NEAR EAST AND SOUTH ASIA REVIEW

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP85T01184R000301390002-9
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 27
• Document Creation Date: December 22, 2016
• Document Release Date: September 29, 2010
• Sequence Number: 2
• Publication Date: March 29, 1985
• Content Type: REPORT

Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85TO1184R000301390002-9
Directorate of , r .~ w -- ---
intewgence IVIM I H f I f E COPY
Q~ MA x [I;
Near East and
South Asia Review
NESA NESAR 85-008
29 March 1985
Copy 4 16
Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85TO1184R000301390002-9
 Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85TO1184R000301390002-9
Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85TO1184R000301390002-9
 Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85T01184R000301390002-9
Secret
Near East and
South Asia Review
Articles Algeria Realigns Itself in Middle East Politics
The most significant shift in Algeria's foreign policy under President
Bendjedid has been a more active role in promoting stability in the
Middle East, but Bendjedid's interest in promoting this role will not
translate into quick and consistent support for US policies in the
Egypt's Military Options Against Libya
Libyan hostility during the past year has led Egyptian policymakers
to consider military retaliation. But, instead of a broad, conventional
attack, they will continue to rely on public warnings to Libya,
military buildups near the border, support to Libyan dissidents, and,
if these measures fail, small-scale raids into Libya.
25X1
25X1
25X1
25X1
Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85T01184R000301390002-9
 Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85T01184R000301390002-9
Hopes are reviving for meaningful regional cooperation in South
Asia, but the organization entrusted with this task is too weak to
overcome serious bilateral issues among the members and a major
breakthrough at a regional summit meeting later this year is
unlikely.
The Afghan resistance fundamentalist alliance is closely linked to
the Muslim Brotherhood, the international Islamic fundamentalist
movement whose goal is the installation of Islamic governments in
all countries in the Middle East.
The popularity of Islamic fundamentalist views on many Middle
Eastern university campuses has increased markedly in the current
academic year as Islamic groups have emerged as the dominant
political force among students. Central governments and university
administrations are avoiding confrontations with campus Muslim
activists.
Dubai's refusal to pay its full share of UAE federation expenses or
to participate in OPEC-mandated oil production cutbacks for the
UAE has been a constant source of friction in federation politics.
25X1
25X1
25X1
25X1
25X1
25X1
Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85T01184R000301390002-9
 Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85TO1184R000301390002-9
Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85TO1184R000301390002-9
 Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85TO1184R000301390002-9
Secret
Algeria Realigns Itself
in Middle East Politics
The most significant shift in Algeria's foreign policy
under President Bendjedid has been a more active role
in promoting stability in the Middle East. The
Algerians are maintaining close ties with Syria and
radical Palestinian groups while increasing
cooperation with Arab moderates. Algeria has not
moved completely into the moderate Arab camp or
given unqualified support to recent PLO-Jordanian
peace efforts. Nevertheless, the change in its position
is dramatic compared with only a few years ago when
it was an active participant in the Steadfastness Front
set up after Egyptian President Sadat's visit to
Jerusalem. Indeed, Cairo now sees Algiers as a key
player in any Middle East peace initiative.
Bendjedid's active role in Middle East politics reflects
a maturing of leadership and a willingness on his part
to expand his responsibilities as an Arab statesman. In
our view, Bendjedid's first term is best characterized
as a period of consolidation of power with an emphasis
on domestic issues. As a second-term president,
Bendjedid appears eager to develop a positive role for
Algeria in the international community, and by
gradually placing his men in key positions he has
reinforced his mandate to advance his policies.F___1
A host of factors have led Algeria to reconsider its
place in the Arab lineup and its role in Middle East
politics during the past several years:
? Algeria has been increasingly affected by the
political ferment that Islamic fundamentalism,
religious radicalism, and political subversion have
produced in the Middle East during this period.
? The increasing use of terrorism as a political tool
has caused Algeria to reevaluate its support for
revolutionary groups, as it believes terrorism has
served only to increase instability in the region.
? Although the Algerians at one time encouraged the
polarization of the Arab world into moderate and
radical camps, Algiers has come to realize that this
has weakened the Arabs' ability to offer
constructive solutions to the Arab-Israeli conflict.
? Finally, the turmoil in Lebanon and increased
factionalism within the PLO have reinforced
Algiers's view that instability in the region has
undermined the Arab stand against Israel.
Support for the PLO
Algeria's more active role in Middle East politics has
been driven in part by the Palestinian issue. Algeria is
one of the few Arab states that has maintained open
communications with all PLO groups while
supporting Arafat's leadership. Algiers provides
sanctuary to about 2,000 Palestinians evacuated from
Lebanon and allows these fighters to train on
Algerian military equipment. In Algiers's view, an
independent and unified Palestinian national
movement is a critical factor in the Arab-Israeli
equation, and it thus advocates a strict policy of
noninterference in Palestinian internal affairs.
Algerian officials also have stated that a unified PLO
is necessary to deter more radical Palestinian
elements from returning to terrorism.
Secret
NESA NESAR 85-008
29 March 1985
Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85TO1184R000301390002-9
 Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85T01184R000301390002-9
For the past two years, the Bendjedid government has
been called upon by other Arab leaders to work with
Syria and its Palestinian allies to reconcile their
differences with pro-Arafat groups. Bendjedid's
decision not to act as host to last year's Palestine
National Council meeting in Algiers no doubt
reflected his concerns about Syrian threats that
radical PLO groups would not attend. Bendjedid
probably believed this would formally split the PLO-
an outcome for which the Algerians do not want to be
responsible.
Backing Away From the Radicals ...
