New Silk Road Strategy: Problems and Perspectives – Interview with Prof. S. Frederick Starr

By Dr. Guli Yuldasheva and Mavlon Shukurzoda.

Since the collapse of the bipolar world system, discussions on the new world order and problems of regional instability have not yet ceased. They have recently achieved perhaps their apogee – fierce mass media disputes have erupted around the Russian-proposed Eurasian way of development from the one side, and the US “New Silk Road” strategy from the other. Each suggested model of development has its own advantages and vulnerabilities. It is quite obvious that each vision’s success is closely linked with the settlement of the Afghan issue in one or another format; that is natural in conditions of globalization, integrity and indivisibility of international security.

In fact, any strategy pertaining to the Eurasian area should have to deal with the Afghan dilemma, directly or indirectly affecting the speed and the level of its realization. Besides the issues of illicit traffic in drugs, illegal migration and criminality from the territory of Afghanistan, the following external tendencies should be kept in mind that can also negatively influence the processes ongoing on the Eurasian continent:

                               

• spread of radical movements in Central Asia (currently found in Kyrgyzstan and Kazakhstan);
• atomism and absence of geopolitical unity in the CA region;
• gradual ascent of Islamic regimes to power in the Middle East and continuation of instability there;
• gridlock in the Caspian dispute and uncertainty in the sphere of energy policy in the Middle East.

In this connection, the concept of the so-called “New Silk Road” is of special interest. It was suggested by Prof. S. Frederick Starr, Chairman of the Institute of Central Asia and Caucasus at Johns Hopkins University, and later formulated as a new US strategy jointly with the Washington Center for Strategic and International Studies. At present, the Obama Administration seems to have actively started implementing its provisions, as evidenced by the agenda of US Secretary of State Hillary Clinton’s last visit to the republics of Central Asia and Pakistan, which immediately border Afghanistan.

The ideas, set forth in the concept are not new. Similar ideas have been already voiced in October 1997 by Senator Sam Brownback (R-KS), who closely cooperated with Prof. Starr in his legislative initiative “Silk Road Act,” and later were extensively developed by Prof. Starr in his “Big Central Asia” concept. Today he suggests the renewed version of the concept named a “New Silk Road” in his report titled “Afghanistan Beyond the Fog of Nation Building: Giving Economic Strategy a Chance.”

It is worth noting that the regional dimension of the US Central Asian strategy was analyzed by Prof. Starr in such his earlier works such as “A Strategic Assessment of Central Asia and the Caucasus, 1999-2000” and “The New Silk Roads” (2008).

In “Afghanistan Beyond the Fog,” Prof. S. Frederick Starr continues to focus on the regional dimension of the new US strategy, but takes into account opinions of his opponents and present-day realities. The process of realizing transport-trade operations in Afghanistan rests upon the support of such states as Russia, China and Iran, the role of which he analyzed in detail as early as in 2008. Indirect cooperation with Iran is in fact already proceeding, though quietly.

In the interests of geopolitical and economic stability, Prof. Starr’s report justifies a leadership and broker’s role for the US in this project, which is de-facto the biggest investor in Central Asia and whose interests therefore cannot be ignored in any analytical layout. At the same time, long-term economic and political goals, set forth in the new Afghan strategy, logically exclude US global leadership so as to avoid the clash of numerous involved resources and interests, without which the project itself will not be practically fulfilled.

By the same logic, in this strategy Afghanistan plays the role of an important hub and a crossroads for the trade-transport routes under construction. Yet, as an unstable state, it is only a center for concentrating efforts on social-economic stabilization of Central Asia, but not by all means as a geopolitical center or a model of development for its neighbors.

