The China-Pakistan Axis: Asia's New Geopolitics

by Andrew Small

  The history of the Karakoram Highway’s construction is itself a demonstration that in China-Pakistan relations, strategic intent can—eventually—trump an array of physical, cultural, economic and security obstacles. The story is littered with disasters, almost as many man-made as natural. As Muhammad Mumtaz Khalid, the principal historian of the road, remarks: “Thoughtless urgency would become a peculiar feature of this mega-project, and perhaps for all future ones. Any presidential order, or for that matter any higher command dictates, would rarely be questioned by the Corps’ top brass regardless of the serious technical, financial and administrative problems, time constraints or frictions of terrain and weather.”98 Arbitrary deadlines and very poor preparation from the Pakistani side, especially for the extreme altitude, dogged the early phases of a venture that was launched with extraordinarily minimal surveying or planning. The raising and dispatch of Pakistan’s Khunjerab force in 1966, which was supposed to begin the process of building the road down from the border, is described by one military officer as “the worst [operation] ever done by anyone”.99 Many of the first contingent needed to be rescued. In two years, the poorly prepared force had achieved only a 13km pilot cut, prompting an offer from the Chinese to take over the task. China had completed its portion of the road before the Pakistanis had even started theirs.100 The assumption of greater and greater Chinese responsibility for realizing the ambitious project became so pronounced that the Pakistani government, during the worst of its financial difficulties, even considered handing over the whole task to the Chinese and disbanding the newly established Frontier Works Organisation, the paramilitary body that had been leading the task on the Pakistani side.101 The road did enjoy its first “opening ceremony” in February 1971, but it was closed again almost immediately by floods and landslides, and while a desperate attempt to clear a route for the first Chinese trade delegation in July was successful,102 the 1971 war and its aftermath stalled most of the subsequent construction efforts.103 It would prove to be many years before the road was upgraded to a level that could be meaningfully considered functional. Even the second opening ceremony, which took place in June 1978 at Thakot bridge with Zia ul Haq and China’s Vice-Premier Geng Biao in attendance, was a false start.104 There was still over a year of additional work required, and the last Chinese workers only left Pakistan on 19 November 1979, “after a hot cup of tea at the chilly Khunjerab pass”, thirteen years after Ayub Khan had first given the project the green light.105

  Like many other joint Sino-Pakistani projects, the KKH would have been killed off quickly if its economic value had been the only thing it had going for it: the highway was conceived as a political and territorial project, not as the most logical trade route between the two sides. Its direct military utility is questionable, given that it would be easy to interdict in the event of war, and no logistical planner could expect to count on a reliably landslide-free supply route. But it “altered the balance of geographical politics on the subcontinent”, expanding the reach of the Pakistani government into previously inaccessible frontier regions, and consolidating Sino-Pakistani control over territory that India claims as its own.106 As the roadbuilding initiative was launched, Ayub Khan “was pleased to remark that in order of priority the first urgency was strategic and one of the immediate significance”. The “economic and commercial importance of the highway” was only “the second objective” for Pakistan.107 The same was true for China. The principal construction phase for the road closely paralleled the Cultural Revolution, a period that was distinguished by very little normal economic planning. The largest centrally directed Chinese economic project at the time was the vast “Third Front” programme to develop an industrial base in the west of the country that could act as a strategic reserve in the event of war with the United States or the Soviet Union.108 The route, especially the development of the border-crossing at Khunjerab rather than the more obvious Mintaka Pass, was carefully devised to keep it further from the Soviet border.109 China’s sense of encirclement, vulnerability and isolation was acute, and Pakistan in the mid-1960s was one of the few countries that mitigated it. The Sino-Pakistani air agreement of 1963, China’s first with a non-Communist country, breached the Western ban on commercial air services to China, and ensured that it was no longer “air-locked”.110 The Karakoram Highway itself provided a “‘welcome out’ sign at their backdoor”.111

