NEAR EAST AND SOUTH ASIA REVIEW

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP05S02029R000300960001-8
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 55
• Document Creation Date: December 22, 2016
• Document Release Date: July 9, 2012
• Sequence Number: 1
• Publication Date: September 25, 1987
• Content Type: REPORT

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Directorate of Secret
Intelligence
Near East and
South Asia Review
25 September 1987
ecre
NESA NESAR 87-022
25 Septelby 487
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Near East and
South Asia Review
25 September 1987
Articles PLO: Leadership Rivalry in Fatah
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Page
Relations between PLO Chairman Arafat and his two principal
deputies have deteriorated since the Palestine National Council
meeting in Algiers last April. The principal issue is the longstanding
demand that Arafat accept collective leadership within the PLO and
its dominant Fatah component and adhere to Palestine National
Council decisions.
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Baghdad Aid Payments: Shortfalls Hurt Recipients' 5
Economies
Annual Baghdad Pact payments to Syria, Jordan, and the PLO
continue to fall short of the $3.5 billion that was committed by
Saudi Arabia, Kuwait, UAE, Qatar, Iraq, Algeria, and Libya when
they signed the pact in 1978. The shortfalls are straining the
recipients' fragile economies and damaging their efforts to finance
imports and investment projects.
Iraq: Changing Attitude Toward Israel
Iraq has modified its views toward the Arab-Israeli conflict because
of a need to cultivate the United States and to align itself with
Egypt and Jordan and because of a decline in anti-Israeli
revolutionary fervor. Nonetheless, Iraq still regards Israel as a
military threat allied with Iran and has not dissociated itself from
anti-Israeli terrorist groups.
India-Iran: Relations Strained Over Tehran's Meddling
Over the past few months inflammatory statements by Iran directed
at inciting Indian Muslims have worsened relations with India,
which were already strained by a series of differences since the
Iranian revolution in 1979. New Delhi fears Iranian meddling will
heighten tension between the country's divided Muslim and Hindu
communities.
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NESA NESAR 87-022
25 September 1987
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India's Drought: Gandhi's Next Hurdle
Prime Minister Rajiv Gandhi's political fortunes in the coming
months will depend heavily on his success in managing drought
relief. Gandhi will avoid asking for international assistance, but he
probably would welcome commercial trade offers of edible oils on
concessional terms and would accept discreet offers of aid.
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India-Fiji: Postcoup Developments
Prime Minister Gandhi's efforts to elicit international condemnation
of the military takeover in Fiji last spring are another attempt to
assert India's global leadership role. New Delhi's future support for
Indians in Fiji probably will be limited to public diplomacy, as Fiji is
well outside India's military sphere of influence.
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Sri Lanka: Reconstruction and Rehabilitation
Concerns about Sri Lanka's deteriorating economy were a factor
prompting the government to seek Indian assistance for a settlement
to the island's four-year ethnic conflict. Returning Sri Lanka to the
road of high growth will require a major inflow of foreign aid and
investment.
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Afghanistan: A Demographic Profile
Because more than one-fourth of its population has fled to Pakistan
and Iran since the Soviet invasion in 1979, Afghanistan is one of
only a handful of countries with a smaller population now than in
1980. Should the refugees return, the population could double in 20
years and severely strain the country's land, water, and other
resources.
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Changing Patterns in Aden's Leadership
A younger, less ideologically committed generation of leaders will
gradually emerge in South Yemen as technical-administrative
expertise and personal relationships take precedence over
revolutionary background or ideological posture.
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Egypt: Expanding RPV Capabilities
Cairo is seeking to expand and improve the capabilities of its
remotely piloted vehicle fleet as part of its military modernization
effort. The perception that other countries are exploiting RPVs to
achieve combat successes or to enhance their technical capabilities is
driving Cairo's interest.
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Western Sahara: Is the Berm Crumbling?
A series of successful attacks by Polisario Front guerrillas this year
has challenged Morocco's ability to defend the berm it has
constructed in Western Sahara. Although Morocco must adjust its
strategy as a result of these attacks, it will almost certainly continue
to prevent the Polisario from seizing and holding territory behind
the berm.
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Mauritania: Taya's Increasing Vulnerability
Growing economic problems and popular discontent over official
corruption are bringing President Taya to the most critical juncture
of his nearly three years in power. He still appears to have the
support of the Army and security forces, but, unless he can
demonstrate stronger leadership, the military could engineer a coup
against him.
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Some articles in the Near East and South Asia Review are
preliminary views of a subject or speculative, but the contents
normally will be coordinated as appropriate with other offices
within CIA. Occasionally an article will represent the view of a
single analyst; an item like this will be designated as a
noncoordinated view.
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Near East and
South Asia Review
Articles
PLO: Leadership Rivalry
in Fatah
Relations between PLO Chairman Arafat and his two
principal deputies?Salah Khalaf (Abu Iyad) and
Khalil al-Wazir (Abu Jihad)?have deteriorated since
the Palestine National Council meeting in Algiers last
April. The principal issue in dispute is the
longstanding demand of Arafat's deputies that he
accept collective leadership within the PLO and its
dominant Fatah component and adhere to Palestine
National Council decisions. The current strife among
the PLO leaders was brought to a head at recent
meetings of the Fatah Central Committee and
Revolutionary Council when Arafat sought to tighten
his control by adding additional supporters to key
policymaking bodies. In addition, Arafat and his
deputies have disagreed about the conduct of relations
with Egypt, as the PLO Chairman has maintained a
dialogue with President Mubarak despite the
Palestine National Council decision calling for no
contacts with Egypt unless it renounces the 1978
Camp David accord.
The longstanding friendship between Arafat and his
senior aides and their desire to maintain Fatah unity
have so far proven stronger than their policy
differences. We believe each recognizes that he needs
the other to keep the Palestinian movement alive.
Arafat's critics, moreover, acknowledge that the PLO
Chairman has become the symbol of Palestinian
nationalism and that he is largely responsible for the
broad popular support the PLO commands among
Palestinians and for the organization's recognition
and support from Arab states. Arafat, in our view,
wants to avoid a serious split in Fatah that would risk
driving key hardline figures led by Khalaf into the
Syrian camp.
Background
The current tension is characteristic of the often
acrimonious relationship that has prevailed for years
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between Arafat and his Fatah lieutenants. Khalaf and
Wazir have never seriously challenged Arafat's
leadership but have sought to limit his freedom to act
independently and to determine PLO tactics and
policies.
Khalaf, who heads the PLO's United Security
Organization, is Arafat's most prominent critic within
Fatah. He has been identified consistently with the
radical left of the organization. Palestinian contacts of
US Embassy officials say he opposes negotiations with
Israel, rejects PLO-Jordanian cooperation, and
advocates a return to international terrorism.
Nonetheless, he has generally accepted Arafat's
efforts to gain a negotiated settlement of the
Palestinian problem.
Wazir has been Arafat's closest adviser for the past
decade. He is charged with organizational and
Occupied Territories affairs within Fatah, and in that
capacity he has been responsible for intelligence and
military activities in the West Bank and Gaza Strip.
Wazir has generally supported Arafat's diplomatic
efforts and worked with Jordanian officials in these
efforts before King Hussein's decision to suspend
political coordination with the PLO in February 1986.
Faruq Qaddumi and Khalid al-Hasan, two other
founding members of Fatah, have sharply criticized
Arafat over the years. Qaddumi advocates a harder
line than Arafat in resolving the Palestinian problem.
He has publicly warned that any peace plan not
recognizing the right of Palestinians to self-
determination and to an independent state or not
allowing the PLO to openly participate in negotiations
will fail. Hasan has long served as a senior counselor
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NESA NESAR 87-022
25 September 1987
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to Arafat and, in our view, is one of the strongest
proponents of a diplomatic approach to the
Palestinian issue. Nonetheless, disputes with Arafat in
the past led to his departure from the Executive
Committee in 1973. He later mended his fences with
the Fatah leader but could not overcome Arafat's
opposition to his return to the PLO Executive in 1981,
according to an expert on the Palestinians.
Relations among the Fatah leaders were particularly
tense in the latter half of 1986. Arafat was vulnerable
to criticism from his rivals because his attempt to
coordinate peace strategy with Jordan had collapsed
earlier in the year. The PLO chief continued to stress
his interest in working with moderate Arab states to
find a diplomatic solution to the Palestinian problem
but came under pressure from Khalaf and other
Fatah hardliners to seek a reconciliation with Syria
and to reunite Fatah with Syrian-backed Palestinian
groups.
At several Palestinian gatherings in late 1986?
including meetings in which representatives of the
Syrian-backed factions participated?Khalaf
reaffirmed his hardline position. According to US
Embassy reporting, Khalaf rejected UN Resolution
242, criticized Egypt because of its acceptance of the
Camp David accord, and warned Arafat against
forsaking armed struggle on behalf of the Palestinian
cause. His joint appearances with Syrian-aligned
Palestinian leaders underscored his commitment co
Palestinian unity?a major theme in his public
remarks.
In early 1987 a more conciliatory atmosphere
prevailed between Arafat and his critics as
preparations began to convene the Palestine National
Council and to discuss reunification with the
Damascus-based groups and reconciliation with Syria.
KhalaI in particular probably was willing to tone
down his attacks against Arafat so as not to risk
turning him against PLO reunification and
reconciliation with Damascus.
Acrimony Returns
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In June, Arafat accused Khalaf and the Hasan
brothers of issuing unauthorized policy statements on
behalf of the PLO. Khalid al-Hasan publicly accused
Arafat of harming relations with Morocco by caving
in to Algerian demands that he allow a representative
of the Polisario to speak at the National Council
meeting.
Later that same month, Khalaf publicly criticized
Egyptian President Mubarak for closing down the
PLO office in Cairo and for his continued support of
the Camp David accord. According to Arab press
reports, Arafat subsequently ordered WAFA, the
PLO news agency, to publish a statement saying that
Khalaf was speaking only for himself and not on
behalf of the PLO. The director of WAFA, however,
did not publish the statement.
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The dispute within Fatah came to a head in meetings
of the Fatah Revolutionary Council and Central
Committee in July in Tunis where Arafat sought to
tighten his control.
Outlook
The recent tension among Fatah leaders appears to
have dissipated since the group's meetings in July, but
the underlying causes remain and the internal
struggle will most likely resume soon. Arafat's
unwillingness to curb his freewheeling leadership style
and his willingness to use political as well as military
and terrorist means to solve the Palestinian problem
inevitably provoke opposition from his colleagues. The
PLO Chairman also has tended to play his deputies
against each other, and he maintains tight control
over most PLO finances to keep any one from
developing an independent power base.
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For now, Arafat and his rivals have worked out a
modus vivendi that allows them to work together
despite their differences. We believe each recognizes
that he needs the other to keep the Palestinian
movement alive?a recognition honed by years of
bitter and unrelenting political and military struggle.
Moreover, Arafat's critics recognize that he has
become the symbol of Palestinian nationalism and
that he is largely responsible for the broad support the
PLO commands among Palestinians and most Arab
states. Thus, Khalaf and Wazir and the others will try
to keep their disputes with Arafat within bounds. We
believe Arafat, for his part, wants to avoid splitting
Fatah?his indispensable power base?for fear of
driving key figures like Khalaf and Qaddumi into the
Syrian camp. He thus will be careful not to make
commitments to join in a Middle East peace rocess
that would risk splintering his movement.
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Baghdad Aid Payments: Shortfalls
Hurt Recipients' Economies
Annual Baghdad Pact payments to Syria, Jordan, and
the PLO 'continue to fall short of the $3.5 billion that
was committed by Saudi Arabia, Kuwait, UAE,
Qatar, Iraq, Algeria, and Libya when they signed the
pact in 1978. Recipients received only $1.2 billion in
1986, with 83 percent of this coming from Saudi
Arabia. The shortfalls are straining the recipients'
already fragile economies and damaging their efforts
to finance imports and investment projects and repay
foreign debt. When the Baghdad Pact expires next
year, these countries will probably continue to receive
aid from Arab donors, but at even lower levels. To
make up for the expected reductions in aid, recipients
probably will turn to Western countries as well as
increase their reliance on high-cost commercial
lending.
