NATIONAL INTELLIGENCE DAILY WEDNESDAY 31 JANUARY 1979

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP81T00368R000100010063-8
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 25
• Document Creation Date: December 23, 2016
• Document Release Date: April 8, 2010
• Sequence Number: 63
• Publication Date: January 31, 1979
• Content Type: REPORT

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3/ January 1979
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Contents
Situation Reports
Iran
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Briefs and Comments
Italy: Andreotti's Expected Resignation . . . . 4
France-Spain: Basque Policy 5
North Korea - Libya - USSR: Pilot Training . 6
West Germany: Cabinet Meeting 7
Tanzania-Uganda: Military Situation
Syria-Iraq: Results of Talks
Ethiopia: Offensive in Eritrea
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USSR: Warnings on Intelligence Equipment .
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Morocco - Western Sahara: Polisario Success 10
Rhodesia-Botswana: Airlift 10
NATO: Greek Reintegration Dispute 11
Purchase 11
Argentina-USSR: Initial Arms
Special Analysis
Pakistan: The Current Mood 12
Overnight Reports 15
The Overnight Reports, printed on yellow paper as
the final section of the Daily, will often contain mate-
rial that updates the Situation Reports and Briefs and
Comments.
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SITUATION REPORTS
IRAN
Representatives of the Iranian religious opposition
told US officials yesterday that they have reached agree-
ment with senior military officers on security arrange-
ments for Ayatollah Khomeini's return. 25X1
the agreement was reached aj-ter
Minister Bakhtiar and General Gharabaghi, Chief of the
Supreme Commander's Staff, concluded that Khomeini 25X1
should be allowed to return because the military could
not control the violent demonstrations in Tehran. There
have been no indications, however, of movement toward
resolving
Bakhtiar.
the political conflict between Khomeini and
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Once Khomeini returns to Iran, moderate members of
the religious opposition and political leaders associ-
ated with the Liberation Movement of Iran will probably
urge him to move cautiously in his relationship with
Bakhtiar to avoid provoking the military. He is widely
expected to announce the formation of an Islamic Revolu-
tionary Council when he returns, however, and to call
again for the resignation of the Bakhtiar government. A
spokesman for Khomeini had said in Paris on Monday that
senior military leaders would be "purged" under a new 25X1
Islamic government since, he said, these officers were
responsible for the recent bloodshed in Tehran.
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senior
military leaders have acknowledged in their discussions
with the opposition that political changes are necessary
and that the military would accept these changes if they
are carried out in accordance with the constitution.
Calls for a purge of senior officers, however, or any 25X1
move by the opposition to renew violent demonstrations
could trigger a crackdown by the military.
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one reason for
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allowing
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Khomeini's return was to make it possible to arrest
Khomeini if the military had to start detaining opposi-
tions leaders.
Despite the senior officers' apparent confidence
that they can take over the government and crack down on
the opposition if necessary, the military's ability to
act as a cohesive force is steadily diminishing. There
have been increasing signs of support for Khomeini among
junior officers and conscript soldiers, particularly in
the provinces, and on Monday members of a battalion of
the elite Special Forces Brigade stationed in Tehran an-
25X1 nounced to their officers that their sympathies lie with
the "people." The Special Forces would be relied upon
heavily in any military coup.
--continued
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BRIEFS AND COMMENTS
ITALY: Andreotti's Expected Resignation
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Prime Minister Andreotti is expected to present his
resignation to President Pertini today. At this point,
Andreotti seems the most likely candidate to attempt to
form another government. The attitudes of the Communist
and Socialist Parties, however, will make the formation
of a new government exceedingly difficult.
The Communist Party precipitated the situation last
Friday by withdrawing its parliamentary support from the
government. Party chief Berlinguer is reportedly intent
on placing the party in the opposition. The Socialists,
concerned that association with any new government would
subject them to Communist attacks, would most likely fol-
low the Communist lead. 25X1
Both the Socialists and the Social Democrats hope
to avoid an early parliamentary election in which they
expect to do poorly and so have been seeking an alterna-
tive governmental formula. These parties have called
for the appointment of several non-Christian Democratic
"technicians"--and possibly some acceptable to the Com-
munists--to the next cabinet. While there are indica-
tions the Christian Democrats might approve this alter-25X1
native, Berlinguer reportedly considers this an inade-
quate response to Communist demands.
The inability or unwillingness of the parties to
reach a compromise on a successor government may make
an early election inevitable. The Socialists and So-
cial Democrats evidently would prefer a vote following
the direct election for the European parliament--slated
for 5 June--to capitalize on their association with 25X1
other European Socialists. The Communists seem to
favor an Italian election before that test.
