US embassy cable - 05NEWDELHI1422

S E C R E T SECTION 01 OF 03 NEW DELHI 001422 
 
SIPDIS 
 
PASS TO NRC 
 
E.O. 12958: DECL: 02/25/2015 
TAGS: PGOV, PARM, MASS, TRGY, KNNP, ETTC, IN, NSSP 
SUBJECT: ASSESSING NEAR-TERM OPPORTUNITIES FOR THE NSSP 
 
REF: NEW DELHI 1261 AND PREVIOUS 
 
Classified By: Ambassador David C. Mulford, for Reasons 1.4 (B, D) 
 
1.  (C) Summary:  In hopes of avoiding a slowdown on key 
issues in the Next Steps in Strategic Partnership (NSSP), MEA 
Joint Secretary (Americas) S. Jaishankar outlined specific 
matters that require resolution during a February 18 meeting 
with visiting SA/RA Director John Schlosser, PolCouns, and 
PolMilOff.  Jaishankar was optimistic that several upcoming 
visits can focus both governments on steps to remove current 
obstacles.  In a separate meeting, Department representatives 
at Embassy New Delhi identified several opportunities in the 
near-term to maintain momentum on the NSSP.  End Summary. 
 
2.  (C) Schlosser began the February 18 meeting by outlining 
progress in several areas under the Next Steps in Strategic 
Partnership (NSSP) initiative recently:  the first meeting of 
the HTCG defense industry group on the margins of AeroIndia, 
positive dialogue between India's nuclear establishment and 
Nuclear Regulatory Commissioner Merrifield, as well as a 
trilateral discussion between the US Department of Energy, 
the IAEA, and GOI on the Regional Radiological Security 
Partnership.  As a result of completion of Phase One, the 
classified PAC-2 briefing was set for February 22, proving 
that the quality of the dialogue between the GOI and USG has 
improved dramatically.  Expressing appreciation for 
Jaishankar's efforts to stimulate the GOI to make progress on 
its export control commitments in Phase Two of the NSSP, 
Schlosser went on to urge the GOI to provide a copy of draft 
export control legislation, acknowledging that this would be 
"crossing the rubicon" for the GOI to provide draft 
legislation to another country. 
 
Nuclear Irritants 
----------------- 
 
3.  (C) Jaishankar responded that providing this legislation 
has been &a harder nut to crack than we thought8 due to 
foot-dragging by NSSP skeptics, especially in India's 
Department of Atomic Energy (DAE).  &Without the support of 
the nuclear establishment, we're trying to drive with the 
brakes on,8 he quipped.  Recalling the positive response of 
India's nuclear establishment to NRC Merrifield's comments 
during his February 8-11 visit to India (reftels), Jaishankar 
appealed for more flexibility regarding collaboration on 
nuclear safety, "not legislative changes, but greater 
latitude."  Jaishankar admitted, however, that he understands 
Merrifield doesn't necessarily speak for the Administration, 
much less for the Nuclear Suppliers Groups (NSG).  Any 
changes to the NSG's approach to India would require 
consensus among its members, Schlosser noted.  Jaishankar 
countered that some NSG members tell India they would be 
willing to support greater flexibility in interpreting NSG 
safety guidelines, but are constrained by the US.  Jaishankar 
asserted that the issue of nuclear fuel supply is 
particularly urgent for India.  "If we're pushed to the wall 
on this, we'll have to look at options that are uncomfortable 
for all of us," Jaishankar warned. 
 
4.  (S) Referring to outstanding nonproliferation cases, 
namely, two Indian scientists sanctioned for involvement in 
Iran's WMD program, and an older case of Russian assistance 
to India's ballistic missile program, Jaishankar cautioned 
that these encourage some in the GOI to question US 
commitment to partnership with India.  The GOI has offered to 
show copies of the scientists' passports to determine the 
extent of their travel to Iran, but lack of response from the 
US has "soured" some on the Indian side, according to 
Jaishankar.  The Joint Secretary complained that Washington 
has pushed opposition to any Indian cooperation with Iran to 
"ridiculous heights," adding that New Delhi does not view 
Iran as a state sponsor of terrorism.  Jaishankar added that 
Washington seems not to acknowledge its double standard of 
assisting Pakistan, nor sanctioning it for damage done by the 
AQ Khan network. 
5.  (S) Expressing Washington's awareness of Indian 
sensitivities about these cases, Schlosser pointed out that 
there is evidence that Russian assistance is ongoing. 
Further, some of these &irritants8 could be removed if 
India brought its export controls in line with international 
standards.  Any effort the GOI is making on export control 
cooperation with other countries, e.g., the UK, Japan, 
Australia, would be viewed positively by the US, Schlosser 
added. 
 
Misunderstanding on Space Collaboration 
--------------------------------------- 
6.  (C) On civil space cooperation, Jaishankar admitted there 
may be &genuine misunderstanding8 of the phased nature of 
the NSSP within the Indian Space Research Organization 
(ISRO), but there is also a perception that the US is not 
using existing latitude to make progress on space issues. 
"Some in the US adhere to the letter ) not the spirit ) of 
the NSSP," he said, adding, "I need some help from you to 
move this along." 
 
