KERALA'S COMMUNIST CHIEF MINISTER CALLS FOR FOREIGN

UNCLAS CHENNAI 000299 SENSITIVE SIPDIS E.O. 12958: N/A TAGS: PGOV PREL ECON EINV IN SUBJECT: KERALA'S COMMUNIST CHIEF MINISTER CALLS FOR FOREIGN INVESTMENT REF: CHENNAI 272 ¶1. (U) Principal Officer Andrew Simkin traveled to Trivandrum (Thiruvananthapuram),the capital of the South Indian state Kerala, on August 29-30 where he held introductory meetings with senior government officials and other key contacts. During his trip he met with Chief Minister V.S. Achuthanandan of the Communist Party of India (Marxist) (CPM),Governor R.S. Gavai, Chief Secretary P.J. Thomas, state Finance Minister Thomas Isaac, the Director General of Police, and members from the opposition Congress Party. ¶2. (SBU) During their August 29 meeting, Chief Minister Achuthanandan mentioned the CPM's interest in attracting U.S. investment to Kerala. The Chief Minister was particularly adamant about stressing that the CPM was specifically focusing on promoting the growth of three sectors: information technology, biotechnology and tourism. He had invited a large crowd of reporters and photographers to his office at the opening of the meeting, and invited them back after the conversation. In that closing press opportunity he stressed to the media that the CPM wanted to promote foreign investment in the three sectors he identified. ¶3. (SBU) Comment: These comments are significant because they demonstrate that the orthodox Communist Chief Minister is coming around to the need to welcome foreign direct investment in the state. Since coming to office in 2006 the Chief Minister has fought a losing battle against the Kerala CPM's more investment-friendly faction, which is led by the CPM State Secretary Pinarayi Vijayan. In early August Vijayan took the unprecedented step of openly seeking our assistance in drawing U.S. investment to Kerala (reftel). To have Achuthanandan, who has long opposed such a move, affirm this policy shift is a clear sign that Kerala is moving in a new direction. End comment. Simkin