Cablegate: Afghanistan: Building Cell Towers and Developing Telecom

DE RUEHBUL #2920/01 2631043
O 201043Z SEP 09




E.O. 12958 N/A
SUBJECT: Afghanistan: Building Cell Towers and Developing Telecom
Capacity and Fiber Optic Infrastructure

REF: 08 Kabul 2020

1. (SBU) Summary: Minister of Telecommunications and Information
Technology Amir Sangin said he supports ISAF plans to locate
cellular phone towers on U.S. Forward Operating Bases (FOBs), and
thinks state-owned Afghan Telecom should own the towers, renting
space to other service providers. He complained USAID road
subcontractors cut a portion of new fiber optic cable in Afghanistan
which links the country to Pakistan, but set out suggestions for
avoiding future occurrences. He requested USG technical assistance
in developing the ability to market fiber optic services. Sangin
reiterated support for a risk insurance fund for cellular operators
and said earlier plans to privatize Afghan Telecom are on hold for
at least three years given the current security situation and global
financial crisis. Discussing other aspects of his portfolio,
Minister Sangin noted the need for outside help in developing
Afghanistan's postal service -- which he said now reaches all
provinces regularly except Helmand and Nuristan -- and instituting a
national identity card plan for which he hopes the U.S. will provide
initial financing. Embassy's Interagency Telecommunications Working
Group is working to support the increased cell phone towers, aspects
of the fiber optic cable issue, and ways to provide advisors to
Afghan Telecom. Embassy will follow up on assistance requests
working with USAID in concert with ISAF and others. End Summary.

Towers on FOBs: Good Idea, But Who Will Own Them?
--------------------------------------------- ----

2. (SBU) Minister of Telecommunications and Information Technology
Amir Sangin told Coordinating Director for Development and Economic
Affairs, Amb. E. Anthony Wayne, September 17 he has not had frequent
discussions with ISAF regarding plans to locate cellular phone
towers on U.S. Forward Operating Bases. His understanding of the
state of play of talks between ISAF and Afghanistan is that ISAF is
considering providing state-owned Afghan Telecom with cellular
infrastructure, but allowing commercial providers to rent space on
the towers. Ambassador Wayne said the USG is working to ensure
commercial providers have opportunities to use the towers. (Note:
ISAF plans to lease towers-on-wheels from a private contractor. The
cellular provider will likely be a U.S. company operating on Afghan
Telecom infrastructure. Once the towers are operational, commercial
providers also may be able to place their equipment on them. End

3. (SBU) Sangin said any plan should designate ownership of the
towers to ensure routine maintenance. He said Afghan Telecom
ownership would be "a good start," but private telecoms should have
space for their own infrastructure and pay rent to Afghan Telecom.
He agrees with the idea discussed in earlier conversations with
visiting State officials that television and radio providers be
allowed to mount equipment on towers and added that community radio
stations should not be charged for this service. Sangin suggested
working with Afghan Telecom would be simpler than ISAF negotiating
directly with multiple telecoms and would expedite tower
construction and operation. (Note: ISAF plans to lease the towers
will prevent clear ownership in the short-term. Both Embassy and
ISAF will work with the Ministry and Afghan Telecom to develop an
agreed way forward. End Note.)

Risk Insurance Still a Option

4. (SBU) In response to a query from Ambassador Wayne, Sangin said
the Ministry still supports risk insurance to help rebuild towers
destroyed by insurgent attacks. However, as he has said before, the
Telecommunications Development Fund (TDF), which is intended to
support service expansion to underserved areas, cannot be the sole
source of funding -- private operators must also pay a premium.
Minister Sangin suggested one-half of one percent of revenue would
be sufficient. This step, Sangin continued, would allow use of the
national TDF for a program that would mainly benefit the south of
Afghanistan and would demonstrate the Afghan Government is not
simply subsidizing profitable telecoms companies, which will help
avoid criticism from a Parliament which perceives the companies make
large profits.

