IRAN EAGER FOR INDIAN TIES, DELHI WORRIED ABOUT

C O N F I D E N T I A L SECTION 01 OF 02 NEW DELHI 000553

SIPDIS

SIPDIS

E.O. 12958: DECL: 01/25/2016
TAGS: PREL PGOV KNNP EPET ELTN IR IN AF
SUBJECT: IRAN EAGER FOR INDIAN TIES, DELHI WORRIED ABOUT
AFGHANISTAN ACCESS

REF: NEW DELHI 548

NEW DELHI 00000553 001.2 OF 002


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


1. (C) Summary: Joint Secretary (Pakistan, Afghanistan,
Iran) Dilip Sinha told PolCouns and Poloffs on January 25
that India is worried about losing overland access to
Afghanistan via Iran if its relations with Tehran sour
further, but did not appear worried about the energy security
impact of the deepening IAEA crisis. Sinha reported pressing
the Iranian Deputy Foreign Minister on NPT compliance during
a recent visit to Tehran, and acknowledged that Iran is
making efforts to engage India bilaterally to show that it is
not isolated from the international community. New Delhi
maintains that it is better to remain engaged with Iran than
to sever ties. As long as it continues, Pakistan's policy to
deny India land access to Afghanistan increases Iran's
relevance to New Delhi. End Summary.

More Visits in the Works
--------------


2. (C) After returning from Tehran on January 23 following a
preparatory visit for the March 2006 India-Iran Joint
Commission meeting (headed on the Indian side by Secretary
(East) Rajiv Sikri),Sinha told us that Iran is "keen to
showcase bilateral visits" with India to demonstrate that it
is fully engaged with the international community. At
Tehran's suggestion, Sinha extended an invitation to the
Iranian foreign minister to visit New Delhi. PolCouns
observed that the Iran nuclear crisis was unlikely to be
resolved by March, and warned that India would face
increasing pressure not to conduct business as usual with
Tehran.

Nuclear Issues
--------------


3. (C) Sinha's discussions with Iranian interlocutors
generally avoided the nuclear issue except when the Deputy
Foreign Minister raised the upcoming IAEA Board of Governors
meeting. Sinha said that he gave India's standard line about
expecting Iran to comply with its nonproliferation
commitments, and urged Iran to make a concession to
international concerns on its nuclear program, but the
Iranian answer "did not give any solace."

Infrastructure in Iran and Afghanistan
--------------


4. (C) Sinha's agenda in Tehran was dominated by discussion
of the Chabahar port and connecting railway to Afghanistan,
he told us. While Indian companies are ready to undertake
the construction, the Government of Iran hopes that India
will arrange financing for the construction. Ultimately,
Sinha predicted, Tehran will need to pay for the port, but
India is still considering other options. The port an
railroad are part of India's strategy for maintaining access
to Afghanistan, Sinha said, adding that he secured Iranian
commitment to provide asphalt, petroleum products, and cement
for the Zaranj-Delaram road that India is constructing in

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Afghanistan (reftel). However, while India can find other
energy suppliers, potential problems with Iran on the nuclear
issue "threaten our Afghanistan goals and projects," Sinha
warned, adding "the entire road project is dependent on
access through Iran."

Indian View of Iranian Politics
--------------


5. (C) It is clear that a "tussle" is taking place in
Iranian politics, Sinha observed, but it is too early to tell
if Ahmadinejad will prevail, or if he will moderate his views
and come to an accommodation with the old guard that opposes
him. New Delhi is not sure if Ahmadinejad is trying to shore
up domestic support or his international profile through his
inflammatory statements, Sinha commented, but his
inexperience and rhetoric are causing trouble for Tehran.
Nevertheless, India believes that it is better to remain
engaged with Iran than to cut ties because of the regime's
poor behavior, Sinha argued, pointing out that the GOI uses
the same rationale to justify the continued dialogue with
Pakistan in spite of continued cross-border terrorism.

Comment: India Needs Iran Less?
--------------


6. (C) We find it encouraging that MEA officials are not as
nervous as we had thought about the prospect of losing Iran
as a reliable source of energy. The issue of land access to
Afghanistan, however, poses a challenge to both Indian and
USG interests in Afghan reconstruction that will remain
unresolved unless Pakistan can be convinced to allow Indian
transit.


7. (U) Visit New Delhi's Classified Website:
(http://www.state.sgov.gov/p/sa/newdelhi/)
MULFORD