Competition intensifies: US seeks to reshape ties as Chinese influence grows

Published: May 10, 2015
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In response to Chinese investment in Pakistan, US to provide expertise, technical assistance. PHOTO: PAKISTAN TODAY

In response to Chinese investment in Pakistan, US to provide expertise, technical assistance. PHOTO: PAKISTAN TODAY

ISLAMABAD: 

In the recent energy talks between Pakistan and the United States, a key thing that became apparent was that Washington was desirous of reshaping its relations with Islamabad in the wake of extensive Chinese influence and investment of billions of dollars to give a push to Pakistan’s economy.

At a press briefing, US Special Envoy for Energy Amos Hochstein though welcomed the massive flow of Chinese investment, a perception has emerged that Beijing’s deepening partnership with Islamabad including the takeover of the strategic Gwadar Port has disturbed the US and India. This has prompted the US to gain a geopolitical foothold in the region which China seems to be dominating.

Hochstein, however, said, “it is not a question of dollar, we are doing it in our own way to build infrastructure in Pakistan,” adding, the US would provide expertise and technical assistance. This indicates that the US has no money to inject into the investment-starved energy sector.

At the same time, Hochstein called for putting the Iran-Pakistan (IP) gas pipeline project on the back burner until sanctions against Tehran were lifted. Instead, he pointed out, Pakistan should focus more on the Turkmenistan, Afghanistan, Pakistan and India (Tapi) gas pipeline and the Central Asia-South Asia (CASA) 1000 power import project.

Washington has come in for a lot of flak here as a major share of the technical assistance allegedly goes back to its consultants and the actual money spent on specific purposes remains very low.

Apart from this, the US has spent billions of dollars on counter-terrorism efforts in Pakistan, but officials suggest that it would have been better, had Pakistan injected finances into energy projects to give a boost to the economy and provide jobs to people in order to discourage many from joining the ranks of militants. Unemployment is considered to be a major reason for the spread of terrorism and militancy.

LNG the right choice

During the talks, US authorities also laid stress on the importance of liquefied natural gas (LNG) in resolving Pakistan’s energy crisis. It again, this time indirectly, sent a message that Pakistan should stay away from the IP gas pipeline, rather it should go for LNG imports from Qatar.

US companies like ConocoPhillips have shareholdings in LNG manufacturing and sales in Qatar. In a strategic move, these companies had pumped capital into Qatar to secure gas supplies and meet the demand back home. However, after the discovery of huge shale gas reserves in the US, it is going to become an exporter of LNG in 2016.

Now that the US does not require Qatar gas, these companies would like to sell LNG to countries like Pakistan in a bid to prevent Islamabad from going for Iranian gas imports.

On the other side, the US is said to be pushing Iran to export gas to Europe via Turkey in an attempt to prevent EU states from importing Russian gas and heap pressure on Moscow due to the Ukrainian crisis. Reports suggest that Washington has also offered LNG exports to the EU at discounted rates.

China and Russia too have close relations with Iran and both are scouting for investment opportunities there.

Relations with Tehran

In the case of Pakistan and Iran, there have been some developments in recent months which would have a significant impact on their relations.

The attack mounted by Saudi Arabian forces on Yemen’s Houthi fighters has triggered a cold war between Tehran and Riyadh. Pakistan views its ties with both of them as extremely important.

A preliminary nuclear deal between Iran and global powers including the US has sparked prospects of lifting of economic sanctions. No doubt, the removal of curbs will lead to a major leap forward in relations between Iran and Pakistan as progress on different energy projects including the IP pipeline and electricity import has been stalled.

Petroleum and Natural Resources Minister Shahid Khaqan Abbasi said recently Pakistan was laying an LNG pipeline from Gwadar with no hope of receiving gas from Iran. “But now we are hopeful that we will be able to build the pipeline with Iran.”

Things will be clear in June when Iran and the world powers are to sign a final nuclear deal.

Abbasi dismissed the perception that the cold war between Iran and Saudi Arabia would hamper progress on the IP pipeline project.

This is the right time for Pakistan to cash in on the investment offers from different countries when the US has little to invest. China is investing in the energy sector and Russia has also come up with investment offers.

THE WRITER IS A STAFF CORRESPONDENT

Published in The Express Tribune, May 11th,  2015.

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Reader Comments (22)

  • Zahid
    May 11, 2015 - 3:34AM

    Now.USA thinking to invest why not before Chaina investment, chaina playing a vital rolls in Pakistan, we welcome to chaina Recommend

  • woody
    May 11, 2015 - 6:41AM

    Another made in Pakistan article based on the myth that USA views China as enemy and is somehow jealous of China’s investment in Pakistan … pure rubbish.
    .
    USA has publicly supported China’s investment in Pakistan. USA doesn’t care who manages Gwadar and has never viewed Gwadar as an economically viable project and certainly doesn’t view it having any international strategic/tactical value that would harm USA or any of it’s allies. Further – USA has never tried to sell LNG to Pakistan – USA govt doesn’t own LNG and only sets export limits which were maxed out before Pakistan thought about buying.Recommend