Of greater importance for US interests is Algiers's
pulling away from the radical Arab states. Algiers has
rebuffed Syrian, Libyan, and Iranian efforts to
reconstitute the radical Steadfastness Front. The
Bendjedid government has stopped routinely
supporting the radical Arab states on the Palestinian
issue because of what it views as Syrian and Libyan
efforts to preclude progress toward PLO unity. We
believe that Algiers realizes that recognition of
Israel's right to exist as well as reestablishment of
relations with Egypt are inevitable-a position in
sharp contrast to that held in Damascus, Tripoli, and
Tehran.
Algiers's reluctance to join the radicals also reflects
its desire to mediate the Iran-Iraq war. Algeria's
inclusion with Iran in the radical front would
jeopardize, in Algeria's view, its ability to represent
both parties in any negotiations.
Algeria's close ties to Syria and its Palestinian
surrogates to persuade Syria not to block a settlement.
Algiers's determination to move closer to the
moderate Arab states extends beyond compatible
views on the Palestinian question, the Arab-Israeli
conflict, and the Iran-Iraq war. The Bendjedid
government has come to realize that Jordan, Saudi
Arabia, and Egypt can be helpful in realizing
Algeria's goals in North Africa:
? Bendjedid probably hopes that King Hussein, King
Fahd, and President Mubarak will use their
personal ties with Moroccan King Hassan to modify
what Algiers believes has been Moroccan
intransigence on the Western Sahara issue.
? Along with other Arab leaders, Bendjedid believes
Qadhafi is a major threat to Middle East stability
and sees Saudi Arabia and Egypt in a position to
cooperate in countering Libyan subversion.
Outlook
Bendjedid's interest in promoting Algeria as an
important contributor to regional stability will not
translate into quick and consistent support for US
policies in the Middle East. Algeria is unlikely to take
the lead in forging solutions to inter-Arab disputes.
We anticipate that Algiers will prefer to use its
influence behind the scenes to urge a consensus and
25X1
25X1
... Toward the Moderates
Bendjedid's recognition of Arafat's leadership and
tacit approval of his efforts to work with Jordan on a
joint approach to peace negotiations bring Algeria
even more in line with the moderate Arab coalition of
Saudi Arabia, Jordan, and Egypt. The moderates are
particularly pleased with Algeria's insistence on a
Palestinian consensus for any peace formula and its
efforts at mediating Syrian-PLO differences.
Jordanian and Egyptian officials are counting on
keep its role discreet.
Algiers has little leverage over Damascus, but it will
do what it believes is necessary to resolve Syrian-PLO
differences, including working with other Arab
leaders to temper Syrian objections and develop PLO
unity. If the issue is controversial, as in the case of the
Hussein-Arafat agreement, the Algerians probably
25X1
Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85T01184R000301390002-9
 Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85T01184R000301390002-9
Secret
will remain silent or convey their position privately.
Algiers, however, will take a more open position on
issues of principle, such as criticizing Syria and Libya
for encouraging factionalism within the PLO.
As Algeria's relations with moderate Arab states
improve, we believe Algiers will be more willing to
cooperate with Washington on issues it views as
debilitating or dividing the Arab world-Libya, the
Iran-Iraq war, Western Sahara, and terrorism.
25X1
25X1
Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85T01184R000301390002-9
 Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85TO1184R000301390002-9
Secret
Egypt's Military Options
Against Libya
Libyan hostility during the past year has led Egyptian
policymakers to consider retaliation, particularly in
the event of a provocation by Libyan leader Qadhafi.
We believe Egypt is unlikely to launch a broad,
conventional attack against Libya after such a
provocation, although relations will remain tense in
any case.
Egypt's policymakers probably
will continue to re y on public warnings to Libya,
occasional military buildups near the border, and
support to Libyan dissidents. If those measures fail to
deter Qadhafi from further troublemaking, Egypt will
consider small-scale raids into Libya.
Background
Libya last year used a variety of tactics to attack
Egyptian interests. Libyans targeted Egyptian
officials for assassination and mined the Gulf of Suez
and Red Sea. The Egyptians believe Tripoli also
planned to bomb the Aswan High Dam, although
Libya's deep-rooted fear of Egyptian military
retaliation makes such an attack unlikely. To
destabilize Egypt's ally, Sudan, Libya bombed a radio
station in Omdurman and supported Sudanese
dissidents seeking to overthrow President Nimeiri. In
response, Egypt mounted a temporary show of force
near the border, upgraded air defenses around Aswan,
and publicly warned Tripoli against further
provocations.
Earlier provocations by Libyan leader Qadhafi had
led to a military clash along the border in July 1977.
Catalysts for Egypt's attack included a plan by
Qadhafi to assassinate President Sadat, Qadhafi's
role in a coup attempt that almost toppled Nimeiri,
and Libyan involvement in a train bombing that killed
12 Egyptians in Alexandria.
Egyptian Views of the Libyan Threat
The Mubarak government expects hostility from
Libya as long as Egypt honors its peace treaty with
Israel, maintains friendly relations with the United
5 Secret
NESA NESAR 85-008
29 March 1985
Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85TO1184R000301390002-9
 Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85T01184R000301390002-9
States, and continues to counter Qadhafi's influence
in the region. Egyptian leaders know the mercurial
Qadhafi can mount terrorist operations and limited
conventional attacks against Egypt and its allies.
Senior military officers, moreover, perceive a long-
term danger in Libya's Soviet-backed military
buildup.
They point especially to the Libyan Air Force, whose
fleet of largely Soviet-made aircraft is more
sophisticated and double the size of Egypt's.
Qadhafi.
Egypt's Military Options
Threats and Troop Alerts. Threats of retaliation and
the occasional alerting of troops are a low-cost way of
keeping the Libyans guessing about Cairo's
intentions. The option reduces the risk that a small-
scale confrontation will escalate into a wider conflict.