At this time, the Christian Democrats appear to
hold the key: A Christian Democratic caretaker govern-
ment might delay or facilitate an election--depending25X1
upon the parties with which the Christian Democrats
would prefer to deal.
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FRANCE-SPAIN: Basque Policy
The French Government announced yesterday that it
would no longer accord Spanish Basques political refugee
status. This change in policy is not likely to prevent
terrorists from crossing the French border, but will
give a boost to Spanish Prime Minister Suarez and his
struggle against the Basque terrorist organisation ETA.
As an earnest of their resolve, the French yesterday ex-
pelled seven Basques and rounded up 20 more.
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Madrid has long charged that fleeing ETA members
slip across the border and live openly in southern
France as "political refugees." When Franco ruled Spain,
Paris used its lenient policy toward Spanish Basques
as a protest against his regime. The French became
uncomfortable during the past two years, however, as
Madrid established a democratic parliament and consti-
tution. French officials yesterday referred to the
Basque refugee status as "obsolete." 25X1
After ETA stepped up its attacks in Spain and the
Spanish military grew restive over the government's ap-
parent inability to contain the terrorists, Spanish For-
eign Minister Oreja flew to Paris earlier this month to
seek French cooperation. Domestically, the apparent suc-
cess of his mission will help Suarez in the period lead-
ing to the legislative election on I March by creating
the impression that his government can rally international
support for the war against ETA.
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NORTH KOREA - LIBYA - USSR: Pilot Training
North Korea's decision to send a sizable contingent
of combat pilots to Libya marks an important policy de-
parture that may well entail significant political risks.
North Korean President Kim Il-song no doubt realizes the
risks but may have agreed to this arrangement in hope
of receiving MIG-23s or late-model MIG-21s from the USSR
at some later date.
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North Korean fighter pilots operated in Egypt and
Syria in the early 1970s, but in recent years North 25X1
Korea has avoided a tactical military role in Third
World countries where there is significant competition
between the Chinese and Soviets. In sending a large
number of personnel to Libya
North Korea could complicate its present warm
relations with China, which has developed steadily
closer ties with Egypt. North Korea also runs the risk
of becoming embroiled in a conflict between Libya and
Egypt. 25X1
If the arrangement is publicly exposed, Pyongyang
will be open to charges of serving as a Soviet surrogate.
Such a label would undercut North Korean efforts to gain
support in the Nonaligned Movement.
The Soviets could see several advantages in this
arrangement. It is responsive to Libyan requests for
strengthened air defenses, offers Kim Il-song an incentive
for moderating North Korea's recent strong public sup-
port for the Chinese, and underscores the possibility
of the USSR's reentry as an active participant in an arms
race in Korea if the US provides South Korea with advanced
weaponry such as F-16s.
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WEST GERMANY: Cabinet Meeting
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the cabinet, which meets today to discuss
defense and security questions, can be expected to en-
dorse Chancellor Schmidt's views for handling the parlia-
mentary debate on these issues tentatively set for March.
Schmidt has long maintained that arms control negotia-
tions with the East should be carried out at the same
time advanced weapons systems are being developed for
deployment in Western Europe. He is under some pressure
within his Social Democratic Party to take a new initia-
tive on disarmament, but neither the junior coalition 25X1
partner--the Free Democratic Party--nor a majority of
Schmidt's own party favors such a proposal.
Advocates of a new disarmament policy, such as
Social Democratic parliamentary leader Wehner and Bundes-
tag arms control chairman Pawelczyk, believe that there
will be little if any progress on the Mutual and Balanced
Force Reduction talks this year because of the major
hurdles still ahead in those discussions. They are also
skeptical that the US and USSR will conclude a SALT 11
agreement; Wehner is said to believe that the USSR is
no longer interested in pushing the agreement since the
US established diplomatic relations with China.
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Wehner and others argue that, in order to maintain
the momentum of detente in Europe, the West Germans
must break new ground. Schmidt and Foreign Minister
Genscher, however, supposedly believe that a disarmament
initiative would collapse before it got off the ground,
primarily from lack of support in both coalition parties.
Genscher, the Free Democratic Party chairman, is in-
clined, like Schmidt and Defense Minister Apel, to favor
negotiations from strength and the party's rank and file
would probably support this view.
