PIPELINES, EDUCATION AND SECURITY IN CENTRAL ASIA:

C O N F I D E N T I A L SECTION 01 OF 04 NEW DELHI 008365

SIPDIS

SIPDIS

E.O. 12958: DECL: 12/13/2026
TAGS: PREL PGOV PINR KISL EPET ELTN TX KZ TI KG
UZ, IN
SUBJECT: PIPELINES, EDUCATION AND SECURITY IN CENTRAL ASIA:
P/DAS MANN AND J/S BHAGWATI


Classified By: POLCOUNS Ted Osius for Reasons 1.4 (B, D)


1. (C) SUMMARY: In a Dec. 13 meeting, Joint Secretary
(Eurasia) Jaimini Bhagwati expressed concerns to P/DAS Steven
Mann about whether Turkmenistan could live up to its
obligations in a proposed
Turkmenistan-Afghanistan-Pakistan-India (TAPI) natural gas
pipeline. Citing the Indo-Pak relationship and pricing as
concerns, Bhagwati nevertheless said India is interested in
both TAPI and the proposed Iran-Pakistan-India natural gas
pipeline. He described Tajikistan and Kazakhstan as
relatively stable, but Kyrgyzstan as plagued by a lack of
resources, Uzbekistan as difficult to do business with, and
Turkmenistan as complicated due to its dictatorial leader.
Mann asked Bhagwati for greater cooperation on energy and on
developing educational opportunities in Central Asia, and
urged the GOI to use its influence in tempering
Turkmenistan's worst instincts. END SUMMARY.

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CENTRAL ASIA THROUGH THE EYES OF INDIA
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2. (C) Joint Secretary (Eurasia) Jaimini Bhagwati briefed
P/DAS Mann on the GOI's view of the current political and
developmental landscape of Central Asia in a December 13
meeting. President Rahmonov of Tajikistan is relatively
young at age 55, he said, and India expects he will remain
fully in control of the country for some time. Though he
received 76% of the vote, there is not much to speak of in
terms of opposition to the government, remarked Bhagwati,
adding that although Rahmonov promised to make changes in his
government after the election, only the foreign minister has
been replaced at this point. "Tajikistan is a poor country,
and Rahmonov must figure out how to improve the quality of
life for his people," said Bhagwati, noting that the country
is reasonably stable. Rahmonov doesn't want to "push things
too far," but instead ensures that clans and tribes are
allowed to have their say, therefore providing a "safety
valve" and semblance of plurality without relinquishing
control, opined Bhagwati.


3. (C) Kyrgyzstan is less stable, and poorer than
Tajikistan, indicated Bhagwati. The government doesn't want
to push things to a breaking point, nor does it want
wide-spread bloodshed, he conjectured, adding that the
country needs to figure out what to do with its economy.
"They have neither personnel, nor natural resources," noted
Bhagwati, "and their $450 or so per capita will not likely
rise in the short, or even medium, term." An increasing
number of Islamic women wear the hijab in Kyrgyzstan and
growing numbers of people observing the Ramadan fast,
Bhagwati reported. Expressing concern, he said, "I worry
that such outward manifestations are linked to a mindset to
become more fundamentalist." Bhagwati indicated that this is
an issue of development, pointing out that life is harsh in

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this country, especially in winter, and that people may be
influenced by fundamentalists to believe that Islamic
conservatism is a way out of the "morass."


4. (C) Turning to Uzbekistan, Bhagwati remarked, with 25
million people, it is more populous than Tajikistan and
served as a cultural and transport hub in the Soviet era.
Its people were known for their skills and still have high
degree of expertise, but they are losing it, he noted. The
country doesn't have good relations with anyone around them,
acknowledged Bhagwati, despite some interdependence with
Tajikistan on electricity and trade. Bhagwati contended that
the Russians are worried about dissent in Uzbekistan being
put down too firmly. He warned that cotton crops, an Uzbek
staple, are not viable because they ruin the soil and fields
have to remain fallow for several years. They have oil, gas
and even gold, he said, but questioned whether or not the
Uzbeks can exploit it commercially. Uzbekistan has the
highest potential for human resource development, asserted
Bhagwati, with Kyrgyzstan and Tajikistan trailing behind.
Uzbekistan's President Karimov, at 66 years old, does not
look healthy, observed Bhagwati, adding that Karimov's
daughter Gulnra is likely being groomed to take over for him.
Bhagwati opined that the Uzbeks, with their stream of
ever-changing ministers, are bad-faith bargainers, and
indicated that it would be difficult to do business with
them.


