LEFT RAISES THE STAKES IN CONFRONTATION WITH

C O N F I D E N T I A L SECTION 01 OF 03 NEW DELHI 008394

SIPDIS

STATE PASS TO USTR

E.O. 12958: DECL: 10/06/2015
TAGS: PGOV ETRD PREL SCUL PINR EINV ELAB SOCI IN
SUBJECT: LEFT RAISES THE STAKES IN CONFRONTATION WITH
DITHERING CONGRESS

Classified By: DCM Robert Blake, Jr. for Reasons 1.4 (B, D)


1. (C) Summary: On October 27, after a four month hiatus,
the Left Front (LF) deigned to meet their Congress coalition
partners again in their formal Coordination Committee, but
instead of being cowed by their recent pummelling in the
press, the Communists were even more combative and rigid, and
their obstructionism leeched into new areas such as foreign
investment in education. Prior to the conclave, the Left
leaders promised to confront Congress on its foreign and
economic policies, especially FDI in the retail sector, the
GOI vote on Iran in the IAEA and the perceived pro-US tilt in
Indian foreign policy. The LF, not content with venting
itself in the coordination process, will sponsor nationwide
mid-November demonstrations urging the GOI to "vote with
Iran" in future IAEA votes and oppose foreign investment in
Indian universities. This is Indian political theater at its
most craven and non-constructive. The LF is taking advantage
of the BJP's self-absorption to ratchet up the rhetoric to
scare the Congress, but has no intention of actually bringing
down the government. Congress is likely careful and afraid
enough to put its own agenda on hold until upcoming state
elections determine which direction the political wind is
blowing. We should expect few economic and foreign policy
initiatives from Congress until domestic political fortunes
become clearer after the Bihar poll results are finalized in
late November. Until then, the Left will snort and bluster,
scaring investors and frustrating Indians who would actually
like to see some quicker movement to press ahead with needed
reforms. End Summary.

Lots of New Bombast From the Left
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2. (U) After a four month hiatus caused by their ongoing
dispute regarding privatization of the Bharat Heavy
Electricals Limited (BHEL),Congress and the Left Front (LF)
held a United Progressive Alliance (UPA) coordination meeting
on October 27. On the day before the meeting, the LF
leadership spelled out an ambitious agenda to confront the
UPA. CPI(M) General Secretary Prakash Karat was confident
that the process would work well, while CPI National
Secretary D Raja maintained disingenuously that "A proper

SIPDIS
discussion and arriving at consensus is a must for the smooth
running of the government, which we want to last for a full
five years."

Our Beloved Allies the Iranians
--------------


3. (U) CPI(M) Politburo Member Sitaram Yechury noted that
the principal issues irritating the LF were the UPA's foreign
policy orientation, "anti-Iran stand," and the proposal to
open India's retail market to FDI. Raja hoped that the UPA
would change its earlier stance in the IAEA and vote in favor
of Iran at the next IAEA meeting on November 24. Forward
Bloc General Secretary Debrat Biswas claimed that the LF
would demand that the UPA "maintain and strictly follow our
independent foreign policy based on the NAM and not tilt
toward the US, as the latter is not a reliable ally."

Feeling its Oats, and Spreading the Misery
--------------


4. (C) More ominously, the Left clearly feels it has Congress
cowed enough to start expanding its obstructionist agenda in
other fields. The emboldened LF is not content to air its
grievances only within the formal coordination process. In a
bit of old-fashioned political theater, the left convened a
seminar on "India's Independent Foreign Policy" (read:
"anti-US") on October 27 and is reportedly planning Iran vote
demonstrations for November 13 in Lucknow, Calcutta,
Hyderabad and Mumbai, timed to coincide with the reopening of
Parliament the week of November 21 (and just in time for the
November 24 IAEA session). The CPI and CPI(M) have also
launched a new attack against the Commerce Ministry's Doha
round proposal to make India more accessible for foreign
universities. Our PMO contacts tell us that PM Singh is
personally interested in this idea and wants to raise further
the quality of Indian education. However, in a statement,
the Left warned that the entry of foreign universities into
India will foster "cultural insensitivities" by introducing a
curriculum "not aligned with Indian views on Kashmir and the
freedom struggle." The left also predicted that such a
measure would add to an "urban elitist bias" and poach the
best teachers from Indian institutions.

Consultations Resume, Enveloped in Threats
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5. (U) At the Consultation Committee meeting, Sonia
Gandhi, Prime Minister Manmohan Singh, and Finance Minister
Chidambaram, represented Congress, while the entire left
leadership, headed by Prakash Karat, attended. As expected,
the Left objected to UPA proposals to open retail trade to
FDI, saying that the decision was "unjustifiable," as India
has no prior commitment to the WTO to do so. The LF also
decried the GOI vote on Iran in the IAEA, as a sacrifice of
India's "independent foreign policy," and thundered that the
UPA "not repeat its mistake" of voting against Iran if the
issue again comes up for a vote at the IAEA meeting on
November 24. The LF then urged the UPA to support the
Women's Reservation Bill and the Scheduled Tribes
(Recognition of Forest Rights) Bill in the upcoming
Parliamentary session. Congress asked the LF to approve the
disinvestment of small portions of government equity in
non-profit making public sector enterprises, and for LF
support of three bills to amend banking laws and the Pension
Bill, currently under consideration by the Parliamentary
Standing committee on Finance. The meeting did little to
resolve differences, with the UPA agreeing merely to study
further the Left's urgings.

COMMENT: Emboldened, But Still Delirious
--------------


6. (C) COMMENT: The coordination meeting was pure political
theater. Congress sought to appear cooperative, but will
continue to press its agenda, while the CPI(M) is happy to
continue to criticize Congress policies without precipitating
a mid-term poll that could propel the dreaded BJP back into
power. Both Congress and the LF are aware of the unwritten
rules of this game and are playing to their respective
galleries. As long as the BJP is unable to play the role of
a viable opposition, the LF is free to take on Congress
across-the-board without fear. India's political class is
waiting to see if elections in Bihar will reveal a clear
trend. Until that happens, we should not expect dramatic
political or economic initiatives. While these supposed
coalition partners spar over what ought to be economic
no-brainers, a billion people are crying out for needed
reform, and the Indian Margaret Thatcher is nowhere to be
found. END COMMENT.
MULFORD