Moreover, it appears to suit the cautious style of
Mubarak, who, in our view, wants to cultivate the
image of a statesman who is far more responsible than
Egypt's strategy of bluff, however, may in time lose
credibility with the Libyans. Cairo's relative inaction
might embolden the Libyans, although we believe
Qadhafi has a good sense of how far he can push
Mubarak. Tripoli can call Cairo's bluff by increasing
political and military pressure while denying Cairo
cause for military retaliation. Such an action would
be designed to highlight Egyptian vulnerabilities and
undermine the credibility of Cairo's military
relationship with Washington.' It probably would also
heighten frustration among Egyptian soldiers and
increase internal pressure on Mubarak to retaliate.
Abu Ghazala, al-Orabi, and other senior military
officers have warned that Libya's conventional
military capabilities are growing faster than Egypt's.
Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85T01184R000301390002-9
 Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85T01184R000301390002-9
Secret
Outlook
Egypt probably will continue to rely on public
warnings and occasional military buildups near the
Libyan border as its main responses to Libyan
belligerence. Egyptian policymakers will remain
reluctant to risk an armed confrontation out of
wariness about Libya's air capabilities, uncertainty
about each side's allies, and recognition that a war
might be long and costly
Nonetheless, Cairo might resort to commando-type
raids into Libya if:
? It had proof of Libyan responsibility for the
assassination of a high-level Egyptian official or
officials. Egyptian policymakers might view the
25X1
25X1
Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85T01184R000301390002-9
 Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85TO1184R000301390002-9
attack as a direct challenge which, if left
unpunished, could tarnish Egypt's prestige and
encourage further Libyan attacks.
? It concluded that a pro-Libyan group was about to
seize power in Sudan. Although the Egyptians are
not committed to Nimeiri's personal survival,
evidence of a strong Libyan threat to Sudan might
impel Cairo to launch small-scale attacks against
the Libyans to ease pressure on Khartoum.
Implications for the United States
Egypt's avoidance of war with Libya would neither
damage nor advance US interests in the next six
months. With little chance of a war, Cairo would not
need to seek the politically sensitive AWACS from
the United States. This cautious Egyptian policy
would not reduce Libya's Soviet-backed military
buildup or curb Qadhafi's efforts to weaken
governments in the region that are on good terms with
Washington.
Unless Libyan dissidents managed to topple Qadhafi,
increased Egyptian and other aid to such dissidents
would heighten Libyan-backed violence in the area.
Qadhafi appears determined to keep his exiled
opponents from becoming a major threat to his rule.
To this end, he would, if necessary, step up his
assassination campaign against them and probably
would target more Egyptian and possibly US
personnel and facilities for terrorist attacks.
An Egyptian raid into Libya would dramatically
increase the chances of a larger confrontation. Cairo
would have broken an implicit Egyptian-Libyan
understanding, mutually respected since 1977, not to
attack each other with conventional military force.
Given the caution exercised by Cairo thus far, the
move might indicate that Mubarak felt politically
weak and in need of a bold gesture to restore his
support.
The Egyptians are unlikely to launch a broad
conventional attack against Libya, but, if they did,
this would trigger Arab condemnations of Egypt and
damage Cairo's effort to promote Arab-Israeli peace
negotiations. Egypt's attack would intensify divisions
within the Arab world and might prompt Syria to
provide military support to Libya as a show of
solidarity. Egypt would expect some form of US
military aid, particularly in the unlikely event the
USSR committed personnel to help the Libyans.
Failure to meet Cairo's requests would chill Egyptian-
US relations and weaken Washington's credibility in
the region as a reliable partner. Cairo might even be
tempted to withdraw its promise to allow the United
States access to some facilities that would be needed
in the event of an attack on friendly Arab states.
Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85TO1184R000301390002-9
 Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85TO1184R000301390002-9
Iq
Next 7 Page(s) In Document Denied
Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85TO1184R000301390002-9
 Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85TO1184R000301390002-9
Secret
South Asian Regional Cooperation:
Slowly Moving Ahead
Hopes are reviving for meaningful regional
cooperation in South Asia, but the organization
entrusted with this task is too weak to overcome
serious bilateral issues among the members. The
South Asia Regional Cooperation group (SARC),
which consists of India, Nepal, Maldives, Pakistan,
Bangladesh, Bhutan, and Sri Lanka, has had many
multilateral meetings since a regional organization
was first proposed by the late President of Bangladesh
Ziaur Rahman in 1981 and has achieved some success
in cooperation on noncontroversial issues such as
meteorology, agriculture, health, and cultural affairs.
Security issues, border disputes, water sharing, and
other sensitive matters, however, have been
deliberately excluded. The first SARC summit
meeting will probably be held later this year, but we
do not believe any major breakthroughs will be
achieved.
New Hope?
India's predominance in the South Asian region-
politically, militarily, demographically, and
economically-has meant that SARC finds itself with
little room for maneuver unless India agrees. With the
assassination of Indira Gandhi-who was always less
than enthusiastic about SARC-and the higher
priority Rajiv Gandhi has given to better regional
relations, the smaller states see a chance for a more
positive Indian role in SARC. In addition, we believe
the leadership in Pakistan feels somewhat more self-
confident about dealing with India after its recent
electoral success.
How It Works
SARC members have agreed to avoid two major
pitfalls of other regional associations: political issues
and bilateral disputes. Virtually every country in
SARC has a dispute with India, ranging from water
sharing to nuclear arms production to support for
insurgent groups. The region is also filled with
historical enmities and memories of old wars. The
prohibition against raising bilateral issues has worked
fairly well at previous foreign ministers' meetings,
Ironically, many bilateral
issues get a fairer and less public airing in the
inevitable "corridor chats" on the margins of an
SARC conference. The opportunity to set up a small
ASEAN- or EC-style "foreign ministers' club" seems
to be proving irresistible. For instance, Foreign
Secretaries Bhandari of India and Naik of Pakistan
are old school friends, and both claim privately they
enjoy the opportunity SARC meetings provide to talk
out of the media spotlight.