Intent Versus Performance
The Baghdad Pact subventions, agreed to at an Arab
League summit meeting in Baghdad in November
1978 after the signing of the Camp David accord by
Egypt and Israel, were designed to strengthen?
economically and militarily?the confrontation states
still at war with Israel and to discourage other Arab
states from joining Egypt. The annual payments of
$3.5 billion, payable in three equal installments, were
to continue for 10 years. Although the Baghdad
agreement appears to extend through 1988, some
Jordanian officials fear that the November 1987
payment could be the last, according to the US
Embassy in Amman.
Only during the early years of the agreement?before
the Iran-Iraq war and when oil prices were still
strong----did donor countries come close to fulfilling
their commitments. After 1980?when recipients
received 85 percent of total obligations?the amount
of aid has steadily fallen. Iraq discontinued payments
to Syria, Jordan, and the PLO after 1981 because of
domestic economic hardships caused by the war with
'The term PLO?except where indicated?refers both to the
Palestine Liberation Organization and to the Jordan-PLO Joint
Fund for the Occupied Territories.
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Annual Baghdad Pact Commitments Million US $
Donor
Donor's
Annual
Commit-
ment
Recipient
Jordan
Syria
PLO a
Saudi
Arabia
1,000
357.14
528.60
114.26
Kuwait
550
196.43
290.70
62.87
United
Arab
Emirates
400
142.86
211.40
45.74
Qatar
230
82.14
121.60
26.26
Iraq
520
185.71
274.90
59.39
Algeria
250
89.29
132.10
28.61
Libya
550
196.43
290.70
62.87
Total
3,500
1,250.00
1,850.00
400.00
Includes commitments to the PLO and the PLO/Jordan Joint
Fund. Officially, the PLO is to receive $250 million annually and
the Joint Fund $150 million.
Iran.' From 1981 to 1986 disbursements fell by over
55 percent. Jordan, for instance, experienced a 62-
percent decrease in Baghdad aid. No donor other than
Saudi Arabia has made payments this year. The
Saudis have paid two installments. The remaining
1987 payment is expected in November.
The recession in the Persian Gulf has contributed to
aid cutbacks. Arab donors?faced with reduced oil
revenues?chose to slash aid disbursements rather
than impose unpopular domestic spending cuts. In
addition, we believe the smaller Gulf states?
particularly the UAE and Kuwait?relied on
continued Saudi aid to soften the impact of their
reductions.
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BAGHDAD PACT PAYMENTS TO SYRIA, JORDAN & THE PLO III
1980 Total = $2964.3 Million
Saudi Arabia
Algeria
* Includes additional contribution to cover Libya's
nonpayment in 1979
1986 Total = $1209 Million
Saudi Arabia
UAE
rKuwaKuwait
it
Political differences between the donors and recipients
also hindered Baghdad aid payments:
? Libya reneged on its payments from the start,
primarily because Qadhafi was displeased with the
weak indictment of Egyptian President Sadat at the
Baghdad meeting. Qadhafi also was cool to the idea
of contributing to such a fund because of its lack of
direct political benefit to Libya.
? Qatar ceased all Baghdad payments following the
Gulf Cooperation Council summit meeting in
Manama in November 1982, probably to punish
Syria for its ties to Iran. Qatar continued making
partial payments to Jordan and the PLO, but these
payments ended in 1985.
? Kuwait's National Asssembly deleted the Baghdad
Pact subsidies from its 1985-86 budget because of
concern that the money was being used by Syria to
fund assassination operations against dissident
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Palestinians and even citizens from donor countries,
according to the US Embassy in Kuwait. The
Assembly simultaneously increased its foreign aid
budget?enabling Kuwait to maintain, at its own
discretion, aid levels equivalent to its Baghdad aid
commitments.' Kuwait's 1986 contributions,
however, fell by 16 percent from 1985 levels. No
payments have been made in 1987.
Coping With the Shortfall
Jordan, Syria, and the PLO rely on Baghdad Pact
payments as a prime source of revenue and foreign
exchange. Without other revenue, the recipients must
reallocate?or reduce?expenditures, principal and
interest payments, and import financing to avoid large
budget and current account deficits.
For the purposes of this study, 1986 bilateral aid payments to
Syria, Jordan, and the PLO from Kuwait are treated as the
equivalent of Baghdad aid payments.
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BAGHDAD AID: COMMITMENTS & PAYMENTS BY RECIPIENT
Millions of US $
PLO JORDAN
----- Committed
Actual Payment
SYRIA
2000
MMO
2000
1000
1000
ism
1000
1000
......
loco
.......
000
MM
BOO
......................... e
0
0
1979 1000 11MM 1002 1013 19114 1MM 1000
+Transom+ lan mo 1004 1015 1MM
1979 1M0 1991 19112 111113 111114 1995 Ills
Jordan. The Jordanian Government's deficits, created
in part by declining Arab aid, have increased from 13
percent of GDP in 1980 to 19 percent in 1986. After
two years of expansionary government spending, the
1987 budget allows for only modest growth. To
finance the deficit?and avoid substantial cuts in
imports?Amman has:
? Drawn down foreign exchange reserves. Reserves
fell to $199 million by June 1987?compared to
about $1.1 billion in 1980.
? Increased domestic revenue collection from 23
percent of GDP in 1980 to 32 percent of GDP in
1986, according to the US Embassy in Amman.
? Almost doubled the level of foreign debt since 1982
to $3.2 billion in 1986, testing Jordan's ability to
service its foreign debt. In 1986 the debt service
ratio was 27 percent?up from about 15 percent in
1983.
? Increased reliance on commercial lending. Jordan's
share of outstanding total debt owed to commercial
lenders rose from 17 percent in 1982 to 34 percent
in 1986?often at higher interest rates. Jordan
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recently signed a seven-year $150 million
syndicated loan agreement to finance the deficit in
government funds for development projects.
Syria. The most serious consequence of reduced
Baghdad aid payments to Syria is the depletion of
foreign exchange reserves. We estimate that average
hard currency holdings are below $50 million?equal
to about one week of civilian imports. Because of the
shortage of foreign exchange, third parties outside the
Syrian banking system finance most private-sector
imports. It, however, is becoming increasingly
difficult to finance imports of primary metals and
basic commodities. Some factories have closed
because of the lack of needed inputs.
The shortage of hard currency prevents the
government from making debt payments?except for
token amounts?and makes Damascus increasingly
reliant on grant aid as lenders grow reluctant to
provide more loans. Past budget deficits were covered
by Arab aid. Current deficits are financed through
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PALESTINE NATIONAL FUND:
ESTIMATED SOURCES OF INCOME, 1980 ? 1986a
1980/81 Total=$304 Million
5 . 9%
a Based
1985/86 Total=$160 Million
on fiscal years, i July ? 30 June
OP. Elagteked CommItmenb
011> Other Arab Donations
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increased domestic and external borrowing at higher
rates. We believe that net bank financing of the 1986
budget was $900 million, at the tourist exchange rate.
The extent of Syria's debt burden is hidden by the
wide range of barter deals and credit arrangements
with Iran, USSR, and Eastern Europe. Syria's debt to
non-Communist countries stood at about $4 billion in
1985 with debt service equivalent to 19 percent of
goods and services exports. Syria is having trouble
paying its World Bank loans, causing the World Bank
to stop disbursing loans in mid-1986 and to place
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Syria on nonaccrual status in February 1987.
arrearages will
reach $90 million by the end of 1987 if no money is
paid.
PLO. Since Israel's invasion of Lebanon in June 1982,
the Palestine National Fund?the financial arm of
the PLO?has reported sizable budget deficits.?
Baghdad aid payments from 1982 to 1986 fell by 47
percent?to $132 million. In addition to the recession,
aid to the PLO fell due to internecine fighting within
the PLO, which rankled traditional supporters and
caused some donors?including Kuwait?to withhold
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payments, according to the US Embassy in Kuwait.
Aid fell at a time when military and administrative
expenses were rising due to the dispersal of PLO
fighters from Lebanon to other Arab states. The PLO
has been forced to reduce its financial reserves and to
reduce funding for some projects. We believe that
PLO financial reserves ranged from $150 million to
$200 million in early 1986?about one-half to two-
thirds the level we estimate the PLO held before
1982.
Outlook
The participating donors probably will not renew the
Baghdad Pact commitments in 1988 because of their
own financial constraints. Saudi Arabia and Kuwait
are the only countries likely to continue giving
significant amounts of direct aid to Syria, Jordan, and
the PLO. They probably will continue subsidies to
preserve their pan-Arab credentials and to buy
protection?especially from Syria.
Arab aid donors also will use economic assistance to
try to persuade recipients to take more moderate
positions on issues of concern to the contributors.
Saudi Arabia, for instance, is likely to continue to
provide aid to Syria in an attempt to draw Syria into a
broader Arab consensus, to put distance between it
and Iran, and to limit the spread of Soviet influence in
the region, according to the US Embassy in Riyadh.
Concern is growing in Jordan, Syria, and the PLO as
the expiration date of the Baghdad Pact draws near.
Faced with the prospect of reduced aid, we believe the
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recipients will seek more Western aid to maintain
budget revenues and provide foreign exchange. The
Soviet Union?despite increased economic overtures
in the region, including settlement of Egypt's
approximately $2.5 billion military debt in March
1987?probably will not increase aid and/or loans to
Syria, Jordan, or the PLO to replace the current
Baghdad payments. Syrian-Soviet relations, in
particular, are strained because of Syria's inability to
service its massive debt:
? As Jordan's foreign exchange reserves fall, Amman
will continue to increase foreign borrowing to avoid
substantial cuts in imports. Jordan probably will
resort to international capital markets to fund
modernization programs, increasing its
international liquidity and external indebtedness
over the medium term.
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? Syria cannot afford an aid cutoff and may consider 25X1
adjusting its foreign policies?including attending
an Arab League summit meeting?to obtain Arab
and Western economic assistance after the pact
expires in 1988.
? The PLO's financial situation will remain poor, but
reserves are probably sufficient?in the near term?
to cover important needs as annual income flows
prove inadequate. In addition, many PLO leaders?
including Arafat?probably have enough money in 25X1
private personal accounts to draw upon if needed.
Over the longer term, however, the PLO may be
swayed to modify its tactics?especially on
terrorism?to attract aid from moderate Arab
countries and other nontraditional supporters?
possibly even the Soviet Union.
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Iraq: Changin Attitude
Toward Israel
Iraq has modified its views toward the Arab-Israeli
conflict because of a need to cultivate the United
States and to align itself with Egypt and Jordan and
because of a decline in anti-Israeli revolutionary
fervor. Nonetheless, Iraq still regards Israel as a
military threat allied with Iran, and Baghdad has not
dissociated itself entirely from anti-Israeli terrorist
groups. When the Iran-Iraq war ends, Iraq probably
will maintain its less strident outlook, but it will still
defend the Palestinian cause forcefully because of
continuing antagonism toward Israel.
Signs of Change
In recent years Iraq has modified its views of the role
of negotiations in resolving the Arab-Israeli conflict.
In 1982, President Saddam Husayn told a US
Congressman that Iraq no longer supported a military
solution to the conflict and instead favored a
negotiated settlement. Baghdad supported Jordanian
King Hussein's attempts to establish a common
position with PLO Chairman Yasir Arafat in 1985 as
a first step toward negotiations with Israel. During
the King's initiative, Iraq's Foreign Minister Tariq
Aziz told US Embassy officials that Baghdad
supported whatever position was acceptable to the
majority of Palestinians and favored the expulsion of
the PLO's most extreme elements. In 1986, Iraq
limited its criticism of Moroccan King Hassan's
meeting with Israeli Prime Minister Peres to
statements by the Ba'th Party. The government itself
ignored the visit. Iraq, like Egypt and Jordan,
currently favors an international conference to resolve
the conflict.
Iraq's Ambassador to Washington has conveyed
Iraq's new views to a wide audience in the United
States since relations were reestablished in 1984.
Ambassador Nazir
Hamdoon in November 1986 met with two Israeli
generals and an Israeli academic at a small dinner
party held by a Harvard University professor and
outlined Baghdad's support for a negotiated solution,
11
Hamdoon also
made a major effort to explain Iraq's new views to
Israel's supporters in the United States during his
tour of duty. We believe that Hamdoon's recent
promotion in the Foreign Ministry to deputy minister
for the industrialized countries indicates that
Baghdad fully supported his efforts.