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TANZANIA-UGANDA: Military Situation
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After fending off Ugandan counterattacks last week-
end, Tanzanian forces consolidated their hold on a strip
of Ugandan territory up to 15 miles deep.
the Tanzanian military, encouraged by the
light resistance they have met so far, is preparing to
drive farther into Uganda. A logistics buildup to sup-
port the operation is under way, and 800 Ugandan armed
exiles loyal to former President Obote were recently
moved to the border area and reportedly will spearhead
the assault, the
exiles would be intiltrated through the lines to conduct
guerrilla attacks. On Friday and Saturday Ugandan Presi-
dent Amin sent telegrams to UN Secretary General Waldheim
appealing for action by the UN or the Organization of
African Unity.
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SYRIA-IRAQ: Results of Talks
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Syrian President Assad and Iraqi political leader
Saddam Husayn ended three days of talks in Damascus
yesterday with vague pledges of closer defense coopera-
tion and of further study of formulas to achieve Baath
Party unity. Iraqi Foreign Minister Hammadi said much
work remains to be done in reaching agreement on a "unity
formula" and implied that Syrian and Iraqi leaders may
not meet again for several months. These pledges fall
considerably short of real military or political in-
tegration, and a rumored meeting between Assad and
Iraqi President Bakr early next month now seems un-
likely. 25X1
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ETHIOPIA: Offensive in Eritrea
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The Ethiopian Government's offensive against
Eritrean People's Liberation Front forces in northern
Eritrea is moving forward. Government forces last
weekend staged an amphibious landing at Mersa Tekley,
some 50 kilometers from Carora, a vital transshipment
point on the Sudanese border. Other forces are push-
ing north from the Mescalit Pass towards Nakfa. The
EPLF has suffered heavy casualties in the fighting but
reportedly has also inflicted major losses on the Ethi-
opeans. The Eritreans expect to abandon Nakfa during
the next few days and revert to guerrilla warfare.
USSR: Warnings on Intelligence Equipment
The Soviets are warning against any transfer of
US electronic intelligence equipment from Iran to Tur-
key. At a press conference last week, Soviet Deputy
Foreign Minister Korniyenko reaffirmed that the USSR
would regard the transfer of equipment "in the most
negative manner." A commentary in Izvestiya asserted
that the use of such equipment anywhere in the region
would be a serious threat to the "peoples of the area "
The Soviet press has ignored the SALT implications of
the possible withdrawal of US equipment, but the Soviet
Ambassador to Bulgaria last week criticized the claim
by opponents in the US of a SALT treaty that develop-
ments in Iran could become an obstacle to SALT verifica-
tion. 25X1 25X1
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MOROCCO - WESTERN SAHARA: Polisario Success
We can now confirm that Polisario Front guerrillas
overran the Moroccan town of Tan-Tan on Sunday and sub-
sequently withdrew.
The Polisario admit to
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heavy casualties, but their estimate of the number of
Moroccans killed--some 225--probably is exaggerated.
The Moroccan Council of Ministers met on Monday to re-
ceive reports on the attack and to announce that they
were sending the Minister of the Interior to the scene.
As yet there are no indications of a Moroccan response
but one is likely--possibly a raid by Moroccan irreau-
lars against Polisario camps in Algeria.
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RHODESIA-BOTSWANA: Airlift
The US Embassy in Botswana is concerned that Rho-
desian security forces may attempt to disrupt the airlift
of some 10,000 Rhodesian refugees from Botswana to Zam-
bia scheduled to begin tomorrow. Botswanan officials
have sought South African intercession with Rhodesia
after receiving private warnings from Rhodesian sources
against carrying out the airlift, which will be made
up predominantly of military age males who will join
the Zambian-based Zimbabwe African People's Union.
Rather than extend the conflict into Botswana, the Rho-
desians may wait until the refugees are in Zambia before
making any attacks.
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NATO: Greek Reintegration Dispute
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NATO Permanent Representatives have asked the
Supreme Allied Commander, General Haig, to try to break
the deadlock over Greek reintegration into the Alliance's
military command. There has been little progress since
Turkey rejected the proposals General Haig worked out
with Greek officials last June giving Greece, on an
interim basis, the same air and sea responsibilities
it had in the Aegean before it withdrew from the mili-
tary side of NATO in 1974. The Turks are afraid of
prejudicing their position in the dispute with Greece
over Aegean rights and thus are insisting that the
problem be settled before reintegration. The Greeks,
who have the same concerns for their Aegean rights, have
said that such matters can wait until they are back in
the NATO military structure. 25X1
ARGENTINA-USSR: Initial Arms Purchase
Argentina is reported to have signed a contract with
the USSR for antiaircraft guns and ammunition. If true,
this would be Argentina's first arms deal with a Commu-
nist country. Argentina may have turned to the Soviets
after a West German firm failed to meet the complete 25X1
delivery schedule for an $11 million order placed last
July. 25X1
Last summer,
the Soviets stepped up their sales efforts when Argentina
became concerned about a possible confrontation with 25X1
Chile. The Soviets offered to sell Argentina let fighter
aircraft, helicopters, and missile systems
The Argentines may believe that25X1
the present limited purchase is justified by their
quarrel with Chile and by their policy of broadening 25X1
and diversifying trade relations with the Soviets. The
USSR, however, is not likely to become a major arms sup-
plier for Argentina.
