US embassy cable - 05NEWDELHI5048

C O N F I D E N T I A L SECTION 01 OF 03 NEW DELHI 005048 
 
SIPDIS 
 
E.O. 12958: DECL: 07/01/2015 
TAGS: PREL, PTER, PK, AF, IR, NP, BG, CE, IN, Indo-US 
SUBJECT: U/S BURNS' DISCUSSIONS ON SOUTH ASIAN ISSUES 
 
 
Classified By: Charge Bob Blake for Reasons 1.4 (B, D) 
 
1.  (C) Summary:  U/S Nicholas Burns met with Foreign 
Secretary Shyam Saran on June 25 to review Indo-Pak 
 
SIPDIS 
relations, Iran, Nepal, Bangladesh, and briefly Sri Lanka. 
Although pleased with the groundswell of support for 
people-to-people exchanges with Pakistan, Saran warned that a 
single major terrorist attack, rising infiltration across the 
LOC, or domestic instability in Pakistan could seriously 
endanger recent gains in the peace process.  On Iran, U/S 
Burns expressed skepticism that Tehran would accept the EU-3 
compromise to let Iran to keep its nuclear plants but not 
allow access to any part of the fuel cycle.  The GOI was 
encouraged by Nepalese political parties' concurrence on a 
common platform seeking a ceremonial role for the monarch, 
civilian control of the army, but did not expect the Maoists 
to agree.  The GOI continues to withhold lethal military 
assistance to the RNA.  The GOI was making progress on border 
issues and increased trade with Bangladesh, but has increased 
concerns about Dhaka's slide toward Islamic fundamentalism. 
Finally, U/S Burns welcomed the news of an agreement between 
the Sri Lankan government and the LTTE to share tsunami aid. 
End Summary. 
 
Pakistan 
-------- 
 
2.  (C) Because neither New Delhi nor Islamabad would change 
their positions regarding border demarcation in Kashmir, the 
Foreign Secretary summarized GOI strategy for managing the 
ongoing dispute: "Rather than redraw the lines, why not deal 
with the human consequences so that the lines become less 
relevant?"  He was pleased with the groundswell of support 
for people-to-people exchanges, citing an unprecedented 
volume of cross-border traffic creating a "larger and larger 
constituency of peace."  Further, the "natural affinities of 
peace" could expand with better infrastructure, such as a 
proposed Pakistani consulate in Mumbai and a counterpart 
Indian consulate in Karachi. 
 
3.  (C) Although there is popular support for these 
initiatives, Saran expressed concern that several factors 
could derail the process.  A single high profile attack like 
the bombing of Parliament in December 2001 could "send both 
sides back to square one."  Islamabad's refusal to dismantle 
terrorist infrastructure was evident in continued training 
camps and terrorist handlers who are allowed to move freely 
in Pakistan, which gave New Delhi a sense that terrorism was 
"a card that Islamabad still intends to play." 
 
4.  (C) Noting that the Taliban are still active in 
Afghanistan, the GOI had heightened concerns about increased 
infiltration from Pakistan because it could negatively impact 
the Indo-Pak process.  Admitting he did not know the 
motivation behind the alleged assassination attempt of the US 
Ambassador to Afghanistan by three Pakistani nationals, Saran 
described the attempted attack as symptomatic of Islamabad's 
unwillingness to stop cross-border infiltration.  The FS 
cautioned further the US against making distinctions between 
"good" and "bad" Taliban. 
 
5.  (C) Observing that the peace process depends to a 
considerable degree on Musharraf's personal assurances, 
domestic instability and weak support within his own regime 
could also undermine the process.  Saran asked whether 
international consensus backing President Musharraf had been 
shaken by divisions that have started to show in Pakistan's 
domestic politics, as well as events in Baluchistan, and 
recent incidents of sectarian violence in Karachi. 
 
6.  (C) U/S Burns echoed Saran's concerns about cross-border 
terrorism in Kashmir and infiltration along the 
Pakistan-Afghanistan border.  Noting that the Taliban's 
seasonal cross-border offensive was more extensive this year 
than last year, he relayed US commitment to maintain its 
force presence in Afghanistan, but with modified troop 
positions.  The USG has encouraged NATO member states to 
increase their presence in Kabul, and northern and western 
Afghanistan, thereby allowing the US to concentrate on more 
problematic areas in the south and east.  However, this 
change would only be effective if some NATO members adopted 
more aggressive rules of engagement in their respective 
areas.  PDAS Camp added that Pakistan had taken positive 
steps such as taking the lead in securing the tribal areas 
and had turned over the captured al-Qaeda suspect Abdul Faraj 
al-Libby. 
 
Iran 
---- 
 
7.  (C) In response to U/S Burns' question about the 
implications of the election of Mahmoud Ahmadinejad as the 
new Iranian President, Saran admitted that India does not 
know much about him, but that he seemed to be conservative, 
but not a part of the clergy, the Revolutionary Guard, nor 
the business community.  "He projects himself as an ordinary, 
god-fearing Iranian," he observed. 
 