Iraq has shown other signs of greater flexibility
toward Israel:
? The First Secretary of the Iraqi Embassy attended a
conference on water sharing in the Middle East in
Washington along with Israeli Embassy officials in
1986.
? The Iraqi Deputy Foreign Minister agreed to the
presence of Israeli journalists at a press conference
in Washington in 1984.
Motivations
We believe that Iraq's new attitude is motivated
primarily by a need to marshal US support against
Iran. Most of Iraq's statements concerning a more
flexible policy have been made in the United States or
to US officials abroad. Baghdad's expulsions of the
Abu Nidal Organization in 1983 and of Colonel
Hawari, a PLO official involved in anti-US activity,
in June 1987 reflect Baghdad's effort to induce
greater US cooperation in ending the Iran-Iraq war.
Since the resumption of formal ties to the United
States in 1984, Baghdad also has shown greater
hospitality toward US academics visiting Iraq.
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25 September 1987
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Secret
Baghdad's Policies Toward Israel Before the
Iran-Iraq War
Of the Arab states not bordering Israel, Iraq has
played the most important military role in past Arab-
Israeli wars. During the 1948 conflict, Iraq sent
between 1,000 and 2,000 troops and a small number
of aircraft to join the other Arab armies arrayed
against Israel. Iraq's forces came within 10
kilometers of the Mediterranean in an attempt to cut
Israel in half. In 1967, Baghdad reinforced its
infantry brigade stationed in Jordan with two more
infantry brigades and an armor brigade, but it did not
intervene in the fighting. In December 1968, Iraqi
artillery based in Jordan bombarded Israel before
being destroyed by an Israeli air attack. During the
1973 war the Iraqi Army sent two armored divisions,
comprising 12,000 troops, to fight in the Golan
Heights. Israeli aircraft and sappers destroyed one
division before it reached the main battle front.
Israeli tanks destroyed the other division in several
days of intense combat
Before the Iran-Iraq war, Iraq's diplomatic stance
toward Israel was among the most militant in the
Arab world. Baghdad voted against UN Security
Council Resolution 242 in 1967, which asserted the
right of all Middle Eastern states to live in peace in
return for an Israeli evacuation of the occupied
territories. Following the signing of the Camp David
accord by Egypt and Israel in 1978, Iraq organized a
conference in Baghdad of Arab heads of state that
denounced the agreement, suspended Egypt from the
Arab League, and pledged financial aid to Syria,
Jordan, and the PLO.
The modification of Iraq's position reflects as well an
effort to align itself more closely with Egypt and
Jordan, two of its main supporters in the Arab world.
Egypt has sold large amounts of arms and
ammunition to Iraq since early in the war. Jordan has
provided a key overland supply route to Iraq from the
Gulf of Aqaba. Because of this crucial assistance,
Baghdad has wanted to support both countries' efforts
to negotiate a favorable settlement with Israel.
Secret
Iraq's greater flexibility also results, albeit to a lesser
degree, from a long-term evolution in its political
outlook that is not based solely on tactical
considerations. According to several Western
diplomats and academics, the current Iraqi leaders
have matured since taking power in 1968 and have
come to accept Israel as a permanent fixture in the
Middle East. These Western observers believe that
younger, middle-level Iraqi officials who were not
involved in the 1968 coup are less steeped in militant
anti-Israeli Ba'thist beliefs than older Iraqi leaders.
Continuing Antagonism
Despite its less hostile views, Iraq still considers Israel
to be a threat. Baghdad officials deeply resent the
Israeli attack against the Iraqi nuclear reactor in
1981 and have taken the lead since then in trying to
punish and embarrass the Israelis in the International
Atomic Energy Agency. Iraq decided not to build an
oil pipeline through Jordan in 1984, in part because it
would have been vulnerable to Israeli airstrikes.
Baghdad has concerns about additional Israeli
attacks, particularly after Baghdad began using
chemical weapons in 1983, according to US officials.
Iraq also resents Israel's cooperation with Iran. Iraqi
Foreign Ministry officials have told the US Embassy
in recent months that Israel is still selling arms to
Iran. Moreover, Iraqi officials probably are aware
that most Israelis still believe Iraq to be a greater
threat than Iran and that Israeli-Iranian ties probably
will improve after Khomeini's death. We believe that
Israeli arms sales to Iran reinforce Iraq's view that
Israel is a political and cultural interloper in the
Middle East and allies itself only with non-Arab
countries.
We believe Iraq has not dissociated itself entirely
from terrorist groups operating against Israel, despite
its expulsion of the Abu Nidal Organization in 1983.
Since the Israeli bombing of the PLO headquarters in
Tunis in October 1985, Baghdad has become a major
center of PLO political and operational activity.
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Secret
Although Baghdad probably uses these grouns
primarily to attack Syria,
Outlook
We believe that Iraq will continue to adhere to its less
strident position on the Arab-Israeli conflict. Even if
hostilities with Iran decline or end, Iraq will still
consider its primary threat to be Iran and is likely to
continue to seek diplomatic, economic, and military
support from the United States, Egypt, and Jordan.
Moreover, we believe that Iraq will be highly
reluctant to participate in a future Syrian-Israeli war
Reverse Blank
13
because of the need to defend the Iranian front,
widespread war weariness as a result of the long war
with Iran, and poor relations with Damascus.
Iraq will continue to defend the Palestinian cause
forcefully in Arab forums. Its resentment over Israel's
bombing of the Iraqi nuclear reactor and its view of
Israel as a cultural outsider in alliance with Iran will
limit future development of Baghdad's policies toward
the Israelis.
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ortArt
India-Iran: Relations Strained
Over Tehran's Meddling
Over the past few months inflammatory statements
by Iran directed at inciting Indian Muslims have
worsened relations with India, which were already
strained by a series of differences since the Iranian
revolution in 1979. Tehran has criticized New Delhi's
alleged mistreatment of India's 90 million Muslims
and encouraged Indian Muslims to protest the deaths
of Iranian pilgrims in the Mecca riots. New Delhi
fears Iranian meddling will spark more Muslim
militancy in India and result in heightened tension
between the historically divided Muslim and Hindu
communities, which have suffered some of the worst
communal rioting in recent years. Government
officials monitor Iranian activities in India, but they
are unlikely to intervene so long as such activities do
not threaten India's internal stability or foreign
facilities in India. We believe New Delhi would
cooperate quietly with the United States to curb
Iranian terrorism in India directed against US
personnel. India, however, would maintain a low
profile to avoid retaliatory attacks by Tehran and to
protect trade ties.
State of Relations
India and Iran maintained close diplomatic relations
during the 1970s, but since the Iranian revolution in
1979 ties have deteriorated. Diplomatic exchanges
between New Delhi and Tehran are now often openly
fractious. New Delhi worries about Iranian meddling
in India's Muslim community, is concerned about
growing Iranian ties to Pakistan, and differs with
Tehran on an Afghan solution.
Statements released after recent visits between
government officials suggest the rift between the two
is widening. A joint economic commission meets
annually but has recently served mostly to highlight
trade differences. Diplomatic differences have also
resulted in Tehran's apparent decision to delay
indefinitely recognition of India's ambassador-
designate to Iran. Indian military sales to Iran are
minimal, and fewer than a dozen Iranians receive
training at Indian military schools.
15
New Delhi's Concerns
New Delhi suspects Indian Muslims are highly
susceptible to Iranian meddling. India has a centuries-
long history of Hindu-Muslim violence, and India's
Muslims have in the past shown some receptivity to
Iran's revolutionary ideology. Although Shia Muslims
make up less than 10 percent of India's approximately
90 million Muslims, Muslim militancy is rising in
India, along with incidents of Hindu-Muslim rioting.
Iranians in India have found some Shia sympathizers
among the Muslim community. Pro- and anti-
Khomeini Indians and Iranians sometimes
demonstrate in India, and Indian police arrested 85
pro-Khomeini Iranians in 1982 for murdering an anti-
Khomeini student. Some pro-Iranian Shia students
from other Islamic countries, such as Bahrain, also
are active in India
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Bilateral Trade Problems
India and Iran forged strong economic ties during the
Shah's reign. During the mid-1970s Tehran ranked
first among India's Middle Eastern aid donors,
supplying $400 million in assistance. India also
imported 30 percent of its oil from Iran during the
same period. India has a large trading population in
Iran, where between 300 and 400 Indian merchant
families have lived for generations.
India sought to strengthen bilateral ties after the
Iranian revolution. New Delhi circumvented Western
trade embargoes with a view to boosting ties and
securing Iran as a major source of oil. During the
early 1980s India's imports of Iranian goods doubled.
Indian exports to Iran languished, however, and the
growing trade deficit prompted New Delhi to insist
that future trade be contingent on increased Iranian
imports of Indian goods.
Despite annual meetings to identify new areas for
expanded trade and economic cooperation, there is
little likelihood of a major breakthrough. Bilateral
exchanges consist mostly of crude oil from Iran for
light industrial products, chemicals, and foodstuffs
from India. Lower oil prices and escalating war costs
have prompted Iran to clamp down on nonessential
imports, including many of the goods that India can
supply.
Trade continues at a reduced level, but relations are
marred by bickering and allegations that the other
country has not adhered to negotiated trade
agreements. After the Indo-Iranian joint economic
commission held its fourth annual meeting in New
Delhi last February, an Iranian official stated that
the "trend of cooperation" in 1986 had not continued
in the 1987 meetings. He charged the Indians with
refusing to purchase more Iranian oil. In August
1987 a senior Indian Foreign Ministry official said
economic relations had deteriorated since 1980
because India would only buy more Iranian oil if
Tehran bought more Indian goods.
Secret
Iran's Covert Activities in India
Tehran has repeatedly issued public statements about
Indian Muslims that New Delhi regards as
inflammatory. New Delhi strongly protested
comments by the Iranian Ambassador when he called
on Indian Muslims returning from Mecca to
demonstrate against the deaths of Iranian pilgrims at
this year's Haj, according to the US Embassy in New
Delhi. Iranians demonstrated outside the Indian
Embassy in Tehran after the Indian protests,
according to press reports. Iran also criticized India's
handling of Hindu-Muslim riots in Meerut last spring
when over 130 Indians died. Iranian Majlis Speaker
Rafsanjani charged Gandhi with "suppressing" Islam
in India following an Indian court decision last year to
award to Hindus a shrine claimed by Muslims.
Iran has worked to organize Indian Muslims through
several official facilities in India, including the
Iranian Embassy and Iranian cultural centers in New
Delhi and Bombay.
both the Embassy and the cultural centers
distribute propaganda charging the United States
with responsibility for global repression of Muslims.
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Vt
We believe Tehran was involved last year in
organizing the Adam Sena, India's largest Muslim
militant group.
Prospects and Implications for the United States
New Delhi will cooperate in squelching Iranian-
backed moves against US targets in India.
Nevertheless, India's concerns about Iranian
retaliation probably will preclude New Delhi from
openly suggesting Iranian involvement in
international terrorism. New Delhi has not moved to
halt operations of Iranian-backed groups that have
offices and recruit in India but do not target facilities
within India.
Iran may look increasingly to India as a location to
stage terrorist attacks against US targets if tightened
17
security reduces opportunities in Western Europe.
Iran probably would view India as more attractive
than Pakistan because Tehran's relations with New
Delhi already are strained.
Iranian support for radical Indian Muslims will
heighten Hindu-Muslim tensions and increase
Muslim militancy in India. Indian Shias and Sunnis
sects probably will respond to growing tensions
between Shia- and Sunni-led states with violent
confrontations in India. New Delhi already is trying
to curb such violence by restricting demonstration
permits for religious groups.
New Delhi nonetheless will try to keep relations with
Tehran on an even keel:
? It wants to maintain an influential role in the
Nonaligned Movement, of which both Iran and Iraq
are members.
? It would like to match Pakistan's influence with
Middle Eastern countries.
? It wants to maintain access to Iranian oil and
markets for Indian exports.
? It is concerned about not offending Indian Muslims.