The following factors will benefit the “New Silk Road” project’s realization:

• diversification of regional transit routes is in the interest of all CA republics;
• the transport-logistical system of the Northern Distribution Network, so important for the US strategy in Afghanistan, covers the territory of nine former republics of the USSR – Uzbekistan, Tajikistan, Kyrgyzstan, Kazakhstan, the Russian Federation, Azerbaijan, Georgia, Ukraine and Latvia;
• US experts often speak in favor of a partnership with Russia and China as important regional players, whose potential and interests should be taken into account in the Afghan strategy;
• rapprochement of the EU and US positions on Afghanistan (in particular, Germany and the US);
• removal of military sanctions and activation of American business in Uzbekistan;
• diplomatic and other efforts of the US on regulating interstate relations in Central Asia;
• the continued aspiration for regional integration among some CA states, which is underscored by Kazakh President Nursultan Nazarbayev’s adherence to the idea of the Central Asian Union’s revival, and the efforts of Uzbekistan and Kyrgyzstan to normalize relations (opening borders between them on October 26 this year);
• a restoration of the dialogue between Pakistan and India, culminated with the signing of a transit agreement between them.

It goes without saying that these tendencies are still unstable and much more should be done. However, alongside with statistical data provided in Prof. Starr’s book, they inspire hope for a positive outcome in Central Asia.

What follows is an in-depth interview with Prof. Starr, where he extrapolates the main ideas of his new concept on Afghanistan. It should be stressed that the ideas and thoughts set forth in the introduction and conclusion of this article reflect opinions of the authors and by no means refer to the position of Prof. Starr.

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Question: The US government has recently presented a “New Silk Road” strategy, which is aimed at deepening economic and trade relations between Central and South Asia. What are the distinctive differences between the new strategy and the previous American approach to economic reconstruction in Afghanistan?

Prof. S. Frederick Starr: The new US strategy is concentrated on the development of an integrated strategy of economic and social development in Afghanistan, which means construction of the new system of transport and trade routes along the ancient Silk road.

The US’s approach to economic renewal of Afghanistan will rest on job creation, the provision of basic services, the construction of infrastructure and the development of fiscal sustainability. However, all these goals will be focused around a more purposeful yet comprehensive strategy, one that embraces the expansion of transport and trade as the main engine of economic advancement.

At the same time the usage of military measures will only be a means and not the final strategic goal. The revival of the ancient transit routes through Afghanistan in new conditions can solve the present US strategic dilemma and can become a genuine key to the success of their regional strategy, whereby the US can efficiently use its leadership potential and possibilities in this issue.

A new economic strategy acknowledges the reality that the Afghan struggle is regional in scope, affecting the rest of Central Asia, Pakistan, India, China, Iran, etc., and must be resolved on a regional basis. Such a strategy benefits all and is directed against no one. Priority projects include the completion of the Afghan Ring Road and Kabul-Herat highway, and linking them to continental trunk routes, especially to the Pakistani port at Gwadar; completing trans-Afghan rail lines linking Europe and Asia; constructing the TAPI pipeline; and completing electrical transmission lines linking Central Asia, Afghanistan, northern Pakistan and India.

The US nowadays treats the implementation of a “New Silk Road” strategy as a matter of the highest priority. In keeping with this, the Obama administration has already appointed a special Presidential-appointed Envoy to lead a major inter-agency task force that will work closely with military and civilian leaders in the US, Afghanistan, among coalition partners and in regional states. At the same time it is planned to use all tools at the disposal of the US government to engage the private sector.

Question: What criteria must a revised economic strategy for Afghanistan meet to achieve success?

Prof. S. Frederick Starr: First, it must directly and manifestly improve the lives of Afghans, Pakistanis and people in those Central Asian states that are key to this region-wide project. As this happens, internal and external stakeholders will buy into the effort. Only through these means can one expect a decline in the resort to violent solutions. Only in this way will the need for a large and costly US military presence begin to lessen in the immediate future.

Second, it must be possible to pursue the economic strategy simultaneously with the military strategy, and in such a way that the two are mutually reinforcing. Third, it must leave the Afghan government with an income stream. Today the US is paying the salaries of all Afghan soldiers and civil servants. This cannot go on forever.

Fourth, an economic strategy must work fast, showing substantial results within the next 1-2 years. An early focus on removing administrative and procedural blockages to trade will produce quick results. Overall, economic progress will create the conditions that will enable the US to shift its main emphasis from military power to economic and social betterment.

The only approach that meets these criteria is one that focuses on reestablishing Afghanistan’s traditional role as a hub of transport and trade, linking Europe and the Middle East with the Indian sub-continent and all South and Southeast Asia.

