, when it comes to the Iranian nuclear program (or support for Hamas and Hezbollah), Beijing does not share American interests.

Iran, as the Chinese are keenly aware, is also rich in oil and gas. It holds 10.3 percent of the world’s proven oil reserves and 15.8 percent of its gas reserves (second in size only to Russia’s). In 2010, China was Iran’s largest energy customer (accounting for 16.2 percent of Iran’s energy exports), and Iran was China’s largest energy supplier (accounting for 17.4 percent of China’s energy imports). These numbers have grown since sanctions have cut Iranian energy exports to Europe and the
rest of Asia. The Chinese too cut some of their formal oil imports from Iran, but that drop is more than made up for by off-the-books exports of Iranian oil to China via Iraq and some of it through Dubai.

More important, Iran has the only major oil and gas reserves in the region that are outside Western multinational control. It presents Chinese state-controlled oil companies with a unique opportunity to build “upstream” capabilities. China has signed on to develop the North Azadegan oil field and to explore for natural gas offshore in the North Pars field under the Persian Gulf.

Then there are the deepening economic ties that have unfolded apace with tightening Western sanctions. As Western businesses left, Iran turned to China to fill the void. Chinese goods flowed into Iran to replace European, Japanese, and Korean imports. Chinese oil conglomerates stepped in to take over energy and infrastructure contracts abandoned by French and Japanese companies. Iranians did not like the China option, but they had no other recourse. Iran’s bureaucrats doubt that Chinese companies can get the job done—the North Azadegan field is five years behind production schedule, and China’s record exploring oil and gas in the South China Sea has not inspired confidence either. Many Iranians, moreover, find the Chinese hard to work with—the cultural gap is wider than the one that separates Persians from Europeans. Despite their legendary toughness and wiliness as negotiators, Iranian businessmen find that their Chinese partners give less and squeeze more and drive exceptionally hard bargains. But China is willing to do business with Iran when no one else will, and the Iranians have nowhere else to turn.