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ecret
Indian Regions of Drought
KABUL*
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Effect of Drought
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Orissa
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Boundary raorasont.on ;ft
nol nocassanly authootanve
18
711135 03002241 6-87
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Secret
India's Drought: Gandhi's
Next Hurdle
Prime Minister Rajiv Gandhi's political fortunes in
the coming months will depend heavily on his success
in managing drought relief. Gandhi has taken charge
of the national relief drive to help revive his political
fortunes following a year of setbacks, including
election defeats, corruption charges, and the
departure from government of many personal friends.
By mid-September he had reallocated $600 million in
the budget for drought relief, toured drought-afflicted
areas, and undertaken public works projects to
distribute food and wages to affected families.
India: GNP Growth. 1980-88a
India faces severe water shortages following the third
year of below normal rainfall. New Delhi has
sufficient domestic grain stocks and foreign exchange
reserves to avoid a famine, but Gandhi's political
opponents are poised to fan popular discontent with
his administration wherever rising food prices and
distribution problems cause suffering. Gandhi will
avoid the domestic political embarrassment of asking
for international assistance, but he probably would
welcome commercial trade offers of edible oils on
concessional terms and accept discreet offers of
assistance.
The Economic Impact of the Drought
India depends on the summer monsoon?seasonal
winds that bring rains to the subcontinent from June
through September?for three-quarters of its annual
rainfall. Following two years of inadequate rainfall,
India's summer monsoon did not materialize this
year, creating a severe shortage of water throughout
most of the country. According to Indian Government
statistics, over two-thirds of the country is
experiencing rainfall at least 20 percent below
normal. The hardest hit regions are mainly in the
north, including the agriculturally and politically vital
states of Punjab, Haryana, and Uttar Pradesh.
Madhya Pradesh, Kerala, southern Karnataka, Tamil
Nadu and Orissa have also been seriously affected.
19
8
82
8
84
85
80
87
88(
l'c'n 'ell(
a Data for fiscal period ending 31 March of the stated scar.
Negative growth due in large part to drought conditions.
Estimated.
?4,58 487
The dry spell will have a widespread impact on
economic growth. Preliminary data suggest that the
economy will continue to grow this fiscal year, but at
a much slower pace. Significant reductions in output
in the agricultural sector, which accounts for 34
percent of GDP and employs 70 percent of the labor
force, will be the leading factor in declining growth.
India's summer crops, which provide 60 percent of the
nation's food grain production, have been severely
damaged. The groundnut crop?an important source
of cooking oil central to the Indian diet?is expected
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Secret
India: Agricultural Production,
1980-88 "
1711
15.5
125
III I 1 Wen( I
I It) 5
' 1),tt.t Ii ,L.t1 petiod enchno 31 Mardi of Ihu tttd ?cdr.
314056 987
to meet only 30 to 35 percent of its production targets.
The shortfall will aggravate edible oil shortages
already present in the country. Although the prospects
for coarse grains and pulses?soybeans, peanuts, and
sorghum?have improved slightly with the onset of
some late rains, production probably will meet only 60
percent of its target. Scarce fodder and water for
livestock are expected to result in about a 50-percent
drop in dairy production and extensive loss of
livestock.
Industrial output also will suffer as power and water
are redirected from manufacturing to agricultural
uses. Hydroelectric power provides 15 percent of
India's commercial energy. The energy shortages will
probably become more acute as water held in
reservoirs for power generation is released for
irrigation purposes. The energy shortfall is expected
to increase from 10 percent to about 13 percent as a
result of the drought.
Secret
State requests for disaster relief and additional
welfare measures will increase the government budget
deficit and force a scaling back of development plans.
US Embassy reporting indicates that relief assistance
will probably require at least $1.5 billion in
government funds. Press reports in mid-September
indicate New Delhi has reallocated $600 million
earmarked for defense, railroads, and
telecommunications to pay for immediate drought
relief. The states of Gujarat and Madhya Pradesh had
asked for $500 million in central government
assistance as of early August.
The Political Challenge for Gandhi
Periods of drought are often costly for Indian
politicians, and this year's drought probably will be
difficult for Gandhi. The effects of the drought are
most severe in the north Indian states held by the
Congress Party and in opposition-controlled Punjab
and Haryana?all areas critical to Gandhi's political
future. Gandhi faces urgent domestic security
problems with the Sikhs in Punjab and unresolved
Hindu-Sikh competition for water and other
agricultural development resources in Punjab and
Haryana states. His most serious political challengers,
V.P. Singh and Arun Nehru, both have their base of
support in India's most populous drought-affected
state, Uttar Pradesh.
Gandhi has taken charge of the nation's drought relief
effort to preempt those who were ready to attack him
for being insensitive to the suffering of the people. He
postponed an August trip to Europe and made a
whistlestop tour of drought-afflicted areas in early
September. The government is urging farmers to shift
to different crop varieties that require less water and
have a shorter growing time to generate production.
Food-for-work programs also are being extended
throughout the country, and concessional loans are
being offered. Restrictions on various imports are
being temporarily lifted to reduce the shortages of
some items such as cotton and edible oils.
India probably can avoid severe shortages of basic
food items if Gandhi can effectively organize and
20
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Secret
implement an internal distribution plan. Foreign
exchange reserves of $5.9 billion at the end of the first
quarter, a near record level, give New Delhi a short-
term capability to import scarce items. According to
government estimates in July, stocks of foodgrains
accumulated from several years of good harvests will
be sufficient to meet expected shortfalls through at
least the next year. Although India estimates it has 23
million metric tons of grain, we believe the actual
amount of grain available for distribution is
significantly less. Taking into account grain for seed
and feed as well as assuming some spoilage, we
estimate the amount of grain available for distribution
is in the neighborhood of 18-20 million metric tons.
Inadequate transportation and infrastructure,
however, will hamper the distribution of food stocks.
Gandhi is constrained by economic and political
factors in his ability to funnel relief to his political
advantage. His political opponents will be quick to
charge him with political favoritism and neglect of his
responsibilities as a national leader if he obviously
favors Congress Party?controlled states. Despite an
adequate supply of domestic foodstocks for short-term
drought relief, their uneven distribution among
different states and bureaucratic restrictions could
prevent the timely and smooth implementation of
assistance efforts. A significant portion of the
foodstocks is held by individual states, and
government regulations restrict the movement of
foodgrain across state lines. Moreover, some states,
particularly Punjab, may hedge by keeping their
foodgrain stocks intact and refusing for political
reasons to sell their surplus grain to more needy
states.
The drought will compound Gandhi's problems in
Punjab. Water sharing is already a sensitive issue that
Reverse Blank
21
contributes to interstate and ethnic tensions between
the majority Sikh state of Punjab and the
predominantly Hindu state of Haryana. If New Delhi
is viewed by Punjabis as favoring Haryana with a
larger share of water and relief assistance, many
disgruntled Sikh farmers may join with Sikh
extremists who employ terrorist methods to
underscore their anger over New Delhi's lack of
support for Punjabi concerns.
A Limited Role for the United States
Gandhi almost certainly will shy away from direct
requests for US drought assistance but may welcome
offers of edible oils through commercial channels on
concessional terms and accept discreet offers of other
assistance. So far, the most pressing need is edible
oils. In addition to direct assistance, New Delhi might
be receptive to increased cooperation in agriculture,
water management, and water conservation.
Gandhi will want to avoid the political embarrassment
of seeming to beg for food and will try to minimize the
setback to India's efforts to achieve agricultural self-
sufficiency. He may minimize US offers of assistance
to avoid criticism from his left-leaning political
opponents. These critics oppose his efforts to improve
Indo-US relations and are likely to charge that the
United States will take advantage of India's
misfortune to interfere in domestic affairs. They
would probably point to India's experience during the
1965 drought when New Delhi secured US assistance
only after the government agreed to implement
economic reforms.
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India-Fiji: Postcoup
Developments
Prime Minister Gandhi's efforts to elicit international
condemnation of the military takeover in Fiji last
spring are another attempt to assert India's global
leadership role. Gandhi's calls to the Commonwealth
to back the reinstatement of the democratically
elected government dominated by ethnic Indians have
not received the support he had hoped. New Delhi's
future support for Indians in Fiji probably will be
limited to public diplomacy, as Fiji is well outside
India's military sphere of influence.
Ethnic Indians in Fiji
Ethnic Indians comprise about 49 percent of the
country's population of 700,000, compared to 47
percent native Fijians. Although almost all the
Indians were born in Fiji, they are a separate ethnic
entity and have never been assimilated into Fijian
society. The Indian population dominates Fiji's
economy and finance and includes probably the most
skilled and entrepreneurial people in the country.
They are leaders in the sugarcane industry?the
mainstay of the Fijian economy for more than a
century?and account for about half of Fiji's
professionals, technicians, managers, and
industrialists.
The rapid immigration of Indians into Fiji began in
1879, when the British brought them as indentured
laborers for the sugarcane plantations. There were
more than 50,000 Indians in Fiji by 1916 when the
official immigration ended. After the indenture
system was terminated in 1920, most of the Indians
remained in Fiji and became tenant farmers on lands
primarily owned by the Fijian communities.
Background of Coup
The Indians were excluded from Fiji's colonial
government until 1929 when the first Indian
representatives to the governor's Legislative Council
were elected. The Indian-dominated National
Federation Party emerged in the early 1960s, but a
lack of political cohesion and the complex Fijian
voting system kept the ethnic Indians out of power.
23
In last April's parliamentary election, a coalition of
the National Federation Party and Timoci Bavadra's
Fiji Labor Party defeated the native Fijian-dominated
Alliance Party?which had ruled since the country's
independence in 1970. Ethnic Indians dominated the
new coalition government, but Bavadra, a native
Fijian, was named Prime Minister. His appointment
of eight Indians to the Cabinet intensified Fijian fear
of Indian domination and spurred demonstrations and
protest marches by the native Fijian population.
Fijian military officers?led by Lt. Col. Sitiveni
Rabuka?seized control of parliament and announced
dissolution of the month-old government on 14 May.
Rabuka then appointed himself head of an interim
Council of Ministers dominated by ethnic Fijians and
set out to draft a new constitution to ensure
parliamentary dominance by native Fijians. The coup
leader received widespread support from the Alliance
Party, the Fijian-dominated military, and the native
Fijian population.
Fiji's Governor General Ganilau, as representative of
the Crown, immediately claimed executive power
under the Constitution and succeeded in taking
control from Rabuka. Within weeks he set up an
interim government under his authority to restore
democracy in Fiji. He also appointed a 16-member
committee to review the Constitution.
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groups met to consider Ganilau's proposal, but
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authorities assure his personal safety and that of other
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Meanwhile, the high level of racial tension is having
an adverse effect on the Indian community. Militant
Fijians have attacked ethnic Indians and their
businesses and property. Fearing for their safety,
financially established ethnic Indians have begun to
emigrate in significant numbers.
Indian Community Turns to New Delhi
Fiji's Indian community is looking to New Delhi to
help resolve the ethnic strife.
In several instances, Indian support to Tamil
separatists in Sri Lanka was cited as justification for
Indian involvement in Fiji. According to the US
Embassy in Suva, Fiji's Indian leaders have also
looked to the High Commissioner to exert pressure on
the United States, Canada, Australia, and New
Zealand to relax immigration rules for Fiji Indians.
Members of Bavadra's ousted coalition government
have also sought New Delhi's assistance in their
attempts to mobilize international opinion. The
coalition has decided to send a delegation of former
Cabinet ministers to African and Asian capitals to
explain its stand and has requested that India provide
support for the trip. New Delhi is likely to agree to the
request.
New Delhi's Diplomatic Initiatives
Less than a week after the coup, Prime Minister
Gandhi sent letters to the Prime Ministers of
Australia, New Zealand, Britain, and the
Commonwealth Secretary General calling for urgent
steps to restore the democratically elected government
in Fiji and preserve the Constitution of 1970,
according to the press. According to the US Embassy
in New Delhi, the Indian Foreign Minister requested
similar support from the United States. Gandhi also
sent two special envoys to Canberra, Wellington, and
London to coordinate Commonwealth efforts "to
bring normalcy back" to the South Pacific country.
While in New Zealand, press sources report, the
Indian special envoy asked Prime Minister David
Lange to consider economic sanctions against Fiji's
interim government.
