NAWAZ STILL NEGOTIATING

C O N F I D E N T I A L SECTION 01 OF 03 ISLAMABAD 000807



SIPDIS



SIPDIS



E.O. 12958: DECL: 02/25/2018

TAGS: PREL, PGOV, PHUM, PK

SUBJECT: NAWAZ STILL NEGOTIATING



REF: ISLAMABAD 745 ISLAMABAD 584 ISLAMABAD 07 5138



Classified By: Anne W. Patterson, for reasons 1.4 (b)(d)



1. (C) Summary. Nawaz Sharif told Ambassador February 25

that on election day the process had been free and fair. He

continued to negotiate with the Pakistan People's Party (PPP)

over joining in a coalition government but had not made any

final decisions. It was likely he would run in a by-election

and may be named Speaker of the National Assembly in lieu of

taking a formal position in the government. His Pakistan

Muslim League-N (PML-N) party would form a government in the

Punjab and Nawaz's brother, Shahbaz would become Chief

Minister. Nawaz did not support inclusion of the Muttahida

Quami Movement (MQM) in a national government but would

continue to support the PPP if it decided to invite MQM into

the coalition. Efforts to woo independent candidates and

potential defectors from Musharraf's party will continue for

the next week to ten days; until independents declare their

party affiliations, it is unlikely the PPP and PML-N will

make a final decision on a coalition.



2. (C) Nawaz continued to press his personal feud with

Musharraf and questioned why the U.S. would continue to

support a politically defeated leader who "cannot deliver on

Washington's agenda to fight terrorism." Nawaz clearly wants

Washington recognition and respect that he has returned to be

a major player in Pakistani politics. He insisted he was and

remains "the best friend" of the U.S. End Summary



3. (C) Ambassador and Polcouns met February 25 with

Pakistan Muslim League-N (PML-N) leader Nawaz Sharif in

Islamabad. Also attending the meeting were former Petroleum

Minister Chaudhry Nisar Ali Khan, former Finance Minister

Ishaq Dar, and former Pakistani Ambassador to the U.S. Tariq

Fatemi.



4. (C) Nawaz admitted that on February 18, the election

process was in fact "free and fair." But he described

several attempts by the GOP to dissuade him from campaigning

because of security threats and claimed that, if his

nomination papers had been approved, the PML-N would have won

even more seats. Nevertheless, "we have broken the siege"

and won 87 seats (counting women and minorities). The PML-N

is now wooing independent candidates and hopes to further

expand their National Assembly seats by perhaps 14 more.

Khan noted that there were a growing number of defections

from Musharraf's party to the PML-N; "even PML-N spokesman

Tariq Azeem is ready to join us."



5. (C) The party has not yet decided if it will join the

Pakistan People's Party (PPP) in a coalition government, but

Nawaz confirmed that PPP Co-Chair Zardari has offered to form

an equal partnership despite PPP's greater numbers. PML-N is

opposed to cooperating with the Muttahida Quami Movement

(MQM) because it was part of Musharraf's government and is

"fascist and non-democratic." However, if Zardari agrees to

include MQM, the PML-N will continue to support the

coalition.



6. (C) Nawaz confirmed that the PML-N would form a

government in the Punjab with the support of the PPP.

Nawaz's brother Shahbaz would run in a provincial by-election

and become the Chief Minister of Punjab. Ambassador asked

about Nawaz's own plans; Khan said that the party had chosen

Nawaz as their parliamentary leader, so he would have to run

in a by-election to take his seat. But Nawaz said the PML-N

would probably not accept national positions as ministers

because that would require them to take an oath before

Musharraf.



7. (C) Ambassador noted that some analysts were predicting

that PML-N would sit back and wait for the next government to

falter over a growing list of economic challenges. Nawaz

agreed that probably would be the best strategic option, but

he had "a moral and national obligation" to pave the way for

democracy, so he would work with the PPP in the next

government. (Note: Before Nawaz arrived, Khan told the

Ambassador the PML-N believed that the next government would

not last long. He also said the PML-N would demand that

Nawaz become the Speaker of the National Assembly rather than

take a formal position in the government.)





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The U.S. is our "best friend"

--------------



8. (C) Nawaz spent most of the meeting wondering why

Washington continues to support President Musharraf. Why,

asked Nawaz, is President Bush extending support to

Musharraf, an unpopular president who "cannot deliver on

Washington's agenda to fight terrorism?" It would be better

for the winning parties to devise a joint strategy that can

succeed, and the PML-N is ready to work with the U.S. and the

UK to that end.



9. (C) Noting that Musharraf's party lost "in every nook

and cranny" of Pakistan, Nawaz said the U.S. should accept

the mandate of the Pakistani people. The PLM-N does not

accept Musharraf as a legitimate president; the former

Supreme Court ruled against his eligibility as a candidate,

and even if the POLITICAL parties try to ignore this, civil

society will continue to press the issue. It is key to

restoring Pakistan's democracy. The sooner politicians and

"our foreign friends" recognize this, the better. Nawaz said

he did not know if Secretary Rice had been misquoted, but he

read that she had said Musharraf "is and will remain

President." We are ready to work together, said Nawaz, but

that spirit must be reciprocated. "Washington is our best

friend, but you should respect us."



