(S) NIAG 6023 FOLLOW-UP: INDIAN ENTITY ASSISTANCE

1. (S/NF) BACKGROUND: Per ref B instructions, Embassy New
Delhi informed MEA Joint Secretary (Disarmament and
International Security) Hamid Ali Rao on May 16 that the
Indian firm GEA Energy Systems Ltd. had delivered a large
cargo of water filtration equipment to Iran's Bushehr Nuclear
Power Plant (BNPP) in mid-January 2006. Embassy urged the
GOI to ensure that the GOI prevent Indian firms, including
GEA, from cooperating in any manner with Iran's nuclear
establishment. Rao responded that the GOI "will consider
contacting GEA" and asked how the USG would reconcile its
concerns regarding GEA's activities with Russia's
construction of BNPP (ref B).



2. (S/NF) BACKGROUND CONTINUED: The apparent lack of a GOI
commitment to investigate this case and to ensure that GEA
and other Indian firms do not cooperate with Iran's nuclear
establishment is of great concern to the USG, especially as
we move forward with the GOI on the civil nuclear initiative.
In addition, this shipment appears inconsistent with
previous assurances by Indian officials to senior USG
officials that nuclear cooperation with Iran would be "in
dissonance" with the transformation of the US-India
relationship (ref D). GOI officials also assured the USG
that there is no bilateral nuclear cooperation with Iran
(refs C and E).



3. (U) ACTION REQUEST: Department requests that Post use
the points contained in paragraph 4 to follow-up with the GOI
at a senior-level on ref A demarche. Points may be left as a
nonpaper.



4. (S/REL INDIA) Begin points for India:

-- We recently shared with your Government information that
the Indian firm GEA Energy Systems Ltd. delivered a large
cargo of water filtration equipment to Iran's Bushehr Nuclear
Power Plant (BNPP) in mid-January 2006.

-- At the time, you indicated that the GOI would consider
contacting GEA.

-- We would appreciate an update on how the GOI has decided
to proceed on this case and whether Indian authorities have
reached out to GEA and other commercial enterprises to ensure
that there is no further cooperation with BNPP.

-- The USG's concerns with assistance to BNPP are well-known.
In light of Iran's IAEA safeguards noncompliance, we
continue to press Russia to suspend its cooperation with Iran
at Bushehr. Under Secretary Burns reiterated our
long-standing opposition in his April 28 public remarks in
Moscow. Under Secretary Joseph has also urged senior Russian
government officials to suspend construction at Bushehr while
Iran is defying the international community by not taking any
of the steps called for by the IAEA Board, and you will note
that Russia has neither completed the construction nor
shipped fuel to Bushehr.

-- Given Iran's continued defiance of the UNSC March 29
Presidential Statement and previous IAEA Board resolutions,
and in light of Iran's accelerated efforts to develop a
fissile material production capability, it is imperative that
any states engaging in cooperation with Iran's nuclear
programs reconsider that cooperation.

-- India's affirmative vote for the February 4 resolution,
and its own commitment to upholding the international
nonproliferation regime, argue strongly in favor of a more
firm GOI approach to Iran to persuade the Iranian regime to
change course.

-- If the Iranian regime continues its defiance, we will seek
a Chapter VII UNSCR requiring Iran to comply. India should
not/not be engaged in any form of cooperation with Iran's
nuclear establishment in these circumstances.

-- Indian cooperation with Iran on Bushehr would send exactly
the wrong signal to the Iranian regime, as well as to the
international community, regarding India's stance towards
Iran's pursuit of a nuclear weapons capability.

-- We recall that in September 2003 MEA Joint Secretary
Jayant Prasad informed then-Assistant Secretary for South
Asian Affairs Christina Rocca that nuclear cooperation would
be "in dissonance" with the transformation of the US-India
relationship.

-- Furthermore, MEA Additional Secretary Sheel Kant Sharma
assured USG officials in both August and December 2003 that
India has no bilateral nuclear cooperation with Iran ongoing
or proposed.

-- We are, therefore, perplexed by how the GEA shipment to
Bushehr was able to proceed as the export appears to
contravene what your government has communicated to the USG
previously on nuclear cooperation with Iran.

-- We strongly urge you again to ensure that GEA engages in
no further cooperation with the Bushehr Nuclear Power Plant,
as well as to inform Indian companies to stop all exports to
and cease any cooperation with Iran's nuclear establishment.
This includes to safeguarded facilities such as Bushehr.

-- It is important that India, as a responsible member of the
international community and a strategic partner of the United
States, be careful not to cooperate with Iran's nuclear
program in any manner.

-- We appreciate the opportunity to raise issues of
proliferation concern like this one within the framework of
our strategic partnership.

End points for India.



5. (U) Please slug all responses for ISN and SCA. Washington
appreciates Post's assistance.
RICE