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Special Report
Last Updated: 04/28/2003
Shifting Sands: Instability in Undefined Asia
Strategic Foresight Group

There are periods in history when the world changes. The Second World War from 1939 to 1945, and the end of Cold War and apartheid from 1989 to 1992 were the last two such periods. The war on terror, which began in 2001 and which seems set to go on till 2005 or beyond is the next such period of momentous change.

How long will the war on terror, including US-Iraq confrontation, go on? What will be its outcome? How will the world change, if at all, after this war? The wars in the nineteenth century were driven by national interests, and those in the twentieth century by ideologies. Some scholars argue that those in the twenty-first century will be a clash of civilisations. Will the war on terror be a war between the West and Islam? Will it define the architecture of global politics in cultural and religious terms? What are key certainties? What will be the surprises?

New Geopolitical Entity

The scope of this report covers Afghanistan, Pakistan, Iran, Saudi Arabia and Iraq. Afghanistan is a key country, since it provided bases for the Al Qaeda terrorist network under the Taliban regime. Pakistan is crucial, since it had in effect colonised Afghanistan under Taliban, and has the potential to help Taliban and Al Qaeda resurface in the future. Pakistan is also a host to many other terrorist groups. Saudi Arabia is known to be the key financier of many terrorist and radical religious groups. Iran and Iraq are components of the US axis of evil.

There is no compact grouping to which the countries covered in this report exclusively belong. Iran, Saudi Arabia and Iraq belong to historical West Asia. Afghanistan and Pakistan are parts of historical South Asia. But together these five countries, along with smaller Gulf States, especially Qatar and Yemen, form a geopolitical entity, which we refer here as 'undefined Asia'.

The countries of 'undefined Asia' are interlinked by geopolitical realities, oil-related issues, terrorism, conflicts between religious orthodoxy and modernism, interplay of interests of outside powers, and crisis of survival. Actions of Saudi Arabia, Pakistan and Iran have shaped Afghanistan. The US presence in Afghanistan provides the former options all over undefined Asia. US actions in Iraq are also found to have impact on Iran, Pakistan and Saudi Arabia. Iran and Saudi Arabia have contributed to sectarianism in Pakistan and Pakistan can choose to drive terrorism all over undefined Asia.

Strategic Foresight Group has developed a 4-G framework for developing various scenarios for the region in a post war-on-terror world. It includes:

  • Growth - rate, scope, quality
  • Governance - participation, accountability, efficiency
  • God - role of religion, values in society
  • Geopolitics - neighbours, global power


It is remarkable that all the countries under review have experienced negative growth rates in the last one or two decades. The growth pattern in all these countries is narrowly spread. There is a small elite that monopolises economic resources, leaving the rest of the population high and dry. In Afghanistan development is concentrated in Kabul. In Saudi Arabia, it is the royal family and its extended network. In Iran, Pahelvi dynasty's monopoly has been replaced by Ayatollah oligarchy. In Pakistan, a nexus between landlords, military men, a few businessmen, and since 1980s the Mullas, have formed an oligarchy.

All the countries are single commodity-dominated economies: Afghanistan - poppy, Pakistan - cotton, Saudi Arabia, Iran, Iraq - oil. None of the countries have made any effort to diversify, due to which the quality of growth is tenuous. Such growth does not provide hope for the youth, which unfortunately is the dominant force in all the countries. There are approximately 50 million young men in the age group of 15-35 years in the five countries together, willing to join official, unofficial or religious armed forces. They account for more than a third of the male population of the respective countries.


There are severe curbs on civil liberties in all these countries. The press encounters censorship. Political space is closed to a large extent, making it difficult for people to participate in institutions of governance.

All the regimes in the countries under review have been accused of misappropriation of authority - whether to benefit in terms of pecuniary consideration or in terms of ability to inflict harm on opponents.

The performance of regimes with regard to efficiency varies. Saudi Arabia and Iran have provided high quality infrastructure and public health facilities. They have invested in education, but mostly in religious education irrelevant to modern economic functions. Successive Pakistan governments have provided some physical and social infrastructure in urban areas, but have largely neglected rural areas. Afghanistan has failed by any criteria of efficiency.


Since the popular base of the ruling classes is very narrow, they need to justify it on some basis. It is easiest to do so in the name of God. Since both rulers and rebels use violent, non-human methods, they propagate that they have religious sanction to do so.

In order to justify the role of religion in the affairs of the state, or political forces seeking to undermine the state, it is also essential to establish the role of religion in the society. All the four societies accommodate rulers and clerics together. Saudi Arabia's monarchy consists of al-Saud family of rulers and al-Sheikh family of preachers. Iran has a combination of Ayatollahs and elected representatives who are also religious leaders. The Pakistani state is a de facto combination of military men and Mullas. Afghanistan was a theocracy. There is a pressure to make religion the basis of the new constitution to be finalised in 2003.


All the countries in the report are politically intertwined. Afghanistan under Taliban was a Pakistani colony. Now it is an American protectorate in practice. Pakistan is ruled by three As - Army, Allah and America. Saudi Arabia has heavily depended on the US for the protection of its royal family. Iran under Shah was a close US ally. Iran, Saudi Arabia and Pakistan patronise various non-state actors in the region.

The most important external player in the region is the US. It has played a critical role in the internal state structures of all the four countries. Since October 2001, it has established physical presence in the region.