  Military and political considerations underpin many of the other principal joint economic projects too. China’s investments in Pakistan’s civil nuclear power sector, addressed in more detail in the second chapter and in the epilogue, do have commercial utility—they give China’s nuclear industry the opportunity to showcase power plants outside its home market. But they have also been inextricably bound up with the long-standing programme of Sino-Pakistani nuclear weapons cooperation and, in more recent years, the response by Islamabad and Beijing to the US-India nuclear deal. It is even more obvious in the defence sector, the one area of commercial relations that can genuinely be said to be booming. Exports to Pakistan, which comprise 55% of Chinese arms sales, propelled China to become the world’s fifth largest arms exporter in 2012.112 The major defence-industrial relationships between China and Pakistan are the successors of the procurement agreements of the 1960s and 1970s, when China swung in to assist Pakistan during and after its wars with India. Companies such as the China Precision Machinery Import-Export Corporation, the Chinese missile exporter, and the principal Chinese defence-production companies, Poly Technologies and Norinco, have longstanding relationships with Pakistan dating back to their days as arms of the Chinese state. When Norinco and Heavy Industries Taxila (HIT) announced in 2012 their plans to jointly sell the tanks and other security vehicles they produce together to new markets, it was the culmination of decades of cooperation.113 Norinco is the successor of China’s fifth ministry of machine building, which oversaw tank, artillery and small arms production.114 HIT is the huge military-industrial complex in the Punjab that was originally established with Beijing’s assistance to maintain and rebuild the Pakistani army’s fleet of Chinese T59 tanks after the 1965 war.115 There is now a lengthening list of such joint ventures, including the JF-17 fighter aircraft, developed for Pakistan’s air force by China’s Chengdu Aircraft Industrial Corporation and Pakistan Aeronautical Complex;116 and the F-22P frigates117 and the PNS Azmat fast attack vehicles, built by Karachi Shipyard and Engineering Works, the China Shipbuilding and Trading Company and other Chinese firms.118 The value of defence-industrial ties for Pakistan goes well beyond their economic or military value. Not only do they grease the wheels of the China-Pakistan relationship, they ensure buy-in from some of China’s highest-ranking party and military families, who have controlled companies like Poly Industries since their inception.119

  While nuclear plants and armaments production are in secure locations, other Chinese companies operating in Pakistan are less fortunate. Telecoms, power, and mining have promised some of the most significant new infusions of Chinese manpower and resources, but have faced some of the most acute security risks. Huawei, the world’s largest telecoms equipment company, has become Pakistan’s dominant telecoms infrastructure operator, and ZTE, Huawei’s state-owned counterpart, spent several years as its largest telecoms vendor. China Mobile, the mammoth Chinese mobile telecoms company, made Pakistan the destination for its first overseas acquisition, purchasing Paktel, the fifth largest Pakistani mobile operator, for $284 million in January 2007.120 “If we cannot succeed in Pakistan, we’d better not go anywhere else,” the company’s Chairman Wang Jianzhou declared after the acquisition.121 The hydropower sector in Pakistan features a roll-call of Chinese mega-firms working on a range of current or prospective projects: Sinohydro,122 China Three Gorges Corporation,123 and Gezhouba Group.124 And the mining sector has seen Chinese companies such as China Metallurgical Group Corporation125 and China Kingho Group drawn in by the opportunities to tap natural resources in Balochistan and Sindh.126 Some of the compa
nies and projects have struggled—China Mobile did poorly with its revenue and customer base, its new brand “Zong” ending up in last place among the operators in Pakistan;127 the hydro projects have hit an assortment of financing hurdles.128 But for a list of companies that reads like a “Who’s Who” of the major Chinese investors in the developing world, the challenges of unfamiliar markets, corruption, and politicized deal-making are par for the course. Since 2004, though, they had to navigate security threats of a novel sort.