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New Delhi's diplomatic soundings have not been
productive. Australia, New Zealand, and Britain
immediately denounced the military takeover but
have chosen to back the Governor General as the
constitutional power in Fiji rather than move to
reinstate the deposed government. Trade unions in
New Zealand and Australia imposed boycotts against
Fiji, but these recently have been lifted. The US
Embassy in Suva reports that the governments of
Australia and New Zealand are considering easing
their stance toward Fiji's present administration and
wish to gradually reestablish contact with the interim
government.
Fijian resentment of India's initiatives became evident
in early August, when the Taukei Movement?a
hardline Fijian group?accused Gandhi of taking the
lead in organizing foreign intervention in Fiji. In a
petition to India's High Commission in Suva, the
Movement warned that, if New Delhi intervened,
there would be a massive tragedy in Fiji, according to
the press.
Prospects
India's primary concern will be to deter constitutional
changes that put the Indian community in Fiji at a
severe disadvantage. We believe that New Delhi is
reconciled to some form of weighted parliamentary
representation favoring the ethnic Fijians. If the
Indian community accepts such a solution, India
probably will not oppose it. New Delhi will oppose a
constitutional amendment that reduces ethnic Indians
to second-class citizens but would have to rely on
diplomatic leverage?of which it seems to have
little?to reverse the situation. Fiji, which is
thousands of kilometers away, is beyond India's
military reach.
Restoration of the deposed coalition is a moot point,
but India will continue to support the restoration of
democracy in Fiji to show the ethnic Indians that
New Delhi has not abandoned them. Gandhi will
probably raise the matter of Fiji at the
Commonwealth meeting in Vancouver in October and
in other international forums. Gandhi is also likely to
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maintain pressure on the issue to gain favorable
domestic publicity by asserting India's role as
protector of Indian communities abroad
Fiji's Indian population almost certainly will continue
to count on New Delhi for help in protecting its rights.
Constitutional changes depriving ethnic Indians of
their rights would further erode confidence within the
Indian communiity and trigger even more emigration.
The departure of prosperous Indians from Fiji would
eventually leave a poor Indian minority without
political or economic clout.
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India
?Tondi
Dbanushkodi
Delft
Island
Kan kesantural
Point Pedro
Trincomalee
Nuwara
Eliyao
Sri Lanka
(Ceylon)
waismim Province boundary
(non-administrative)
District boundary
0 National capital
0 District capital
Railroad
Road
District names are the
same as their capitals
2p 40 Mles
2.0 4"2 Klic meters
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Sri Lanka: Reconstruction
and Rehabilitation
Last month New Delhi and Colombo signed an
agreement aimed at ending the four-year ethnic
conflict between Sinhalese and Tamils in Sri Lanka.
concerns
about the country's deteriorating economy were a
factor in prompting Sri Lanka's decision to seek
Indian assistance for a settlement. Although the
conflict has had a significant negative impact on the
economy, some of the strains were evident before the
outbreak of hostilities. Returning Sri Lanka to the
road of high growth will require a major inflow of
foreign aid and investment.
Recent Economic Performance
Sri Lanka's economic performance in fiscal year 1986
was the poorest since 1977. Growth fell from 5
percent or more annually to 4 percent, with
agriculture leading the slowdown. Rice output fell
because of poor weather conditions and insurgent
activity in production areas. Rising defense
expenditures have required cuts in other sectors and
have led to serious and recurring budget deficits.
Sri Lanka also is facing severe foreign payments
problems. Despite over $500 million in foreign
assistance, overall payments remained negative and
official foreign exchange reserves dropped to about
two months' worth of imports. Foreign earnings
declined as international prices for most of Sri
Lanka's major export commodities?tea, rubber, and
coconuts?remained depressed. At the same time,
tourism and direct foreign investment?other
important sources of foreign exchange?declined. Sri
Lanka has fallen deeper into debt, and principal and
interest payments of $ 540 million equaled nearly 30
percent of export and service receipts.
Assessing the Damages
Foreign investment and assistance are vital to the
growth of the Sri Lankan economy, and the greatest
economic effect of the ethnic conflict has been the
decline in international confidence. The number of
foreign investments approved by the Foreign
27
Investment Advisory Committee dropped from 56 in
1983, when the insurgency became increasingly
active, to 18 in 1986. Their value dropped from $11
million to $7 million in the same period. Tourism,
viewed by Colombo as a growing source of foreign
exchange, has declined by 50 percent during the same
three years, earning only $71 million in 1986.
Although foreign assistance steadily increased,
threats by donors to reduce aid intensified last year
following allegations of human rights violations by Sri
Lankan soldiers. In 1986 Sri Lanka received about
$534 million in foreign assistance, Comparable
figures for 1984 and 1985 were $536 million and $474
million.
The most severe physical damage occurred in the
economically backward Northern and Eastern
Provinces, especially the area around Jaffna.
Insurgent attacks on port facilities, repeated robberies
of banks and businesses by Tamil militants, and the
general collapse of civil order crippled economic life in
Jaffna. Roads, bridges, and telecommunication
facilities have been destroyed along with schools,
hospitals, and other public buildings. Shortages of
products supplied from the north?cement, fish, and
salt?have been reported throughout the island.
The greatest destruction to the transportation network
has been reported in the northernmost part of the
peninsula between Kankesanturai and Point Pedro.
Other vital roadways in poor condition include the
national highway between Elephant Pass and
Vavuniya. Rail service in the north only goes as far as
Paranthan because the insurgents tore up the railroad
to use the ties and rails for roadblocks and
fortifications.
The insurgency along with two consecutive years of
drought, contributed to the drop in food production.
Blocked transport links to Colombo and periodic
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militant attacks on rice farmers have disrupted
production, milling, and marketing in the north and
east. The drought has also affected food production
and will probably force the government to seek more
food assistance and imports over the next few years.
Fishing, a major part of the economy in the north, has
been hard hit as well. A government ban on coastal
fishing in the northern and eastern regions in addition
to increased Sri Lankan naval surveillance, Army
attacks on fishing villages, fuel shortages, and the
flight of Tamil fishermen to India have led to a 50-
percent decline in the fish catch.
Although the full magnitude of the refugee situation
is unclear, information suggests that the insurgency
has displaced over 200,000 people. More than 125,000
Tamils fled Sri Lanka to southern India. Another
11,000 people have been displaced around the
Batticaloa area alone. In addition, about 70 refugee
camps were reported in the north during the height of
Sri Lanka's counterinsurgency operations earlier this
year.
Prospects for Economic Recovery
Even if the peace settlement holds, overall economic
performance is not likely to improve significantly any
time soon. Much of the government's success in
improving the island's economic situation depends on
securing substantial inflows of foreign investment and
assistance along with increased earnings from tourism
and a reallocation of government spending from
defense to economic development. Reviving foreign
investment and the tourist industry will require the
restoration of international confidence in Sri Lanka,
an effort likely to take time given the continuing
unrest in the north and east. In the meantime, defense
expenditures are likely to command a significant
portion of government spending until the settlement is
completed.
The economy also remains plagued by structural
problems that existed before the insurgency erupted.
The economy depends heavily on world prices of
agricultural commodities, which show no sign of a
dramatic increase. Government protectionism and
inefficiently run public-sector industries continue to
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hold back economic growth. Repaying the large debt
incurred to finance development programs and the
counterinsurgency will be a burden at least until the
early 1990s.
Sri Lanka, however, has taken some steps to restore
the war-damaged economy in the north and east.
Colombo has received financial assistance for
rebuilding the economy from several countries. The
United States, Japan, Canada, United Kingdom, the
Nordic countries, and India have offered to provide
assistance. The assessment of a World Bank team sent
to Sri Lanka will be used to determine whether Sri
Lanka should be given additional assistance. Sri
Lankan Finance Minister De Mel has estimated that
economic recovery will require at least $200 million
above previous levels of foreign aid.
A large portion of the money already promised will be
used to resettle refugees and repair damaged
infrastructure. According to US Embassy reporting,
Colombo estimates that the resettlement effort will
include the rebuilding of 75,000 houses and the
distribution of food to many affected areas. US
Embassy reporting indicates that the procurement of
over 65,000 rail ties, 320 buses, 300 trucks, 100 four-
wheel drive tractors, and 100 jeeps will be required to
bring transportation back to normal. In addition,
Colombo estimates some $ 18 million will be needed
to replace damaged boats, nets, and fish processing
and marketing facilities to rehabilitate the fishing
industry in the north.
The fishing and agricultural sectors in the north and
east could rebound quickly once the refugee
resettlement is completed. The lifting of the fishing
ban will have an immediate positive effect.
Production, however, will remain lower than before
1983 until boats and other equipment can be replaced.
Although dry weather conditions in the east may
hamper rice production, output should surpass 1986
levels once the farmers have uninterrupted access to
their fields.
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Political Obstacles Facing Colombo
Colombo must rapidly mobilize the financial
resources and equipment coming into Sri Lanka to
improve the prospects for a successful peace. The
ethnic violence was originally fueled in part by Tamil
perceptions of economic discrimination by the
dominant Sinhalese. The government can dispel some
of these notions by quickly pressing ahead with
economic rehabilitation projects in Tamil areas. The
implementation of reconstruction projects along with
the resumption of work on unfinished development
projects could also provide needed employment
opportunities.
Sri Lanka, however, will need to balance the
rehabilitation efforts in the north and east with
development programs in the south. If Colombo is
perceived as giving favorable treatment to the
predominantly Tamil areas, it will more than likely
29
erode Sinhalese support for the Jayewardene
government in the south. The south is also plagued
with unemployment problems. According to US
Embassy reporting, village unemployment rates for
men are between 30 to 60 percent, while the
unemployment rate for women averages 50 percent.
An equitable distribution of development resources
will deny Colombo's political opposition another issue
that it could exploit to gain additional support.
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Afghanistan: A Demographic
Profile
Because more than one-fourth of its population has
fled to Pakistan and Iran since the Soviet invasion in
1979, Afghanistan is one of only a handful of
countries with a smaller population now than in 1980.'
Even so, agricultural output probably will be unable
to keep pace with the rapid expansion of the
remaining population, thereby increasing the
likelihood that the country will rely more heavily on
food imports. Accelerated urbanization also is likely
to increase demands on the government to provide
adequate jobs, housing, and social services. Should the
majority of refugees return to Afghanistan as a result
of a political settlement to the war, the population
could double within 20 years and severely strain the
country's land, water, and other resources.
General Demographic Trends
Afghanistan, with a population of 14.2 million, ranks
50th among the countries of the world in terms of
population. During the period between the end of
World War II and the mid-1970s, Afghanistan's
population doubled. This growth was typical of many
developing countries, where high fertility combined
with declining mortality to produce increasing
population growth rates.
Afghanistan's population declined between 1980 and
1987, however, because of the extremely large
number of refugees fleeing the country to Pakistan
and Iran. Afghanistan's population is not expected to
reach the preinvasion level again until 1990.
Fertility information on Afghanistan is limited,
making it difficult to assess past trends or to project
the future course of fertility in the country with great
precision. Nevertheless, we know that fertility in 1979
was high and that the inadequacy of programs aimed
37
at fertility reduction implies the country will have a
relatively high fertility rate in the future. It is
estimated that the average Afghan woman will give
birth to about seven children?one of the 10 highest
crude birth rates in the world.
Counteracting the high fertility rate are the poor
mortality conditions in the country. Afghanistan has
one of the lowest life expectancies at birth in the
world and also one of the highest infant mortality
rates. On average, a baby born in Afghanistan today
can expect to live about 42 years. Afghanistan, like
several other countries in South Asia, is characterized
by a higher life expectancy at birth for males than for
females.
Although general improvement in mortality is the
norm, the Afghanistan war has had a negative effect
on mortality conditions in the country. Given a
settlement to the conflict, we expect to see some
improvement in mortality conditions in the future.
Nevertheless, mortality probably will not decline so
rapidly as to raise the already high rate of population
growth.
Impact of the War
Internal migration in Afghanistan has traditionally
been slight. In 1972, 12 of every 13 native-born
Afghans were living in their province of birth. Since
the Soviet invasion this situation has changed
dramatically, and large numbers of persons have been
displaced within the country.
