Who will win the peace in Afghanistan?

LONDON Sat Apr 4, 2009 12:48pm EDT

LONDON (Reuters) - Behind the talk of how to win the war in Afghanistan is a question which will affect the global economy for years to come: who will win the peace?

Though it may seem premature given a growing insurgency in Afghanistan which is also spreading deep into Pakistan, each country's calculations about who will come out on top will affect their response to the U.S. strategy in Central Asia.

Analysts say China could benefit most from any settlement in Afghanistan which opened up trade routes and improved its access to oil, gas and mineral resources in Central Asia and beyond.

Other countries all have a much harder hand to play.

Russia and Iran would dearly like to see an end to the U.S. military presence in their backyard. But they would also lose leverage over energy supplies if peace brought a diversification of pipelines and land routes through Afghanistan.

And India and Pakistan will struggle to address the tough compromises needed to soften a 60-year-old rivalry that has spilt over into a competition for influence in Afghanistan.

"China is keeping its head under the parapet," said retired Indian diplomat M.K. Bhadrakumar. But he added, "China is probably in my estimation the number one gainer."

While other countries have fretted about geopolitical rivalries, China has focussed on its economic interests.

Its largest copper producer, Jiangxi Copper, is developing the vast Aynak copper mine south of Kabul, while it is also building Gwadar port on Pakistan's Arabian Sea coast to give it access to the Gulf.

China's deputy foreign minister Wu Dawei said this week that Beijing would continue to encourage Chinese enterprises to take part in Afghan reconstruction, according to Xinhua news agency.

Politically, China is keeping a low profile, although Wu said it favoured a strong role for the Shanghai Cooperation Organisation, a grouping of Central Asian states dominated by Beijing and Moscow used to counterbalance western influence.

But unlike the other regional players, and indeed the United States -- which have to find their way through a minefield of competing interests -- China's course is simpler.

Barring a huge upsurge in Islamist militancy that spilt into its Muslim Xinjiang region, an escalation big enough to destroy the U.S. economy and China's dollar holdings, or an invasion of its ally Pakistan, it can keep its head down.

"China is a passive player," said C. Raja Mohan, Professor of South Asia Studies at Singapore's Nanyang Technology University. "They don't have to do anything."

PLAYING CHESS

Washington, by contrast, faces much tougher choices.

It has never been able to shake off suspicion in the region that its interest in Central Asia is as much in the pursuit of oil and gas resources as in targeting al Qaeda.

If it is to win support from Russia, Iran and China for a new strategy outlined by President Barack Obama, it has to show it has an exit plan that will eventually remove U.S. troops.

In doing so, it may not lose the war, but nor will it win the peace.

Russia could emerge a winner if it can exploit the U.S. need for alternative supply routes to Pakistan into Afghanistan in exchange for an end to NATO expansion in Central Asia.

It already scored a minor victory by prodding Kyrgyzstan to close Manas air base -- the only U.S. air base in Central Asia -- while offering to open up its own territory for ground supplies into Afghanistan, thereby increasing its leverage.

"The Russians were playing a little chess by getting Manas shut down and getting the U.S. through their territory," said Shuja Nawaz at The Atlantic Council of the United States. "They always retain the right to squeeze the pipeline."

But Russia faces bigger risks than China from either war or peace. A U.S. defeat that revitalised the Islamists would spread instability into Central Asia and its own Muslim regions.

And peace would give the former Soviet Central Asian states new land routes and potential pipelines through Afghanistan.

"Central Asian republics may find it easier to extract themselves from Russian influence," said Bhadrakumar. "All the access routes are through the old Soviet arteries."

Like Russia, Iran has an opportunity to improve its relationship with Washington by helping on Afghanistan.

Shi'ite Iran co-operated with Washington when it toppled the Sunni Taliban in 2001, but backed off after being branded as part of the "axis of evil" and after the U.S. invasion of Iraq in 2003 left it facing U.S. troops in two of its neighbours.

"The Iranians feel encircled right now," said one diplomat.

But its room for manoeuvre is limited by U.S. suspicions over its nuclear programme and its hostility to Israel, along with its rivalry with Saudi Arabia which has traditionally promoted the cause of Sunni Islam in South and Central Asia.

"Iran is important for Afghanistan but not critical if you can get Pakistan right," said Raja Mohan.

Pakistan and India are, along with China, the countries whose economies would gain the most from peace.

"There are of course selfish interests. They need to be able to trade with each other," said Nawaz.

But that would mean putting aside a history of distrust.

New Delhi is convinced Pakistan will always support Islamist militants to use them against India and after last November's attack on Mumbai is in no mood to compromise.

Pakistan remains so wary of India that it will struggle to do what Washington wants -- turn its back on its eastern border to challenge Islamists on its western border with Afghanistan.

(Additional reporting by Sayed Salahuddin in Kabul; Editing by Dominic Evans)

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