MUKHERJEE EXPRESSES APPRECIATION FOR CIVILIAN

C O N F I D E N T I A L SECTION 01 OF 02 NEW DELHI 008276 SIPDIS SIPDIS E.O. 12958: DECL: 12/08/2016 TAGS: PREL ETRD ETTC EAID ECON EAGR PINR PTER KDEM IN SUBJECT: MUKHERJEE EXPRESSES APPRECIATION FOR CIVILIAN NUCLEAR DEAL Classified By: Ambassador David C. Mulford for reasons 1.4 (B,D) SUMMARY -------------- ¶1. (C) Foreign Minister Pranab Mukherjee t/ld Under Secretary Nicholas Burns on December 8 he appreciated the Bush Administration's efforts to negotiate language for the civilian nuclear legislation that was favorable to India, and said Indian officials were preparing to address their remaining concerns in the 123 negotiations. He stated India would not commit to formal quadrilateral talks proposed by Japan, but would find informal consultations useful. The Foreign Minister welcomed an early 2007 visit@by Secretary Rice and confirmed India would continue its reconstruction efforts in Afghanistan. End SUMMARY ¶2. (C) Under Secretary for Political Affairs C. Nicholas Burns met with Indian Foreign Minister Pranab Mukherjee on December 8. Mukherjee, noting the active interest of both U.S. political parties in the civilian nuclear legislation, expressed appreciation for the Bush Administration's determination to have the final language stay as close as possible to the March 2 and July 18 statements. It is now up to the Indian Government to respond to concerns that will be raised by critics of the deal, he said, noting that he will make a statement before Parliament on the final legislation. Mukherjee said it would be important to address any remaining "constraints" posed by the language in the 123 negotiations, but assured Burns that he likes the legislation "very much." Mukherjee added, however, that we should not be satisfied until we complete the remaining steps and begin civilian nuclear trade. ¶3. (C) Burns noted that he, too, was pleased with the bill, which he characterized as fair and respectful of the March 2 agreement between President Bush and Prime Minister Singh. He stated the US will honor all of its commitments to India, including fuel supply. Burns pointed out that the strong bipartisan support for the bill in both houses of Congress assures that, whatever the outcome of US elections in 2008 and 2010, US-Indian cooperation in this area would continue. Burns, acknowledging Mukherjee's concern about the bill's Iran provision, noted that the final language puts the onus rightly on the Executive Branch -- not India -- to report to Congress. The Under Secretary expressed confidence that, given our cooperation in the IAEA over the last year, India and the US will continue to agree in not wanting to see Iran develop nuclear weapons. Now that US law is being changed, and once the 123 negotiations and the IAEA assurances are completed, the US was confident it could gain the required consensus for the deal in the Nuclear Suppliers' Group. Burns also doubted China would go against the growing consensus, nor would they likely propose a similar deal for Pakistan, given that the legacy of AQ Khan would prevent such a deal from gaining NSG consensus. ¶4. (C) Noting that the Foreign Minister will see Japanese Foreign Minister Abe in December, Burns said that Abe had been insistent about his proposal to invite India to have quadrilateral talks with Japan, the US and Australia. Burns advised Mukherjee that the US was not ready to join a new NEW DELHI 00008276 002 OF 002 formal international grouping at this time, in part because it could send the wrong message to China. He said that Secretary Rice had therefore asked Abe not to announce the SIPDIS initiative during Prime Minister Singh's upcoming visit. Mukherjee agreed this was not the time to set up such a structure, saying that India preferred informal talks. ¶5. (C) Mukherjee said he would welcome a visit by Secretary Rice in January or February 2007. Burns noted that she very much wants to come and will want to increase bilateral cooperation, especially in fighting terrorism and building military-to-miltary relations. The Foreign Minister noted that Defense Secretary Rumsfeld had established a good framework in which to expand exercises, training, frequent visits, and equipment transfers. Mukherjee would now like to explore the possibility of attracting foreign direct investment to support production of US defense items in India. Burns said that US defense companies, several representatives of whom he met at an Indo-American Chamber of Commerce breakfast earlier in the day, have considerable experience in providing offsets and coproduction around the world. ¶6. (C) Burns noted that the Secretary will also want to discuss continued cooperation in Afghanistan with India. Advising the Foreign Minister that the US intends to remain strongly engaged, he noted support in the US for an increase in NATO forces and a substantial supplemental budget request that will fund major infrastructure and other projects. Mukherjee assured Burns that -- in spite of security concerns -- India too was committed to its efforts in Afghanistan. PYATT