US embassy cable - 04NEWDELHI7013

C O N F I D E N T I A L SECTION 01 OF 04 NEW DELHI 007013 
 
SIPDIS 
 
PASS TO NRC 
 
E.O. 12958: DECL: 11/04/2014 
TAGS: PARM, PREL, KNNP, ETTC, IN, NSSP 
SUBJECT: NSSP PHASE ONE: REVIEWING ACHIEVEMENTS AND PENDING 
ISSUES 
 
REF: A. NEW DELHI 6773-6779 AND 6816 
 
     B. STATE 225298 
     C. NEW DELHI 6699 
     D. NEW DELHI 6734 
     E. NEW DELHI 6735 
     F. NEW DELHI 6610 AND PREVIOUS 
 
Classified By: DCM Robert O. Blake, Jr., Reasons 1.4 (B,D). 
 
1.  (C) Summary:  This is the first of two cables reporting 
on the Next Steps in Strategic Partnership (NSSP) 
Implementation Group.  USG and GOI counterparts met in two 
positive and productive sessions of the NSSP Implementation 
Group on October 20-21 to review accomplishments under Phase 
One and chart the course for Phase Two.  Although there are 
some pending issues we need to resolve -- some contentious 
such as the status of onward proliferation cases -- the GOI 
continues to demonstrate high-level resolve to maintain 
momentum.  Throughout the course of the meetings, both sides 
exchanged forthright views on mutual expectations, and 
defined areas where more information is needed or where 
action is pending.  After reviewing measures the GOI has 
already taken to strengthen its export controls, the Indians 
commented that work is already well-advanced on issues such 
as developing a framework for stronger export controls. 
Considerable effort, however, must be sustained to ensure 
effective implementation such as introducing legislation that 
adequately covers "intangible" technology transfers and 
provides for "catch-all" controls.  Other issues, such as 
formulation of an Indian missile defense doctrine, remain in 
the beginning stage.  The Indian side agreed to a further 
discussion of Phase Two issues in connection with the 
November 18-19 High-Tech Cooperation Group (HTCG) meeting. 
End Summary. 
 
2.  (U) A/S Rocca led the USG delegation comprised of 
Commerce Deputy Assistant Secretary Borman, DCM, PolCouns, 
and representatives from the State Department's Bureaus for 
South Asia, Non-Proliferation, and Arms Control, the 
Department of Defense, as well as the Science and Customs 
offices at Embassy New Delhi.  With similarly broad 
representation, the GOI delegation was led by MEA Additional 
Secretary for International Security Meera Shankar, with 
 
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participation from MEA Joint Secretary (Americas) S. 
Jaishankar, other MEA officials from the Americas and 
Disarmament Divisions as well as representatives from the 
Department of Atomic Energy, Department of Space, and the 
Defense Ministry's Defense Research and Development 
Organization (DRDO).  The NSSP Implementation Group meeting 
took place in two sessions, October 20-21.  The following 
cable provides reporting on achievements and pending issues 
from Phase One; reporting on the next steps for Phase Two 
will follow septel.  Because of scheduling constraints, not 
all participants were able to attend all sessions. 
Participant list follows in para 12. 
 
Phase One: Accomplishments and Pending Issues 
--------------------------------------------- 
 
3.  (C) In her opening remarks on Phase One, A/S Rocca 
reviewed significant accomplishments:  Removing ISRO from the 
Entity List; removing licensing requirements for certain 
dual-use items exported to Indian Space Research Organization 
(ISRO) subordinates; and expanding the "presumption of 
approval" for all dual use items not controlled by the 
Nuclear Suppliers Group (NSG) for "balance of plant" 
operations.  She inquired about the GOI response to U/S 
Grossman's letter offering the sale of the Patriot PAC-2 
missile defense system and expressed USG desire to continue 
the Strategic Stability Dialogue. 
 
4.  (C) Additional Secretary Shankar began by describing 
India's security perimeter as "stretching from the Straits of 
Malacca to the Gulf and beyond."  In addition to the security 
concerns posed by India's immediate neighbors, Shankar said 
that proliferation linkages with this region also impinge on 
Indian security.  Chinese proliferation of centrifuge 
technology to Pakistan, for example, and subsequent onward 
proliferation to Libya, North Korea and others also pose 
security risks to India.  Because of the direct impact of 
proliferation on India's security, Shankar urged the US to 
share intelligence about proliferation in the region, 
particularly the status of dismantling the AQ Khan network. 
A/S Rocca responded that it may not be possible to provide 
more information at this time without endangering the ongoing 
investigation, but underlined US commitment to dismantle the 
AQ Khan network "root and branch." 
 
Onward Proliferation 
-------------------- 
 
5.  (C) Both sides agreed that it is necessary to determine 
the status of several pending onward proliferation cases. 
Shankar presented eight non-papers outlining the GOI 
investigation of numerous cases raised by the US (Ref A), but 
expressed frustration that current cases are reviewed, new 
ones are added, but old cases never seem to be resolved. 
"Our agencies want to see the NSSP as forward-looking and 
prospective, not retrospective," Shankar said.  Caroline 
Russell, the NP representative, assured Shankar that Indian 
information is carefully considered, but since our goal is to 
have a dialogue, further questions often arise about the 
original situation, if not about GOI action.  As information 
is exchanged, cases can be removed from the list. 
 