Question: There is no doubt that Afghanistan’s advantage is its geostrategic location. At the same time this country is still viewed as the “end of the road” rather than a central hub. How do you assess this situation?

Prof. S. Frederick Starr: Over two millennia, Afghanistan was the place where trade routes to India, China, the Middle East and Europe all converged. This is why Marco Polo crossed the country en route to China, and why Arab travelers like Ibn Battuta crossed it on their way to India. Such trade along the misnamed “Silk Road” (in fact, every conceivable product was transported over it) produced immense wealth. Balkh, near Mazar-e-Sharif, was once among the largest and richest cities on earth. Medieval Arabs, who knew something about urban life, called it “the Mother of Cities.” Bagram once maintained lucrative ties simultaneously with ancient Greece and India, enabling it to flourish in opulent splendor.

The US-led Operation Enduring Freedom radically changed the situation in modern Afghanistan by reopening its northern border to long-distance trade for the first time since 1936, and by creating similar potential on Afghanistan‘s eastern border with Pakistan. This action, entirely unintended and largely unnoticed in America or elsewhere, is one of the most transformative developments on the Eurasian landmass in the past century.

Question: What other factors contribute to the future development of transcontinental trade in Eurasia via Afghanistan?

Prof. S. Frederick Starr: The most powerful drivers of the expansion of transcontinental Eurasian trade in the coming years will be the rapid growth of the Indian and Chinese economies. To date, most of Chinese and Indian exports are shipped by sea, but the anticipated continued growth of such exports will increase demand for transcontinental road and rail shipping routes. Much shipping from Western China, for example, naturally lends itself to transcontinental trade, given the long distance from production site to port and the slowness of maritime transport. Realistic estimates for Indian trade by land through Central Asia to European and Middle Eastern markets foresee a growth to US $100–120 billion annually by 2015. Afghanistan and its neighboring Central Asian countries stand to benefit immensely from this trade through the collection of tariffs and through the growing role of their own transit-related industries.

Question: But some politicians and analytics argue that a transport-based “New Silk Road” cannot be realized until stability is established in Afghanistan. Do you agree with such an assessment?

Prof. S. Frederick Starr: It cannot be denied that sustained violence in Afghanistan – as well as areas like Baluchistan, Kashmir and other parts of Eurasia – inhibits economic activity and dampens the private and public investment that could help foster continental trade and growth. Yet, the continuing flow of Pakistani trucks ferrying NATO supplies from Karachi to Afghanistan along roads fully accessible to Pushtun and other insurgents is proof that commercial activity can flourish amid instability. Any gains that militants would make from disrupting these vital supply lines on a strategic level are outweighed by the fact that local tribes derive significant income from the traffic. As long as such incentive structures hold, local populations have shown themselves ready to prioritize commerce over political violence. The US and NATO would do well to recall that one reason the Taliban succeeded in gaining control of Afghanistan is that they promised to abolish local toll-collection points.

Improvements in the 3,000 km Ring Road, which connects the cities of Mazar-e Sharif, Kabul, Kandahar and Heart, have already facilitated Afghan internal transportation growth. IMF and Afghan authorities estimate that there are now more than 600,000 vehicles in Afghanistan today, as compared to 175,000 in 2002, and they travel on more than 13,000 km of newly built or rehabilitated roads. These improvements are part of a strategic priority placed on transportation by the Afghan Government, and they serve to stabilize the situation in Afghanistan.

Question: As the world and regional trade benefit from the reestablishment of the New Silk Road, what do you estimate the role has been of individual countries in the development of a transportation sector in and around Afghanistan so far?

Prof. S. Frederick Starr: The project in fact is already supported by all neighboring states. With or without America, they would like to get benefits for what, they consider, they have all historical rights. Uzbekistan, with financing from the Asian Development Bank (ADB), has extended its rail system to Mazar-e-Sharif and is sending electricity to light Kabul. Neighboring Tajikistan, with help from China and Iran, has opened a road across the lofty Pamirs from China to the new American-built bridge to Afghanistan and also intends to lay a rail line from its capital of Dushanbe to the Afghan border. Turkmenistan is also constructing roads and railroads to link with the Afghan Ring Road.

