London Scheme for Pushtun-Taliban Rogue State Goes Public

July 1 (EIRNS)—Lyndon LaRouche has warned for the last two years of a British imperialist scheme to separate Pushtun-dominated areas of western Pakistan, and join them with neighboring parts of Afghanistan, creating a tumultuous new mini-state which would destabilize South Asia, erase national borders, bring the region into the ambit of drug-financed, British-controlled terrorism, and threaten nearby China, Russia, and India. And the splitoff of these Pushtun areas would trigger a similar secession of Pakistani Baluchistan, to join with Iran's Baluchistan-Sistan province into a second lawless drugs-and-guns mini-state, erasing national borders.

Now what LaRouche warned of is surfacing publicly, in the wake of the insurgent sieges of Kandahar in Afghanistan, and now of Peshawar in Pakistan, the capital of Pakistan's Northwest Frontier Province (NWFP). The takeover of these areas by British-manipulated separatist and fundamentalist insurgents is not new. What is new is the public flaunting, which aims to create the false impression that this is something that just occurred, rather than back when LaRouche fully identified the phenomenon at least two years ago.

As the fact of the militants' control over Pakistan's tribal areas, the Northwest Frontier Province (NWFP) and the Northern Tribal Areas bordering Kashmir, has been publicly advertised, some Pakistanis have started proposing separation of these Pushtun-dominated tribal areas from Pakistan, and making them part of Afghanistan. The latest such suggestion came from Brig. Gen. Shaukat Qadeer (ret.), former vice-president of the Islamabad Policy Research Institute (IPRI)—a think-tank based in Islamabad. He argues that the Pushtuns in Pakistan's tribal areas will continue to support the Afghan Pushtuns against the foreign occupiers. Therefore, Islamabad should tell them that since "you feel compelled to fight in Afghanistan, we offer to liberate you from your allegiance to Pakistan and permit you to become citizens of Afghanistan; Pakistani security forces will be pulled out of your area."

Although the proposal is virtually unworkable, it is evident that many leaders in Pakistan have lost the zeal to fight the tribal and other militants to keep the country united. On the other hand, the separation of the tribal areas and the NWFP to form an independent nation, is very much the British policy. The British objective is to weaken Pakistan, create a very unstable and weak nation along the Central Asia and Iran borders, and keep China, Russia and India out of the oil- and gas-rich region.

As of now, the Pakistani Army is not making any serious effort to regain control of the area, which is now virtually under the militants' control. Militants have set up their justice and tax-collection offices in Waziristan, Khyber agency, Mohmand agency, Bajaur agency, and even inside Peshawar City.

Washington, having lost the power to influence Islamabad significantly, has apparently limited its demands to keeping open the long supply line that feeds the U.S./NATO/ISAF in Afghanistan, and allowing the Special Ops and covert CIA operators, who are already inside the tribal areas, to look for Osama bin Laden and his lieutenants there.

British-Inspired 'Democracy' Promoters Destabilize Mongolia

July 2 (EIRNS)—Mongolia, sandwiched between Russia and China, was thrown into chaos following the June 29 parliamentary elections, by the losing Mongolian Democratic Party (MDP). Accusing the ruling Mongolian People's Revolutionary Party (MPRP) of committing fraud, 6,000 MDP supporters conducted a violent protest in Mongolia's capital, Ulan Bator. Following the clash, which wounded many, between the police and the demonstrators, a curfew has been imposed in the city.

Mongolia's strategic location makes it a major target for the British and their adjuncts. Mongolia has large uranium reserves, and is in the process of developing a close relationship with Russia around the development of its nuclear power. Russia's state-owned uranium-mining enterprise, UGRK, announced a year ago that it was planning to develop uranium deposits at Erde in Mongolia. In addition, during his last April visit to Moscow, Prime Minister Sanjaa Bayar reiterated that Mongolia is interested in building small- and medium-capacity nuclear power plants with Russia's help. In advance of the meetings, the head of the Russian state nuclear corporation Rosatom, Sergei Kiryenko, said that Russia is currently carrying out a feasibility study into such a project.

