EXTRANCHECK: POST-SHIPMENT VERIFICATION: SANDVIK ASIA LTD.,

UNCLAS NEW DELHI 002929

SIPDIS

SIPDIS

USDOC FOR 532/OEA/M.N-DORSEY/KGAINES/JAY HATFIELD
USDOC FOR 3131/USFCS/OIO/ANESA/KREISSL
USDOC FOR 4530/MAC/ANESA/OSA
ICE HQ FOR STRATEGIC INVESTIGATIONS
STATE FOR EB/ESP

E.O. 12958: N/A
TAGS: ETTC ETRD BEXP IN
SUBJECT: EXTRANCHECK: POST-SHIPMENT VERIFICATION: SANDVIK ASIA LTD.,
GUJARAT, LICENSE NO. D343053

REF: USDOC 03872


1. Unauthorized disclosure of the information provided below is
prohibited by Section 12(c) of the Export Administration Act.


2. BIS requested a Post-Shipment Verification (PSV) at Sandvik Asia
Ltd. (Sandvik),Tel: 91-2764-283-313 and 91-2764-283-314, Cell:
982-532-4618, email: jagdish.gajjar@sandvik.com. Sandvik was listed
as the Ultimate Consignee and Shanbhag & Associates (Shanbhag),
Mumbai as the Foreign Purchaser for one model 5703-080 half-inch,
air-operated double diaphragm pump controlled under ECCN 2B350. The
license applicant was Lutz-Pumpen GmbH (Lutz),Wertheim, Germany.


3. Though reftel was transmitted to Post on April 27, 2007, BIS New
Delhi received it on May 22, 2007. On May 18, 2007, Post received
an email from Jay Hatfield (BIS/OEA) containing scans of various
documents relating to this transaction. On May 21, 2007, BIS New
Delhi advised BIS/OEA that they were not in receipt of the original
action cable for this PSV. Post's Communications Office was able to
locate and forward to BIS New Delhi the action cable for this PSV.


4. Lacking valid telephone numbers, BIS New Delhi could not
immediately establish communication with Sandvik. A subsequent
Internet search was also unproductive.


5. An email address of Sandvik's Group Leader-Purchase Jagdish
Gajjar (Gajjar) was gleaned from the documents sent by BIS/OEA. On
May 29, 2007, BIS New Delhi sent an email to Gajjar introducing BIS
and requesting facilitation of a PSV at Sandvik for a pump they had
purchased from Shanbhag in December 2005. Shanbhag is the exclusive
distributor for Lutz-Jesco in India.


6. In response to BIS New Delhi's email, Gajjar sent an email to his
colleagues stating, "Below is mail, which is self-explanatory, and
doing the needful at your disposal." The mail was sent on following
email addresses: sanal.kumar@sandvik.com, paresh.desai@sandvik.com.
It was copied to taro.rajpal@sandvik.com and BIS New Delhi. On May
30, 2007, BIS received a very unprofessional response from Gajjar:
"Hi! Need not to visit our plant." On the same day, FSN Narayan
replied and stated that he and ECO would like to discuss the PSV
over the telephone with Gajjar and the appropriate Sandvik
representatives. On May 31, 2007, FSN Narayan again sent an email
reminder to Gajjar and requested his mobile phone number as the
telephone numbers listed on his email rang continuously with no
response.


7. On May 31, 2007, FSN Narayan spoke with Gajjar via telephone. He
was not forthcoming and stated that they regularly source products
from Shanbhag. He went on to say that there had been reluctance on
the part of Sandvik when Shanbhag informed them that the pump would
be sold under an U.S. Department of Commerce export license. He
further stated that Shanbhag insisted that it would not pose any
problem and that Shanbhag and its U.S. supplier (Lutz-Jesco) would
handle all formalities.


8. In addition, Gajjar stated that it would be difficult to locate
one specific pump within the plant and the documents relating to
this transaction. FSN Narayan asked for contact information for the
most senior corporate officer at the Sandvik plant. Gajjar provided
the name of Vice President Ajay Sambrani (Sambrani). He declined to
provide Sambrani's mobile telephone number. The office number he
provided was not valid. Therefore, on two occasions, BIS New Delhi
sent via fax a letter to Sambrani requesting a PSV at the Sandvik
plant. BIS New Delhi received no response from Sambrani. On June
1, 2007, ECO sent a hard copy of the letter to Sambrani by
registered mail. BIS New Delhi received no response. On June 14,
2007, ECO sent Sambrani another registered letter. The letter
informed Sambrani that if the PSV had not been scheduled by
close-of-business June 22, 2007, BIS New Delhi would close the case
with a finding of UNFAVORABLE and this would undoubtedly have a
negative impact on Sandvik's ability to import additional licensed
products of U.S. origin. As of June 25, 2007, BIS New Delhi still
has not received a response from Sambrani.


9. Recommendation: In view of Sandvik's unresponsiveness to BIS New
Delhi's repeated attempts to establish communication and schedule
this end-use check, Post recommends an unfavorable Post-Shipment
Verification at Sandvik Asia Ltd. (PSCUSHMAN/PNARAYAN) Mulford