  • Pramod Joshi
    May 11, 2015 - 10:40AM

    “At a press briefing, US Special Envoy for Energy Amos Hochstein though welcomed the massive flow of Chinese investment, a perception has emerged that Beijing’s deepening partnership with Islamabad including the takeover of the strategic Gwadar Port has disturbed the US and India.” The writer can have his own perception, but from Indian perspective I can say that economic activities in Pakistan do not bother India. The rise of civil society, modernity and democracy in Pakistan is beneficial to India. The rise of religious fundamentalism in Pakistan bothers us. India too has such forces. I think such forces across border are complementary.Recommend

  • May 11, 2015 - 10:44AM

    I think in both cases Pakistan is inching towards economic slavery. Now Pakistan has to decide which one will benefit more.The investment from both countries are gong to destroy local economy that is 100% sure.Recommend

  • Aschraful Makhlooq
    May 11, 2015 - 10:56AM

    Why this has been necessary and need of the hour for US that US always wants to see Pakistan a US’ aid dependent country most especially importantly that times when China starts its investment in Pakistan in the sectors of energy and ports and why US can’t allow Pakistan to stand on its feet to get the uninterrupted economic prosperity,self-reliance and sovereignty?Recommend

  • Khurram
    May 11, 2015 - 10:58AM

    @ Woody go to bed mate, its too late.Recommend

  • Salman
    May 11, 2015 - 11:40AM

    If Pakistan Iran gas pipeline is on hold due to sanctions then someone explain to me why it’s okay for India to invest in Chabahar port? These are the double standards that US and India work on I sincerely hope our government doesn’t open borders for them and traitors Afghanistan. Recommend

  • abeer
    May 11, 2015 - 12:02PM

    DEMOCRACY
    at its best. Recommend

  • wahab
    May 11, 2015 - 12:03PM

    @woody , If I am not wrong the LNG is bought from ConocoPhillips which operates in Qatar. I would appreciate if you can please do the basic research. Recommend

  • adnan
    May 11, 2015 - 12:43PM

    its difficult to understand why the US is pressuring Pakistan to work on the TAPI project, which will never happen. A pipeline from Turkmenistan through Afghanistan to Pakistan doesn’t make sense. The pipeline from Iran is far easier. The Americans can’t force Pakistan not to buy gas from Iran and allow India to sign deals for Chabahar. Recommend

  • Milind
    May 11, 2015 - 12:48PM

    @Pramod Joshi – Spot on… Unfortunately most Pakistanis are programmed to think that we Indians are against the existence of Pakistan, least of all a progressive Pakistan…The main cause of this conflict is the disproportionate role and power the Pakistani army has. A democratic Pakistan will benefit both the countries.. As it is the Modi Govt has taken steps to demarcate the boundary with Bangladesh and put any border issues & controversies to rest.Recommend

  • pakistani
    May 11, 2015 - 12:49PM

    @Bimal William:
    @woody:
    lol at the indian who came here and feel jealous about all this.

    But from pakistan point of view, this is an opportunity of a life time to get our country together and really progress. beware of all the black sheeps from india, Afghanistan and iran.Recommend

  • Umair
    May 11, 2015 - 1:00PM

    @Pramod Joshi
    “but from Indian perspective I can say that economic activities in Pakistan do not bother India”

    May be you should convey this to your media as wellRecommend

  • Arshad
    May 11, 2015 - 2:12PM

    This is a welcome development if it is undertaken on positive lines that is as a measure to help a friend and an ally and not against some country or for furtherance of international conflict. We hope that as part of this policy America plays a role in solving Kashmir problem and also solving energy problem by extending civil nuclear technology facility to it.Recommend

  • Inner
    May 11, 2015 - 3:15PM

    @Bimal William:

    Is that the “economic slavery” the Arabs suffer from in UAE?

    Also, this is an environmentally safe investment, that would not damage or pollute our country.
    That is perhaps the most under-appreciated part of it. Recommend

  • Whiskey Khan
    May 11, 2015 - 4:18PM

    Hope this opportunity doesn’t become a victim of corruption, Please make sure that all Mr.% don’t get their hands in the jar.Recommend

  • Saleem
    May 11, 2015 - 4:33PM

    Dear Indian Trolls, do not worry as we still have Hussain Haqqanis , Hamir Mirs and Hamid Guls among us to distort any efforts that can help Pakistan. Your government should not spend so much money on hiring and keeping trolls as long as these brave sons of land are alive. They can better spend it on ‘development’ of Baluchistan.Recommend

  • Milind
    May 11, 2015 - 8:34PM

    @Umair – “May be you should convey this to your media as well”

    Unfortunately our media sucks… Just as the ordinary Pakistani has poor opinion about your media, we too have the same for ours.. So conveying the any message may not help as they’re sold outs to vested interests, wanting to keep the pot boiling.Recommend

  • JSM
    May 12, 2015 - 2:37AM

    @Salman:
    Because India is an independent country and do not need permission from USA before signing any agreement with Iran.Recommend

  • Meshuga
    May 13, 2015 - 12:10AM

    @Zahid: US’s has given $58 billion since the 1950s with nary a thanks. You are counting your chickens before they are hatched.Recommend

  • Meshuga
    May 13, 2015 - 12:17AM

    @Salman: You are probably right – double standards at work. Need I remind you, though, that double standards – or discrimination in any sense – are at work all the time. Even Pakistan and its people practice double standards. It is all about what is in one’s best self-interest.Recommend

  • Aborigine
    May 13, 2015 - 12:23AM

    @Saleem: This was such an idiotic remark, Saleem. We expected better thinking from you. :-(Recommend

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