AHMADINEJAD VISIT TO INDIA FOCUSES ON PIPELINE,

C O N F I D E N T I A L SECTION 01 OF 03 NEW DELHI 001180

SIPDIS

SIPDIS

E.O. 12958: DECL: 04/30/2028
TAGS: PREL PGOV KNNP KISL ENRG ECON ETRD IR IN
SUBJECT: AHMADINEJAD VISIT TO INDIA FOCUSES ON PIPELINE,
TRADE, WITH A SWIPE AT AMERICA FROM IRANIAN LEADER

REF: A. NEW DELHI 1142

B. ISLAMABAD 1699

Classified By: Ambassador David C. Mulford for Reasons 1.4 (B, D)


1. (C) Summary. Iranian President Ahmadinejad's April 29
visit to India focused primarily on energy and trade issues,
according to Ministry of External Affairs (MEA) contacts.
Indian officials announced the Iran-Pakistan-India pipeline
deal "is doable" within 45 days, though "a lot of work" needs
to be done, but stopped short of confirming an agreement had
been made. The two sides agreed they would attempt to triple
bilateral trade, but did not set a timeframe. Ahmadinejad
used an hour long press conference to repeatedly criticize
the United States, often referring to the "bullying power"
which was seeking to block Iran. Post assesses that the
Indian government used the visit to demonstrate to its
domestic constituency that it maintains an independent
foreign policy and would overlook Ahmadinejad's anti-American
rants, while walking an increasingly precarious tightrope
with its foreign policy. End Summary.

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I'M A NUT JOB
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2. (C) Iranian President Mahmoud Ahmadinejad visited New
Delhi for around five hours on the evening of April 29,
meeting with President Patil and dining with Prime Minister
Singh before holding a press conference. According to
Randhir Jaiswal, Deputy Secretary (Americas Division) at MEA,
the visit focused on energy and trade issues primarily, while
there were also discussions on regional issues to include
Afghanistan and the Middle East.


3. (C) Ahmadinejad used his hour-long press conference as a
platform to attack the U.S., repeatedly referring to us as
"the bullying power" and appealing for the U.S. to "evacuate"
the region. Ahmadinejad's diatribe in front of about two
dozen TV cameras was full of AMERICA bashing , including
insinuating that AMERICA is set to collapse, saying that the
U.S. "dare not" attack Iran, blaming the U.S. for high oil
prices and questioning the extent of September 11 casualties.
He included an assertion that AMERICA will not allow an
African-American man to become president and questioned the
extent of the Holocaust. Rediff speculated that "He was
using his short trip to India to raise his profile in the
region and earn kudos back home....as if he was addressing a
native crowd in the downtown area of Tehran."

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GOI PUBLIC COMMENTS ON IPI MEASURED AFTER TALKS . . .
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4. (SBU) Turning to the proposed Iran-Pakistan-India (IPI)
natural gas pipeline, Ahmadinejad described the talks as
positive and expressed hope that the deal would be wrapped up
in the near future. Indian Foreign Secretary Menon was more
circumspect in his separate remarks to the press, noting that
"a lot of work" remained to be done to ensure that the IPI
was commercially and financially acceptable to India, but
that the project was "doable."


5. (SBU) The bilateral talks between PM Singh and
Ahmadinejad, which encompassed IPI, came on the heels of
Pakistan-Iran talks on the same issue in Islamabad April 28
(see reftel B) during the Iranian president's three-country
sweep through South Asia. Separately, Indian Minister of
Petroleum and Natural Gas (MPNG) Deora and Secretary
Srinivasan traveled to Islamabad April 23-25 for a meeting of
the Steering Committee of the Turkmenistan, Afghanistan,
Pakistan, and India (TAPI) gas pipeline, which included the
signing of an intergovernmental framework agreement on April

25. Prior to those meetings, MPNG told us that Deora and
Srinivasan would discuss IPI with the Pakistanis on the
margins. The bilateral IPI discussions were to focus on

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transportation tariffs and transit fee issues covering the
passage of gas through Pakistan's portion of the IPI. Press
reports of the Indo-Pakistan meetings indicated progress had
been made on some principles that would guide the setting of
the transport and transit fees. Post will report septel on
further details of the IPI discussions in Islamabad on April
25 and Delhi on April 29 after meeting with MPNG officials.



6. (SBU) Statements by officials on both sides in the lead up
to the visit cited Indo-Iranian cultural and historical ties
and geographic proximity as important. Despite this,
economic and trade ties remain minimal and a goal to triple
bilateral trade is not very ambitious. Although non-oil
bilateral trade between Iran and India has increased at a
double-digit pace in recent years, it did so upon a very
small base. This base effect is further exaggerated by the
composition of trade, which leans heavily toward commodities
ranging from metals to certain agricultural products, many of
which have seen above trend price increases over the past few
years. In FY2007, India's non-oil merchandise exports to
Iran increased to $1.45 billion from $1.18 billion in FY 2006
(the Indian fiscal year ends March 30). The former figure
represents slightly more than a 1% share of total Indian
non-oil exports of $126.2 billion for the year. India,s
non-oil merchandise imports from Iran for the comparable
period increased about 20 percent, from $702 million in
FY2006 to $845 million in FY2007.

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. . . BUT BONHOMIE UNWELCOME DESPITE SLOW PROGRESS
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7. (C) Comment. This visit seemed to accomplish what Post
perceived (reftel A) to be the Indian goal: demonstrating to
its domestic audience India's "independence," while
attempting to balance its foreign policy by not actually
committing to anything. Ahmadinejad's tendentious
anti-American venom aside, there are no indications that Iran
gained anything of substance from India during this visit.
It was extremely negative that the GOI chose to allow an
Ahmadinejad visit at this time, after two years of bragging
to us that they were refusing such requests. Some believe
that, based on the sensitivity the GOI showed toward U.S.
concerns about such a visit, which began with notifying the
Embassy before even notifying some parts of their own
government, that elements of the GOI want to limit the damage
to U.S.-India relations of the Iranian President's visit.
While this may be the case, there is no doubt that the GOI's
willingness to host Ahmadinejad and to give him this platform
for attacking the U.S. is just one more sign of the weakness
of the present Indian government.


8. (C) Comment continued. Although post remains skeptical of
IPI prospects -- especially since the GOI remains discomfited
over Iranian commercial reliability -- we are concerned about
the Singh-Ahmadinejad meeting's apparent focus on IPI. Given
that a (likely Iranian) diplomatic source has cited IPI
progress as the litmus test for improved Indo-Iranian
relations, USG officials must view skeptically private GOI
assurances of lack of IPI progress. On April 24, Under
Secretary Dobriansky was the latest senior USG official to

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receive such assurances from our interlocutors, but public
comments about progress on the pipeline must be taken
seriously.


9. (C) Comment continued. While the specificity of a 45-day
goal for completing the IPI is worrying, numerous past
"deadlines" for the deal have already come and gone. In the
past year or so, Iran has cut back on proposed gas volumes
for IPI and turned off an Indian LNG import deal from the
Jufeyr and Yadavaran fields, undermining Indian confidence.
However, we cannot count on the Iranians continuing to shoot
themselves in the foot. We would echo Embassy Islamabad's
analysis of the importance of TAPI and U.S. efforts to ensure
its success (as quickly as possible). Although MPNG Minister

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Deora has stated that both pipelines are important and
necessary to India's future energy needs, rapid progress on
TAPI coupled with further hurdles to IPI might lead to less
internal economic pressure on the GOI to have a successful
IPI outcome. End comment.
MULFORD