Afghan Telecom: No Privatization, For Now

5. (SBU) After an unsuccessful 2008 tender process, Afghan Telecom
will not be privatized for at least three years, Sangin said. The
current security situation scares off many potential attractive
investors, while others cannot obtain capital due to the global
financial situation. As many prospective buyers are Russian, Sangin
said future heavy usage by ISAF and Afghan military customers makes

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him hesitant to sell Afghan Telecom for data security reasons. He
also cited concern that the leading companies interested in buying
Afghan Telecom are Russian. Still, to prepare for privatization,
the Ministry will add new features such as d-cell broadband and
expand the copper cable network.

Fiber Optic Cable Not in Service Everywhere

6. (SBU) Sangin outlined multiple setbacks in building a nationwide
fiber optic cable, which physically connects to networks in
Uzbekistan, Tajikistan, and Pakistan, as well as Iran. The Uzbek
network operator refuses to agree on a contracted price for network
traffic and is demanding a three fold increase, thus the connection
may not be operational by October 1 as planned. Sangin said this
situation underscores the urgency for Afghanistan to develop
multiple connections to international networks.

7. (SBU) The Minister also noted a USAID road contractor
accidentally cut the cable near the Pakistani border, severing the
network's connection to Pakistan a few days after it was completed.
Sangin said the Ministry of Public Works was not aware of the USG's
plan to build a road near the cable and had not warned the
contractor laying the cable. Ambassador Wayne said USAID met three
times with the Deputy Minister and provided the cable contractor
with road design drawings. The Afghan Ministry's contractor has not
provided USAID with drawings of the cable location or the
coordinates of the cut, as requested. USAID issued a stop-work
order along a 27 kilometer section of the road to ensure the cable
is not cut again. It has offered to dig trenches for the cable
along the roads it is constructing. Sangin said the cable
contractor had provided the necessary information to the USAID road
contractor, and suggested it had not been shared with USAID
management. (Note: We will follow up with the contractor to ensure
he received this information. End note.)

8. (SBU) Despite construction challenges, Sangin seeks donors to
support an additional cable from Kabul to western Afghanistan
crossing through the central part of the country. The additional
line would create a double loop in the country, helping ensure
continued service even if the cable was cut in other places. Its
construction would also mean economic benefits in some of the
poorest, least developed parts of Afghanistan. Ambassador Wayne
said he would discuss the idea within the Mission and with ISAF and
evaluate its compatibility with other projects.

9. (SBU) Ambassador Wayne added the Embassy and USFOR-A are both
interested in commercially leasing cable space, but Afghan Telecom,
which owns the cable, lacks capacity to negotiate commercial
arrangements. USFOR-A has offered to provide an advisory team to
Afghan Telecom to help it negotiate commercial agreements. Sangin
found the idea attractive, noting the Ministry needs an expert to
negotiate international and commercial agreements, but also thought
over the longer term an advisor supported by USAID or a U.S.
civilian agency would avoid a conflict of interest with the
military, which is likely to be the largest customer for Afghan
Telecom in the near term. (Comment: Embassy will work with USFOR-A
as well as others to follow up on these items. In addition, the
Embassy Telecom Working Group, which encompasses civilian and
military representatives, is examining the various options for
placing mobile towers on FOBs and strengthening Afghan
telecommunications capability. End comment.)

Moving on a National Identity Card, Other Projects
--------------------------------------------- -----

10. (SBU) The European Commission has expressed support for a
computerized national identity card program, Sangin said, as an
anti-fraud tool in future elections. He sees value in the idea,
even if it may take a number of years to include every Afghan. Such
a system, which would store information in a national computer
system, would undercut individuals' current ability to buy new
identity cards. Sangin will present this proposal to an upcoming
Joint Coordination and Monitoring Board meeting. Ambassador Wayne
suggested relevant Ministry staff meet with USAID experts for advice
and help develop a list of potential donors. Sangin said the plan
will cost $15 million in the first year and $10 to $15 million per
year for two additional years. He suggested individuals should pay
a fee and the receipts be used to lower the cost of the program. He
made it clear he hopes the U.S. will help fund the start up of this

10. (U) Sangin added that France's La Poste has developed a plan to
modernize and restore the Afghan postal service that will also be

KABUL 00002920 003 OF 003

presented to donors for funding.


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