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SPECIAL ANALYSIS
PAKISTAN: The Current Mood
Pakistanis are more worried about the future of
their country than they have been at any time since in-
dependence in 1947. The US Embassy in Islamabad con-
cludes that there is widespread pessimism about where
the country is heading and who will be charting the
course.
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The prevailing mood stems from the apparent lack
of solutions to the country's many domestic and foreign
problems.
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To many Pakistanis, there may seem no way in which
the country can be governed effectively. In the last
three decades, Pakistan has had presidential, parlia-
mentary, and military rule, several different versions
of federalism, and both free and carefully controlled
elections. None of these has led to lasting governmen-
tal stability, prevented periodic outbreaks of civil
disorder, or lessened regional and ethnic tensions.
The Alternatives
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Pakistan is now ruled by a general with limited pop-
ular support and declining prestige. The alternatives
to him are:
-- Some other general.
-- A civilian government under some new leader.
-- The return to power of former Prime Minister
Bhutto.
-- The institution of Islamic rule.
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--continued
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There are problems in every one of these alterna-
tives. There is no reason to believe, for instance,
that another general would be any better able to rule
the country than President Zia has been. The military--
regarded as the savior of the nation when it first seized
power in 1958--lost half the country's territory in the
war with India after it again took over in 1969. Few
Pakistanis--even in the Army--believe that a continuation
of the most recent period of military rule, which began
in July 1977, will solve Pakistan's problems.
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There is mounting pressure for a return to civilian
rule, but most prominent politicians do not attract the
masses, have only a regional following, or have failed
to convince the people that they can carry out their
promises. Even were the military to surrender power,
there is no guarantee that civilian rule, no matter what
its form, would be an improvement.
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Former Prime Minister Bhutto has been sentenced to
death for a political murder, and the Supreme Court
could announce its decision on his appeal in the next
few days. The court is expected to uphold the sentence
and leave the final decision to Zia. There are conflict-
ing reports about which way Zia is leaning, but any de-
cision is likely to increase Zia's problems and could
lead to civil disorder or Zia's removal from office.
Despite the many accusations against Bhutto, he is
charismatic and capable and regarded by many Pakistan'
as the one man who could solve the country's problems25X1
Many others, however, regard him as a dangerous man who
is responsible for many of Pakistan's current problems.
Even if he is executed he is likely to remain a divisive
issue in Pakistani politics. 25X1
Some. Pakistanis argue that the institution of Is-
lamic rule is the only way to save Pakistan. Although
Islam has a deep influence on most Pakistanis, it is
fragmented with no strong organized leadership as it has
in Iran. Pakistanis have been debating the nature of an
Islamic state since independence, and politicians invari-
ably try to portray themselves as more Islamic than their
--continued
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opponents. There is, however, no agreement on what would
constitute an Islamic state or on the practicality of
such a goal. President Zia and the politicians who now
support him are attempting to institute Islamic reforms.
So far these have included such things as the prohibition
of alcohol and the institution of "Islamic punishments,"
such as flogging and amputation, but have not dealt with
more important political and economic questions.
Intractable Problems
25X1
Adding to national pessimism is a worsening economic
situation. Urgently needed reforms have been postponed
for political reasons and many believe that the economy
has been mismanaged. A serious balance-of-payments
problem is the most pressing difficulty. Given the gov-
ernment's failure to address economic problems, there is
not likely to be any significant improvement in the econ-
omy over the next several years. 25X1
Seemingly as intractable are Pakistan's problems
with its neighbors. To Pakistan, India is still a
long-term threat to independence, and Pakistanis are
aware that they are falling further behind India in mili-
tary power. The installation of a Marxist government in
Afghanistan has greatly increased fear of Soviet designs
on Pakistan, and turmoil in Iran threatens the reliabil-
ity of one of Pakistan's few allies. 25X1
Pakistanis are somewhat reassured by their con-
tinuing good relations with China, but they have little
hope of regaining the strong backing they had from the
US until the mid-1960s. Although they see some prospects
for increased US support, many believe that Washington
has decided on a pro-Indian policy in South Asia.
