DELHI DIARY, AUG 04-22

C O N F I D E N T I A L SECTION 01 OF 04 NEW DELHI 003844

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E.O. 12958: DECL: 08/22/2017
TAGS: PREL PGOV MOPS MARR KISL KWBG KPAL ELTN AS
IS, SN, BT, PK, IN
SUBJECT: DELHI DIARY, AUG 04-22


Classified By: Acting PolCouns Atul Keshap for Reasons 1.4 (B,D)


1. (U) Below is a compilation of political highlights from
Embassy New Delhi for August 4-22, 2007 that did not feature
in our other reporting, including:

-- MEA Opens a 22-year-old "Rulebook" to Keep Other
Government Entities Out of Foreign Affairs
-- Indo-Pak Border to Open for Trade October 1?
-- Aussie Navy Chief Continues to Step Up Indo-Australian
Military Ties During Five Day Visit
-- Indian Delegation of Muslim Leaders Witnesses Rocket
Attacks While Visiting Israel
-- Another Bomb Found, Safely Defused In Bhutan

MEA Opens a 22-year-old "Rulebook" to Keep Other Government
Entities Out of Foreign Affairs
--------------


2. (U) According to an "Indian Express (IE)" report Aug. 18,
Ministry of External Affairs (MEA) Foreign Secretary Shiv
Shankar Menon recently reiterated to Indian Central
Government Ministries and state governments that the MEA is
the only Indian entity with the right to "officially
interact" with foreign governments, multilateral
organizations or their missions in New Delhi. Menon
reportedly sent a note August 3 to all Secretaries to the
Government of India (GOI) and Chief Secretaries of all state
governments, copying the Cabinet Secretary, stating that
"direct correspondence with foreign states violates the
established norms of interaction with foreign governments."
Attached to the letter was a twelve-page set of instructions
from 1985, spelling out the "Channels of Communications
between the Government of India and state governments on the
one hand and foreign governments and their missions in India
and international organizations on the other," according to
the "IE," which reported that the document was so outdated
that it referred to apartheid in South Africa.


3. (U) In addition, the letter stipulated that foreign tradQ
inquiries about the production or development of certain
products "should be shared after consultation with the
Intelligence Bureau," which is entitled to seek counsel from
the Director General of Military Intelligence and the MEA,
according to the media. Menon cited "several recent
instances of certain junior officials in Central Government
Ministries corresponding with foreign governments without
going through the MEA or its missions abroad," as well as
"cases of ministers in the state government writing directly
to foreign governments seeking foreign aid without the
consultation of the MEA or the Central ministries or missions
abroad, said the "IE." "Some of these communications have
caused embarrassment and were not acted upon by the foreign
governments who sent Qem back to the appropriate Indian
authority," Menon reportedly wrote.


4. (C) MEA Americas Joint Secretary Gaitri Kumar indicated
to PolCouns Aug. 21 that Menon's statements were a reaction
to some of India's 28 states having taken foreign policy
matters into their own hands, and having tried to enter into
agreements with foreign governments to negotiate foreign
assistance arrangements directly. PolCouns noted that, while
the USG drew the line at allowing states to carry out an
independent foreign policy, they were not prevented
communication among states and foreign entities. Kumar
restated that the MEA is the only window through which
foreign governments and multilateral organizations could
interact with the GOI, staunchly defending Menon's edicts.


5. (C)COMMENT: This 22-year-old "rulebook" is evidence of
the lingering paranoia of the Indian system, a throwback to
the Soviet era, and surprisingly unreflective of India's
current efforts at globalization. Post suspects that the MEA

NEW DELHI 00003844 002 OF 004


is in knee-jerk reaction mode, responding to a turf war with
other agencies, entities, and states. Felix Dzerzhinsky
would be proud. END COMMENT.

Indo-Pak Border to Open for Trade October 1?
--------------


6. (U) For the first time since Partition, India and
Pakistan will soon allow cargo vehicles to cross the Indo-Pak
border, according to media reports. Currently, goods are
brought up to the Wagah/Attari border in Punjab on either
side and laborers then carry these across on foot to be
loaded onto waiting trucks. This process is very cumbersome
and costly and the two countries have been discussing how to
simplify it. According to media, starting October 1, both
sides will allow trucks from either side to go to designated
points at the Wagah/Attari border for unloading of cargo.
Both sides have agreed to establish a hotline between customs
authorities at the border and introduce a system of
computerized single-entry permits for the truck drivers.
Initially, the trucks will be limited in size to ten-wheelers
with travel hours from 7am to 2pm. Both countries have
agreed to open a dedicated cargo gate soon, and when that
happens, officials reportedly said, the time and size
restrictions will cease.


7. The proposal for launch of the truck service was
reportedly discussed at the Commerce Secretary-level meetings
in Delhi on July 31-August 1, between Indian Commerce
Secretary G.K. Pillai and his Pakistani counterpart Syed Asif
Ali during the Fourth Round of India-Pakistan talks on
Economic and Commercial Cooperation within the framework of
the Composite Dialogue. During the talks, the two countries
agreed to enhance commercial ties and raise bilateral trade
five times to 10 billion dollars by 2010 from the current
1.67 billion dollars in 2006-07, according to media reports.
Since 2004, India and Pakistan have increased cross-border
transport links by adding several bus routes including the
"Friendship Bus" connecting Srinagar, capital of Indian-held
Kashmir, with Muzaffarabad, administrative headquarters of
Pakistan controlled Kashmir. The South Asian neighbors
launched a bus link between New Delhi and Lahore in 1999, but
the service was suspended following a deadly raid on India's
Parliament in December 2001 which India blamed on
Pakistan-based militants. The link was restored in 2003 when
relations between the neighbors began to improve.


