US embassy cable - 05NEWDELHI388

C O N F I D E N T I A L SECTION 01 OF 02 NEW DELHI 000388 
 
SIPDIS 
 
E.O. 12958: DECL: 01/13/2015 
TAGS: PREL, ETRD, BG, PK, IN, SAARC 
SUBJECT: SAARC SUMMIT: WHAT'S THE HOLD UP? 
 
REF: A. NEW DELHI 303 
     B. 04 NEW DELHI 7426 
 
Classified By: PolCouns Geoff Pyatt.  Reason 1.4 (B,D) 
 
1.  (C) Summary: The GOI has not yet agreed to the proposed 
February 7-9 dates for the SAARC Summit, and media reports 
indicate New Delhi has suggested February 6-7 instead.  The 
MEA remains tightlipped about the reasons for delay, but some 
New Delhi foreign policy watchers speculate that the SAARC 
indecision is connected to the major upcoming elections in 
the states of Bihar and Jharkhand, or the unsuccessful talks 
with Pakistan on the Baglihar Dam.  India is likely 
ultimately to agree to a Summit in February.  Further 
postponement of the Summit would put off progress on SAFTA 
negotiations, as well as a first-time meeting between PM 
Singh and Bangladeshi PM Khaleda Zia.  End Summary. 
 
 
2.  (C) MEA Deputy Secretary (SAARC) Oscar Kerketta told 
Poloff on January 12 that there was still "some haggling" 
going on over the proposed dates.  While Kerketta said that 
the "majority" had accepted February 7-9, not all member 
states were on board (but declined to specify which countries 
had not yet agreed).  A well informed journalist reported 
that as of January 13, India was the only member who had not 
accepted the Summit, but predicted a decision within a few 
days.  The media reported on January 14 that India has 
suggested February 6-7 to Islamabad, which currently holds 
the SAARC chairmanship until Dhaka takes over at the Summit. 
 
Elections No Excuse 
------------------- 
 
3.  (C) Some commentators have attributed New Delhi's 
resistance to the February dates to upcoming elections in the 
battleground states of Bihar and Jharkhand, noting that 
February 7-9 falls between the first two phases, February 3 
and 15.  "Hindustan Times" Deputy Editor Pramit Pal 
Chaudhary, however, dismissed this notion, remarking on 
January 13 that "nothing big is on the stake for the Congress 
party" in these states.  Raj Chengappa of "India Today" came 
to the same conclusion, as did the "Business Standard's" 
Aditi Phadnis, who said "Sonia Gandhi, not PM Manmohan Singh, 
would be required for campaign and other poll exercises," and 
that "assembly elections were not a potent reason for 
postponing the Summit." 
 
It Wouldn't Be the First Time 
----------------------------- 
 
4.  (C) Although the Dhaka Summit will mark SAARC's twentieth 
anniversary, it will only be the thirteenth summit, as seven 
summits have been nixed because of neighborly animosity. 
While this meeting does not appear to be in any imminent 
danger of being called off, observers in India suspect 
bilateral friction may be at the root of New Delhi's slow 
response to Dhaka's proposal.  Debunking the explanation that 
New Delhi wishes to avoid high-level travel during the state 
elections, political commentator Zafar Agha suggested that 
poor atmospherics between India and Pakistan following 
Islamabad's threat of World Bank arbitration to resolve the 
Baglihar Dam dispute (Ref A), have prompted New Delhi's 
reluctance to confirm the Summit, which normally includes 
bilateral meetings on the sidelines. 
 
5.  (C) MEA officials have given other reasons for India's 
hesitation.  MEA Director (Bangladesh, Sri Lanka, Maldives) 
TS Sandhu said it would not be appropriate for the PM and 
 
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Foreign Minister to be seen on non-tsunami related travel 
while parts of the country are still recovering from the 
disaster.  Kerketta of the SAARC desk ascribed the delay to 
ongoing discussion among the members as to which documents 
are to be signed, but he mentioned four agreements (Customs 
Mutual Assistance Agreement, SAARC Arbitration Rules, 
Multilateral Double Taxation Treaty, Promotion and Protection 
of Investment Agreement) that the MEA expects to be finalized 
in Dhaka. 
 
The Problems With Postponing 
---------------------------- 
 
6.  (C) ORF Senior Fellow Jayshree Sengupta, who takes an 
admittedly pessimistic view of the organization ("SAARC does 
not have a bright future"), recently told Poloff that if 
India were to put off the Summit it would delay action on 
South Asia Free Trade Area (SAFTA) negotiations and also 
postpone release of the Poverty Commission Report.  Sengupta 
described the report as useful in highlighting that all the 
SAARC countries suffer from the same problems.  MEA Joint 
Secretary (SAARC) V. Ashok had outlined an ambitious schedule 
 
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for SAARC implementation in a November 22 conversation with 
PolCouns (Ref B).  While he did not think the Dhaka Summit 
would include any significant announcements on SAFTA itself, 
he noted that the four agreements would be important to 
facilitate trade and investment in the region. 
Comment: Baglihar Theory Holds No Water 
--------------------------------------- 
 
7.  (C) Despite the chatter among some commentators, we do 
not buy the theory that the GOI is using SAARC as a tool to 
show its displeasure with Islamabad.  This judgment is 
reinforced by the MEA's January 13 confirmation that Foreign 
Minister Natwar Singh will travel to Pakistan (shortly after 
the Summit) on February 15.  If India were as upset with 
Islamabad as some suggest (and we have seen little evidence 
of this), holding Natwar's visit hostage would be more 
effective with Islamabad than quibbling over SAARC. 
Postponing the Summit considerably would also put off the 
PM's first meeting with Bangladeshi PM Khaleda Zia, which 
provides an opportunity to make inroads into New Delhi's 
recent difficulties with Dhaka.  On balance, we still expect 
the GOI to agree to a Summit (and the PM's first trip to any 
of India's neighbors) in February. 
MULFORD