25X1
The prevailing pessimism could be exploited by a
leader able to convince the people that he had the solu-
tions to Pakistan's problems. No such leader is on the
scene, and the variety of proposed solutions and the
number of potential leaders with limited appeal might
well serve only to deepen divisions within the nation.
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OVERNIGHT REPORTS
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(The items in the Overnight Reports section have not
been coordinated within the intelligence community.
They are prepared overnight by the Office of Current
Operations with analyst comment where possible from
the production offices of NFAC.) 25X1
Rhodesia
Rhodesian whites yesterday approved by a wide margin
the proposed constitution for a government of national
unity scheduled to take power in May. Government fears
that the deteriorating security situation and voter
apathy would produce a low turnout were unfounded. Ac-
cording to press reports, about 70 percent of Rhodesia's
94,700 registered white voters went to the polls and
over 85 percent of those casting ballots voted to
accept the majority-rule constitution. Black nationalist
guerrillas apparently made no serious effort to disrupt
the voting.
USSR
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The US Embassy in Moscow reports that the USSR's
press appears to be preparing the Soviet people for
contentious debate in the US Senate on ratification of
a SALT II agreement. A Pravda article last Saturday,
for example, covered the mechanics of the ratification
process and cited a statement by Senator Schweiker that
ratification will possibly be "linked" to Soviet be-
havior elsewhere. The Embassy also notes that a Red
Star article on Monday alleged that while the majority
of US citizens support SALT II, "Zionists" oppose it
and exert considerable influence on public opinion
through control of the mass media and close ties with
the military-industrial complex. 25X1
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Ethiopia
The US Embassy in Khartoum reports that two of the
three Eritrean liberation movements have, as expected,
decided to unite and form a joint delegation to nego-
tiate the Eritrean question with the Ethiopians (see
related Ethiopian article in Briefs and Comments). The
Embassy says the unification accord, announced in Khar-
toum on 27 January, appears to be no more substantial
than previous so-called agreements and consists only of
plans for further discussions. It believes the Sudanese
Government probably has accepted the pact only to give
President Numayri a semblance of Eritrean unity before
he meets with Ethiopian Chairman Mengistu, possibly in
mid-February. 25X1
COMMENT: Eritrean unity has always been more hon-
ored on paper than in practice. Numayri met with the
Ethiopian Ambassador to Sudan on Saturday to discuss the
agenda for his talks with Mengistu, but we suspect a
mid-February meeting is problematic. 25X1
South Korea - North Korea
South Korea today called on the North to resume
meetings of the North-South Coordinating Committee--
the mechanism for dialogue set up in the early 1970s--
and to reopen the Seoul-Pyongyang hotline which Pyong-
yang had deactivated in 1976. A South Korean official
says Seoul does not expect a positive response from
the North, but believes its proposal will place Pyong-
yang on the defensive and keep the spotlight on the
need for government-to-government contacts during the
current exchange of public proposals on reunification.
25X1
The North Koreans, meanwhile, announced today that
they are unilaterally implementing the first step of
their proposal of 23 January. Pyongyang said it would
cease media attacks defaming South Korea, effective to-
morrow, and reaffirmed the "ideas and principles" of the
North-South joint statement issued in 1972.
--continued
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USSR-Vietnam
Moscow's Radio Peace and Progress yesterday marked
the 29th anniversary of the establishment of diplomatic
relations between the USSR and the government in Hanoi
by commenting that the provision for mutual defense in
the three-month-old Soviet-Vietnamese friendship treaty
is "crucial in the present conditions." Soviet Deputy
Premier Arkhipov arrived in Hanoi yesterday at the head
of an economic delegation. 25X1
COMMENT: The reference to the mutual defense pro-
vision is the first by the Soviets since the Chinese be-
gan increasing their forces opposite Vietnam. Radio
Peace and Progress, however, is a propaganda outlet with
no official standing. In their talks with Arkhipov, the
Vietnamese will be seeking increased Soviet assistance.
UK
25X1
The US Embassy in London reports that Foreign Sec-
retary Owen is coming to Washington this week at a low
point in his two years in that post. He understands
that he may be moved to another, lesser position in the
Cabinet even if Labor wins the impending election. The
Embassy comments that Owen's sense of political vulner-
ability has been reinforced in recent months by personal
setbacks in foreign policy--especially on Rhodesia. It
believes Owen will thus have a restricted brief for his
talks with Secretary Vance but will want to discuss a
simplification of the Anglo-American plan for peace in
Rhodesia and how the US and the UK should react to yester-
day's white referendum there and to the Rhodesian elec-
tions on 20 April. Owen probably will propose joint ef-
forts to obtain a South African commitment to interna-
tionally supervised elections in Rhodesia.
17 Too Secret
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