The Billings Outpost

China benefiting from U.S. war in Afghanistan


Brad Molnar

Last October I wrote of the involvement of Chinese-owned development corporations, not to mention U.S. taxpayers, in Afghanistan, India and Pakistan energy development.

China’s high bid had secured rights to the oil fields of northern Afghanistan. Combined with winning “bids” that gave China the rights to the copper deposits, a coal mine, generation facility, a smelter and a railroad, the combination made China the largest investor in Afghanistan.

But the question posed was this: Who will protect these Chinese assets? With the Taliban proudly xenophobic, it is a long-lasting question with the stability of the region in the balance.

According to the World Socialist website (hey, I go where I have to go; it’s not like Jon Tester or Denny Rehberg is going to talk about this when they can jive over who is most independent of party pressures) the $700 million exploration deal for the projected 1.6 billion barrels in oil reserves is expected to net from royalties, taxes, and land rent $5 billion for Kabul over 10 years of partnership with the China National Petroleum Corp.

With the total non-foreign aid budget of Afghanistan being $2 billion (actually less than Montana’s budget) this is major cash, but it won’t help.

A 2010 Pentagon survey pegged the value of Afghanistan’s oil, copper, gold and lithium at $1 trillion. Chinese companies have a serious advantage in “bidding” as they represent government interests and are not bound by commercial constraints.

For example, the oil reserves are only about 350 miles from China’s Xinjiang Uyghur Autonomous Region, a staging base for Chinese companies building land-based pipelines throughout Central Asia to supply the ravenous energy appetite of China and avoid naval embargos.

Security plans for the oil fields have yet to be announced, but the Afghan government has pledged 1,500 National Police to protect the Chinese-owned railroad, copper mine, coal mine, power plant and smelter (combined investment of $3.5 billion). After the Aynak copper mine deal was announced, Taliban insurgents stepped up their activity in Logar province. It was not the Afghan National Police that responded; the U.S. sent 2,000 troops to seal the deal.

Quoting the Socialist website, “Because of the unstable security situation, progress on Chinese investments has been slow over the last few years. As a result, China is completely dependent on U.S. and allied forces to provide protection, which could change if relations with Washington worsen.”

Per strategic commentator Robert Kaplan way back in 2009, “The problem is that while America gives its blood and treasure, the Chinese will reap the benefits. The whole direction of America’s military and diplomatic effort is toward an exit strategy, whereas the Chinese hope to stay and profit.”

With Washington backing, India and Afghanistan signed a strategic partnership agreement ensuring India will play a major role in defending U.S. and Afghan interests after the 2014 NATO drawdown by training and equipping Afghan security forces.

Several weeks later, Kabul granted rights to an Indian steel consortium to develop the Hajigak iron ore deposit, Asia’s largest untapped ore deposit. The investment would be $11 billion for development of the mine, a power plant to run it, and a 900-kilometer rail line to transport the ore back to India via Iran.

Pakistani-Indian relations are punctuated with mistrust and military clashes. Pakistan seems unable to stop the Taliban or Al Qaeda from basing in its territory and the Taliban are voting against any foreign presence. They vote with their Kalashnikovs and would gladly oust the Indians on behalf of their hosts and themselves.

Marine Gen. John Allen, the highest ranking commander in Afghanistan, told the Armed Services Committee on March 22, “We will need significant combat power in 2013.” Stating that rather than an Afghani drawdown in 2013 he prefers a combat force of 68,000 “as a going-in number,” Gen. Allen argued that the war could still be won and failure would create a geopolitical vacuum. He acknowledged to Sen. Susan Collins, R-Maine, that to fund the Afghan National Security Force cost about $5 billion. With Afghanistan’s entire annual revenue of only $2 billion, international help would be required. 

Without foreign resource investment, Afghanistan remains an economy reliant on foreign largess. With it, Afghanis are de facto colonized by China, et al, and engaged in civil strife and military action.

Perhaps Gen. Allen should tell us what a “win” would look like. Perhaps our two candidates for the U.S. Senate should tell us why we should sacrifice our courageous troops to make Afghanistan safe for Chinese investment and if that has anything to do with their ability to buy U.S. votes with money they borrowed from the Chinese.


Brad Molnar is the senior member of the Montana Public Service Commission and serves on the National Association of Regulatory Utility Commissioners International Relations Committee.


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