SCENESETTER FOR CENTCOM COMMANDER ADMIRAL FALLON

S E C R E T SECTION 01 OF 04 ISLAMABAD 000293

SIPDIS

SIPDIS

E.O. 12958: DECL: 01/17/2018
TAGS: PREL PGOV PTER MARR PK
SUBJECT: SCENESETTER FOR CENTCOM COMMANDER ADMIRAL FALLON

REF: ISLAMABAD 172 ISLAMABAD 105

Classified By: CDA Peter Bodde, for reasons 1.4 (b)(d)


1. (C) Summary. Benazir Bhutto's assassination and its
potential to oust Musharraf's party in delayed parliamentary
elections, electricity and flour shortages, a disturbing
increase in suicide bombings throughout the country, and
emboldened attacks by militants in the tribal areas are
combining to create a new level of political and security
uncertainty in Pakistan.


2. (C) As expected, COAS General Kayani is slowly but
deliberately moving the Army away from now civilian President
Musharraf. Kayani is trying to balance a growing list of
demands on the Army, from preventing election and sectarian
violence to battles fought with increasingly determined
militant forces. An economic cash crunch has heightened the
GOP's desire for Coalition Support Fund (CSF) payments and is
fueling its desire to use FMF for more elements of the F-16
program. Kayani likely will raise CSF, congressional
restrictions on military aid, and GOP frustration over media
stories suggesting unilateral U.S. action in the tribal areas
and distrust about Pakistan's ability to safeguard its
nuclear weapons. We are making progress on the Security
Development Plan (SDP) for the Frontier Corps (FC) and on the
tripartite Border Coordination Centers (BCC). Ambassador
Patterson looks forward to briefing you on her recent
meetings in Washington. End Summary.


Political Uncertainty
--------------


3. (C) You last visited on November 2, the day before
President Musharraf declared a state of emergency (SOE) and
suspended the constitution. By the end of 2007, all but a
handful of the 6,000 civil society and opposition party
members arrested during the 42-day SOE had been freed, and
access to all but two television channels had been restored.
The newly reconstituted Supreme Court blessed Musharraf's
re-election; he then retired as Chief of Army Staff (COAS)
and took the presidential oath of office as a civilian. But
the SOE further alienated the very secular liberals whose
support Musharraf needs to fight extremism, and he may face
impeachment charges in the next parliament.


4. (C) Due to violence following Benazir Bhutto's
assassination, parliamentary elections were postponed from
January 8 to February 18. Before her death, Musharraf's
Pakistan Muslim League (PML) party was confidently expecting
an electoral victory. Now, most analysts predict a surge in
sympathy votes for Bhutto's Pakistan People's Party (PPP)
that could push the PPP into first place. Adding to PML's
troubles, voters blame the government for electricity
shortages and rising food prices. Benazir's husband, Asif
Zardari, is now running the PPP. He reluctantly agreed to
the election delay and thankfully has avoided stirring
additional Sindhi-Punjabi tensions. We believe Zardari is a
pragmatist who will deal with the PML after the election, and
the PML has already reached out to mend fences with the PPP.
However, there is rampant speculation about which combination
of parties will align to form the next government.


5. (C) If the PPP wins a majority, the PML can, at best,
hope for a secondary role in the next government. Current
street expectations are that the PPP will indeed win,
although our analysis shows a very close contest in the
critical Punjab. If the PML wins, however, many Pakistanis
will presume electoral fraud and launch street protests,
especially in the PPP stronghold of Sindh. Quick formation
of a coalition government could alleviate the situation, but
a growing PPP leadership struggle may prolong negotiations.
It may take weeks or even months after the election before a
new Prime Minister is chosen and Pakistan again has a
functional government that can focus on tackling extremism.


6. (C) Inability to rein in election year spending (up
nearly 90%) or decrease energy and food subsidies have
created a cash crunch, and the government has resorted to
record borrowing to finance its growing budget deficit.
However, most analysts still expect annual 5 percent growth.
The GOP blames the U.S. for some of its economic woes. To

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retain funding levels in the face of Congressional criticism,
we are converting our annual $200 million Economic Support
Fund cash transfer into project aid. The cash crunch has
heightened GOP concerns about delayed cash reimbursements
from Coalition Support Funds (CSF) and fueled interest in
using FMF for more elements of the F-16 program.

Security Concerns/Army Challenges
--------------


7. (S) The January bombings in Lahore, Karachi and Peshawar
have further raised security concerns, especially for
political candidates. Suicide bombings were practically
unheard of in Pakistan two years ago; in 2007, over 600
people died in attacks attributed to Baitullah Mehsud alone.
Militants have become increasingly emboldened, attacking
police, Army and intelligence targets, with the latest rocket
attack January 17 on the Pakistan Aeronautical Complex at
Kamra. The Army has been called out to provide additional
security during the Islamic month of Muharram, and will be
deployed in Sindh and other sensitive polling areas during
the elections.


8. (C) Neither the Army nor the security services would
relish the prospect of adding post-election riot control in
Sindh to their currently full plate. Military operations in
Swat have been reasonably successful. The Army has regained
territory, killing and expelling many militants, but hundreds
avoided decisive engagement and remain in the general
vicinity. The Army will likely have to maintain a
significant presence in Swat well into the spring to prevent
a resurgence of militant activity. In the Federally
Administered Tribal Area (FATA),the Army is attempting to
prevent Sunni-Shia' violence, exacerbated this year by
militant involvement, in Kurram Agency. A tenuous cease fire
has temporarily eased months of sectarian violence that has
claimed more than 300 lives since April, but we expect
sectarian clashes to increase during the month of Muharram.


