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08ISLAMABAD1614 2008-04-18 15:50:00 SECRET Embassy Islamabad
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1. (C) During an April 18 call on Prime Minister Gillani,
Ambassador again raised our concern about the possible
release of 27 Al Qaeda/Taliban terrorists. Gillani stated
his firm objection to such a release; that was echoed when
Pakistan People's Party (PPP) leader Zardari abruptly joined
the meeting. Zardari said he had spoken to ISI and "the big
boss" (presumably Musharraf); the detainees would not be
released. Zardari made it clear he had weighed Pakistan's
equities and decided that they "needed to be with you more,
rather than less." Zardari reiterated Ambassador Durrani's
assertion that the South Waziristan agreement was unrelated
to the detainee issue. Gillani expressed appreciation for
President Bush's phone call and invitation; he would visit
Washington at the first opportunity. End Summary.

2. (C) Ambassador, accompanied by DCM and Polcouns, April
18 called on Prime Minister Yousef Gillani. Also attending
were Ambassador to the U.S. Durrani, Principal Secretary Syed
Siraj Shamasadudin, Additional Secretary for the PM
Secretariat Zamir Akram, and MFA Additional Secretary for

Americas Attiyah Mahmood.

3. (C) Ambassador congratulated Gillani on his election and
said the USG looked forward to working with the new
government. She reiterated President Bush's invitation for
Gillani to visit Washington at the earliest opportunity.
This would be a chance not only to meet with executive branch
officials but to also see Members of Congress. Gillani
thanked her, said he had greatly appreciated President Bush's
call and was grateful for USG support for Pakistan. He would
visit at the first opportunity. (Embassy has now conducted
two long briefings with the PPP about the extent of USG
programs in Pakistan.)

4. (S) Ambassador then raised the issue of the possible
release of 27 Al Qaeda/Taliban detainees. Some of these had
been arrested with U.S. encouragement; we had provided
Inter-Intelligence Services (ISI) with cash payments for
others. We understood that some of them may be swapped for
captured Frontier Corps personnel and/or the kidnapped
Pakistani Ambassador to Afghanistan. Others had been
identified by Baitullah Mehsud, so they could not be friends
of either the U.S. or Pakistan. Some we understood had been
identified by Mehsud operatives who had been released before.
Ambassador said she had discussed the issue with President
Musharraf, Interior Minister Rehman Malik, Pakistan People's
Party Co-Chair Asif Zardari and others. Our Embassy had
raised the issue repeatedly with ISI. The possible release
had come to President Bush's attention, and our government
was very concerned about the implications of this proposed

5. (S) Gillani said he had been briefed on the issue by
Durrani and had already spoken to Zardari. "I told them
categorically -- no -- we will not release these people,"
said Gillani. My leader (Benazir Bhutto) was killed by
terrorists; how could we possibly support such things, he
asserted. "Our commitment is to fight terrorists."
Referring to the pending South Waziristan peace agreement,
Gillani added "if there is any agreement between tribes, it
has nothing to do with this." Ambassador noted that Durrani
had said the same thing (Ref B). Gillani added that he had
insisted that the U.S. be briefed on the Waziristan agreement
so there would be no misunderstandings about its purpose.

6. (S) Ambassador said we understood why the new government
wanted to secure the support of the tribes, but it was
important to understand the basis of our concerns. The 2006
agreement had no enforcement provisions and did not stop
cross-border attacks on our forces. We appreciated that the
new agreement has provisions relating to cross-border raids
and expulsion of Arabs. We know force is not the only
option, and we are spending a great deal on economic
development of the tribal areas. But there had to be
enforcement mechanisms.

7. (C) Ambassador noted that she had met several times with

ISLAMABAD 00001614 002 OF 002

Finance Minister Dar. We understood the scope of the
financial crisis and would do what we could to help. We were
trying to expedite processing of Coalition Support Fund
claims and were exploring ways to possibly provide some food
aid to Pakistan. Gillani stressed the importance of raising
the income support price for farmers now so the country does
not face even greater wheat shortages next season. There was
also the energy crisis; there had been riots in his home town
of Multan because people had no electricity for 14 hours a
day. Ambassador Durrani noted the still pending proposal to
add agriculture as a topic for the Strategic Dialogue.

8. (S) At this point, PPP Co-Chair Zardari joined the
meeting and all the Pakistani participants except the Prime
Minister and Durrani left. Apparently expecting Zardari's
arrival, Gillani appeared unfazed by this surprising breach
of protocol. Zardari wasted no time getting to the point.
He wanted to be sure President Bush understood immediately
that the 27 terrorists would not be released. Zardari had
spoken to ISI, and later to "the big boss" (presumably
Musharraf) and had made it clear the terrorists would not be
released. He continued, "we cannot be blackmailed by this
soft war. Everyone knows where everyone is. The U.S. says
one thing; the Pakistanis say another. Outside experts state
their views. But in the end Pakistan's reputation is
blackened by all this." Zardari added that the release
issue was unrelated to the South Waziristan agreement.

9. (S) Expounding, Zardari said he had given Awami National
Party (ANP) leader Asfundyar Wali Khan the go-ahead to
proceed with his initiative to reach out to tribal leaders.
"You (the U.S.) agreed we should support Wali Khan because he
can talk to the Pashtuns, so we are giving him a chance. The
DCM noted that the problem was the way the 2006 agreement had
broken down over the lack of enforcement. Zardari said, "If
Wali Khan doesn't deliver, then we can try other options."
Explaining further, Zardari said there was a trust problem
between tribes and military or government leaders who come
and go. Wali Khan is a known entity, and he lives there,
said Zardari, so his word will be trusted.

10. (S) Ambassador predicted a likely confrontation with
the terrorists. Zardari agreed, saying the militants were
out to get the new government. Referring obliquely to
Musharraf's recent visit to China, Zardari then said there
were those "who get caught up with little ships and planes.
We can't change them, but we know the relationship with the
United States is more important. We need to be with you more
rather than less."

11. (C) In closing, the DCM mentioned that he had just met
with his Indian counterpart, who had complained of a lack of
access to the new government. We hoped that situation could
be improved as there was a real opportunity to improve
Indo-Pak relations with the new government. Zardari and
Gillani agreed.

12. (S) Comment: Zardari's abrupt entry (and the fact that
Gillani was nonplused by it) was a stark display of the power
relationships at work in the new government. The good news
is that Zardari and Gillani have received our message,
evaluated their equities, and concluded it is decidedly not
in Pakistan's interest to release these terrorists. Despite
Zardari's assurances, we will have to wait and see how this
decision affects the proposed South Waziristan peace
agreement. In a concurrent, separate meeting with CG
Peshawar, Wali Khan said the agreement was not his idea but
had been briefed to the political parties by Chief of Army
Staff General Kayani (septel). This confirms what Musharraf
told us--that his government, not the new Gillani government,
had proposed the agreement (Ref A). It appears that Zardari
is trying to make the most of a difficult fait accompli by
pinning his hopes on Wali Khan's ability to enforce the new