Jaishankar complained that the United States "offers theoretical giveaways and requires us to whitewash their own complicity in breaking our rules. You promise us things in the United States, but you don't really offer reciprocity. Your system is not helpful."

89649 12/15/2006 8:40 06 NEWDELHI 8373 Embassy New Delhi SECRET "VZCZCXRO6017RR RUEHBI RUEHCI RUEHDBU RUEHLH RUEHPWDE RUEHNE #8373/01 3490840ZNY SSSSS ZZHR 150840Z DEC 06FM AMEMBASSY NEW DELHITO RUEHC/SECSTATE WASHDC 1493INFO RUEHIL/AMEMBASSY ISLAMABAD 1360RUEHBUL/AMEMBASSY KABUL 3846RUEHKA/AMEMBASSY DHAKA 8262RUEHKT/AMEMBASSY KATHMANDU 8906RUEHLM/AMEMBASSY COLOMBO 8197RUEHTA/AMEMBASSY ASTANA 0680RUEHDBU/AMEMBASSY DUSHANBE 0391RUEHNT/AMEMBASSY TASHKENT 0776RUEHEK/AMEMBASSY BISHKEK 0601RUEHBJ/AMEMBASSY BEIJING 4733RUEHKO/AMEMBASSY TOKYO 4239RUEHMO/AMEMBASSY MOSCOW 0851RUEHLO/AMEMBASSY LONDON 2296RUEHBI/AMCONSUL MUMBAI 7162RUEHCI/AMCONSUL CALCUTTA 7805RUEHCG/AMCONSUL CHENNAI 7961RUEHPW/AMCONSUL PESHAWAR 4000RUEHKP/AMCONSUL KARACHI 6292RUEHLH/AMCONSUL LAHORE 3392RUEKJCS/SECDEF WASHDCRUEKJCS/JOINT STAFF WASHDCRUEIDN/DNI WASHINGTON DCRUEAIIA/CIA WASHDC" "S E C R E T SECTION 01 OF 04 NEW DELHI 008373

SIPDIS

SIPDIS

E.O. 12958: DECL: 12/13/2016 TAGS: PREL, PTER, PGOV, PINR, EAGR, MASS, IN

SUBJECT: MOVING THE BILATERAL RELATIONSHIP FORWARD: PDAS MANN AND JOINT SECRETARIES JAISHANKAR AND KUMAR

Classified By: Charge d'Affaires Geoffrey Pyatt for Reasons 1.4 (b and d)

1. (S) Summary: On December 13, Principal Deputy Assistant Secretary for South and Central Asian Affairs Steven Mann met SIPDIS with out-going MEA Joint Secretary (Americas) Dr. Jaishankar and his designated replacement Ms. Gyatri Kumar to follow-up on the progress made during Under Secretary Burns' visit. He also solicited the MEA's ideas on how to deepen and widen future collaboration and expand the relationship beyond civ-nuke. Jaishankar underlined his commitment to working with the U.S. on most fronts, but complained about kinks in sharing intelligence, terrorism and a laundry list of administrative irritants. Juxtaposing Jaishankar's cranky end-of-tour-itis and the customary bluntness that accompanies it, Gyatri Kumar was warm in tone, but muted on substance. End Summary.

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Moving the Relationship to the Next Level

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2. (SBU) Visiting PDAS Mann opened the discussion by congratulating Jaishankar and Kumar on their new positions (Note: Jaishankar is moving to Singapore as Ambassador; Gyatri Kumar is the new Joint Secretary for Americas. End Note.) Mann explained that in addition to serving as Assistant Secretary Boucher's Deputy, he also had responsibility for India, Nepal and Sri Lanka and regional responsibility for oil and gas issues. He added that while he had traveled to South Asia occasionally during his PDAS tenure, this was his first opportunity to spend time in India. Mann confirmed that Under Secretary Burns was pleased with his December 7-9 visit to India and there was much to celebrate in the civilian nuclear agreement. Reaching this milestone provided an opportunity to flesh out fresh ideas, beyond deliverables lists, that would build a wider foundation for U.S.- Indian relations. Kumar and Jaishankar agreed that the time was ripe to discuss future collaboration and proposed several ideas, including:

-- Reformation of the Rural Sector: Kumar observed that the Prime Minister was personally interested in agricultural initiatives. Opportunities for collaboration abound, including capacity-building, engaging the private sector, commercialization, market development, etc.