  The violence that convulsed Gwadar port was at one level predictable. When it came to security, Balochistan was understood to be a special case—an on-off insurgency had been running there virtually throughout Pakistan’s history, and accusations of external involvement ran back for decades.129 Soviet help to Baloch agitation was raised by the Chinese as a subject of concern as long ago as the 1970s, and the involvement of the Americans, the British, and (especially) the Indians in backing the Baloch nationalists has been a source of finger-pointing for many years.130 In that sense, China knew what it was signing up for when it agreed to develop a port in the restive province. In the rest of the country, however, it believed that—as Pakistan’s close friend—it was safe from the sort of political targeting that Gwadar attracted. Events in South Waziristan would therefore come as something of a shock.

  The Gomal Zam dam project, about 13km west of Tank, the winter headquarters of the FATA agency, had a long prehistory: a feasibility report on the dam’s construction was first commissioned by the British Royal Corps of Engineers in 1898.131 An abortive effort to build the dam was finally made in 1963 but it was not until August 2001, when a Chinese consortium was brought in to lead the construction, that it looked as if it would finally be realized.132 The South Waziristan region had a fearsome reputation but the project provided demonstrable local economic benefits, including irrigation and electricity, and it was hoped that the dam-building could proceed in peace. But by the time construction was underway, the tribal agency had become the principal location for foreign fighters fleeing Afghanistan. As a result, there was growing US pressure on the Pakistani government to launch military action against the Al Qaeda-linked militants who had set themselves up there.133 In January 2004, the army launched its first operation in South Waziristan. In October that year, two Chinese engineers working for Sino Hydro went missing. The two men, Wang Teng and Wang Ende, had been heading to work at the dam early in the morning when they were seized, their abandoned vehicle being found nearby.134 The initial hope for the Pakistanis and the Chinese was that the kidnappers were simply bandits seeking ransom, which was not uncommon in the area and could have been dealt with quickly and quietly. There were also rumours that some of the kidnappers were foreigners—specifically Uzbeks, which would have linked them to Uighur terrorist groups.135 But the identity of the real protagonists was far more troubling: Pakistanis with a political agenda.

  The operation had been ordered by a one-legged militant commander who had once been held at Guantánamo Bay, Abdullah Mehsud, who was a member of the region’s largest tribe. In an interview with a Pakistani journalist, he argued his case: “We have no enmity with the Chinese people, and I am sad that we had to kidnap the Chinese engineers,” he said. “But desperate people do desperate things and the only way we thought we could compel the Pakistan government to stop its military operations in South Waziristan was to kidnap engineers belonging to Pakistan’s best friend, China.”136 The national and local reaction was swift. General Musharraf publicly stated that he would personally shoot Abdullah Mehsud dead if he had the chance.137 Abdullah Mehsud was summoned before local jirgas led by Mehsud elders in an attempt to persuade him to release the hostages.138 The government sent four of his cousins—including his brother-in-law—to engage in negotiations. The Pakistani government had been so concerned about the engineers’ safety that it was even willing to consider his immediate demand to give the kidnappers and their hostages safe passage to nearby Spinkai Raghzai, in territory under the control of Mehsud and his men. Initially it seemed as if there might be an amicable resolution. Abdullah Mehsud allowed messages in Chinese to be passed to the Chinese embassy and to Sino Hydro. But ultimately the army decided to move. Pakistani commandos dressed as members of local tribes launched an attack on the mud hut in Chagmalai where the kidnappers and their hostages were holed up. The two kidnapped men had been wired with explosives, and Wang Teng, the younger of the two engineers, who also spoke some English, had urged the Pakistani government not to conduct a military operation given the danger it would place them in. His young wife was waiting for him at the Sino Hydro office in Dera Esmail Khan. The kidnappers were killed in the raid, but so was Wang, who was hit by bullets as he tried to duck behind one of Mehsud’s men.139