6.  (C) After A/S Rocca delivered the demarche points in 
Reftel B regarding Russia's transfer of MTCR Category II 
propellant mixers to India's ballistic missile program in 
1999, GOI representatives expressed dismay and 
dissatisfaction on several counts (Reftel C).  Beyond their 
reaction to the case itself, Shankar broadened her critique 
by stating the GOI view that conventional weapon issues are 
outside the purview of the NSSP.  "The US has raised concerns 
about conventional weapons based on your own foreign policy 
and political concerns," she said, "but these concerns are 
best addressed by in our respective Foreign Ministries, not 
the NSSP."  "It seems that you have some discretion in 
interpreting your laws and choosing which cases to raise and 
when," she continued.  "On the case of China providing ring 
magnets to Pakistan," for instance, "despite substantial 
evidence, sanctions were not imposed."  Shankar offered two 
non-papers about proliferation to Pakistan (Refs D and E), 
with a request that the US investigate the matters and share 
any resulting information with the GOI. 
 
7.  (C) Turning the tables, Mr. Siddhartha, a consultant to 
MEA and former DRDO official, wanted assurances that the US 
would not allow Indian technology to be passed on to 
Pakistan, as in the case of a mission control computer 
developed in India that could be fitted on an F-16.  He 
predicted that such situations may be more common in the 
future as India's technology sector develops. 
 
8.  (C) Finally, Shankar reiterated concerns that information 
the GOI has shared with the US on cases of onward 
proliferation, e.g., NEC, has been shared with other 
governments without GOI consent, possibly endangering cases 
under judicial review.  Russell assured the GOI that the US 
treated the information they provided with the utmost 
confidentiality.   She said she was unaware that any GOI 
 
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information had been passed on to other governments, but 
noted that the U.S. did on occasion share with other 
countries information from its own sources.  She observed 
that in the NEC case, the subsequent warning issued by the 
German government could have been based on press accounts of 
the public announcement of U.S. sanctions against NEC in 2002. 
 
Sanctioned Scientists 
--------------------- 
 
9.  (C) Returning to the controversial issue of US sanctions 
against two Indian scientists for involvement in Iran's WMD 
program (Reftel F), Shankar said the timing of the 
announcement could not have been more unfortunate because "it 
tarnished the shine of the NSSP."  She reiterated the GOI's 
oft-stated defense that Dr. Surendra has never been to Iran 
and that Dr. Prasad worked on safety issues at the Bushehr 
nuclear reactor under IAEA auspices.  The sanctions 
determination has raised questions within the GOI about the 
credibility of the NSSP; a decision to drop sanctions would 
consequently bolster confidence among GOI skeptics, according 
to Shankar. 
 
10.  (C) A/S Rocca acknowledged that the timing of these 
penalties was regrettable, but believed the intelligence to 
be solid and stated that the determination would be upheld 
unless the GOI presents new information.  "We do not share 
your perception of this issue," Shankar replied.  A/S Rocca 
responded that it is critical to develop better means of 
communication to ensure that similar cases do not occur in 
the future. 
 
11.  (C) Indicating the depth of GOI resentment on this case, 
Jaishankar again raised the issue of the sanctioned 
scientists on the second day of meetings.  The announcement 
of US penalties against the two eminent scientists "played 
badly in the media, but much worse in-house," he said. 
Citing an article about the case in the local press the day 
before, he predicted, "We will keep getting hammered on this 
(until the decision is reversed)."  He went on to say that he 
is "personally aggrieved" by the way the announcement was 
handled.  Recalling that a State Department official 
contacted him by cell phone in a restaurant in DC to discuss 
an issue related to the IAEA debate in Vienna, he expressed 
dismay that no one in Washington tried to contact him about 
this issue of great concern to New Delhi. 
 
Participants 
------------ 
 
12.  (U) USG Participants: 
 
State Assistant Secretary for South Asia Christina Rocca 
Commerce Deputy Assistant Secretary for Export Administration 
Matthew Borman (Oct. 21) 
Embassy New Delhi DCM Bob Blake 
Embassy Political Counselor Geoffrey Pyatt 
Embassy Science Counselor Marco DiCapua (Oct. 21) 
Embassy DHS Customs Representative Jim Dozier (Oct. 21) 
State Non-Proliferation Bureau Caroline Russell 
State Arms Control Bureau Tom McIlvain 
State India DeskOff Jim Seevers 
Defense, OSD Country Director Jim Alverson (Oct. 21) 
Embassy PolMilOff Stacy Gilbert (notetaker) 
 
GOI Participants: 
 
MEA Additional Secretary (International Security) Meera 
Shankar (Oct. 20) 
MEA Joint Secretary (Americas) S. Jaishankar 
MEA Director (Americas) Renu Pall 
MEA Director (Disarmament and Int'l Security) Venu Rajamony 
(Oct. 20) 
MEA Deputy Secretary (Americas) Santosh Jha 
MEA Under Secretary (Disarmament and Int'l Security) Nutan 
Kapoor 
MOD Defense Research and Development Organization, Dr. Anup 
Chatterjee 
Dept of Atomic Energy, Dr. S.D. Misra 
Dept of Atomic Energy, Scientific Officer, Dr. A.B. Awati 
Dept of Space, ISRO Director, Dr. Rajeev Lochan 
Consultant to MEA, Dr. V. Siddhartha (Oct. 20) 
 
13.  (U) This cable has been cleared by A/S Rocca and 
Commerce DAS Borman. 
MULFORD