Pakistan and China are rebuilding the main north-south road across Pakistan that provides Afghanistan with a key link, through the Khyber Pass, both to China and the Arabian Sea. At its southern terminus at Gwadar, they have already built a new port that will provide the most efficient sea link between Central Asia, Afghanistan and the burgeoning economies of Southeast Asia. China also hopes to enhance Afghanistan’s access to the East with a railroad through the Khyber Pass that will then connect to east-west lines across Pakistan.

Iran, meanwhile, is extending its railroad and highway systems to Herat, the key city of western Afghanistan. Teheran is also constructing a new port at Chabahar rivaling Gwadar. India has helped build a road to connect Chabahar to Afghanistan’s Ring Road. Afghanistan’s neighbor to the northwest, gas-rich Turkmenistan, has meanwhile built a new port on the Caspian Sea at the city of Turkmenbashi that will transmit cargoes from Afghanistan and the East to Azerbaijan and then the Black Sea and Europe. Turkmenistan signed an agreement with Afghanistan, Pakistan, and India to construct a gas pipeline to deliver Turkmen gas across Afghanistan to India’s energy starved northwest, as well as to Pakistan. And, as I mentioned earlier, the United States spent US $1.8 billion to redevelop 635 km of the Ring Road and 2,700 km of other roads linking primary and secondary markets.

Question: You described in detail the situation with the highway and railroad projects in Afghanistan. What progress do you see concerning the aviation sector in this country?

Prof. S. Frederick Starr: Connecting Afghanistan with the larger world by air has proceeded slowly, and in a competitive environment in which most of Afghanistan‘s neighbors are striving to become the main stopover for East-West flights. Japan, however, has reconstructed the terminal at Kabul airport and a new private Afghan-owned airline is already flying into Frankfurt. Direct flights from Kabul to major air hubs are essential, as is the development of a reliable and Afghan-owned airline for internal travel. Uzbekistan has already made huge strides in establishing itself as an air hub between South and East Asia and Europe. Those who think only in terms of a “zero sum” fail to realize the large potential of this traffic in the future. Afghanistan may not become THE main air hub, but it can play a useful role and one that benefits its domestic economy.

In Afghanistan and around the region there are many opportunities to implement relatively routine enhancements to commercial aviation operations that would result in more safe, secure and controlled airspace and ground operations. This would allow Central Asian countries along the New Silk Road to assert rights and collect rents commonly associated with destination and en route flight operations in the developed world.

Question: Recognizing that inadequate infrastructure is not the only barrier to expanded commerce in the region, what measures are necessary to address institutional impediments to efficient transportation in Afghanistan?

Prof. S. Frederick Starr: There is a lot of research, which concludes that the biggest obstacles to transcontinental trade are institutional, bureaucratic and political. The most common of these obstacles are excessive duties imposed by governments, simple corruption on the part of border officials, and the failure of bordering states to cooperate to facilitate trade. A survey conducted by the ADB of nearly 1,000 continental truck drivers from various countries hauling goods across Afghanistan supports this assessment, with 90 percent pointing to the bureaucracy at borders as the greatest impediment to trade. This does not mean that infrastructure is unimportant. It is crucial, of course – especially railroads, pipelines and power lines. But that is only part of the story.

That is why the standardization and professionalization of customs administration is essential to unlocking Eurasia’s trade potential. They will reduce the opportunity for low-paid and untrained officials to extract illegal rents from shippers, and will also spur private investment. In addition, the modest expense of a comprehensive standardization and professionalization effort can be shared among leading trading nations or funded by multilateral financial institutions such as the World Bank. Both the political and financial risks involved are modest, and would decline further as success breeds success. The resulting reductions in dollars-per-ton-per-mile costs will allow Afghanistan, Central Asia, Pakistan and their neighbors on the Modern Silk Road to compete favorably with other trans-continental transportation routes.

Question: Who will lose under this proposal?

Prof. S. Frederick Starr: First, it is not a proposal. The new silk roads are advancing on many fronts, with or without the US or any other single country or grouping of countries. The opening of continental transport across Afghanistan and Central Asia is inevitable. The only question is whether it can be hastened through US support. So we are not asking whether or not such a project should go forward. It is already advancing quickly.