The next decade in the region from West to South Asia will be as much shaped by national developments in important countries of the region, as by American motives and ambitions. Since September 2001, the US is very much an active player and not merely a remote super power. United States has significant physical presence of its military personnel and armaments in the region. Its actions are guided by three factors:

  • Terrorism
  • Oil and gas
  • Strategic objectives


The most ostensible reason for the US attacks on Afghanistan is to dismantle the Al Qaeda terrorists network. US authorities averred that their concern is not restricted to one group in one country; the US wants to extirpate terrorism itself. There is no doubt that the region hosts many terrorist organisations. However, the US assertion of its motive to counter terrorism is suspect because of its double standards. US was quick to take action in Afghanistan and psychologically target Iraq and Iran. It appears reluctant to take any action against Saudi Arabia and Pakistan, despite the two countries being at the core of the problem.

With US concentrating on regime change in Afghanistan and Iraq, the present ground realities are bound to promote terrorism. There are approximately 50 million young men in the age group of 15-35 in Iran, Iraq, Pakistan, Saudi Arabia and Yemen. Out of them 25 million are in Pakistan - the epicentre of international terrorism. On the one hand, these young men are used as fodder by military officers in Pakistan, Ayatollahs in Iran and Sheikhs in Saudi Arabia to expand their own power in the region. On the other hand, these young men feel a sense of grievance due to loss of per capita income, breakdown and irrelevance of education, frustration to find a solution to the Palestine problem, failure of agriculture creating rural unemployment and general conditions of privation. All the countries have high population growth rates creating a constant flow of new entrants in education and job market. Further, educational systems are based on religion making the youth incapable of technical skills required to succeed in modern occupations. Economic policies have concentrated on enriching a small elite in each country, limiting manufacturing and employment. There is large-scale displacement and migration. The orthodox social order in the region does not allow interaction between men and women and advocates masochism. With this degenerating educational, economic, and social framework and the growth in the population of young people, terrorism can be expected to grow in the next decade. The US policy of supply side controls on terrorism, whereby funding and support from some of the states to terrorist groups is controlled, does not address the factors on the demand side. As already pointed out even supply side measures are selective as reflected in delayed and half-hearted measures against Saudi Arabia and very superficial and cosmetic actions vis-à-vis Pakistan. Under the circumstances, US agenda in the region appears to be only partially motivated by terrorism. Other likely motives need to be examined.

Oil and Gas

US is accused of engagement in the region to control oil and gas supplies. However, at present US draws almost 70 per cent of its petroleum needs from its domestic reserves, Canada, Mexico, Venezuela and UK. Its dependence on Saudi oil is only 15 per cent of total imports or less than 10 per cent of total need. US also has access to non-Arab suppliers like Russia, Norway and Nigeria. Therefore, US does not need to attack Afghanistan or Iraq just to replace its 10 per cent supplies from Saudi Arabia. Moreover US has so far not developed reserves in Alaska for environmental reasons, but it can do so if required.

While in the short run it does not make sense for US to secure alternative supply routes; long term considerations can be different. The oil reserves in the US, North Sea and the Russia are likely to be exhausted in 30 years time, whereas those in the Middle East and Central Asia are likely to last for more than a century. Also, American oil companies have acquired rights to almost 75 per cent of the oil and gas output from the Caspian region. If US does not control transit routes in the future, American companies may end up paying huge transit fees to Iran, Russia and others. On the other hand, if US controls transit routes and a major supplier like Iraq, it can make OPEC irrelevant and push the oil prices below $20 per barrel. Moreover, it can control supplies to China that is headed towards a serious energy deficit in the next decade.

But these considerations do not commensurate the heavy cost and the toll of human life. Therefore US interests in oil and natural gas can only partially explain its agenda in the region.

Strategic Objectives

In the last 20 years, US alignments have changed very substantially, with the potential to change even more drastically in the next decade. Until 1979, Iran was the staunchest American ally in the region only to turn into its most vehement enemy that year. Until 1989, Soviet Union was the most formidable rival of the US in the world as well as in the region under study. It turned into a guarded friend in the years that followed. Until 1999, Saudi Arabia was a completely reliable economic and strategic ally. It turned into one of the primary sources of the worst attack on the US homeland two years later. When President George Bush Junior was elected in 2000, his advisors described China as America's strategic competitor. By 2003 China has emerged as a US partner in war on terror, as well as global economy transformation.

As the US looks ahead in the future, it has to take into consideration the potential competition from Iran, Russia and China in the region. In fact, this is the time for the US to establish its military presence in the region and sow the seeds of popular support for a close relationship with the people of the region, when the three potential powers are too weak and too pre-occupied with internal economic revival to obstruct the US in the region.

It is evident from the above discussion that the US is partially motivated by terrorism and oil, but its primary objective seems to be strategic. The US wants to establish geopolitical supremacy, while potential contenders for power in the region - Iran, China and Russia - are weak. This precedes a three-tier strategy:

  • Installation of friendly regimes in the region including Afghanistan, Iraq, perhaps Saudi Arabia and wherever else possible.
  • Establishment of military bases in Afghanistan, Uzbekistan, Tajikistan, Qatar, Kuwait, Yemen, Iraq, Saudi Arabia and wherever possible.
  • Control of the Indian Ocean by the US navy.