The war has also caused a substantial increase in the
rate of external migration, dominated by the
movement of more than 5 million refugees to Pakistan
and Iran. If the present population of Afghanistan
plus the refugee population is taken as the total
Afghan population, then approximately one of every
four persons is living outside the country. The
movement of refugees, while continuing, has slowed
considerably since 1982.
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Unenviable Record
Demographically, Afghanistan has the unenviable
distinction of ranking among the top?or bottom-10
countries of the world in several areas. For example,
Afghanistan has one of the 10:
? Highest crude death rates.
? Highest crude birth rates.
? Lowest life expectancies at birth.
? Highest infant mortality rates.
? Highest net emigration rates.
? Lowest percentages of the population aged 65 or
over.
Social Progress?
Social conditions in Afghanistan have historically
been poor. In 1979 only slightly more than 20 percent
of the Afghan population over age 10 could read and
write. Even this low literacy level, however, showed
improvement over levels attained in 1972.
Gender is an important influence on literacy in
Afghanistan, with the percentage of males who are
literate greatly exceeding the percentage of females.
An urban/rural differential in literacy is also present
in Afghanistan, but it is less than the observed sex
differential. According to the Afghan Government
census in 1979, approximately 42 percent of the urban
population over age 10 was literate, but only 18
percent of the rural population in the same age group
was literate. In addition, the percentage of the literate
population generally decreases with increasing age.
Three-fourths of urban males ages 10 to 14 were
literate in 1979, but less than half of those ages 35 to
44 and less than one-third of urban males ages 55 to
64 could read and write.
The Afghan Government claims it has made
substantial progress in increasing literacy in the
country since 1979. The regime has instituted a large
adult literacy campaign, and programs exist to send
Afghan students to the Soviet Union and some East
European countries. Nevertheless,
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Kabul's success in this area has been limited.
The Afghan regime also claims to be making great
strides in providing adequate health facilities for the
population. Official Afghan Government statistics
show that during 1979-82 the number of hospital beds
increased by 11 to 12 percent per year. The number of
persons per hospital bed over this period declined even
when population loss due to refugee movement is
taken into account. These trends suggest improvement
in the availability of health facilities to the population.
Still, comparing the number of persons per hospital
bed in 1981-82 with the 1976 data of another
developing country of similar size and population
density?Iraq?shows that Afghanistan has greatly
deficient health care coverage. In 1976, Iraq had 492
persons per hospital bed compared with 2,016 persons
per bed in Afghanistan in 1981-82. This disparity can
probably be explained by the :reat difference in the
two countries' relative wealth.
the war has substantially disrupted the
country's health system. For example,
there has been an increase in the incidence
of disease and most doctors have fled the country.
Increasing Urbanization
The population of Afghanistan is predominantly
rural. According to the census of 1979, only 15.1
percent of Afghanistan's settled population was
reported to be living in urban areas. (Inclusion of
nomads among the rural populace reduces the
percentage of urban dwellers to 12.7.) Provincial
variations in the percent urban for the settled
population were large in 1979, ranging from a low of
0.6 percent in Paktika Province to a high of 49.3
percent in Kabul Province.
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Sixty-three urban areas were identified in the 1979
census. Of these, Kabul was by far the largest with
nearly half of the country's urban population living
there in 1979.
an increasing portion of
Afghanistan's population is relocating to urban areas
to escape the fighting in the countryside. Sources of
the US Embassy in Kabul, for example, estimate that
the population in the capital now totals well over 2
million, up from an estimated 913,000 in 1979.
Increasing urbanization will probably affect the
demographic profile of the country. Data from the
1979 census indicate that there are urban and rural
differences in the level of fertility. Urban women
exhibit lower fertility rates than rural women in each
age group, with an urban woman bearing an average
of 58 children versus an average of 7.3 children born
to rural women. This suggests that, as Afghanistan's
population becomes increasingly urban, a
corresponding decline in the country's fertility rate
will be observed. There probably will also be a rise in
the literacy level. Official data indicate a higher
literacy level among urban dwellers, probably because
they place a higher value on education as a means of
economic advancement and also have greater access
to educational programs.
Outlook
Afghanistan's high fertility rate poses several serious
problems for the future social and economic
development of the country. Although the population
decreased between 1979 and 1986 because of the
exodus of refugees, it is now increasing at a faster rate
than grain production. Unless substantial investment
is made in agrotechnology?unlikely as long as the
war continues?per capita agricultural output in
Reverse Blank 39
Afghanistan is likely to fall, forcing the country to
rely more heavily on imported food. Moreover, the
shortage of arable land?only about 20 percent of the
total?will worsen and probably prompt increased
migration from the countryside to the cities.
Increased urbanization will challenge the current
regime or any future Afghan government to provide
adequate jobs, housing, and social services to
maintain stability in urban areas under its control. In
our view, there will be little social and economic
progress as long as poor security conditions persist
and large segments of the urban population are
destitute.
Future demographic developments in Afghanistan
depend to a large extent on the fate of the Afghan
refugees. Should a negotiated settlement provide for
the return of Afghans who have taken refuge in
Pakistan and Iran, the Afghan Government probably
would be hard pressed to cope with a rapid influx. For
instance, in the event of a settlement in which the
refugees began going back to Afghanistan in 1990,
with 15 percent of the Afghans outside the country
returning per year, the projected total population in
1994 would be 19.7 million, some 18 percent more
than if none had returned. By 1998, Afghanistan's
population would swell to 23 million, over 25 percent
higher than if the refugees had stayed in Iran and
Pakistan.
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Changing Patterns in Aden's
Leadership
A younger, less ideologically committed generation of
leaders will gradually emerge in South Yemen as
technical-administrative expertise and personal
relationships increasingly take precedence over
revolutionary background or ideological posture.
Many of the country's more renowned revolutionary
leaders have recently died, been exiled, or imprisoned.
Although young when they took power, the remaining
leaders of the old guard are aging and generational
transitions are not far off.
Several long-term trends in South Yemeni politics are
likely to alter the character of the country's political
elite. Institutionalization, with its unique
requirements for management, is gradually
increasing. In addition, the bases of elite recruitment
are slowly changing as the members of the
preindependence elite diminish in number and the
impact of development grows.
Personality and personal relationships also play an
essential role in the country's politics.
Geographic and Social Origins
South Yemeni leaders generally have come from three
geographic regions: North Yemen, Aden, and the
outlying provinces. Surprisingly, an Adeni
background has not increased prospects for
postindependence leadership. Most key figures in
South Yemen after independence were from the
hinterland or even North Yemen. Adenis tended to be
41
identified with preindependence British institutions,
the old bourgeoisie, or gravitated to eventually
discredited revolutionary groups, such as the South
Arabian League. Many politically active Adenis went
into exile at the time of independence, leaving the
field of party and government leadership open to
people from the hinterland.
Those not from Aden have had other advantages to
facilitate their move into politics, including a large
and strong power base within the tribe or region and
opportunities to lead highly visible guerrilla activities
against easy targets. The career of the late Brig. Gen.
Ali Antar Ahmad Nasir al-Bishi provides a prime
illustration of how the hinterland served as a
springboard for a career in postindependence politics.
He gained a fierce reputation early on as a patriot and
warrior by his leadership of the Radfan rebellion in
1963,2 and he later rose to top positions within the
national leadership with support from his fellow Dali
tribesmen.
The specific characteristics of a tribe or region are
also key factors in achieving political power and
penetrating key institutions, such as national party
organs, armed forces, militia, or the intelligence and
security apparatus. The uncertain course of South
Yemeni politics has meant that true loyalty can come
only from family, tribe, and region. These form the
foundation of any drive for power. Conversely, entire
families, tribes, and regions suffer when a prominent
member falls from grace. At the family level, the
apolitical brothers of former Prime Minister
Muhammad Ali Haytham were imprisoned for
several years after Muhammad's downfall and exile to
North Yemen in 1971. They were rearrested after the
This rebellion led to the creation of the National Liberation Front
and marks the beginning of the four-year armed struggle against
British domination in South Yemen.
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Key Political and Tribal Factions
Faction
The Lahijis
Led by the powerful Armed Forces Chief of Ste and
his uncle, the Minister of State Security, Lahijis
control key positions within the military and security
services, including elite Army units garrisoned near
the capital. The faction resents its exclusion from top
party positions and is trying to increase its
representation in the Politburo and Central
Committee. Because of uncertain Soviet support for
their political agenda and a need to expand their
power base, the Lahijis have papered over personal
and tribal rivalries to forge an alliance with the
Yafa'is.
The Yafa'is
The Yafa'i tribe?one of the most numerous of the
South Yemeni tribes?is represented in the Aden
regime by pro-Soviet hardliner Salim Salih
Muhammad, deputy secretary general of the Yemeni
Socialist Party. A contentious figure, he is regarded
as a maverick by many within the Aden leadership.
Salim Salih has been the target of a concerted
campaign by the northerners to abolish his position,
forcing him to overcome his enmity with the Lahijis
to shore up his flagging political fortunes. Salim
Salih 's supporters are primarily junior Yafa'i Army
and police force members.
Government and Party Positions Held
Armed Forces Chief of Staff and Deputy Defense
Minister Haythem Qasim Tahir
Armed Forces Deputy Chief of Staff Muhammad
Haythem Qasim
Minister of Defense and Politburo member Salih
Ubayd Ahmad
Deputy Minister of Defense Muhammad Ali
Haythem
Minister of State Security Sa'id Salih Salim
Minister of Transport Salih Abdallah Muthana
Secretary of the Presidency Ali Ahmad Nasir al-
Salami
Yemeni Socialist Party Deputy Secretary General
Salim Salih Muhammad
Minister of Housing Muhammad Ahmad Salman
events of January 1986 solely because of their family
connection. On a broader scale, deposed President Ali
Nasir Muhammad al-Hasani's fellow tribesmen who
did not flee with him after his overthrow have been
barred from civil and military service by the new
Aden leadership, who are from rival tribes.
Furthermore, the region of Ali Nasir's birth has been
the object of economic discrimination by the central
government.
Nearly all the country's regions have been
prominently represented in the leadership since
independence, but the attenuation of Aulaqi,
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Dathinah, and Abyan tribal power in the recent civil
war has left the new regime with a tribal imbalance.
The political leadership has narrowed to a struggle
between the northerners and the tribes of the Lahij,
backed by the Yafa'i tribe. Hadhramis also have
gained more exposure recently. They tend to be
technocrats or relatively minor political figures?with
the exception of the ruling party secretary general and
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The Northerners/National Democratic Front
Although primarily an insurgent movement, the
Front has played a major role in South Yemen
politics and controls three seats on the Politburo. In
the last three months, however, the Front has been
losing ground within the party and government as a
result of the combined LahijilYafa'i effort to reduce
its influence. Support from the Soviet Ambassador in
Aden has only somewhat buttressed the Front's
position. The Front is no match for the military
strength of the Lahijis, but it has its own
paramilitary units and will not relinquish its political
position without alight.
The Hadhramis
Many of the government's bureaucrats hail from the
outlying province of Hadhramaut. Not known for a
warrior tradition, Hadhramis generally serve as
mediators between the various tribes. They are the
least united faction, lacking a strong tribal or
political base which limits their influence. Attas was
installed as president by the Soviets as a compromise
candidate. Party Secretary General al-Bayd has
found it necessary to align himself with influential
Lahiji leaders to protect his position. Hardliners
within the government appear hesitant to move
against the Hadhramis because of their Soviet
backing. They lend a moderate image to the regime
that Moscow hopes to exploit to further its own
policy goals in the Gulf.
Politburo member Muhammad Sa'id Abdallah
Muhsin al-Sharjabi
Politburo member Fadhl Muhsin Abdallah
Politburo member Jarulla Umar
Minister of Foreign Affairs Abd al-Aziz al-Dali
Minister of Industry Abdallah Muhammad Uthman
Minister of Agriculture and Agrarian Reform Ahmad
Ali Muqbil
Minister of Health Sa'id Sharaf
Yemeni Socialist Party Secretary General Ali Salim
al-Bayd
Head of State Haydar Abu Bakr al-Attas
Minister of Interior Salih Munassir al-Siyayli
the head of state. Hadhramis do not have large power
bases, however, and do not necessarily cooperate
among themselves.