Will there be losers as well as winners? Not necessarily. The opening of continental transport across Afghanistan and central Asia is not against anyone. The Russian government in Moscow may have expressed skepticism, because it wants to preserve Soviet era patterns of transport. But meanwhile, businesses in the Urals, West Siberia and Altai are eager to be able to ship goods to India, Pakistan and Southeast Asia, and will benefit enormously from the proposed initiatives. The only losers will be those who refuse to compete, and those who try to prevent others from competing.

Question: What main considerations were behind the American administration’s adoption of the “New Silk Road” concept for Afghanistan?

Prof. S. Frederick Starr: First, the failure by the US to embrace a “Silk Road Strategy” for Afghanistan and adjacent countries would have been a blow to Washington’s credibility in Kabul and other regional capitals. This prospect of becoming strategically irrelevant is no trivial matter for the US, given that Afghanistan and Central Asia are the only region on the planet surrounded by four, or possibly five, nuclear powers (Pakistan, India, China, Russia and, possibly, Iran). It means that in some future crisis Afghanistan, Central Asia, and Pakistan, too, will respond first not to Washington but to other voices, by no means all of which wish America well.

Second, if Washington took a pass on a transport and trade-based strategy, it would have failed to seize and build upon its comparative advantage throughout the broader region. It would proclaim to anyone listening that the greatest commercial power also have passed up an opportunity to engage NATO partners and other powers in a project to which even their most pacifist parliaments cannot object. In other words, if the US had failed to embrace and lead a transport- and trade-based strategy, NATO, too, would also have paid the price.

Third, a transport strategy effectively attracts the US private sector, including American firms. Even though their role will surely not be enormous, it is an important factor in garnering domestic support for Central Asia within the US. Business leaders in China, India, Japan and Iran, with strong encouragement and help from their governments, are already actively lining up transport-related projects that will cross Afghanistan and the region. As the new corridors open, opportunities in fields as diverse as insurance, freight forwarding, hotels, mining, hydroelectric production, agriculture, and manufacturing will open up.

Finally, if the US had failed to open its eyes to a trade-based economic strategy, or rejects it as nation-building, it would have squandered its enormous investment in the form of American blood and treasure, and at a moment when a positive outcome is still within reach. This would be all the more regrettable in light of the fact that the United States has already been the biggest single investor in the new transport systems that will reconnect Afghanistan with the world.

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Conclusions

1. It is obvious that a solution to the Afghan issue, as described above, first of all benefits US interests by removing the potential threats to American and Central Asian interests. The solution preserves American presence in Central Asia. Furthermore, US efforts at raising the regional countries’ economic, scientific-technical and commercial potential strengthens their links with global political institutions and financial markets.
2. In the meantime, the problems of democracy-building are relegated to secondary importance due to the incommensurability of potential consequences of regional instability for democratic development. It will be easier, however, for more open political systems to evolve in those countries that enjoy peace, stability and solid economies.
3. It is impossible to exclude as well the interests of the regional states themselves, including first of all CA states, in achievement of stability, development of transit possibilities and regional trade, solution of the social-economic issues. Purely political projects for “integrating” Central Asia have not advanced, and for understandable reasons. The New Silk Road strategy calls not for integration but for coordination, which is compatible with the concerns of all regional states to preserve and enhance their sovereignty and independence.
4. Despite shared regional interests supporting the New Silk Road strategy, current bi-lateral friction such as between US-China, US-Iran and US-Pakistan, as well as lesser US disagreements with Russia, hamper its realization, Special US efforts are needed to remove these barriers. But it should be stressed again: the New Silk Road Strategy is not against anyone. Everyone will benefit from it, not least China, Russia and Iran.
5. It is obvious that success of the “New Silk Road” will be largely defined by economic interests in the region, by existing demand and completed projects. However, political support will also play an important role. If political disputes and discussions on New Silk Road implementation are prolonged, and unanticipated difficulties in the Central Asian area arise, the new strategy will risk turning into nothing more than just another political slogan. If the New Silk Road strategy stumbles, Moscow’s proposed Eurasian way of development will undoubtedly be the strongest impetus for Central Asian coordination.