NSSP PHASE ONE: REVIEWING ACHIEVEMENTS AND PENDING

C O N F I D E N T I A L SECTION 01 OF 04 NEW DELHI 007013

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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