8. (C) COMMENT: Allowing the trucks to cross the border to
the customs point is certainly an incremental step towards
greater trade liberalization, but will only improve
efficiency marginally since the trucks still have to be
unloaded and reloaded for further transport. The next step
would be to allow Indian and Pakistani trucks further inland,
possibly even to Lahore and Amritsar, where they could unload
directly at warehouses and distribution points. By making
these changes, both India and Pakistan can take advantage of
the potential gains from greater bilateral and regional
trade. The fear of terrorism launched from the other side
keeps India cautious. END COMMENT.

Aussie Navy Chief Continues to Step Up Indo-Australian
Military Ties During Five Day Visit
--------------


9. (C) Australian Navy Chief Vice-Admiral Russ E. Shalders
started a five-day visit to India Aug. 20, reportedly meeting
Indian Navy Chief Admiral Sureesh Mehta on the first day of
his visit. According to Steven Brinton, Assistant to the
Defence Attache of the Australian High Commission, Shalders
will be making "all the usual calls in Delhi," including the
chiefs of the army and air force and new Defence Secretary
Vijay Singh. Shalders is scheduled to visit the eastern
naval command headquarters at Visakhapatnam and the western

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naval headquarters in Mumbai, according to Brinton, as part
of what he termed a "liaison and goodwill" visit. According
to media reports, Indian naval officials will travel to
Australia later this year as observers of two multination
naval exercises - Operations Kakadu and Pacific Reach, the
latter of which will be focused on submarine rescue
operations and will include China and Pakistan. Shalders'
visit comes two weeks ahead of the Malabar 07-2 naval
exercises which are being held in the Bay of Bengal September

4. India and Australia are expected to participate along
with Singapore and the U.S.

Indian Delegation of Muslim Leaders Witnesses Rocket Attacks
While Visiting Israel
--------------


10. (U) An Indian delegation of Muslim leaders visiting the
southern Israeli city of Sederot reportedly witnessed rocket
attacks from Gaza and was rushed to a shelter house behind
the mountains. The delegation, which visited Israel on the
invitation of the American Jewish Committee (AJC) and the
Australian Israel Jewish Affairs Council, was just 800 meters
away from the Gaza border when the rocket attack occurred,
according to the press. "We were just watching the Gaza
strip from the top of a mountain when the rockets were fired
from the Hamas controlled territory," Ilyasi, General
Secretary of the All India organization of Imams of Mosques,
was quoted by the media. The Muslim leaders' visit to
Israel, touted by some press outlets as part of AJC's efforts
to showcase Israel as a tolerant society and to improve
Muslim-Jewish relations, follows a trip to India earlier this
year by Jewish rabbis for an inter-faith meeting. The
delegation, which is expected to meet with President Peres
and Foreign Minister Livni, was criticized in India's Urdu
press, with one Urdu daily alleging that the delegation
members would "sell the sentiments of 40 million Indian
Muslims to their Zionist masters." Sirajuddin Qureshi
dropped out of the delegation after the negative press
reports hit the stands, according to the media. Post will
follow up shortly with a snap-shot of the current state of
Indo-Israeli affairs.

Another Bomb Found, Safely Defused In Bhutan
--------------


11. (U) The Bhutanese media stated that a bomb was found
August 10 in a five-story building in Phuentsholing, a town
on the Indian border in Southern Bhutan. According to the
press, the bomb, located in a building across from a hotel,
was safely removed and inspected by an Indian bomb disposal
expert and detonated with the assistance of Bhutanese police.
This brings the total count to six bombs found in Bhutan in
the past ten months, five of them in Phuentsholing.
Bhutanese media reported in June that Bhutanese police
believe the Bhutan Tiger Force, the militant wing of the
Nepal-based Communist Party of Bhutan, is responsible for all
of the bombing incidents inside Bhutan since October 2006.


12. (U) Timeline of recent bomb incidents in Bhutan:


1. October 2006: Two bombs were defused in the Bhutanese
city of Phuentsholing on the Indian border.

2. December 5, 2006: A bomb exploded in Phuentsholing,
wounding three civilian workers and one security guard.

3. March 12, 2007: An IED was found below a culvert on
the road between Pasakha and Tala. Police safely destroyed
the bomb, and found leaflets nearby written by an
organization identified as the militant wing of the Communist
Party of Bhutan in Nepal.

4. May 21, 2007: A bomb exploded in a parked bus in
Phuentsholing ) none injured.

5. May 28, 2007: An IED was found below a culvert on the
road between Phuentsholing and Thimpu ) the bomb was safely

NEW DELHI 00003844 004 OF 004


defused.

6. August 10, 2007: Bhutanese police find bomb in a
five-story building in Phuentsholing ) police safely removed
and detonated the bomb.
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