The controversial issue on which the elections were contested was the Minerals Law. This law kept the government from concluding investment agreements with international mining giants such as the British-owned Rio Tinto Zinc, Canadian-owned Ivanhoe Mines, U.S.-owned Peabody Energy, Australia-U.K.-owned BHP Billiton Ltd., among others, to develop mineral deposits in the Gobi Desert. The existing law gives the government the right to take up to 50% interest in an important mineral deposit, if state funds were used to discover it.

The proposed change would give Mongolia a minimum 51% stake. But while the ruling party wants the government to hold that stake, the Mongolian Democratic Party says private Mongolian companies should be able to hold it.

MDP, the British-inspired political group that demands democracy, is led by former prime minister Tsakhiagiin Elbegdorj. He is one of the signatories of the Britain-based Henry Jackson Society, a protégé of former Soviet President Mikhail Gorbachov, and a rabid promoter of free trade. In 1991, when the International Republican Institute (IRI) set up shop in Ulan Bator, the MDP embraced it as a harbinger of reform. First, the reformers were persuaded by the IRI to fight the next election against the ruling MPRP. Next, they were acquainted with Newt Gingrich's Contract with America. Enter the Contract with Mongolia, which promised a free-market revolution.

Not That Much of What China Exports Is Made in China

June 30 (EIRNS)—China's People's Daily reports that "the low level of 'Chinese content' in China's export products has resulted in exports to developed markets that are not as rewarding for China as expected." In some categories of products exported to the United States, such as computers, Chinese domestic content makes up only about 10-25%.

In 2006, for example, Chinese exports to the U.S. totaled $201 billion. But $113 billion of that amount was outsourced to other countries; only $88 billion worth was really "Made in China," according to the Tsinghua-Brookings Research Center.

Chinese exports have particularly very low "domestic value added" in the processing trade. In joint ventures and wholly foreign-owned enterprises, which do more processing trade than Chinese companies, the Chinese content in their exports is below 50% and 35% respectively.

For products with less processing content, such as textiles, apparel, and furniture, Chinese exports are much higher domestic value added. Chinese companies are the major players in this sector. For state-owned enterprises, for example, 70% of exports are locally produced.

Chinese exports to developing markets have high Chinese content. Exports to Russia are 80% domestic value added, and exports to Mexico are 60% domestic value added.

To a large extent, "processing elements" of the China trade are the assembly operations preformed by low-skilled workers at low wages; such operations bring little value to the Chinese economy in terms of either skill levels or wages. The high-value components that are "processed" to a finished assembly and package usually are originally manufactured in Korea or Japan; however, such goods will usually be marked "Made in China," because that was the point of final assembly.

China Aims To Ensure Grain Self-Sufficiency by 2020

July 3 (EIRNS)—The Chinese government today approved a plan to increase grain production, to ensure that the nation becomes over 95% self-sufficient in grain production by 2020. The goal, presented by the State Council, is to produce 540 million tons of grain a year. China is already basically food self-sufficient: It has produced bumper grain crops over the past five years, with an annual crop of over 500 million tons in 2007. However, this was 15 million tons less than total demand. China also has large grain reserves—some 150 million tons, including 40-50 million tons of rice reserves.

The Chinese nation suffered starvation both before and soon after the 1947 revolution, and is determined to prevent such disasters in the future. China faces a huge challenge: It must feed 22% of the world population with well less than 10% of world arable land. China's arable land per capita is just 12% of what the U.S. has, and 50% of what India has.

Chinese Prime Minister Wen Jiabao said that "sprawling industrialization and urbanization" are increasing the pressure on farm production. The government must be "relentless" in its commitment to maintaining a minimum of 120 million hectares of arable land, as well as improving vital water supplies and other agriculture infrastructure. The government is also committed to ensuring rising incomes for farmers.

Jilin province, in the Northwest, which is already a big grain producer (including corn), is to increase its grain production by over 5 million tons over the next five years. The national and provincial governments will invest 26 billion yuan ($3.72 billion) in water diversion and irrigation projects, as well as improving mechanization and overall education of Jilin's farmers in advanced techniques. The program will given Jilin another 200,000 hectares of arable land, and upgrade the productive capacity of over 3 million hectares (7.4 million acres) of Jilin's current 5.3 million hectares (13 million acres) of farmland.