PRT Herat: Iran's Influence in the West:

UNCLAS SECTION 01 OF 02 KABUL 003569 SIPDIS SENSITIVE SIPDIS DEPARTMENT FOR SCA/FO, SCA/A, NEA/IR NSC FOR AHARRIMAN CENTCOM FOR CG CFC-A DUBAI FOR IRAN OFFICE E.O. 12958: N/A TAGS: ELTN ECON PREL IR AF SUBJECT: PRT Herat: Iran's Influence in the West: Inauguration of Highway, Rail(!) Projects KABUL 00003569 001.2 OF 002 Summary -------------- ¶1. (SBU) On July 29, the vice presidents of Afghanistan and Iran dedicated three Iranian-funded projects: completion of a portion of highway linking Herat province to Badghis and points north; "ground breaking" for a railway from Khaf, Iran, to Herat (pledged by Iranian President Ahmadinezhad to President Karzai in Dushanbe); and the opening of the Herat branch of Iranian-owned Arian Bank. The ceremony encapsulated Iran's efforts to gain influence via commercial outreach into western Afghanistan; the GOI's demonstrably patronizing attitude towards its Afghan counterpart; and uncritical Afghan acceptance of Iranian development "largesse" - even when financially and economically unsound for Afghanistan. End summary. ¶2. (SBU) In a ceremony at Heart's (still unopened) "Five Star Hotel," Afghan Vice President Ahmad Zia Massoud and his Iranian counterpart for Executive Affairs, Ali Saeedlou, formally opened a 60-kilometer portion of the Herat-Qal-i- Naw stretch of the Ring Road, built at a cost of USD 23 million. The new hardtop to the provincial frontier with Badghis will eventually link with the Spanish-built portion of the Ring Road, currently under construction. When -- and if -- completed, the rail line from Khaf to within 15 kilometres of Herat would extend 191 kilometres. An Iranian Embassy press release said Iran would fund (at $78 million) the 77 kilometre portion of the railway from Khaf to the Iranian-Afghan border and 61 kilometres of rail into Afghanistan ($75 million). The GoA would have to finance the rest of the track (roughly 50 kilometres) to Herat city. Moreover, according to the Iranian vice-president, the project must be completed in three years, as per a signed mutual agreement. Unrealistic Railroad? -------------- ¶3. (SBU) While Saeedlou affirmed the commercial utility of the Khaf-Herat railway, PRToff later privately spoke with Herat Governor Anwari and Herat MFA Representative Afzali about the economic viability of such a rail link and questioned whether such a project would ever become operational, let alone profitable. Among issues apparently never considered by the Afghan side: competition with the new and underutilized Islam Qala-Herat highway which the railroad would parallel; inevitable land disputes over the rail right of way; truck-based customs facilities now planned for Islam Qala; the railway's inherently low capacity utilization combined with very high marginal costs; the need for expensive engines/carriages/maintenance shops and on-load/off-load infrastructure; management, labor and training; the high cost of capital; the railway's short distance which in any case necessitates truck movement for all freight; and, perhaps most importantly, the absence of rail within Heart's own provincial development priorities. While PRToff conceded that Iran could spend, or waste, its resources as it sees fit, he noted that Iranian contractors and engineering firms were the project's big beneficiaries. Meanwhile, the GoA and Herat Province would inevitably be called upon to absorb the project's enormous costs before one kilogram of freight could be shipped. End comment. Iranian Remarks -------------- ¶4. (SBU) In his remarks, Saeedlou clearly sought to make a political statement. According to journalists who attended the ceremony, the Iranian VP explicitly announced Iran would halt its Afghan reconstruction assistance unless the GoA set a date for the departure of "international forces" from Afghanistan. However, in a private conversation with PRToff, MFA Rep. Afzali denied that the Iranian Vice President had made such a statement. Given reported confusion among participating Afghan officials during the KABUL 00003569 002.2 OF 002 event, it is likely Saeedlou did try to score points for Tehran on this issue. Afzali confessed that the ceremony "belonged to the Iranians." The Iranian team was well prepared with "everything on paper." An Iranian advance team landed in Herat 48 hours before Saeedlou's arrival. The Afghan side, on the other hand, had not prepared nor sent any advance team to Herat. Afzali agreed that while the Iranians were thinking of their image, the participating Afghans were concerned with cutting the ribbons and returning to Kabul. ¶5. (SBU) Behind the scenes, protocol hiccups marred the event. Because of an argument over arrival timings, Afghan VP Massoud waited for three and a half hours for the arrival of his counterpart. Iran insisted Saeedlou give his speech after Masoud, presumably so that his message, including diatribes against the U.S., Israel, etc., would resonate most effectively with the audience. The MFA won the day and kept Massoud last - although given the reportedly poor caliber of his unrehearsed, unscripted speech, it probably made no difference. Afzali bemoaned the GOA's amateurish performance, compared to the polished Iranians, which he blamed largely on the VP's own office. Comment -------------- ¶6. (SBU) While the Herat-Faryab portion of the Ring Road is an important national project, the same cannot be said for the Khaf-Herat railway. Heratis seem to believe the project will catalyze development and trade. Little or no consideration appears to have been given to the huge costs relative to the minimal benefits such a project entails. Nor has anyone, in Herat at least, questioned why rail is necessary when Herat already enjoys the country's best road connection to the border. Diverting scarce capital resources to a costly rail project - which appear to primarily benefit Iranian contractors - is not wise and bodes ill for Afghanistan's economic development. ¶7. (SBU) Senior GOA leadership must be better prepared for future high level visits of this nature. While Afghan officials did not join in with Saeedlou's vitriolic anti- U.S./anti-Israel attacks, they were unprepared with any response or talking points, thus giving the appearance of benign concurrence with Iranian rhetoric. NEUMANN