-- Regional Affairs: In addition to India's important role in stabilizing acute cases such as Sri Lanka, Nepal and Bangladesh, PDAS Mann urged the GoI to expand its thinking to include extending its regional presence northward to Central Asian countries where a greater Indian presence may be beneficial.

-- An ""Enabling Government"": While there was already a charted path for collaboration in defense cooperation, counter terrorism and trade, Jaishankar rejoined that both sides ought to think beyond ""traditional issues"" of defense (e.g. licensing, technology, etc.) and ""bread and butter issues"" (e.g. trade and investment). He characterized these areas as important for government-to-government agenda, but urged consideration of initiatives that could progress with minimal government involvement. He joked, ""Rocky I was a good movie. But people are bored by Rocky VI."" Instead, Jaishankar pitched a new bilateral focus on civil society. He illustrated his vision of an ""enabling government"" as one that launches collaboration, but is not bound to sustain it.

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He cited as an example the National Academy of Sciences Innovation Forum's partnership with the Confederation of Indian Industry (CII). Although the first year required government assistance, Jaishankar beamed that ""the government may not even be invited to attend by the third year"".

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Reviewing Deliverables

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3. (SBU) Kumar commented that the atmosphere during the Burns visit was riddled with pins and needles ""as the entire world waited"" to see how Congress would vote on the civ-nuke legislation. While exciting, civilian nuclear euphoria dominated the agenda and other bilateral initiatives were glossed over. Kumar said that, ""Frankly, working through the bilateral items was not detailed this time. Previously, we would go into specifics and talk deliverables and discuss our progress to date since the July 18 Joint Statement. We need to determine where we are on such areas of cooperation as the High Tech Commerce Working Group (HCTG), Coalition Against Wildlife Trafficking (CAWT), Avian Flu and as well as discuss other targets and other goals for a future POTUS-PM Summit."" POLCOUNS informed Kumar that not all issues were brushed aside, citing how visiting S/CT Deputy Coordinator Virginia Palmer engaged her counter terrorism interlocutors in a meaningful way.

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Chronic Issue: Terrorism

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4. (S) Jaishankar acknowledged that the U.S. is publicly perceived in India as a partner across the board - except on issues relating to terrorism. Furthermore, ""public perceptions are not entirely unrelated to government perceptions. We need to address this (referring apparently to Indian security agency skepticism about the U.S. role with Pakistan)."" He lamented that the chronic inability to talk frankly about terrorism dragged down other areas of collaboration. Jaishankar clarified that the GoI is not seeking U.S. assistance in any manner that will compromise Pakistan's internal security nor was he questioning the U.S. relationship with Pakistan (including quipping ""good luck to you with that."") However, he complained that the U.S. alliance with Pakistan should not lead us to ignore Pakistan-origin terrorism in India. He argued that working with Pakistan and helping India fight terror are not mutually exclusive and requested that the U.S. ""figure out your relationship with Pakistan and then determine how you can help India."" PDAS Mann solicited Jaishankar's thinking on whether or not the Indian public believes that the United States has not publicly rebuked Pakistan, resulting in the erroneous conclusion that the United States is therefore neglecting India's concerns about Pakistani terrorists. Jaishankar argued, ""You have created that standard for yourself. People know that the United States does not want to be caught in between Indo-Pak issues.""