  The tragic incident derailed the dam project. The Chinese companies pulled out for three years, only resuming in 2007 when the Frontier Works Organisation had taken charge and a far more robust level of security protection was provided.140 At the time there was reason to hope that the kidnapping might be a one-off. Even Haji Mohammad Omar, who was one of the principal leaders of the Pakistani militants operating in FATA, denounced the whole operation: “Abdullah Mahsud committed a blunder. He shouldn’t have kidnapped the Chinese engineers. And after the botched kidnapping attempt, he should have agreed to the government’s offer of safe passage for the five kidnappers in return for the release of the two Chinese hostages. I am still unable to understand why he so carelessly sacrificed five young and loyal militants who organised the kidnapping and obeyed his every order,” said Omar.141 The Chinese were not, for the most part, seen as a legitimate target, and even Abdullah Mehsud had been apologetic about his political tactics. The Pakistani government’s relationship with the militants was not yet at breaking point. And from China’s perspective, Pakistan—and General Musharraf—had acted quickly and forcefully. But in fact, the kidnapping was only the start.

  The Lal Masjid siege in 2007, detailed in the prologue, knocked out all grounds for believing that the Gomal Zam kidnappings might be an aberration. The Pakistani government’s relationship with the Mehsud tribe, and others that went on to form a mainstay of the Pakistani Taliban, moved from a period of half-hearted military forays, negotiations, and peace deals into outright warfare. And the Chinese were turned into legitimate targets for groups that had previously left them alone. In the aftermath of the revenge killings of three Chinese engineers in Peshawar that followed Lal Masjid, it was clear that there had to be a dramatic shift in the level of protection provided.142 As a result, Pakistan and China put in place an extensive battery of security and emergency response mechanisms. A joint liaison committee for the safety of Chinese workers was established, consisting of officials from the National Crisis Management Cell and the Chinese embassy.143 A 24-hour hotline connected the Chinese diplomats with the interior ministry and all Pakistani provinces, alongside an early warning system for Chinese associations, company heads, and student groups. There was a scramble to register everyone. Estimates of the total number of Chinese nationals in Pakistan have run between 10,000 and 13,000, among whom a 2009 embassy estimate suggested 5,000 were labourers, 3,500 engineers and 1,000 business people.144 Thousands of additional Pakistani security personnel were deployed to protect Chinese projects. Workers in some of the most dangerous locations travelled in armed convoys or armoured personnel carriers, or even commuted to work by helicopter. In supposedly safe locations, Chinese businesspeople took additional precautions, with drivers being assigned at short notice, and information about their destinations and routes withheld until the start of the journey.145 The Chinese embassy itself responded to the heightened security risk by buying in a 20-day stockpile of food, water and diesel oil, and was reported to have started a vegetable plot “as a reserve food source”.146 Chinese officials now described security concerns in Pakistan as their “top priority”.147 Musharraf’s successor would find out that they weren’t bluffing.

  In October 2008, Asif Zardari wa
s on his first visit to China as Pakistan’s head of state. This was an issue in its own right—the Chinese had not been at all happy that he had failed to follow tradition and make China his first overseas destination.148 Claims that trips to Dubai, London and New York were not official visits didn’t cut much ice, and his subsequent attempt to over-compensate by turning up every six months was an even greater hassle for over-worked Chinese officials.149 The Chinese government was already suspicious of him. The PPP, Zardari’s party, was the creation of Zulfiqar Ali Bhutto, who had taken on a leading role in the early days of upgrading Sino-Pakistani relations, but the Chinese tended to see his daughter Benazir Bhutto, whose assassination catapulted Zardari into the presidency, as inclined in a more pro-American direction.150 None of this made for an auspicious set of circumstances for a visit in which Zardari would be asking for several billion dollars to help cover Pakistan’s balance of payments crisis.151 China, which had been lobbied by the United States not to give Pakistan the money,152 didn’t need that much persuading—Beijing also thought it would be more helpful if Pakistan were forced to go through an IMF programme, and China had no history of financing Pakistan on that sort of scale. Zardari got a frosty reception from Hu Jintao, who was reported to have reacted with incredulity to his requests for such lavish assistance.153 Overshadowing the trip, however, was the fact that another two Chinese engineers had been kidnapped.