Although still a force to be reckoned with, the North
Yemenis appear to have lost some influence because
of their geographic origins. They have virtually no kin
or regional identification in South Yemen to support
them and are represented in Aden politics by the
National Democratic Front?a South Yemen-backed
insurgent movement made up of North Yemeni
43
dissidents targeted against the Sanaa regime. Many
South Yemenis regard northerners as opportunists
and outsiders and have resisted their full integration 25X1
into domestic politics. The Lahijis are leading a
concerted campaign to reduce the Front's influence in
South Yemen. The presence of North Yemenis in
Aden politics is a historical accident, and there
probably will not be a fresh infusion of North Yemeni
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blood. Their past participation was due mainly to
Aden's role as a magnet for work and dissident
activities during the days of the North Yemeni
imamate and later as a haven for leftists purged from
the newly independent and conservative military
government in Sanaa in the late 1960s and early
1970s.
Revolutionary Background
Since independence, a revolutionary background has
been the single most important factor in gaining
positions of leadership and power, but the
revolutionary ranks are being thinned continually by
internal party struggles and deaths. The deaths
during the fighting in January 1986 of the last
prominent revolutionary figures still active in Aden
may have marked the turning point.
This change can be seen in two ways. Guerrilla
leaders currently moving into top positions had lesser
roles in the war for independence. In addition,
younger, better-educated technocrats are beginning to
penetrate the higher ranks of government. Most of
these men were too young to participate in the
independence struggle and have risen to official
positions through other means, such as tribal
affiliation, personal relationships, political
performance within the party, or unique educational
qualifications.
Career Background
Leadership in the armed forces combined with strong
tribal or regional power within the military can result
in considerable political influence. A good case in
point is the career of Ali Antar, who at the time of his
assassination in January 1986 was a member of the
Politburo, First Deputy Chairman of the Council of
Ministers, and Deputy Chairman of the Presidium of
the Supreme People's Council. Ali Antar's political
strength was based on the loyalty of the armed forces.
Most of the Army's middle-level and junior officers
were fellow tribesmen. Even after Ali Nasir
maneuvered him out of his positions as Defense
Minister and commander of the Army, Ali Antar
retained substantial support within the military and
was often allied with his successor and fellow
Secret
tribesman, Salih Muslih Qasim. Ali Antar's
opposition to the late ex-President Abd al-Fattah
Isma'il in 1980 was instrumental in the latter's ouster
and exile to Moscow. A significant factor in Ali
Nasir's defeat in 1986 was the opposition of key units
in the armed forces seeking revenge for Ali Antar's
murder.
The intelligence and security organization has been
an increasingly less reliable route to political power.
The fortunes of leaders of this apparatus have tended
to rise and fall with the fortunes of those they served.
By virtue of their positions alone, and in light of the
brutality with which some have carried out their
duties, security chiefs have not inspired loyalty among
their peers. Muhammad Sa'id Abdallah (party name
Muhsin al-Sharjabi) may be the exception that proves
the rule. He is completely mistrusted, as much for his
sponsorship of torture and killings when he was
security chief in the 1970s as for his opportunities in
making and breaking political alliances. Muhsin's
present inclusion in Aden's leadership is most likely
due to Soviet sponsorship. CIA analysts believe
Moscow uses him as a reliable spokesman for its
interests within the Aden leadership, as suggested by
his frequent meetings with the Soviet Ambassador
and his continued support for the Soviet line in
Politburo and Central Committee meetings.
Technocrats on the other hand, have been penetrating
the middle and even upper reaches of the government
since the late 1970s, particularly in positions involving
economics, finance, trade, and development planning.
Senior technocrats carry far less political weight than
party leaders, however, implying technocrats are not
an equal or countervailing force to the politicians.
Moreover, as apolitical figures, technocrats are
vulnerable because of their dependence on the whims
of those in power.
Ideology
Most of South Yemen's leaders, including nonparty
members of the Supreme People's Council, have
espoused their commitment to "scientific socialism."
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But their precise interpretation of South Yemen's
guiding ideology has varied as has their commitment
to ideological purity. The ideological spectrum of
leaders since independence has ranged from rightwing
to center to socialist and Marxist.
These ideological categories have been divided by
narrower ideological variations, differences between
strict ideologues and pragmatists, and personal
rivalries. Alliances have often centered far less on
ideological affinity than other factors. Coalitions of
seemingly like-minded ideologues have dissolved in
treachery and violence.
Until this decade, the path of South Yemeni politics
could be said to have veered generally leftward, but,
as dismal economic conditions persist that require a
renewed emphasis on development priorities over
ideological purity, a more collegial leadership is likely
to emerge with an emphasis on pragmatism. Radicals
have schemed against each other, and their popular
support has been lessened by their extreme
dependence on the USSR and its allies, their
repressive tactics, and the country's dire economic
straits. Ironically, the Soviets have encouraged
moderation within the leftist Yemeni Socialist Party
ranks rather than promote even more radical leaders.
Presumably the Soviets wish to avoid another
confrontation along the lines of 1986, which could
jeopardize its growing relations with the Gulf states
and undermine regional cooperation between
Ethiopia, North Yemen, and South Yemen.
Perhaps a fatal blow to the tide of radicalism was the
death of four leading radicals?Ali Antar, Defense
Minister Salih Muslih Qasim, Isma'il, and Central
Committee official Ali Shayi Hadi?in January 1986.
Even though the hardliners prevailed in subsequent
fighting, the resultant leadership is no more leftist
than that of the ousted Ali Nasir. It has found itself
limited to denouncing Ali Nasir in personal terms
while virtually embracing his policies.
Outlook
During the 1980s, the course of Aden's politics has
taken a markedly different path from that of the first
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13 years of independence. Through the end of this
decade and probably well into the 1990s, certain
trends are likely to become evident:
? Tribal and regional divisions will continue to play an
important, if sub rosa, role in South Yemeni politics.
Although education, mobility, and nationalism will
help to weaken tribal ties, the legacy of tribal
hostilities will be the most difficult to overcome and
will continue to generate underlying antagonisms.
Politicians of North Yemeni origin will become
rarer and eventually disappear, barring another
political upheaval in North Yemen that sends
political dissidents southward.
? A revolutionary background, heretofore essential to
political legitimacy, will become less important as
the cadre of former guerrillas is thinned and
eventually disappears.
? Technical or administrative qualifications will
become increasingly important to achieve senior
government positions, especially as Aden switches to
an oil-based economy. It will be some time,
however, before technocrats will be in a position to
exercise real power in Aden.
? The adoption and maintenance of an extremist
ideological posture, key to survival through various
crises in the 1960s and 1970s, is becoming
increasingly irrelevant and even a liability.
? The advantages of a client-patron relationship with
a single outside state or force is diminishing steadily
as working relationships with both the Soviets and
leaders of conservative Gulf states become essential
for Aden's politicians. Consequently, Aden will
remain dependent on the Soviet Union, but it will
keep channels open to the Gulf states and North
Yemen.
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Egypt: Expanding RPV
Capabilities
Cairo is seeking to expand and improve the
capabilities of its remotely piloted vehicle (RPV) fleet
as part of its military modernization effort.' The
perception that other countries are exploiting RPVs to
achieve combat successes or to enhance their
technical capabilities and a desire to maintain the
military's prestige by acquiring new systems are
driving Cairo's interest. A multimillion dollar
program calls for new purchases and includes plans to
develop and produce a new RPV for the military's use
and for export. Despite problems, we believe the
Egyptians are making modest progress. With
continued access to Western technology and
financing, they may, in particular, be able to enhance
their reconnaissance capabilities.
The Egyptians are convinced that RPVs are essential
for any modern military force, and they do not want
to lag behind other regional forces in acquiring the
technology. Unmanned and usually small, RPVs are
less expensive and easier to operate than manned
aircraft and can be modified for a variety of missions.
Moreover, improved technical capabilities and combat
successes have made modern RPVs much more
attractive than were earlier versions.
We believe the Egyptians
also are impressed with the Israelis' success with
mini-RPVs. The Mastiff and the Scout, in particular,
were used to help target surface-to-air missile sites in
the Bekaa Valley at the beginning of the Israeli
invasion of Lebanon in 1982.
Capabilities and Plans
Cairo has made a modest start in building Egypt's
RPV capabilities.
' The term RPV was introduced during the Vietnam conflict to
replace the word drone, apparently to lend the aircraft more
prestige and indicate a wider range of missions and changing
roles?from targets to reconnaissance to multipurpose vehicles. We
use the terms RPV and drone interchangeably in this article.
47
Banshee target on cat
preparing to launch
ult launcher
_
Target Technology ?
To build the military's reputation as a modern force
and to keep up with the perceived capabilities of
Western and neighboring military powers, Egypt is
undertaking a multimillion dollar program to improve
its RPV fleet. The Defense Ministry's plans have
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focused on acquiring more sophisticated multirole
systems, and it is studying options to enhance the
reconnaissance and electronic countermeasure
capabilities of drones already in its inventory.
In addition to purchases, Cairo is involved in several
coproduction projects, and it is likely to seek expanded
coproduction programs in future negotiations with US
and other firms. The Egyptians hope to develop and
manufacture a sophisticated multipurpose RPV to
supply the military's needs and to export.
Secret
R4E Skyeye launching. This version is
carrying a MR camera.
Aviation Weekly and
Space Technology ?
The Egyptians most likely would use their Arab
Organization for Industrialization aircraft factory for
the coproduction work. In our view, they could
manufacture comparatively simple parts for RPVs
and assemble the airframe, especially if they get
foreign assistance. Their expertise is limited, however,
and we doubt that the Egyptians in the near term will
be able to provide the avionics or sophisticated
reconnaissance or ECM payloads.
Integrating RPVs Into the Military
The Egyptian RPV program contributes to broader
efforts to enhance the Air Force's reconnaissance,
early warning, and electronic countermeasure
capabilities. The Air Force has one aging MIG-21
(Fishbed H) squadron and one Mirage 5R squadron
for tactical reconnaissance and operates one IL-28
flight for maritime surveillance. It recently received
EC-130H and E-2C aircraft that will increase Egypt's
ELINT and early warning capabilities. Besides
additional E-2Cs,
expect to receive three more
reconnaissance-adapted C-130s in 1988 and have
r uested data on reconnaissance variants of the F-4.
Even though the Defense Ministry's primary goal for
its RPV fleet is likely to be reconnaissance, Cairo
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Small RPVs often are caught in nets to prevent damage to delicate
systems that might occur with hard landings.
probably will eventually try to use drones to
supplement or replace manned aircraft for a variety of
tasks:
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Outlook
Funds for the military are tight, but Cairo is likely to
continue the RPV program. The Egyptians used US
military aid to pay for most of its RPV fleet, and the
Air Force has another $40 million of US military aid
earmarked for new purchases,
Cairo may request financial assistance from the Arab
Gulf states in exchange for Egyptian-produced RPVs.
It probably sees Iraq as a prime market for the
drones.
51
We have little information on Egyptian intentions to
subordinate RPVs to specific units, and we suspect
that the Defense Ministry has made no detailed plans
for using the drones tactically. The Egyptians' slow
absorption of other systems suggests that they will
need substantial time to fully integrate new RPVs into
their inventory and to broaden their use of the craft.'
Maintenance and logistic difficulties also are likely to
increase as payloads on new systems become more
sophisticated. In the short term, Cairo is most likely
to benefit from the reconnaissance capabilities of the
RPVs it is scheduled to receive or seeking to acquire.
These systems can provide a low-cost and relatively
low-risk means of surveillance not only for Egypt's
borders but also for areas well into neighboring
countries.
5 According to defense attache reports, the Egyptians still cannot
effectively operate the identification friend/foe systems or the
electronic countermeasure equipment on US aircraft.
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Western Sahara: Is the
Berm Crumbling?
A series of successful attacks by Polisario Front
guerrillas between late February and August has
challenged Morocco's ability to defend the berm that
it has constructed in Western Sahara. The attacks
reveal increased Polisario armor capabilities as well as
Moroccan tactical vulnerabilities. The guerrillas have
inflicted heavy casualties on the Moroccans and
destroyed significant amounts of materiel. We believe
that the success of the Polisario attacks will force
Rabat to make tactical adjustments in its defensive
strategy for the desert war, including closer air
support to Moroccan positions under attack. Morocco,
by virtue of its overwhelming manpower advantage,
however, will almost certainly continue to control the
berm and prevent the Polisario from seizing and
holding any territory behind it.
