Saturday, 23 August 2008, 14:12

C O N F I D E N T I A L SECTION 01 OF 03 ISLAMABAD 002802

SIPDIS

EO 12958 DECL: 08/23/2018

TAGS PREL, PTER, PGOV, EAID, PK

SUBJECT: IMMUNITY FOR MUSHARRAF LIKELY AFTER ZARDARI'S

ELECTION AS PRESIDENT

REF: (A) ISLAMABAD 2742 (B) ISLAMABAD 2741

Classified By: Anne W. Patterson, for reasons 1.4 (b)(d)

1. (C) Summary. In separate meetings with Asif Zardari, PM Gilani and Chief of Army Staff Kayani, Ambassador pressed for quick action on immunity for former President Musharraf. Zardari and Gilani said flatly that they were committed to providing immunity, but not until after the presidential election (now scheduled for September 6). Pushing immunity now, they believed, could jeopardize Zardari's candidacy. Kayani expressed concern that if immunity becomes tied up with the ongoing debate over the judges' future, it may never happen. Zardari plans to continue to slow roll action on the judges' restoration but remains confident that Nawaz Sharif will not walk out of the coalition. Nawaz's deadlines for action on the judges continue to pass unfulfilled; the next one is scheduled for August 27. The decision by the Muttahida Quami Movement (MQM) August 20 to back Zardari for President has strengthened Zardari's hand against Nawaz. Nawaz is left with the option of walking out of the coalition but having little prospect of forcing a new general election in the short term. Zardari is walking tall these days, hopefully not too tall to forget his promise to Kayani and to us on an immunity deal. End Summary.

2. (C) Ambassador met with Pakistan People's Party (PPP) leader Asif Zardari on August 23, with PM Gilani on August 21, and with COAS Kayani on August 20.

3. (C) Zardari told Ambassador August 23 that he was committed to indemnity for Musharraf. Ambassador stressed that only the promise of indemnity had persuaded Musharraf to step down as President. We believed, as we had often said, that Musharraf should have a dignified retirement and not be hounded out of the country. Zardari cited a British anecdote about the Spanish empire and said "tell the most powerful man in the world that there is no way that I would go back on what I have said." Zardari noted that he already had firmly committed to the U.S., the UK, and Chief of Army Staff (COAS) Kayani that indemnity for Musharraf would be forthcoming. Ambassador urged him to do it quickly. Zardari said flatly that to do it before he was elected President would lose him votes, but he would do both the legislation and a presidential pardon as soon as he was elected. Zardari revealed that former President Musharraf had approached Chief Justice Dogar about issuing a restraining order against the impeachment motion, but Dogar had refused. Zardari also alleged that Musharraf had planned to replace COAS Kayani if Dogar had blocked the impeachment. 4. (C) Zardari said he was trying to keep Nawaz in the coalition and was candid that he planned to tie up the judges issue for a long time. He said the parliament would debate the restoration of the judges; Chief Justice Dogar would then submit some rulings on the restoration of the judges; all this could take months. In the meantime, he was trying to persuade former Chief Justice Iftikhar Chaudhry to become Governor of Balochistan. (Note: In a move clearly orchestrated by Zardari, the Governor Magsi of Balochistan resigned on August 20, making it possible to offer the position to Chaudhry.)

5. (C) Zardari said he did not think Nawaz would leave the coalition, but he admitted the Pakistan Muslim League-Nawaz had become increasingly testy. He said that he had already agreed with Nawaz to curtail the powers of the President and then allow Nawaz to be eligible for a third term as Prime Minister; both measures would require constitutional amendments. Zardari revealed that he also had leverage over Shahbaz Sharif, who through paperwork snafus, had been technically elected illegally for a third term as Chief Minister. This, too, would have to be resolved in parliament, Zardari said. "So I can give them something they want," noted Zardari, "that's what politics is all about."

Kayani Worried

--------------

6. (C) After an August 20 meeting with visiting S/CT Coordinator Dell Dailey, Kayani asked Ambassador to stay behind and discuss his concerns that Zardari was delaying

ISLAMABAD 00002802 002 OF 003

Musharraf,s immunity bill. Kayani had heard the large meeting of coalition partners (chaired August 19 by the newly returned Bilawal Bhutto) had discussed mostly the judges. Then they decided to take a 72-hour "break" to consult party members.

7. (C) As post earlier reported (Reftels), Kayani said he took Zardari,s commitments to now ex-President Musharraf as the most important argument in persuading him to resign. Zardari made very specific commitments to Kayani. Now, for Zardari to delay, it makes him (Kayani) look bad within his own institution "and I have to bring the Army along with me." Kayani also noted that the delay does nothing for Zardari,s reputation for trustworthiness. If this issue gets conflated with the judges and with Zardari,s own desires to be President, it will become too complicated to pass, Kayani said.

Gilani on Immunity, Bajaur, Subsidies

-------------------------------------

8. (C) Ambassador met with PM Gilani and Interior Minister Rehman Malik for thirty minutes August 21, after a graduation ceremony for U.S. trained members of his protective detail. He had been briefed about PDAS Camp's discussion with Ambassador Haqqani.

9. (C) Gilani said the PPP was going to provide immunity for ex-President Musharraf, but timing was important. They were afraid that putting forward immunity legislation would lose them votes for Asif Zardari,s presidential campaign. Ambassador pressed on this issue, saying that Musharraf would never have agreed to resign without the promise of immunity. He assured Ambassador that he and the party did not want vengeance. Regarding immunity, Gilani said "many will say that we have done a deal with America, but still I understand that we have to do it."

10. (C) Regarding the ongoing military operation on Bajaur (in the Federally Administered Tribal Areas), Gilani assured Ambassador that it will continue "to its conclusion," i.e., until all the militants were driven out. Gilani said the next step would be to go after Taliban leader Baitullah Mehsud. Gilani wanted President Bush to know that over 500 militants had been killed in the operation and that the GOP had reached out to NATO (during General Kayani's recent visit to Afghanistan for a tripartite meeting). He said Pakistan would do everything possible to encourage cooperation between the U.S. and Pakistani militaries. Gilani noted that Pakistan was using its F-16 aircraft to fight the militants and thanked the U.S. for providing funding for the F-16 mid-life upgrades. However, Gilani pleaded for urgent U.S. assistance in providing relief for displaced people around Bajaur and noted that fighting was spreading to neighboring Mohmand Agency.

11. (C) Malik suggested we hold off alleged Predator attacks until after the Bajaur operation. The PM brushed aside Rehman,s remarks and said "I don,t care if they do it as long as they get the right people. We,ll protest in the National Assembly and then ignore it." (Note: The strike has been front page news, but the media is reporting that the targets were nests of Arab fighters.)

12. (C) Gilani said it would be almost politically impossible to reduce fuel subsidies (raise prices) in the short term along the lines Deputy Secretary Kimmitt had suggested to the Finance Minister. The coalition had restoration of the deposed judges, immunity for Musharraf, and the election of the new president on their plate. They were already taking enormous heat for previous fuel price increases.

13. (C) Comment: Nawaz may increasingly be considering leaving the coalition in the center and consolidating his hold in the Punjab because he cannot engineer a new general election in the short term. The addition of MQM's support leaves Nawaz with less leverage over Zardari in the current coalition. The fight over Iftikhar Chaudhry probably is based on Nawaz's expectation that Chaudhry would rule in both Nawaz's and Shahbaz's favor in pending court cases

ISLAMABAD 00002802 003 OF 003

challenging their ability to run as candidates in the National and Punjab Assemblies respectively. Until he can sit in the National Assembly, Nawaz cannot be Prime Minister.

PATTERSON