The second Agosta 90-B submarine being built in Karachi for the Pakistan Navy was launched on 24 August 2002. In 1994, Paris and Islamabad concluded a contract for the construction of three submarines at a total cost of US $ 950 million. It was decided to construct the first submarine in France with assistance from the French state-owned shipbuilding company Direction des Constructions Navales (DCN). The other two were to be assembled/constructed in Pakistan. The loan for construction is being provided by the French and will be repaid in a period of five to six years. The French agreed not to supply these submarines to India.

     Pakistan has sourced its naval hardware largely from France. In 1963, it contracted three Daphne class submarines. The UN embargo on military sales to South Africa resulted in several Agosta class submarines remaining with France. The Pakistani Navy availed of this opportunity and signed a contract in 1966. In 1973, Pakistan approached France for Atlantique maritime patrol aircraft, as also the repair of three naval ships. Thus the foundations for the Franco-Pakistani defence cooperation are long established.

     Bitter experience with US embargoes on military sales has been an important factor forcing Pakistan to look for alternate sources of military supplies from France. Although French equipment was relatively expensive, Islamabad procured them because there was little fear of sanctions, as the French military sales policy was independent of Western approaches to sanctions. According to a report tabled in the Parliament by the French Ministry of Defence, Pakistan is France's third largest customer after Taiwan and Saudi Arabia. Between 1991 and 1997, military sales to Pakistan accounted for US$ 1.5 billion. The Pakistani Navy now plans to acquire French stealth frigates that were built for the Saudi Arabian Navy.

     While France has emerged as an important source for the Pakistan Navy, there have been calls by the French National Assembly and a major trade union to reduce defence sales to Pakistan. This stance is primarily due to the unfortunate incident of 8 May 2002 in Karachi when eleven French engineers were killed in a terrorist attack. Since the September 11 attacks on the US, France has played a significant role in the international war on terrorism. President Jacques Chirac announced that France would do everything necessary to help the United States eradicate terrorism. A French naval task group headed by the Charles de Gaulle nuclear powered aircraft and a nuclear submarine was deployed in the Indian Ocean. France's involvement in the campaign was mostly limited to logistical and intelligence support, and its aircraft carrier conducted surveillance missions to prevent Osama bin Laden and Al-Qaeda members from escaping by the sea route.

     Although there has been no criticism of France by the Jihadi groups linked with bin Laden, a possible reason for the attack on the submarine engineers may have been the perceived French co-operation with the US in the war against terrorism. Besides, the French counter-terrorism agencies have been very active in investigating the links of the Al Qaeda in France. Their bank accounts have been frozen. The French have been active in Afghanistan since 1956. The Direction generale de la Securite exterieure (DGSE), the French CIA, had long established their 'presence and preeminence' several years before the arrival of the American CIA or the British MI5 in the region. They have based their policies on building and maitaining long term 'human relationships' in areas of potential interest and flavoured it with military sales.

     During his formative years, Ahmed Shah Massood attended a French school in Kabul, and several French civilians were his close friends who visited the Panjsher valley to offer support. French support for Massood remained strong even after the Soviet Union withdrew from Afghanistan. In 2001, Massood visited Europe with French support, where he appealed for concrete aid against the Taliban but could only get promises of sanctions and pressure against the Taliban. At the start of Operation Enduring Freedom, there were about forty DGSE operatives in the Panjsher valley and Taloqan. The French have vast intelligence about the region and the US and British intelligence operatives were accorded access to French intelligence files.

     The support to Masood provided Paris with a regional role and permitted an aggressive military sales strategy not linked to the US or British policies. It is understood that President Chirac wants France to increase its defence presence in Pakistan, opening up the possibility for more joint ventures between the two countries.