10. (C) Ambassador agreed that the PPP and the PML-N had won

a big victory; we respected the will of the Pakistani people

and want to work with whomever they choose to be Prime

Minister. We had been surprised, as had many others, by the

margin of the PPP and PML-N victory; Nawaz asked was the

U.S. "pleasantly surprised?" The Ambassador responded "we

were surprised." Regardless of local press allegations that

the U.S. was manipulating the process, she said, we remain

neutral and stand ready to work with whatever coalition

government is formed. But the Secretary was being

accurate--Musharraf is the President of Pakistan, and we see

no indications that this will change. We will work with him

in this positon. The USG has enormous interests here in

terms of anti-terrorism, military, trade and economic

development. When Senator Biden met with Nawaz, he mentioned

the possibility of additional USG assistance for Pakistan,

and we hope to work with the new government if that aid is

forthcoming.



11. (C) Khan reiterated what he outlined in previous

meetings (Ref C): PML-N, he said, has "bent over backwards"

to support the USG including during the war against the

Soviet invasion of Afghanistan, during the first Gulf War,

after the Kargil war with India, and when Nawaz agreed to

extradite Aimal Kansi, who killed two CIA employees in 1993.

"We are not the religious right." "Why would the U.S. cling

to supporting Musharraf when he no longer could influence

events in the U.S. favor?"



12. (C) Ambassador said the U.S. was concerned about

Pakistan's stability because we have so many shared interests

here. Nawaz said he understood personal friendships, but it

was the friendship between the peoples of Pakistan and the

U.S. that was of greatest importance. It was best to support

democracy and the primacy of the parliament.



Relations with the Army

--------------



13. (C) On RELATIONS with the Army, Nawaz noted that COAS

General Kayani had briefly been his military advisor. Kayani

was a good man, and Nawaz felt the new government and Kayani

would have a good working relationship. Musharraf continued

to live in the COAS residence of Camp House, and this,

suggested Nawaz, cannot be helping Musharraf's relationship

with Kayani. Until the 17th amendment (giving the President

primacy over the Prime Minister) can be turned back, Nawaz

said, Musharraf would still have considerable powers. "But

Musharraf will be handicapped by the huge PPP/PML-N majority

in the parliament; he will be fighting Kayani on one hand and

the parliament on the other."



Restoring the Judiciary

--------------



14. (C) Pressing their theme, Dar said the U.S. image was



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being hurt by the perception that we continued to support an

unpopular President and opposed restoration of the deposed

judiciary. The PML-N believed that it did not require a

two-thirds majority to restore the judiciary; it merely

required that that Musharraf's Provisional Constitutional

Order expire or be voted down by a simple majority in the

Assembly. Ambassador said the USG continues to support an

independent judiciary; it was our understanding that there

was considerable debate in the legal community over how to

deal with the judiciary issue. Nawaz said that a commission

outside of parliament was being established. It would

include Dar, Zardari, PPP Senator Rabbanni and attorney

(previously working for Nawaz) Fakhruddin Ebrahim who would

examine the way forward.



Other PML-N Voices

--------------



15. (C) PML-N General Secretary Ahsan Iqbal told Polcouns

February 22 that the party would support the PPP in the next

government but was unlikely to accept ministerial

appointments. He confirmed rumors that PML-N would not

become ministers at the national level in exchange for the

PPP not becoming ministers in the PML-N dominated Punjab

Provincial Assembly.



16. (C) Iqbal also said that the newly elected PML-N

members of the Assembly would annotate their constitutional

oaths in some way to make it clear they did not recognize

Musharraf's amendments to the constitution. They would

question the legality of Musharraf's election and demand it

be ratified by the newly elected assemblies. Iqbal also

stated the PML-N belief that Musharraf's Provisional

Constitutional Order (PCO) of November 2007 would have to be

ratified by the Assembly. Both former President Zia in 1985

and Musharraf in 2003 sought parliamentary approval of their

constitutional amendments; Musharraf was legally obliged to

again seek ratification. If the Assembly does not ratify it,

Iqbal claimed, the PCO will expire and this will put the

former judiciary back on the bench.



17. (C) Comment: Clearly, Nawaz continues to hold a

personal grudge against Musharraf and very much wants

Washington recognition and respect that he has returned as a

major POLITICAL player in Pakistan. The horse-trading over a

possible coalition with the PPP continues while the PML-N and

PPP separately woo a growng number of possible defectors from

Musharraf's party. The Election Commission is expected to

issue a final tally of results by the end of the week; when

it does, independent candidates will have three days to

declare their party affiliations. Until this step is

completed, we expect coalition negotiations to continue.

PATTERSON