9. (C) In the Waziristans, the government is encouraging
the Nazir tribe to engage the rival Mehsud clan and its Uzbek
supporters to counter the growing influence of Baitullah
Mehsud. Since the mid-December pronouncement that militants
in Pakistani were uniting under Baitullah Mehsud to form the
Tehrik Taliban-e-Pakistan, the GOP has increasingly blamed
Meshud for virtually every militant and terror attack
(including Bhutto's assassination) in Pakistan. Meshud has
become a priority target, although it is unclear if the Army
will execute near-term operations to kill or capture him.
Reportedly, Meshud has unified the militants to train and
move arms/men throughout the FATA and into Afghanistan, but
we believe, that it is too early to judge the actual level of
control and influence Meshud has over other militant leaders.



10. (S) The Director Military Operations (DGMO) informed
ODRP that in the previous two weeks, the Sararogha fort had
suffered eight casualties from both direct and indirect fires
from multiple militant attacks. Then on 16 January
approximately 200-300 militants loyal to Baitullah Meshud
massed against the post. At the time of the attack, bad
weather precluded the ability to employ Cobra attack
helicopters. Visibility was so poor that artillery fires
went unobserved and ceased once situational awareness was
lost. Lacking the necessary combat multipliers to repel the
attack, the post was overrun. Of the 40 to 45 troops
defending the fort only 8 had made it back to their higher
headquarters as of 17 January. Presumably all others had been
captured or killed, and militants controlled Sararogha. COAS
General Kayani and DGMO MG Pasha moved immediately to 9th
Division HQs in Wana to personally review plans to retake the
post. A major offensive is currently underway to regain
control of the area. Initial reporting appears positive and
the Army claims to have killed approximately 100 militants.
South Waziristan operations will undoubtedly surface during
your visit with Kayani.

Kayani Meeting
--------------


11. (S) As expected, Kayani is taking slow but deliberate
steps to distance the Army from now civilian President
Musharraf. Mushrraf has not yet moved out of Camp House, the

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traditional COAS residence in Rawalpindi. Kayani announced
that generals would need his permission to meet the
President, issued public statements distancing the Army from
civilian politics and is rumored to be considering a decision
to remove active duty Army officers from civilian GOP jobs.
Kayani also has declared 2008 as the "Year of the Soldier" in
an attempt to improve morale. Privately, he has discouraged
ISI interference in elections.


12. (C) Kayani likely will raise with you Pakistan's
growing frustration over media reports of unilateral U.S.
action in FATA and concerns that Pakistan's nuclear weapons
are about to fall into extremist hands. Both the Foreign
Secretary and CJCS General Majid convoked the Ambassador in

SIPDIS
January to protest U.S. reports questioning the security of
the GOP's nuclear weapons (Ref A). At the Embassy's urging,
the Director of Special Programs January 16 briefed the
diplomatic corps on the organizational structure and
personnel controls that safeguard nuclear weapons. Kayani
may also ask your views on the impact of recent congressional
conditions tying FMF assistance to counter-terrorism.


13. (C) Ref B outlines post's proposals to refocus the
U.S.-Pakistan security relationship. We recommend you raise
with Kayani:

--CSF: Emphasize that to protect continued payments, we need
full transparency and GOP agreement to target monies for
specific needs, e.g., helicopter maintenance. Pakistan has
exaggerated their claims and has not used funds received for
the intended purpose. As a result, combat readiness of key
systems has deteriorated. The last claim paid by the U.S.
was for February 2007. Washington just approved $282 million
of $362 from the March-June tranche of CSF with payment
expected by mid February. Post approved payment for medical
support, rations, accommodations, supply and transportation
costs. ODRP has Pakistan's July - November claims totaling
$506 million. Validation is on hold until a way forward to
ensure accountability and transparency is determined.

-- FMF: Stress the importance of using FMF for programs that
support counter-terrorism/counter insurgency. Address the
concerns in Congress that U.S. military assistance has not
achieved the effects desired in defeating
extremist/terrorists threats.

-- SDP: Emphasize that the U.S. remains committed to our
Security Development Plan for the enhancement of the Frontier
Corps. Construction of nine buildings will begin at the end
of January in Warsak for the Frontier Corps Training Center
(FCTC). Recently, ARCENT & JCTTAP (from the UK) said that
they plan to start the Train the Trainer program on 22 June
2008 (early May was original date) and the first full Wing
Course is now scheduled to begin on 6 Oct 2008 (August was
original date).

-- BCC: Note that the Torkham Border Coordination Center is
almost completed and should be operational 15 March with a
ribbon cutting ceremony scheduled for 29 March 2008.
Construction on the Lawara Border Coordination Center is
scheduled to begin within the next 30 days.

-- FC Equipment: Brief on progress: Currently 124 vehicles
of various types have been ordered for the FC; several now
are being processed through customs in Karachi. Additionally
the following equipment for FY07 funds have also been
ordered: 540 combat lifesaver kits, 28 FLIRS, and 1,050
sets of individual protective equipment (helmets and
Ballistic Vests). Pending is congressional support for an
FY-08 SDP budget to fund equipping 12 new FC Wings,
integrating the BCCs, establishing four FC sector HQs,
establishing the FCTC in Balochistan in conjunction with our
UK allies, enhancing the SSG's Special Operations Task Force
(SOTF),and helping to raise two new Commando Battalions and
one Brigade HQ for the SSG.









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BODDE