U.S. Ambassador in Riyadh picks up ‘sore points' in India-Saudi Arabia relations, but reports economic cooperation to be dominant factor.

India is “concerned” that Saudi Arabia is funding religious schools and organisations that contribute to extremism in South Asia, including India, a senior Indian diplomat is reported as saying in a U.S. diplomatic cable accessed by The Hindu through WikiLeaks.

The cable, dated September 9, 2009 (224156: secret), from the U.S. Ambassador to Saudi Arabia, Richard Erdman, quotes Rajeev Shahare as telling him: “Indian Islam is a tolerant Islam, and we cannot abide by the spread of extremist views.” Mr. Shahare was India's charge d'affaires in Riyadh at the time.

Treatment of Indians

Another “sticking point” in bilateral relations, the Indian diplomat is reported as saying, was the treatment of Indian nationals living in Saudi Arabia. Unskilled Indian workers were “sometimes mistreated by employers, and suffered from restrictive Saudi foreign-labor practices.”

Mr. Shahare reportedly told the U.S. Ambassador that the Indian government had on several occasions proposed a bilateral agreement protecting the rights of Indian workers, but “the Saudis refused this out of hand.” He also complained that Indian companies operating in the kingdom faced an “unsatisfactory regulatory climate.”

“He cited Saudi requirements for maintaining large local bank balances, particularly in the case of foreign-owned trading companies, and ‘Saudiization' of the work force, as specific impediments to further growth and investment. For example Bank of India, which hopes to open a branch in Jeddah in 3-4 months, was currently balking at a requirement that its entire front office staff be Saudi,” the 2009 cable from the U.S. Embassy in Riyadh reports.

Other “sore points” in India-Saudi relations that remained despite a vast improvement since King Abdullah's visit to India in 2006 included the Saudi tendency to view India through a “Pakistani lens” on issues like Kashmir and the treatment of Muslims.

“While these bilateral sore points remain, they are now (to some extent) politely ignored in the context of greater economic cooperation. Shahare described India's policy as aimed at strengthening the economic relationship, to the point where it becomes the dominant factor in the political relationship. The Indian Charge remarked that while India and Pakistan were often lumped together when discussing politics, Pakistan was ‘not a real counterpart' to India on the economic level,” Mr. Erdman wrote.

India was also irritated by Saudi Arabia's criticism of its relations with Israel, Mr. Shahare told the U.S. Ambassador. He added: “We repeatedly remind them we were among the first to recognize a state of Palestine, with Jerusalem as its capital and that the Indian commitment to the Palestinian cause remains unwavering. However, India must put its national interest first, and there are compelling pragmatic reasons for its relationship with Israel.''

Israeli satellite launch

The Indian diplomat described the Saudi media's description of an India-launched Israeli communications satellite as “a spy satellite that would watch Arabs” as “unfortunate.''