5. (S) POLCOUNS informed Jaishankar that the National Security Advisor's request to FBI Deputy Director Pistole was being taken seriously, but that intelligence-sharing must be a two-way exchange. Jaishankar confirmed that the Indian DIA complains that, ""The United States gives us general information and then demands specifics."" Both sides agreed that a detailed exchange is warranted and necessary.

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Addressing Irritants

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6. (C) PDAS Mann cautioned that the rising relationship was in danger of being dragged down by the weight of bureaucratic impediments, including:

- Service Taxes: Jaishankar noted that ""The service tax issue is dragging on forever and it has our Ambassador's attention."" (Note: the GoI levies a tax on over 90 different categories of services. We have repeatedly requested an exemption from these taxes, but the GoI's only reply was in April when it said it had ""initiated"" action to grant the exemption. Despite this, however, the exemption has still not been granted. In response, State refused to renew the Indian Mission's tax exemption cards in the U.S. The GoI has escalated this issue by removing our remaining tax exemption, e.g. VAT and excise tax. We have officially informed the MEA that the U.S. will immediately restore the Indian Mission's tax exempt status when the GoI exempts us from service taxes and rescinds its revocation of our other tax exemptions. End Note.)

- Crew Lists: PDAS Mann inquired about the status of crew lists for U.S. Navy shore parties and inquired if vetting every member was at cross purposes with the desire for a strong allied relationship. Jaishankar argued that Indian law requires that anyone disembarking a ship provide their biodata details. ""If this smacks of xenophobia, then the United States was a willing participant. Up until 2004, this wasn't an issue.""

- Market access for U.S. wheat: During Agriculture Secretary Johanns' November 20 meeting with Minister Pawar, the USDA requested the Ministry of agriculture extend the current phy4o-sanitary terms for imported wheat and agree to technical discussions on remaining concerns involving weed seed tolerances and sampling methods. However, Embassy has not received a reply from the Ministry of Agriculture.

- Blocked U.S. pet food shipments: The GoI ""informally"" banned U.S. pet food shipments due to concerns over avian influenza. On November 7, the USDA provided substantial technical information to the Ministry of Agriculture (Animal Husbandry Secretary Sohni), showing that the U.S. does not have high - pathogenic avian flu. Despite repeated requests to the Ag Ministry, the shipment remain held at the port of entry. Embassy has requested a response back from the Ministry of Agriculture and release of all blocked shipments.

- Visas for American staff and the Fulbright issue.

- India's Irritants: Jaishankar complained that the United States ""offers theoretical giveaways and requires us to whitewash their own complicity in breaking our rules. You promise us things in the United States, but you don't really offer reciprocity. Your system is not helpful."" PDAS Mann encouraged Jaishankar and his staff to generate a list of issues moored in administrative and bureaucratic never-never land that could be resolved with higher-level attention. Jaishankar agreed that he would put together a list (""for clarity, not complaint"") on such issues, but expects it would include schools, visas for new diplomats and Embassy access to the tarmac for the diplomatic pouch. Jaishankar grumbled, ""We get unique demands from the United States. They are all

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in my head - I don't write these down. If our system actually knew how many allowances we gave the United States, they'd scream."" PDAS Mann assured Jaishankar that he was interested, wanted to help find flexibility in both systems, and thanked MEA for continuing to swing the bat at several ongoing irritants.

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Comment: At Least We Know Where We Stand

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7. (C) Near the end of his tour, Jaishankar shows that mixture of impatience and insight that characterized his tenure and made him a valued interlocutor. His suggestions about the way forward after completion of the civ-nuke deal are useful. The CEO forum, Agricultural Knowledge Initiative and other initiatives which focus on private sector and people-to-people activities may bear more fruit in the long run than government-driven initiatives. Still, the trust-building will take time and ""bread and butter issues"" such as expanding trade and investment, strengthening military ties, and enhancing counter-terrorism cooperation will require attention of both governments for the foreseeable future. End comment.

8. (U) PDAS Mann cleared this cable.

PYATT