SARC members have also avoided introducing
divisive trade issues. India's industrial and
technological superiority over its small neighbors has
traditionally made them fear efforts to dismantle
trade barriers.
SARC working committees have instead restricted
their efforts to politically neutral self-help projects in:
? Telecommunications.
? Agricultural research and rural development.
? Meteorology.
? Health and population studies.
? Transport and civil aviation.
? Postal services.
? Science and technology.
? Sports, arts, and culture.
SARC members can identify and discuss cooperation
on such noncontroversial issues is a hopeful sign. At
the most recent meeting of SARC foreign secretaries
in the Maldives in February, all members agreed to
double their budgets for the nine existing SARC
working groups, to expand their data exchange
Secret
NESA NESAR 85-008
29 March 1985
25X1
25X1
Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85TO1184R000301390002-9
 Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85T01184R000301390002-9
capabilities, and to avoid overtaxing budget resources
by tackling new problems.
On the economic front, several SARC members
already have links with international lending bodies
such as the IBRD, Islamic Development Bank, and
Asian Development Bank, and there is hope that the
members of SARC can begin addressing these
lending bodies with one voice rather than as
individual and potentially competing cases.
Summit Meeting
In May, the seven states' foreign ministers will meet
in Bhutan to set the agenda for an unprecedented
regional summit meeting later this year in Dhaka.
SARC proponents hope the summit will establish a
secretariat and decide on a location for a permanent
headquarters.
Except for Sri Lanka, the SARC members believe
there is a need to set up a regional bureaucracy to
facilitate SARC business. Other items to be discussed
include: drafting a summit declaration, or even a
charter formally establishing SARC as a regional
entity, and creating a timetable for meetings of
SARC members at both the foreign minister and
heads-of-state level.
Bilateral Differences Cloud Outlook
Fears of Indian dominance continue to color SARC
discussions
in the postassassination period to be "positive," but he
recognizes that forward movement on thorny bilateral
issues is not likely in the near future. Pakistani and
Indian officials in their talks with US officials,
however, have emphasized that a SARC summit and
an institutionalized regional organization would
provide them with an ideal opportunity for informal
bilateral discussions on troublesome issues.
Bangladesh-Indian relations also suffer from Dhaka's
complaints about patronizing Indian political
behavior,
Bangladesh Foreign Secretary Chowdhury noted to
US Ambassador Shaffer recently that there are
several outstanding bilateral issues with India,
including land and sea border claims and water
sharing, which the Bangladesh Government "cannot
ignore." Bangladesh hopes SARC formalization will
increase bilateral communication within the region.
Bilateral problems make substantial progress on
major issues unlikely, but the momentum that the
South Asian states have already achieved on
noncontroversial projects will probably be maintained.
Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85T01184R000301390002-9
 Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85TO1184R000301390002-9
Iq
Next 2 Page(s) In Document Denied
Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85TO1184R000301390002-9
 Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85TO1184R000301390002-9
Secret
The Afghan Resistance and
the Muslim Brotherhood F
The Afghan resistance fundamentalist alliance ' is
closely linked to the Muslim Brotherhood, the
international Islamic fundamentalist movement. The
movement, whose goal is the installation of Islamic
governments in all countries in the Middle East
including Afghanistan, has followers in most Muslim
countries and in Europe and the United States.
Radical elements of the movement, which was
founded in 1928 by a young Egyptian schoolteacher at
Al-Azhar University in Cairo, were influential in the
overthrow of Egyptian King Farouk and the
assassination of President Sadat.
The Muslim Brotherhood appeals to young, educated
Muslims who have little sympathy with socialism,
Marxism, or capitalism, yet find the views and values
of the traditional Islamic clergy out of date. As a
consequence, in the Arab world, the Brotherhood
often finds itself at odds with established Islam and
the orthodox clergy. Nonetheless, it has generally had
the support of the governments of the Gulf states,
including Saudi Arabia, Kuwait, Bahrain, and the
United Arab Emirates.
Strong beliefs in the Prophet Muhammad, the Koran,
and the Sunna and a strong opposition to corrupt
governments and Eastern or Western imperialism are
at the heart of the Brotherhood and other
fundamentalist groups. Members are generally
militant and highly committed to their principles,
although the degree of extremism varies from country
to country.
The Afghan Fundamentalists
and the Muslim Brotherhood
The Afghan fundamentalist movement has its modern
roots at Kabul University, where many of its followers
were faculty or students. The religiously oriented
' The fundamentalist alliance consists of the Gulbuddin and Yunus
Khalis factions of Hizbi Islami, the Jamiat-i-Islami, and the
Harakat-i-Inqilab-i-Islami groups, based in Peshawar, Pakistan.
students and faculty began to organize largely in
reaction to the activities of the Marxist groups that
dominated the university in the late 1960s and early
1970s. Many of the students came from the
Department of Engineering-Hizbi leader Gulbuddin
was an engineering student. Much of the faculty
leadership came from the Department of Theology.
The religious students quickly began to develop
connections with resurgent Muslim movements in
other countries-connections that continue today.
Most of the departments at Kabul University began
with financial and technical assistance from Muslim
countries, particularly Egypt. The Department of
Theology was aided by Al-Azhar University in Cairo.
Afghan students at Al-Azhar returned to Kabul
University as faculty, and Egyptian professors came
to Kabul University to teach. Several Afghan
fundamentalist leaders, including Sayyaf and
Rabbani, studied at Al-Azhar, as did Mojadedi, one
of the moderate leaders.
