AFGHAN TRADE ENVOY IN RUSSIA OFFERS VIEWS ON CORRUPTION,

UNCLAS SECTION 01 OF 02 KABUL 000796

DEPARTMENT FOR SRAP, SCA/FO, SCA/A, EUR/RPM
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TAGS: PGOV PREL ETRD AF RU

SUBJECT: AFGHAN TRADE ENVOY IN RUSSIA OFFERS VIEWS ON CORRUPTION,
POLITICS IN AFGHANISTAN

REFTEL: Kabul 701

Summary
--------------


1. (U) Kamal Nabizada, a prominent Afghan businessman from
Mazar-e-Sharif, Afghan trade attach in Moscow, and self-described
confidant of President Karzai and Russian Prime Minister Putin,
shared with State PRT officer his thoughts on corruption in the fuel
import business, the upcoming Afghan presidential election, Iranian
support for the opposition United Front (UF),and Russia's views
towards NATO in Afghanistan. Nabizada is pessimistic about efforts
to fight corruption while acknowledging that merchants themselves
perpetuate the corruption cycle. He said unequivocally that he will
support Karzai's reelection bid, and so too will powerful Balkh
Governor Mohammad Atta. Iran is financially supporting the UF, but
Russia has not given a response to the UF's request for assistance.
Nabizada says Russia sees Karzai as the "least bad option" in the
upcoming presidential elections and wants to see him remain in
office through that period but will not lend financial support to
Karzai's reelection bid. He also claimed that he was influential in
getting Russia to allow NATO to transport non-materiel supplies over
Russian territory to Afghanistan.

"Corruption harder to fight than the Taliban"
--------------


2. (U) Nabizada, who imports fuel from Russia and Uzbekistan to
Afghanistan, described the rampant corruption at the Heyratan border
in northern Afghanistan as a problem "harder to fight than the
Taliban." He said that merchants have to pay two fees to the
government when importing fuel: service charges to the Ministry of
Commerce (MoC) for storing the fuel in government-owned fuel tanks,
and customs tariffs to the Ministry of Finance (MoF) based on the
amount of fuel imported. Nabizada said he is vexed by the MoC's
corrupt practice of skimming off a few tons of fuel from every
shipment he brings in. For example, if Nabizada charges 50 metric
tons (MTs) of fuel in tanker railcars in Uzbekistan, Afghan MoC
officials in Heyratan measuring the volume of fuel in those tankers
will claim that the tankers only contain 48 MTs. This also results
in fewer customs revenues collected by the MoF, as the customs
tariff is calculated based not on the 50 MTs, but on the 48 MTs.
Fuel importers pass their losses on to fuel station owners,
resulting in higher prices at the pumps. (NOTE: As per reftel, the
Ministers of Commerce and Finance have recently reached an agreement
that will allow MoF customs officials access to the state-run fuel
import depot at Heyratan - previously the domain of the MoC. It is
too early to tell how the implementation of this agreement is
proceeding.)


3. (U) Additionally, unscrupulous Afghan traders who import
low-grade fuel routinely bribe Afghan MoC officials to mix that
low-grade fuel with high-grade fuel in the same storage tanks.
Those merchants can then sell their better quality fuel (after
mixing) at a higher price on the market. Nabizada said this
practice hurts importers like him who import high-grade fuel. Asked
whether he thought the removal of Engineer Rozi, the corrupt MoC
official who ran his own racket as director general of the state-run
fuel import depot at the Heyratan border, would improve the
situation, Nabizada remains doubtful that will bring change. Even
if Rozi's replacement were an honest man, merchants would soon make
him corrupt by offering him sums of cash too large to refuse if he
would allow them to continue importing low-grade fuel. In
Nabizada's view, the only way to stop this practice is to arrest and
prosecute a few of those traders and the MoC collaborators taking
the bribes.

Friend of Karzai...
--------------


4. (SBU) Nabizada volunteered that he and Balkh Governor Atta are
backing President Karzai's reelection bid. Nabizada, who says he is
a close friend of Atta, remarked that the governor's Nowruz speech,
in which he praised the central government's achievements, was
intended to signal Atta's support for Karzai's reelection. In a nod
to corruption within Karzai's government, Nabizada added that Karzai
has "had his fill" but that a "hungry" new president's
administration would want to have their turn feeding at the public
trough.


5. (SBU) Nabizada offered a nuanced view of the widely reported
remarks by Karzai a few months back when the president said he would
turn to Russia for military hardware sales if the West would not
provide them. Nabizada said this remark jolted him so much that he
called Karzai the following morning and asked him what he was

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thinking. Karzai reportedly admitted to Nabizada that he got off
track in a moment of impassioned speech, prompting Nabizada to ask
Karzai to promise that he would use notes and stick to them in
future speeches.

...and Friend of Russia
--------------

6. (SBU) Nabizada claims that Russian Prime Minister Putin once told
him that he values Nabizada's impressions of events in Afghanistan
more than he does those of Russia's ambassador in Kabul. Nabizada
said that last year, when friction arose between Russia and the West
over Russia's conflict with Georgia, he argued strongly to the
Russian foreign minister that it was in Russia's strategic interest
to allow NATO to transport non-materiel supplies across Russian
territory to Afghanistan.


7. (SBU) Russia is not enamored of Karzai but considers him the
"least bad option" for president, and supports his remaining in
office through the August elections. Asked to comment on
allegations by other political parties that Russia is supporting the
opposition United Front (UF),Nabizada denied this is the case, but
acknowledged that the UF has sought financial support from Russia,
which has neither approved nor rejected that request.

Iranian Influence in Afghanistan's Politics, Media
-------------- --------------

8. (SBU) Iran, claims Nabizada, is providing financial assistance to
the UF through the Iranian Revolutionary Guard Corps (IRGC),with a
certain Mr. Suleimani as the Iranian conduit for that assistance.
Iran, through its agent, Mr. Karimyan, is also bankrolling the
operations of Noor TV and Tamadun TV in Kabul. Nabizada added that
he will financially support the presidential bid of former Iranian
president and current candidate Khatami in the run-up to Iran's June
presidential election.

Comment
--------------

9. (SBU) Nabizada holds sway over several of Afghanistan's movers
and shakers, and by his own account, over several of Russia's too,
including Putin, whom he claims to meet regularly when in Moscow.
He seems resigned that corruption at the border will not diminish,
and as long as his fuel import business remains profitable, we
should not count on him to lead the charge for reform. His claim
that Governor Atta shares his support for Karzai's reelection is
being born out subtly in Atta's public remarks. Despite his overt
closeness to Russia, Nabizada says he is a friend of the U.S. and
offered to deliver any message to either Putin or Karzai that the
U.S. wants him to deliver if it would help relations between the
U.S., Afghanistan, and Russia.


10. (U) Bio notes: A dual Afghan and Russian national, Kamal
Nabizada (or Nabi, as his friends call him) is a multi-millionaire
who, in addition to his fuel import business, owns several other
businesses, among them a construction company, biscuit factory, and
a radio and television station (Arzu TV) in Mazar-e-sharif.
Nabizada spends most of his time in Russia; he holds an Afghan
diplomatic passport in his capacity as a volunteer trade attach at
the Afghan embassy in Moscow. His ties to Russia date back to the
days when he served as Russia's conduit for funneling military
assistance to former Northern Alliance leader Ahmad Shah Massoud.
He is close to the Jamiat Party, especially to Jamiat's Governor
Atta and Ahmad Zia Massoud. His wife and children are U.S. citizens
and reside in Rockville, Maryland. Nabizada is a Shia Tajik
(Qezelbash tribe).

WOOD