5. (C) Calling Turkmenistan an "extremely strange country,"
Bhagwati observed that it is better off than most of its
neighbors in terms of resources, but doubted it was more
stable. Its dictatorial leadership doesn't lend itself to
stability, nor does it lead to development, he theorized.
Bhagwati underlined that the stability of Central Asia as a
whole is a real problem for India, given the relative
proximity of the region. "It is only a two hour and ten
minute flight from Tashkent to New Delhi," he emphasized,
adding that there are many points within India that are
further apart than the capitals of Central Asia are from New
Delhi. Because of Pakistan, there are no surface linkages,
he added, "therefore there is not much we can do but worry."


6. (C) President Nazarbayev of Kazakhstan is "a different
cup of tea," declared Bhagwati, suggesting that the president
"knows when to give and take," therefore making the country,
which has a luxury of resources, more stable. Noting that
the President is thinking of building a bubble over Astana to
keep it warm in the winter, he queried, "how much energy is
needed for that?" The government has a court atmosphere,
observed Bhagwati, combining modern thinking with "throwbacks
to the past" and grand plans such as the desire to lead the
OSCE. Still, it is relatively stable, he said, noting that
Nazarbayev received 91% of the vote in the last election.


7. (C) Bhagwati raised the prospect of uranium as a resource
that India might be interested in buying from Central Asia in

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the future, adding that Russia has also indicated interest in
purchasing it. On the prospect of hydropower in the region,
Bhagwati wondered who would invest the money into those
projects and bring them to fruition. With no land
connections to Central Asia, no direct air connections and a
relatively low volume of trade, the only thing drawing India
and the region together is culture and human resources,
according to Bhagwati, who noted that many Central Asian
professionals and students are trained in Indian
institutions. Mann encouraged Bhagwati to increase India's
role in education in the region, suggesting that the U.S. and
India should work together on education in an effort to
overcome isolation in Central Asia. Bhagwati assured Mann
that India would do whatever it can, but warned that India
was limited by its need to ensure its own students aren't
denied education. He cited recent "affirmative action"
legislation which provides preferential access to
professional courses for India' underprivileged classes,
saying that every Central Asian student takes the place of an
Indian student because of limitations on India's education
capacity.

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GETTING ENERGY OUT OF CENTRAL ASIA
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8. (C) On Central Asian energy, Mann noted that he expects
oil from Kazakhstan's Kashagan field, the fifth largest on
the planet, to come on line in 2010. Bhagwati asked where
the oil would flow, wondering if China, which built a
Chinese-Kazakh cross-border pipeline last year, would be a
consumer. Mann replied that China's pipeline would not
handle Kashagan volumes, nor would it cope with Tengiz
expansion. Raising the proposed
Turkmenistan-Afghanistan-Pakistan-India (TAPI) pipeline,
Bhagwati inquired whether Turkmenistan has enough gas to meet
its obligations, noting that the GOI has expressed interest
in taking part in the project, but is unsure whether or not
India will get enough in return. Mann responded that the
question is in one sense irrelevant, pointing out that
existing volumes could supply TAPI if the Turkmen would shift
exports from Russia to alternative consumers. Overall,
regarding TAPI, declarations are cheap; building a pipeline
and signing a memorandum of understanding without financial
backing is unrealistic. Bhagwati noted that it was unclear
why a meeting on the TAPI project, scheduled to take place in
Ashgabat, was canceled, musing that it likely had to do with
the caprices of Turkemenistan's presidential regime.


9. (C) Bhagwati expressed that there are two main aspects
that need to be addressed on both the TAPI project and the
proposed Iran-Pakistan-India pipeline (IPI). Firstly, "it
depends on how we see our long-term relationship with
Pakistan evolving," opined Bhagwati, adding, "we need to have
confidence that it will last." Both sides have expressed an
openness to the projects, he noted. "The second question is

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who will lay the pipelines and who will pay for them,"
Bhagwati asserted We are prepared to give assurances on
demand, he offered, but we need to know how the gas will
reach our border and we need to work out the pricing, he
added, noting that India would need an analysis of how much
the price would fluctuate. Indian companies are willing to
be engaged in pipeline construction and to compete, he said,
but a consortium outlining the conditions is necessary. "I
don't see anyone leading such a consortium," he lamented, and
Mann agreed. Mann urged Bhagwati to use India's influence in
Turkmenistan to encourage the President to act in a modern
and commercially-sound way. On joint cooperation in the
region, Bhagwati asked if the U.S. would provide unclassified
studies on energy linkages between Central Asia and the rest
of the world.

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COMMENT
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10. (C) J/S Bhagwati, well-versed on Central Asian issues,
has twice requested that the U.S. provide information along
the lines of unclassified energy studies in the Central Asian
region, indicating a hunger for knowledge on the Indian side.
The GOI is clearly interested in pursuing the trans-Afghan
and trans-Iran pipelines, but recognizes the security issues
which need to be overcome, not the least of which is its own
relationship with Pakistan. India is reluctant, with good
reason, to put money into the projects until it has a clearer
picture of what benefits it will get in return, and whether
or not the projects are financially feasible. END COMMENT.
PYATT