8.  (C) In his role as liaison to the EU-3 on Iran's nuclear 
program, U/S Burns then reviewed the status of talks with 
Tehran.  In light of the USG position that Iran should not 
have access to any part of the nuclear fuel cycle, the EU-3 
was developing a compromise that would allow Iran to keep its 
nuclear plants, but all parts of the fuel cycle would remain 
outside the country.  While he hoped the EU's renewed offer 
would succeed, U/S Burns expressed skepticism that Tehran 
would accept it.  If these negotiations fail, the USG will 
encourage the EU-3 to go to the IAEA Board of Governors (BOG) 
to confirm that Tehran could not give an "objective 
guarantee" after which the BOG could refer the matter to the 
Security Council to consider international sanctions. 
 
Nepal 
----- 
 
9.  (C) Saran noted positive developments in Nepal, namely 
the agreement of seven political parties on the same 
platform, led by Nepalese Congress Party leader GP Koirala, 
and their discussions on a power-sharing package.  The GOI 
remained engaged with the Palace, Royal Nepalese Army (RNA), 
political parties, and via indirect communication with the 
Maoists.  According to Saran, the political parties have 
engaged the Maoists regarding a "minimum program for 
settlement," comprised of a ceremonial role for the monarch; 
the RNA to be under the control of an elected civilian 
authority; the Maoists to give up violence for political 
activity and open the areas they control to unfettered 
political activity; elections to be held without the 
intimidation of either the Maoists or RNA; and a "neutral 
referee" to monitor these assurances.  If these conditions 
are fulfilled, all parties would agree to a cease-fire, 
followed by elections.  According to the FS, the parties do 
not think the Maoists will accept this plan, but they will 
nevertheless continue to "agitate for democracy," although 
not with the Maoists.  With the political parties and the 
Maoists allied against him, the GOI has tried to convince the 
King that he has endangered the future of Nepal's monarchy, 
Saran stated. 
 
Military Assistance to Nepal 
---------------------------- 
 
10.  (C) Saran said the GOI provided the RNA with non-lethal 
equipment that was already in the pipeline for use against 
the Maoists (thermal imagers, transport, etc.).  Saran 
confirmed that the GOI had not yet made a decision on 
near-term arms sales.  Similarly, PDAS Camp noted that the 
USG had also provided non-lethal equipment such as night 
vision goggles and Kevlar vests, but was withholding M16s. 
Camp expressed concern about the signal sent by the GOI in 
dealing with the Maoists.  Saran clarified that the GOI had 
no direct dealings with the Maoists, but had an interest 
because of Maoist links with the insurgency in India's 
Northeast.  Saran offered the USG a future confidential 
briefing on the GOI's contacts with Maoists.  He stated 
firmly, however, that the Maoists would have no prospect of 
dialogue with the GOI unless they abandon violence. 
Bangladesh 
---------- 
 
11.  (C) The Foreign Secretary reviewed the results of his 
meetings earlier in the week with Bangladesh's Foreign 
Secretary.  There had been progress on boundary and trade 
 
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issues, and the two sides hoped to renew the joint boundary 
group to continue discussion of demarcation of the boundary 
and exchange of enclaves, among other issues.  On trade, he 
wanted to replicate the GOI Free Trade Agreement with Sri 
Lanka which resulted in more trade and transport links 
between the two countries.  The upcoming Joint Working Group 
on Trade will look at non-tariff barriers, customs 
cooperation, and better transport connections, offering 
Indian financing on the latter.  "If we give our neighbors a 
stake in our own economic development, it will necessarily 
lead to better relations," Saran stated. 
12.  (C) Saran welcomed Dhaka's efforts to provide better 
border security and the recent agreement on joint patrolling, 
beginning with river patrols.  However, he expressed grave 
concern about Dhaka's slide toward fundamentalism, reports of 
Islamic parties putting pressure on the government, 
increasing incidents of harassment of the Hindu minority 
population and Ahmadiyas, as well as other Muslim sects and 
intellectuals, as well as evidence of Pakistani ISI 
involvement in Bangladesh.  Further, he complained that there 
was "no closure on certain unexplained events" such as the 
2004 Chittagong arms seizure and linkages between madrasas in 
Bangladesh with security concerns in Thailand. 
 
Sri Lankan Agreement to Share Tsunami Aid 
----------------------------------------- 
 
13.  (U) Finally, U/S Burns welcomed the news of an agreement 
between the Sri Lankan government and the LTTE to share 
tsunami aid.  Saran remarked that India had reservations 
 
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about the agreement, but did support the Joint Mechanism and 
agreed to continue to assist Sri Lanka through a number of 
bilateral projects. 
 
Participants 
------------ 
 
14.  (U) USG Participants: 
 
U/S Nicholas Burns 
Robert Blake, DCM Embassy New Delhi 
Donald Camp, PDAS, South Asia Bureau 
Matt Boyse, A/PolCouns, Embassy New Delhi 
Xenia Dormandy, NSC Director 
Caitlin Hayden, Special Assistant, P 
Stacy Gilbert, PolMilOff, Embassy New Delhi (Notetaker) 
 
GOI Participants: 
 
Foreign Secretary Shyam Saran 
S. Jaishankar, Joint Secretary (Americas) 
Renu Pall, Director (Americas) 
Santosh Jha, Deputy Secretary (Americas) 
Raj Srivastava, Under Secretary (Americas) 
 
15.  (U) U/S Burns cleared this cable. 
BLAKE