DMK INSIDER SAYS CIV-NUKE WILL GO FORWARD; EXPECTS

UNCLAS CHENNAI 000086

SIPDIS

SENSITIVE BUT UNCLASSIFIED

SIPDIS

E.O. 12958: N/A
TAGS: PGOV PREL ECON ENRG IN

SUBJECT: DMK INSIDER SAYS CIV-NUKE WILL GO FORWARD; EXPECTS
ELECTIONS IN THE FALL

REF: 2007 CHENNAI 605


1. (SBU) SUMMARY: Tamil Nadu Minister for Electricity and Rural
Industry Arcot Veerasamy told post that he expects the ruling United
Progressive Alliance (UPA) to move forward on the U.S.-India Civil
Nuclear Cooperation Agreement. Veerasamy's comments merit attention
because he is DMK leader M. Karunanidhi's right-hand man and is
privy to inside information on the DMK's communications with the
UPA. Veerasamy said Congress leader Sonia Gandhi and Prime Minister
Manmohan Singh are "fully committed" to completing the initiative.
He added that he expects parliamentary elections in September or
October. Veerasamy also confirmed that the DMK plans to allocate
two of five potential Rajya Sabha seats to the Congress party,
indicating a closing of the ranks between the DMK and Congress. END
SUMMARY.

VEERASAMY SEES NUKE DEAL GOING THROUGH
--------------


2. (SBU) Visiting to apply for a visa in order to travel to the
United States to look into solar power technology, Veerasamy
discussed the state's energy situation and future plans. Veerasamy
told us that India needs nuclear energy to meet its growing demand
for power. When asked about the prospects of the U.S.-India Civil
Nuclear Cooperation Agreement, Veerasamy said he expects it to go
through because Congress party leader Sonia Gandhi and Prime
Minister Manmohan Singh are "fully committed" to completing the
initiative. Veerasamy acknowledged that the Left parties are
opposed to the agreement, but said the DMK supports it fully.
Pointing to the December 2007 speech by DMK Rajya Sabha Member K.
Kanimozhi (who is also DMK leader Karunanidhi's daughter) on the
floor of India's Parliament, Veerasamy said "our leader's daughter"
expressed the DMK's strong support of the initiative. Veerasamy
added that he expects parliamentary elections in September or
October.

CONGRESS AND DMK CLOSING RANKS
--------------


3. (SBU) Veerasamy also confirmed reports that the DMK has agreed
to allot two of five seats that the DMK-led ruling coalition is
expected to win in the upcoming Rajya Sabha elections to Congress
candidates. Veerasamy told us "Sonia-ji asked our leader for two
seats and he agreed." Congress leader M. Veerappa Moily confirmed
to post that Sonia Gandhi had requested two seats. Moily denied
recent rumors that the Congress-DMK relationship was on the rocks;
he said the alliance will only grow stronger in the coming days.
Moily took pains to note that Congress would not allow the
controversy over the Sethusamudram project (reftel) to damage its
relationship with the DMK but he declined to offer specifics as to
how the Congress planned to handle the matter.


4. (U) Veerasamy and Moily's comments come against the backdrop of
a brewing controversy over Rajya Sabha seat allocation among the
DMK-led ruling coalition in Tamil Nadu. The coalition is expected
to win five seats. Under the proposed seat allocation announced
this week, the DMK gets two seats, Cogress two, and the Communist
Party of India (Marist) (CPI-M) gets one. The proposal has angeredPMK leader S. Ramadoss, who argued that his PMK shuld get at least
one seat on account of the factthat it holds more seats in the
Tamil Nadu legislture than the CPI-M. Karunanidhi's responded that
the DMK rewarded the PMK in 2004 by supporting Ramadoss's son Dr.
Ambumani Ramadoss's election to the Rajya Sabha and that it is now
the CPI-M's turn to take a seat in the upper body of Parliament.
The elder Ramadoss was not mollified, saying Karunanidhi had "hurt
the PMK deeply." According to media reports, the PMK is considering
the possibility of contesting for a Rajya Sabha seat in defiance of
the DMK's seat allocation decision.


5. (SBU) COMMENT: Because of Veerasamy's close relationship to the
Chief Minister, his comments on the civil nuclear initiative are as
good as having heard them from Karunanidhi himself. The DMK appears
to have gotten its previous reluctance to face early elections.
They are fully behind the deal and, more importantly, believe that
Congress plans to move forward on it. The alliance between the two
parties also seems to be getting closer, despite rumors in Tamil
Nadu that both were exploring other options for upcoming elections.
Karunanidhi's willingness to alienate the PMK -- a small, but
influential party that frequently casts the deciding vote in Tamil
Nadu's state elections -- on the question of Rajya Sabha seat
allocation is strong evidence that he is casting his lot with the
Congress. END COMMENT.


6. (U) This message was coordinated with Embassy New Delhi.

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