The Afghan fundamentalists now receive considerable
financial assistance from the Gulf states, in part
because of the Egyptian connection. The Brotherhood
was spread to the Gulf by Egyptian and Sudanese
members who held important educational, military,
and administrative posts in many of the Gulf states.
The Afghan students also had connections with
Persian fundamentalists at Qom, Iran. Many of the
works of fundamentalist thinkers were translated at
Qom from Arabic into Persian, a language that most
educated Afghans can read. Although the Afghan
fundamentalists come from the Sunni tradition and do
not agree with the Shiite ideology of Iran, the
fundamentalists have maintained ties to Tehran and
may receive Iranian assistance. Gulbuddin, the most
Secret
NESA NESAR 85-008
29 March 1985
Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85TO1184R000301390002-9
 Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85TO1184R000301390002-9
powerful of the present fundamentalist leaders,
emerged from a student organization with ties to Iran
and has traveled there.
The Jamiat
Another important Afghan foreign connection is with
the religious parties of Pakistan, especially the
Jamiat-i-Islami, which has close ties to the Muslim
Brotherhood. The Jamiat is currently in the good
graces of the Zia government; its leader, Mian Tufail
Mohammad, is a relative of Zia. Through the party's
association with the Brotherhood, it serves as a
conduit for the distribution of money and arms for
Afghan insurgent groups. Jamiat connections with the
Pakistan Government allow the party to impede
efforts by moderate leaders seeking to travel to Saudi
Arabia and Egypt to raise money, while smoothing
the way for fundamentalist leaders to do so.
Jamiat-i-Islami and fundamentalist groups in other
countries influence the flow of arms to the Afghan
guerrilla organizations and may also influence day-to-
day insurgent operations.
they have:
? Provided political advice to the fundamentalists.
Several members of non-Afghan fundamentalist
groups advise the executive council of the
fundamentalist alliance in Peshawar. These include
Mian Tufail Mohammad, leader of Pakistan's
Jamiat-i-Islami; Abdullah al-Mutabai of Kuwait;
and Abdur Rahman al-Judar of Bahrain.
? Influenced Afghan guerrilla strategy.
? Publicized the Afghan fundamentalist cause
in the Arab world, making it easier for the
fundamentalists to get funds there.
Secret 24
Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85TO1184R000301390002-9
 Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85TO1184R000301390002-9
Secret
Middle East: Growing Student
Fundamentalism F__1
The popularity of Islamic fundamentalist views on
many university campuses in Egypt, Morocco,
Tunisia, and the West Bank has increased markedly
and law. In Egypt, where examination scores
determine placement in professional schools,
fundamentalist students are among the nation's
brightest students.)
in the current academic year.
Islamic groups have emerged as
the dominant political force among students. As many
as a third of the students have adopted outward signs
of Muslim piety. Beards, turbans, and long robes are
common for men; long skirts, scarves, and veils are
worn by women. Central governments and university
administrations are following a nonconfrontational
policy toward the campus Muslim activists, thereby
denying the militants a focus for their hostility, but
the appeal of fundamentalism on the campuses would
strengthen should a charismatic leader emerge or a
government crackdown provide the fundamentalists
with a dramatic rallying point for their cause.)
Appeal and Motivations
In our view, the student fundamentalists believe that a
more Islamic government will be the panacea for their
problems. Driven by their cultural and economic
frustrations, they are true believers in their cause.F_
We believe that the image of the Iranian revolution,
though tattered, still appeals to Middle Eastern youth.
Most of today's university students, impressionable
youths when Khomeini seized power in 1979, carry a
romanticized image of the revolution and see it as a
model for Islamic student movements.FI
Many students in the Middle East see fundamentalist
Islam as a weapon to strike out against the forces-
chiefly Western influences-that they believe have
caused cultural decline in the Arab world. Western
music, movies, sexual mores, and alcohol use are
constantly criticized.)
25X1 Reports by scholars) lin the Middle
East indicate Muslim militants are concentrated
among lower-middle-class students in the schools of
business, medicine, sciences, engineering, education,
Middle Eastern fundamentalist student groups
commonly demand:
? Mandatory religious instruction.
? Interrupting classes for daily prayers.
? Removing secular and Western study materials.
? Eliminating Western-style cultural events.
? Replacing secular faculty with professors who
exhibit Islamic piety.
? Segregating sexes at all university activities. F
Economic Frustrations
The prospect of a bleak future is a common theme
heard on Middle Eastern campuses and helps explain
the growing susceptibility of students to Islamic
solutions:
? Moroccan students believe that they will be
educated but unemployed. They also fear that King
Hassan's educational reforms will reduce
educational opportunities.
? Many unqualified Tunisian youth, faced with 30-
percent unemployment, flock to universities where
they are further frustrated by academic failure.
? Egyptian students claim that the stagnant economy
coupled with the government's economic austerity
program have darkened their employment
possibilities.
? In Israel, economic stagnation and Tel Aviv's policy
to limit construction and other projects on the West
Bank combine to reduce employment opportunities
for the Arab graduates of West Bank universities.
Secret
NESA NESAR 85-008
29 March 1985
! I I Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85TO1184R000301390002-9
 Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85TO1184R000301390002-9
25X1
25X1
Regional Campus Scene
Egypt. Egyptian fundamentalists-quiet since the
crackdown following Sadat's assassination-are now
the dominant political force on campus:
? At Cairo University, Islamic groups won most of the
seats in the student elections in December 1984 in
the schools of commerce, engineering, medicine, and
the teachers college. They also emerged with a
majority of the seats on the student councils and the
top two positions in the student government.
? Fundamentalists swept the elections at Alexandria
University and won a majority at al-Minya
University in upper Egypt.
at Asyut University in the south
ates linked to the Muslim
Brotherhood and other religious groups did well in
the student council elections, particularly in the
school of commerce.
