INDIAN INITIATIVES IN IRAQ STILL ON HOLD

C O N F I D E N T I A L SECTION 01 OF 02 NEW DELHI 005867

SIPDIS

E.O. 12958: DECL: 07/29/2015
TAGS: PREL PHUM KDEM ENRG EPET IZ IN
SUBJECT: INDIAN INITIATIVES IN IRAQ STILL ON HOLD

REF: A. NEW DELHI 4798


B. NEW DELHI 4619

C. NEW DELHI 3878

Classified By: PolCouns Geoffrey Pyatt for Reasons 1.4 (B, D)


1. (C) Summary: Following the Dead Sea conference on Iraq,
MEA Joint Secretary (Gulf) Sanjay Singh told PolCouns and
PolMilOff on July 28 that he was impressed with how Iraqis
were taking control of their political process, and expressed
confidence that this would result in greater support for
reconstruction. At the same time, however, Iraqis were
exerting so much effort to clear the Constitutional hurdles
before them that they had few resources left to devote
to other political and economic initiatives, such as
reconstituting the Indo-Iraq Joint Commission. Despite
concern about increased violence in the run-up to national
elections in December, the GOI is still interested in
getting details about small-scale, high-priority
electricity projects.
End Summary.

Constitution a Priority Over the Joint Commission
-------------- --------------


2. (C) In contrast to what he previously called an "access
unfriendly" conference in Brussels, Singh was pleased with
the level of access the Indian delegation had to both
senior Iraqi and American officials at the Dead Sea
conference on Iraq, July 18-19. The Joint Secretary was
impressed with how Iraqis were taking control of their
political process, and he expressed confidence that this
would result in greater support for reconstruction. At the
same time, however, he thought that less pressing initiatives
such as the Indo-Iraq Joint Commission would not happen while
Iraqis were fully engaged in trying to meet the deadlines for
drafting and voting on the constitution and national
government.


3. (C) Timing aside, Singh outlined the practical steps
toward resurrecting the Joint Commission. As a result of
Charge's meeting with Oil Ministry Additional Secretary
Talmiz Ahmad on May 25 (Ref C),Singh said that Ahmad had
proposed that the GOI field a small team to begin to develop
ideas for bilateral projects in Iraq. A bilateral technical
group would also meet to discuss pending issues and an agenda
before the first meeting of the Joint Commission. According
to the Joint Secretary, the GOI would like bidding and
procurement to be on the agenda because of Indian complaints
about lack of understanding and transparency in the bidding
process.

Concern with Decreased Iraqi Oil Production
--------------


4. (C) Singh went on to express concern about decreasing
Iraqi oil production, down from "break-even production" of
2.2 million barrels/day to the current level of 1.4 million
barrels, due to refineries' low production capacity and
sabotage. Asked whether the July 27 fire that destroyed an
offshore platform which generates a significant percentage
of India's oil production would hasten a GOI decision to
re-engage quickly in Iraq, Singh was non-committal.

Sparks of Interest in Electricity Sector
--------------


5. (C) PolCouns asked about Indian interest in projects in
the electricity sector, as discussed during Ambassador Jones'
visit (Ref B) and referenced in FM Singh's speech at the
Brussels conference (Ref A). Singh and the Indian Charge
in Baghdad had met with the governor of Basra, the
Electricity Minister, and industry officials in Jordan, and
identified contractors who would be willing to undertake
projects in Iraq, but the GOI did not yet have projects to
offer. Singh also mentioned that there are Indian engineers
in Jordan who regularly travel to Iraq, despite the travel
ban. PolMilOff mentioned that USAID sector experts in Iraq
would compile a list of small-scale, high priority projects
in the electricity sector for GOI consideration, including a
former Indian project in Khor Zubayr, south of Basra. Singh
will encourage Indian electricity experts to be part of the
technical working group to further explore these
possibilities.

Democratic Infrastructure
--------------

6. (C) Although India was still willing to assist Iraq with
any questions it had on drafting its constitution, or
developing a "democratic infrastructure," he acknowledged
that there was little time, given the tight deadline for
drafting and voting on the constitution and national
government. "The process seems to be on track," but noted
that other countries, including Denmark and the EU shared
India's concern about the significant role of Shari'a law in
Iraq's constitution. Singh said he was also concerned about
the potential for increased insecurity in the country in the
run-up to the national elections for a permanent government
in December. The GOI invitation to senior Iraqi leaders to
visit India is "still on the table," but given the
constitution and subsequent election process, he did not
expect that high-level Iraqi officials would visit India
soon.

Ambassadors
--------------


7. (C) Finally, in response to PolCouns' question about the
status of installing their respective ambassadors, Singh
stated that India had designated its ambassador and awaited
agrement, but declined to give the name. He stated that the
GOI had not yet heard from the Iraqis about their candidate
for New Delhi.


8. (U) Minimize considered.
BLAKE