Evolving Strategies
The Polisario began its armed struggle for Western
Saharan independence against Morocco and
Mauritania in late 1975 as Spain began a phased
withdrawal from the territory. Rabat and Nouakchott
agreed to partition the former Spanish colony early in
1976. In 1979, Mauritania signed a peace treaty with
the Polisario and withdrew from Western Sahara,
allowing the guerrillas to concentrate their efforts
against the Moroccans. During the initial years of the
conflict, the Polisario had operated freely in the
sparsely populated territory. Seizing the initiative, the
guerrillas attacked isolated Moroccan garrisons and
ambushed patrols. Mounting Polisario successes
forced Rabat to reassess its strategy.
In August 1980, Rabat abandoned its strategy of
defending garrisoned towns and began constructing
the berm?a series of defensive positions connected by
an earthen wall reinforced by rear area ground and
air units. The objective of this new strategy was to
protect the key population and economic centers and
to deny the Polisario the ability to operate freely or to
hold territory behind the berm. Since construction of
the original berm, the Moroccans have built several
extensions that enclose more than 75 per cent of
53
Western Sahara. The most recent extension was
completed in late April. Although the guerrillas
cannot seize and hold territory behind the berm, they
have not been deterred from attacking Moroccan
positions along it.
We believe that the Polisario's strategy in response to
the berm has been to wage a war of attrition to raise
the human and material cost of the war for Rabat in
hopes that King Hassan will become more amenable
to a compromise settlement. The guerrillas are aware
that an outright military victory is unrealistic, but
they believe that they can undermine the Moroccans'
morale by harassing their positions and occasionally
launching large-scale attacks that inflict major
casualties and destroy equipment. For several years
this strategy was ineffective because the guerrillas
could conduct only a few major attacks a year.
Since late February, however, the guerrillas have
launched at least five successful attacks in six months
that have resulted in a Moroccan casualty rate of
more than 100 per month. If the guerrillas can sustain
this pace while limiting their own casualties,
Moroccan morale could erode to the point where King
Hassan once again would be forced to reassess his
strategy and possibly negotiate.
Can the Moroccans Hold the Berm?
We believe that Morocco's success in Western Sahara
is a result of its manpower advantage manpower over
the Polisario?about 100,000 Moroccan troops versus
3,000 to 5,000 guerillas. A Moroccan population of
almost 24 million?compared to Western Sahara's
population of 94,000?guarantees Rabat a manpower
pool large enough to draw on to man the berm for the
foreseeable future.
Economic considerations?primarily pay incentives to
serve in Western Sahara and poor employment
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prospects in the Moroccan private sector?almost
certainly ensure sufficient volunteers to maintain this
advantage.
volunteers fill most of the country's military
manpower requirements. The vast majority of the
Moroccan Army supports the war and prefers to serve
in Western Sahara because soldiers believe it provides
more opportunities for promotion,
We believe that the one factor that threatens
Morocco's long-term control over Western Sahara is
poor troop morale. There are inherent problems in
fighting a static, defensive war in a harsh environment
with no end in sight. Basic supply problems?
particularly in the far south?maintaining a high
state of alert, and war weariness have contributed to a
general malaise among Moroccan troops in Western
Sahara,
Rabat has taken steps to maintain morale. The most
effective measure has been to conduct offensive
operations that provide a sense of progress in the war.
The Moroccans have not had a clear-cut battlefield
victory over the Polisario since 1984, but the military
has viewed the berm expansion as a military victory
that has driven the Polisario out of Western Sahara,
Although
offensive operations in front of the berm have been
infrequent and usually ineffective, they have
contributed to the 7erception of movement in the war.
Can the Polisario Sustain the Offensive?
Although the Polisario has held the advantage of
choosing the time and place of attack, the guerrillas
have never been able to launch more than sporadic
attacks. This year's attacks, however, suggest that the
guerrillas have adopted new tactics to exploit tactical
weaknesses in the Moroccan defenses,
In addition, the attacks have
demonstrated an impressive logistic capability to
support long-range armored attacks against the
southern?and most lightly defended?segment of the
berm, The guerrillas
apparently have overcome logistic constraints that
had forced them to limit their armored attacks to the
Secret
northern third of the berm.
Moroccans are implementing measures to correct
some of the problems. We believe that a preemptive,
low-level airstrike using Maverick air-to-surface
missiles in July signals a determination in Rabat to
confront the Polisario threat more aggressively.
The guerrillas are faced with constraints that could
prevent them from sustaining the current offensive.
These include continual logistic challenges, the same
open-ended war under the same harsh conditions that
the Moroccans are facing, and limited human and
material resources. Even minimal casualties over an
extended period could severely hinder Polisario
capabilities. The guerrillas' dependence on Algeria for
support and sanctuary could also become a potential
problem. Even if they are prepared to wage a war of
attrition indefinitely, they could not do so if Algiers
withdrew its support.
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Outlook
Although the problems Morocco faces in trying to
defending the berm will persist, we do not believe that
its control over Western Sahara is in serious jeopardy.
We believe that Rabat possesses and will use both the
human and material resources necessary to defend the
berm and reduce casualties to a tolerable level. An
intensified effort in Western Sahara probably would
lead to requests to the United States, France, and
other arms suppliers for more equipment.
The Polisario probably can continue its strategy of
harassment and occasional large-scale attacks into the
foreseeable future. The guerrillas' ability to sustain
the current level of fighting, however, probably will
diminish if Rabat makes tactical adjustments and
applies the necessary resources.
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Mauritania: Taya's Increasing
Vulnerability
Growing economic problems and popular discontent
over official corruption are bringing President Taya to
the most critical juncture of his nearly three years in
power. He still appears to have the support of key
players in the Army and security forces. Nevertheless,
unless he can demonstrate stronger leadership in
dealing with the country's economic problems, we
believe that the military, fearful of losing their hold
on power, could engineer a coup against him.
Initial Popularity of the Taya Regime
President Maaouiya Ould Sid Ahmed Taya made
several highly popular policy decisions when he came
to power in December 1984. He adopted neutrality
toward the war in Western Sahara, a policy most
Mauritanians welcomed, since they had little
sympathy for the efforts of the Polisario and their
Algerian sponsors to undo Morocco's control of the
territory. He also introduced limited democratic
reforms. In December 1986, for example, the
government held free elections for municipal councils
in Nouakchott and 12 regional capitals?the first
contested elections in over 20 years. Taya also became
the first president to appoint to office women and
members of Mauritania's large population of former
black slaves, the Haratin. These steps helped to
bolster Taya's public support during his first two
years in office.
The Turning Tide
In recent months there has been a significant
deterioration in Taya's popularity. The government's
crackdown last fall against dissidents of the
Toucouleur tribe, one of the principal politically
active black ethnic groups, alienated a large number
of Mauritanian blacks. In addition, Taya began to
implement a land reform that is enabling more white
Maurs to acquire land in areas the blacks believe is
traditionally theirs.'
' The Maurs, the traditional Arab elite in Mauritania, account for
30 to 45 percent of the population of this almost entirely Islamic
country and have a tight grip on both the government and economy.
Fundamentally different from the Maurs in psychology, culture,
57
Many Mauritanians are also increasingly critical of
what they perceive as widespread corruption in the
military. According to the US Embassy in
Nouakchott, most people continue to regard Taya as
honest, but there is a growing perception that many
key officials are guilty of large-scale corruption.
Rumors regularly circulate in Nouakchott that
various ministers have stolen large sums of public
funds. In addition, reliable US Embassy sources
report that many of Taya's fellow tribesmen, the
Smassid, are flouting business, customs, and tax laws
on a massive scale, knowing that officials are loath to
interfere with persons who may be close to the
President.
In addition, economic conditions are deteriorating,
and much of the population is having difficulty
surviving. The government's foreign debt was about
$1.6 billion in 1986-3.5 times the value of exports of
goods and services. To reduce this debt, the regime
has instituted a strict austerity program that has
generated increases in already high unemployment
and inflation. Since last September the black market
value of the ouiguiya, the national currency, has
depreciated by close to 50 percent against the
currencies of Mauritania's largest trading partners,
France and Spain.
In a particularly unpopular move undertaken on the
advice of the World Bank, Taya cut the bloated staff
of Mauritania's state-owned enterprises, leaving more
than 1,000 people without jobs. Meanwhile, another
World Bank-inspired reform, a freeze on civil service
and background are Mauritania's three principal black tribes,
which include up to 39 percent of the population and make up the
majority of the military's enlisted personnel, the lower grades of the
civil service, and the unskilled labor force. Caught between these
two groups are the Haratin, a largely Arabized black sector of
society that includes an estimated 25 to 40 percent of the
population and occupies servile positions.
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hiring, has meant that hundreds of students who
graduated this summer cannot turn to Mauritania's
traditional supplier of white collar jobs. Most of them
will join the thousands of earlier graduates who are
still looking for work.
These and other unpopular moves are generating
widespread discontent with the regime. Seeking to
take advantage of this discontent are a profusion of
semiclandestine civilian opposition groups, including
pro-Iraqi and pro-Syrian Ba'thists, Marxists, liberals,
fundamentalists, and pro-Libyan Nasirists. These
groups, however, lack the unity and leadership needed
to pose a major threat to the regime.
Potential for a Military Coup
We concur with the US Embassy that any serious
challenge to the government probably will come from
the military. Indeed, the President runs a dual risk
from that quarter. A particularly plausible scenario is
that officers in the Military Council for National
Salvation (CMSN)?the ruling military junta?might
stage a palace coup and replace Taya with another
president chosen from their ranks. According to the
rules of the committee, the CMSN elects a committee
president who also serves as chief of state. In theory,
the CMSN can remove the president from office at
any time by a vote of two-thirds of its members. In
practice, however, all previous CMSN presidents have
been overthrown by a cabal of CMSN members, who
have then had the other members approve their move
ex post facto. According to the US Embassy, some
CMSN members have grown dissatisfied with Taya's
policies and worry that his declining popularity could
jeopardize the military's grip on power. These officers
may conclude that the time is ripe for another palace
coup.
Another, somewhat less likely scenario is that military
personnel who are not on the CMSN may stage a
coup. The most likely to do so would be the radical
younger officers close to the Nasirist movement. They
could act in conjunction with some senior officers
whom Taya removed from power. The US Embassy
reports that several of these young officers are
increasingly angry at what they perceive as the
corruption of the regime and the deteriorating
economic situation. Unlike the more senior officers
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and CMSN members, their propensity for political
violence is not softened by comfortable salaries and
opportunities for large-scale graft.
Recent Coup Plotting
The US Embassy believes that the government
arrested Col. Boukhreiss and several of his followers
in August for attempting to lay the groundwork for a
coup. Boukhreiss had been one of the architects of the
1978 coup that toppled the civilian regime of Ould
Daddah. He was widely regarded as a highly talented
leader, and, according to the US Embassy, many
observers consider him the most brillant officer in the
armed forces. More significantly,
he opposed the government's
economic reforms. In addition, over the years he has
advocated a pro-Libyan, pro-Polisario foreign policy.
Boukhreiss probably was only beginning to consider a
move against the government, and the regime decided
to preempt that challenge by neutralizing the colonel.
Prospects
Taya retains some key assets despite increased
popular and military restiveness. Most important, key
government members such as Interior Minister
Abdellahi and Chief of the Secret Police Vail are still
loyal. This ensures the support of much of the military
and security apparatus. In addition, Taya is a skillful
infighter and a veteran survivor. Since becoming
President in 1984, he has deftly eliminated his chief
rivals on the CMSN, sending some out of country as
ambassadors and stripping others, such as Boukhreiss,
of power. Although his crackdown last fall against
Toucouleur dissidents heightened ethnic discontent, it
also effectively broke the back of the principal
subversive black group challenging his regime. The
current crackdown against Boukhreiss and others
probably will cow his opponents in the military and
buy him a little time.
Taya, however, must quickly come to grips with some
of his domestic problems if he is to survive. If
Mauritania's economic difficulties continue for long
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and more citizens find it impossible to make ends
meet, the incentives to oust Taya will grow within
both the CMSN and the military rank and file. We
concur with the US Embassy that the next few
months are crucial for the regime.
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