Fundamentalists are increasingly assertive in their
demands that university administrations allow
religious activities banned by President Sadat in 1979.
At Asyut University in late February, Islamic
militants physically and verbally harassed the vice
dean of the business school when he unsuccessfully
attempted to stop a fundamentalist student from
delivering a prelecture invocation,
Also in ate
February, about a thousand students peacefully
demonstrated at Cairo University against the last-
minute refusal to allow a speaking appearance by
Muslim Brotherhood leader Omar Talmassani. The
demonstration attracted fundamentalist students from
Al-Azhar and other local schools.
The Egyptian authorities' strict, but
nonconfrontational approach on university campuses
tends to remove a focal point for student frustrations.
US Embassy sources contend that in the recent
student council elections security officials disqualified
a number of potentially troublesome candidates and
refused to allow debate on sensitive political issues.
Police interference, however, was not so blatant as in
the past.F_-]
West Bank. The growth in Islamic fundamentalism on
university campuses on the West Bank has challenged
the dominance of Palestinian nationalism and
threatens to become a rallying point for anti-Israeli
activity. In the past the fundamentalists usually
backed Arafat supporters against more secular
leftists, but now they only reluctantly back Arafat as
the lesser of two evils.)
The polarization between Muslim fundamentalists
and secular Palestinian nationalists is most evident at
An-Najah University, the West Bank's largest
university. According to the US Consulate in
Jerusalem, one-third of An-Najah's 3,000 students
are avowed fundamentalists, and as many as 70
percent are sympathizers.)
An-Najah fundamentalists use their support among
the townspeople of Nablus to intimidate faculty and
political rivals. Last July, clerics in several Nablus
mosques condemned five secular nationalist professors
in their Friday sermons following classroom disputes
with fundamentalist students. In addition, leaflets
were distributed throughout the West Bank accusing
the professors of atheism and sexual immorality.
Another professor was attacked for giving high marks
to qualified coeds while refusing to give "extra credit"
to fundamentalist male students for their activist
piety. Such preferential grades are sometimes given
by sympathetic faculty, according to the Consulate.
Israeli authorities on the West Bank have hoped that
Islamic fundamentalism would undermine support for
the PLO. The anti-Israeli activities of fanatic Muslim
terrorists in southern Lebanon, however, may force
the Israelis to reconsider this strategy before many
more Arab students turn to radical Islamic leaders for
political guidance.)
Tunisia. Increased fundamentalist militancy at the
30,000-student University of Tunis reflects renewed
Islamic activity throughout the country, according to
the US Embassy. Fundamentalist students belong to a
25X1
25X1
25X1
Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85TO1184R000301390002-9
 Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85TO1184R000301390002-9
Secret
number of small groups that generally sympathize
with Khomeini's Iranian model. The fundamentalists
want the university run by Islamic rules and demand
representation in the university administration and in
the Ministry of Education. They use university issues,
such as examinations and housing, to launch criticism
of contemporary Tunisian society and government
policy. According to the US Embassy, the avowed
pro-Khomeini students belong to a shadowy
organization called the Islamic Liberation Party.n
The Tunisian Government characterizes the
fundamentalists as agents of Khomeini or Qadhafi.
Tunis also charges that fundamentalist activities
appear to exceed what their domestic financial
resources could afford. Government accusations have
hardened attitudes between the authorities and the
fundamentalists, contributing to the latter's
uncompromising positions in disputes. The Libyan-
backed Mouvement de la Rassemblement
Nationaliste Arabe is trying to cash in on the current
appeal of fundamentalism, but it does not have a
significant following, according to the US Embassy.
Authorities have responded to Islamic militants'
activities by trying to diffuse their demands and by
supporting nonfundamentalist students. The Ministry
of Education is willing to accept student participation
on university policy questions and is pursuing the
Arabization of the curriculum. The government hopes
that socialists, leftists, and faculty representatives on
policy committees will dilute fundamentalist influence
on campus.F-1
Morocco. Although bleak employment prospects have
not produced open protest so far, they have
contributed to the sharp rise in radical fundamentalist
sympathies, according to the US Embassy in Rabat.
Student fundamentalists heckled representatives from
moderate Arab states at a colloquium in Rabat in
mid-December and proclaimed the glories of the
Iranian revolution when a representative from Iraq
rose to speak, according to the US Embassy. F__-]
The Moroccan Government has taken care not to
overreact to the student fundamentalists. They have,
however, proceeded with their program to replace
French with classical Arabic (as opposed to the quite
distinct Moroccan Arabic dialect) as the language of
government and education. The US Embassy believes
that the Arabization program is a useful political
weapon to undercut radical fundamentalism.)
Prospects
We believe that the appeal of Islamic fundamentalism
on Middle Eastern campuses will continue to grow as
long as the root causes-a bleak economic future,
dominance of Western culture, a blurred Arab
identity, and the unresolved Arab-Israeli situation-
remain. Moreover, fundamentalism will be
strengthened as Khomeini, the Iranian revolution, and
Islamic militancy become a romanticized part of
Islamic folklore. Graduating students will carry much
of their fundamentalist beliefs with them into the
workplace-in government, the professions, and
industry. We believe they will provide a potential pool
of financial and political support for militant,
antiestablishment Islamic organizations. F_~
Unless a charismatic leader emerges, student Islamic
groups will most likely remain divided and politically
weak. Although they admire Khomeini, we judge that
there is no single organization, such as the Muslim
Brotherhood, that controls or links the student groups
together. F__1
We believe that the nonconfrontational approach
taken by Middle Eastern governments tends to rob
fundamentalists of a specific target for their
frustrations, at least for the time being. In seeking a
clearer enemy and to gain more sympathy for their
cause, radical student groups are likely to become
more active in hopes of provoking harsher government
reactions.)