Possible Progress during Upcoming Visits 
---------------------------------------- 
 
7.  (C) Noting that Defense Secretary Rumsfeld's brief visit 
to New Delhi accomplished more progress on defense sales in 
one day than both sides had been able to achieve in the 
previous months, Jaishankar was confident that upcoming 
visits by FM Natwar Singh to Washington in April, as well as 
proposed visits by A/S Rocca, and a hoped for visit by 
President Bush later this year will focus both sides on 
realistic steps to move forward.  Jaishankar will be in 
Washington February 28 - March 2 to learn more about the 
Container Security Initiative, and expressed interest in 
meeting with counterparts on all aspects of the NSSP, 
including A/S Rocca, A/S Rademaker, and new Commerce Acting 
U/S for Industry and Security Lichtenbaum. 
 
Embassy Identifies Other Opportunities 
-------------------------------------- 
 
8.  (C) Prior to meeting with Jaishankar on February 18, 
Embassy representatives met to brief Schlosser about the 
current state-of-play on the NSSP and review upcoming 
opportunities to move some of these issues forward within 
both the GOI and USG, especially in light of upcoming 
high-level meetings.  It is clear from meeting with our GOI 
interlocutors on several fronts that GOI expectations are 
high for visible progress on NSSP issues during these 
upcoming engagements.  EmbOffs identified several immediate 
opportunities for progress: 
 
-- Nuclear:  We can capitalize on Merrifield's visit to move 
forward on issues under NRC's purview, showing India's 
nuclear establishment that progress in the civil nuclear area 
is not a pipe dream.  GOI will likely propose an energy 
dialogue (to include nuclear issues as well) at the April 5 
Rice-Natwar meeting. 
 
-- Onward Proliferation:  A Rademaker-Shankar meeting in 
Washington could help clear the backlog of older cases.  The 
GOI will continue to insist on sharp distinctions between 
onward proliferation and "inward" cases such as the Russian 
propellant mixers and conventional weapons transfers.  It 
would be useful to triage our list of outstanding cases to 
remove those no longer of active USG concern. 
 
-- Space:  The Indians have promised a think-piece on 
possibilities for space collaboration, perhaps to be 
delivered before the April Rice-Natwar meeting.  Firewalls 
within the ISRO complex are being developed, mostly because 
of commercial concerns within ISRO. 
 
-- Export Controls:  We are still waiting for some GOI 
movement on draft legislation on export controls, especially 
regarding catch-all controls, intangible technology 
transfers, and transit and trans-shipment.  Sharing draft 
legislation on export controls with us would be an 
unprecedented step for the GOI, but as Jaishankar mentioned, 
this is being opposed by DAE for lack of progress on India's 
request for the US to demonstrate flexibility on the safety 
exception to the Nuclear Suppliers Group.  On training, in a 
February 23 meeting with AC/RSS Director Gromoll and SA/RA 
Director Schlosser, MEA Additional Secretary Meera Shankar 
explained that difficulties in scheduling a planned customs 
enforcement exchange were due to personnel shifts and not to 
any lack of commitment to the Export Control/Border Security 
Program on their part.  The GOI will not be able to host the 
next EXBS event until April at the earliest, but if we are 
able to do it in the US, it could be scheduled before April. 
 
-- High-Tech Trade Facilitation:  As recent HTCG events 
indicate, there is still considerable confusion among 
industry about how to access US high-tech goods as envisaged 
by the NSSP.  There could be near-term progress on 
biotechnology, but longer-term movement will require 
establishing a timeline for creating a better regulatory and 
implementation framework for customs and law enforcement, 
based on capacity-building programs and technical exchanges. 
We are getting encouraging signals from the Ministry of 
Commerce and Industry that the level of attention attached to 
trade facilitation under the Trade and Commerce Tracks of the 
Economic Dialogue has increased based on strong direction 
from Minister Kamal Nath to work cooperatively with the US. 
Commerce Secretary S.N. Menon told us on February 24 that he 
wants to expand cooperation on standards and expeditious 
clearing of high technology goods through Indian ports based 
on a new integrated tracking system soon to be in place 
(septel). 
 
-- Missile Defense:  Tangible deliverables include the 
February 22 PAC-2 Gem Plus classified briefing (septel), 
followed by a missile defense workshop organized by the 
Missile Defense Agency in Hyderabad, 3-4 March.  A possible 
POTUS-level deliverable might induct India as part of the 
Defense Technology and Security Initiative (DTSI) to 
streamline licensing authorizations for NATO countries, Major 
Non-NATO Allies, Japan, Australia, and Sweden.  We should 
also reply favorably to the Indian request for a missile 
defense technical cooperation agreement. 
 
Comment 
------- 
 
9.  (C) Mil-mil engagement with India is sailing along 
unfettered by the legacy issues that continue to stymie 
progress in the nuclear and space arenas.  One could think of 
a strategy where rapid implementation of export control 
legislation and regulations by India would result in an 
immediate suspension of unilateral controls the US applies on 
exports to the Indian space program.  These programs appear 
to be making genuine efforts to disassociate themselves from 
India's ballistic missile program.  In addition, as India is 
desperately short of natural uranium to fuel its stable of 
power-producing nuclear reactors, perhaps resurrecting the 
August 8, 1963 "Bilateral Agreement on Cooperation for 
Civilian Uses of Atomic Energy" as it regards to the Tarapur 
1 and 2 reactors, may provide avenues for the Indian nuclear 
and space establishments to get on board the NSSP for good. 
End Comment. 
MULFORD