25X1
25X1
Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85TO1184R000301390002-9
 Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85TO1184R000301390002-9
Secret
Dubai: Maverick of the
United Arab Emirates F
Dubai-second to Abu Dhabi among the United Arab
Emirates in size and wealth-is the most independent
emirate within the UAE federation. It has a long
tradition as a bustling and autonomous trading center
developed as one of the British-protected Trucial
States.' Despite its wealth, Dubai refuses to pay its
full share of federation expenses, forcing the emirate
of Abu Dhabi to bear the brunt of federal costs,
including support for the nonoil emirates, and to
absorb the federation's OPEC-mandated oil
production cutbacks. In contrast, Dubai produces oil
at near capacity and derides Abu Dhabi's oil
recession. These differences have been a constant
source of friction in federation politics and have
caused long delays in the preparation of federal
budgets. F__1
Oil Strengthens a Long Commercial Past
Dubai has emerged from a gold-smuggling past to
become an oil-rich city-state that serves as the
25X1 headquarters for many trading companies doin
business in the Persian Gulf and beyond.
25X1
25X1
The largest component of Dubai's
output is the petroleum sector-crude oil and
liquefied petroleum as
Crude oil
production in 1984 of 351,000 barrels per day (b/d)
yielded gross oil revenues of approximately $3.5
billion. Services earnings-trade, finance, insurance,
and ship repair-make up the next largest component.
Industry is limited to the Dubai Aluminum Company,
' The Trucial States included Bahrain, Qatar, Abu Dhabi, Dubai,
Sharjah, Fujayrah, Umm al Qaywayn, Ras al Khaymah, and
Ajman. With the British departure in December 1971, Bahrain and
Qatar chose separate statehood, while the seven other shaykhdoms
which imports alumina and produces annually about
150,000 tons of aluminum ingots worth about $180
million.
Dubai's Independent Petroleum Policy
Dubai has suffered the least of the Persian Gulf
producers from the soft oil market because OPEC
production guidelines and cutbacks for the UAE have
been borne by Abu Dhabi. Dubai does not believe that
it must uphold the federation's OPEC role. Crude oil
production in Dubai has held steady at about 350,000
b/d since 1978, except for a slight drop to 327,000
b/d in 1983. Current production of 360,000 b/d, if
sustained, would yield gross crude oil revenues of $3.6
billion for 1985 at current prices. If prices fall, 25X1
however, Dubai's oil revenues will decline because it
lacks the excess capacity needed to raise output.
Dubai also produces small quantities of liquefied
petroleum gas and condensate for export and uses
natural gas-both associated gas from crude oil fields
and nonassociated gas from the newly developed
Secret
NESA NESAR 85-008
29 March 1985
1 Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85TO1184R000301390002-9
 Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85TO1184R000301390002-9
onshore Margham field-for domestic consumption.
The Dubai aluminum smelter, several water
desalination plants, and electric power plants are
consuming all available gas.
estimates for Dubai budgets through 1983
indicate that the government takes slightly less than
50 percent of gross oil revenues to fund official
spending. For example, in 1981 when gross oil
revenues peaked at $4.7 billion, reported government
oil revenues hit $2.2 billion. After gross oil revenues
are first reduced by the earnings and expenses of
Dubai Petroleum Company, the remaining revenue is
allocated by the ruler, Shaykh Rashid, between the
government and his office. This personalized budget
system allows Shaykh Rashid to directly control any
surpluses, which probably are considerable. For
example, the ruler has personally guaranteed many
project loans and even prepaid a $419 million Lloyds
Bank loan for the Dubai aluminum smelter in 1981.
This city-state emirate was a continuous construction
site between 1969 when oil first flowed and 1983
when most infrastructure projects were completed.
Although the emirate does not publish expenditure
data, estimates by local observers suggest that
cumulative government expenditures for nonoil and
gas development projects during the past five years
were about $6 billion. Infrastructure development-
electricity, ports, airports, roads, and the drydock at
Jebel Ali-took top priority.
Dubai: Hospital and Parking Lot for Ships
Dubai's large drydock at Jebel Ali, equipped with
state-of-the-art repair facilities, has benefited from
the Iran-Iraq war. Tankers, freighters, and other
vessels attacked by Iranian and Iraqi aircraft in the
Persian Gulf are repaired in Dubai. Moreover,
tankers and freighters await commercial charters in
the 64-berth storage complex at Jebel Ali. Many are
being chartered by the Iranian Government for
hazardous convoy services to the northern Gulf,
according to the US Embassy. Recently, Tehran
purchased two very large crude carriers laid up in
Dubai and is negotiating to buy additional tankers
for its oil shuttle service from Khark Island to less
vulnerable terminals at Lavan and Sirri Islands.
Once the war ends, there will be a surge of port and
drydock activity because both Iraq and Iran will need
all types of reconstruction supplies and vessel repairs.
Shaykh Rashid's approach to emirate development
was to pay for the infrastructure and then encourage
private-sector activity that could use it. As a result,
tiny Dubai has the busiest airport in the region; a Gulf
port capacity that is second only to Dammam, Saudi
Arabia; repair and berthing facilities for vessels
ranging from tugs to ultralarge crude carriers (see
inset); and advanced telecommunications facilities
available throughout the emirate.
The Dubai Traders
Dubai promotes free trade far more aggressively than
the other emirates and has a sophisticated merchant
community willing to do business with anyone.
Ideology is dismissed as irrelevant to business,
according to the US Embassy, reflecting Dubai's long
maritime tradition, history of gold smuggling, and
reputation as an entrepot. The Embassy also reports
that, within Dubai, it is alleged that Shaykh Rashid
and his trading proteges were involved in drug
smuggling in the 1970s and arms smuggling in the
1980s. US Embassy sources in Kuwait and Abu
Dhabi have noted that Dubai traders see nothing
Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85TO1184R000301390002-9
 Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85TO1184R000301390002-9
Secret
Dubai has maintained its historical position as a
leading trade partner of Iran despite the UAE's
membership in the pro-Iraqi Gulf Cooperation
Council. According to US Embassy reporting, if the
Iranians wish to increase their commercial presence
and activities, Dubai will welcome the business, and
the UAE Government cannot block such a
development. Indeed, the Embassy reports that the
already large Dubai-Iran trade flow is increasing,
and this may explain why Iran has not aimed its anti-
immoral in such trade-any commodities are to be
traded at a profit to anyone willing to acquire them.
25X1 GCC rhetoric at the UAE.
In recent years Dubai traders have been most active
in the import and reexport of conventional
commodities rather than gold, narcotics, or arms.
Leading customers are Saudi Arabia, Pakistan, and
Iran (see inset). In 1983 reexports nearly doubled from
the 1982 level to reach $1.4 billion. This was
equivalent to 40 percent of Dubai's gross oil sales that
year.
manufactured goods.
dramatic increases took place last year as
well, despite the general recession in the Gulf. Major
commodities reexported include foodstuffs, livestock,
tobacco and cigarettes, fuels, chemicals, cars,
transport equipment, industrial machinery, and other
A few merchant families dominate this trade and its
financing. For example, one of the foremost Dubai
traders for many years has been Shaykh Rashid's
protege Mahdi Tajir, the UAE Ambassador to the
United Kingdom since 1972. He is a Bahrain-born
Shiite Muslim of Iranian extraction who believes that
Islamic fundamentalism is a threat to Dubai.
According to Embassy reporting, his influence in
Dubai is on the wane, however, because he is detested
by Shaykh Rashid's heirs and by the rest of the
merchant community.
Other major Dubai traders include:
t
g ca es a . The Galadari family, of Iranian origin,
rotects from th UAE' I
p e
Trade with Iran has suffered cyclical swings linked to
Iranian regulations. In late 1983, for example,
Tehran severely curtailed allowable imports by
Iranian citizens returning from abroad. This measure
induced a temporary trade recession in Dubai until
the restrictions were relaxed in early 1984, according
to the press Press reportin further indf t th
s art an communtty to the
Iranian Commerce Ministry influenced Tehran's
reversal. This year, Iran's increasingly tight foreign
exchange situation probably will again limit Dubai's
trade.F---]
Ihas
diversified into hotels, banking, and other services.
One brother, Abdel Wahab, operates independently
31 Secret
25X1
25X1
25X1
25X1
Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85TO1184R000301390002-9
 Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85TO1184R000301390002-9
from the rest of the family and was jailed for debts
after the Dubai government bailed out his
overextended Union Bank of the Middle East in
November 1983.
? The al Futtaym heads the largest UAE
conglomerate involved in trade, banking, and real
estate. The al Futtaym Group is also Dubai's
connection to Japan and owns UAE-wide agencies
for Toyota, Honda, Toshiba, Sanyo, and Seiko.
? Issa Salih al Gurg, an active supporter of Arab
causes despite his Iranian origin. He is the Dubai
agent for several US firms as well as the
representative for Siemens, Grundig, and other
European companies. He is also an adviser to the
British Bank of the Middle East.
Dubai's Independence Within the UAE
Dubai's independent position within the federation on
oil matters is mirrored in other areas as well. Dubai
contributes as little as possible to the UAE
Government, leaving Abu Dhabi to provide most
financial, political, and other support. In principle,
Abu Dhabi and Dubai are supposed to turn over 50
percent of their revenues to the federal government.
In fact, Dubai paid nothing until 1980, when it
contributed $811 million. Dubai claimed this
represented 47 percent of Dubai's spendable revenues.
Dubai's unwillingness to contribute has frequently
caused federation fiscal crises. According to US
Embassy reporting, the 1984 UAE budget was
delayed for several months until Abu Dhabi finally
agreed to provide $3.5 billion of the $4.1 billion
federal budget to ensure federation unity. Dubai-
which had held back its payments-agreed to only a
$545 million contribution
Dubai's insistence on its autonomy is deep rooted,
stemming from its free trade history. Dubai only
agreed to join the federation after its conditions for
autonomy were met. Dubai was a wealthy and
sophisticated trading center before oil was discovered,
whereas Abu Dhabi had been a poor colony of
nomadic herdsmen and fishermen. Although Abu
Dhabi has the leading role in ruling the UAE, Dubai's
leaders tend to regard the Abu Dhabians as primitive
nouveau riches who inflate the federal budget with
exorbitant patronage for themselves. Thus, Dubai
wishes to finance only those federal items that require
spending within Dubai's borders.
Outlook
Dubai's autonomous stand has been a major barrier to
closer integration within the federation. We see little
chance that Dubai's position will change even after
the death of Shaykh Rashid, who is in his seventies
His heirs, however, may adopt a
more cooperative tone. A united UAE is important for
external security, which is critical to Dubai's future.
Moreover, if Abu Dhabi offers Rashid's heirs a
broader role in the federal government, we believe
they would support more federal activity, while
seeking greater control over federal (read Abu
Dhabi's) funds. Nonetheless, commercial acumen is
part of the Dubai ruling family's long-held claim to
legitimacy, and we doubt that subsequent rulers will
relinquish Dubai's freedom to pursue its economic
interests.
25X1
25X1
Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85TO1184R000301390002-9
 Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85TO1184R000301390002-9
Iq
Next 2 Page(s) In Document Denied
Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85TO1184R000301390002-9
 Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85TO1184R000301390002-9
Secret
Secret
Sanitized Copy Approved for Release 2011/08/08: CIA-RDP85TO1184R000301390002-9