43172 10/20/2005 12:37 05NEWDELHI8162 Embassy New Delhi CONFIDENTIAL "This record is a partial extract of the original cable. The full text of the original cable is not available." "C O N F I D E N T I A L SECTION 01 OF 03 NEW DELHI 008162

SIPDIS

E.O. 12958: DECL: 10/06/2015 TAGS: PREL, PGOV, KNNP, ENRG, IR, IN, India_Iran SUBJECT: INDIA'S STANCE ON IRAN AND THE IAEA CONTINUES TO AROUSE CONTROVERSY AND OPPOSITION

Classified By: Charge' Bob Blake for Reasons 1.4 (B, D)

1. (SBU) Summary: The spate of media and political criticism touched off by the GOI's decision to vote with the US and the EU3 (UK, France, and Germany) at the September 24 IAEA meeting on Iran is increasing rather than dying down. Foreign Secretary Saran recently summoned Ambassadors from the EU3 to push for resolving the Iran issue without referral to the UNSC. Meanwhile, Iran is stepping up its own pressure. Tehran announced another pipeline Working Group meeting for October 24, and Iran's Ambassador in New Delhi has mounted a high-profile lobbying campaign. Public interest in the debate is continuing, spurring speculation that the GOI is under growing pressure to backtrack from its earlier stance. The left is most outspoken, predictably accusing India of caving in to American pressure, but others from across the political spectrum are joining the chorus. Only a minority of strategic analysts supported India's decision, arguing that it serves India's interests, heightens the GOI's credibility within the IAEA, and makes the point that the country has moved beyond blind obiedience to the non-alligned movement (NAM) position. The October 21-22 visit of U/S Burns will offer us an opportunity to present our case with Saran and key opinion makers. End summary.

MEA Position

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2. (C) On October 13, Indian Foreign Secretary Saran summoned the EU3 (UK, France, and Germany) Ambassadors to discuss potential political solutions for Iran that would keep the matter out of the UNSC. The German Embassy's Polcouns offered Poloff a detailed read-out on the meeting. According to the German, the Indians want to avoid confrontation with Iran by keeping the nuclear issue within the IAEA. Saran insisted that the recent BOG vote instigated debate within the Iranian government to reconsider its position. He urged the EU-3 to encourage Teheran to compromise by presenting a ""face-saving"" way to return to the negotiating table. Noting that in the past, the international community has discussed confidence-building measures with Iran, Saran suggested that the EU-3 propose a compromise in which Iran would:

- reduce feedstock in Esfahan by 50% (Note: ""Feedstock"" refers to the gases needed for enrichment and to ""feed"" the rest of the nuclear fuel cycle. End note.);

- stop conversion at the U4 stage rather than proceeding to the more advanced U6 stage; and/or

- export finished nuclear materiel rather than storing it within Iran.

3. (C) Our German interlocutor added that Saran emphasized that Iran could become more confrontational if backed into a corner. Saran reportedly indicated that New Delhi is willing to speak to Iran, but needs joint parameters from its allies. A UK poloff confirmed to us on October 19 that Saran was sincerely interested in a dialogue with the EU3 and its allies. She posited that although there is no guarantee India will vote the same way again at the November IAEA meeting as it did on September 24, the GOI's willingness to step away from pro-NAM or pro-Iran rhetoric and constructively plan ahead and engage with others is an encouraging sign.

But Politics Persist...

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4. (SBU) Internal debate on India's IAEA vote referring Iran to the UNSC is also heating up. In a recent London School of Economics speech, Hindu Editor-in-Chief N. Ram described India's vote as a massive foreign policy ""blunder,"" contrived to convince the US that it was an ally, and earn Washington's support for an Indian Security Council seat. Ram was not alone in this assessment- a variety of pundits and politicians have painted India's decision in the same harsh light, increasing the pressure on Manmahon Singh's government to abstain in any future IAEA vote. On October 3, party leaders from the leftist CPI(M), CPI, Forward Bloc, and RSP agreed to begin a nation-wide ""campaign of agitation"" to begin October 28. The campaign will try to force the GOI to reverse its position on referring Iran to the UNSC. In addition to reports on the left's activities, numerous op-ed pieces have pointed out that India's relationship with Iran will be strained and that India will now be perceived as subject to undue American influence. Nevertheless, the debate in the media has not been one-sided. Some analysts have posited that India has actually enhanced its reputation of fairness and independence by breaking with the NAM in the IAEA vote. Furthermore, the MEA's media spin argues that India's inputs to the resolution allowed Iran further time to negotiate before being referred to the Security Council.

Iranian Lobbying

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5. (U) Despite the MEA's publicity efforts, it seems Tehran sees a faultline within the GOI and is attempting to broaden that rift. Press reports indicate that senior Iranian diplomats met key leftist politicians with the hopes of recruiting allies within the GOI. Also, on October 15, Iran's Ambassador to India S.Z. Yaghoubi called on External Affairs Minister K. Natwar Singh. Although the MEA press statement provided no details, there was broad speculation in the media that the meeting was part of an Iranian campaign to pressure India to change its IAEA stance. Yaghoubi has also taken his campaign public, writing op-eds carried in the Times of India and Hindustan Times that talk up Iran-India energy cooperation and decry ""politically motivated"" pressure from ""foreign colonial powers"" against Iran- an argument that resonates with domestic critics of India's vote.

6. (SBU) On October 19, Iran added another element to the GOI's decision-making dilemma by unexpectedly calling for an October 24 meeting of the Joint Working Group on the proposed Iran-Pakistan-India pipeline. Iran is expected to continue to lobby the GOI to abstain in November's vote. Media have reported that a GOI delegation will attend the meeting in Tehran, but the MEA's Iran desk told us that it is unclear as yet whether MEA or the Ministry of Petroleum will be leading that group.

Comment

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7. (C) The Congress-led UPA Alliance committed itself to the September 24 vote without attempting to garner support from Parliament or political leaders. In an October 15 conversation with the Charge', Indo-US Parliamentary Forum Chairman Jay Panda commented that Prime Minister Singh has gone well beyond the national consensus in siding with the US in the IAEA's September vote. Against the background of leftist agitation, he predicted, the Prime Minister will now be obliged to back down. Prime Minister Singh himself has let it be known that he is committed to his current course, but that opinion is not unanimously shared amongst our Congress contacts. Although India voted with the US in September, the GOI may not have the required domestic support to sustain that position. The GOI faces intense domestic criticism and pressure to back down from its stance, and is hoping to avoid further controversy by resolving the Iran issue through behind the scenes diplomatic negotiations that would avoid a November IAEA vote. Our German colleague told us that Saran mentioned an ""exit in honor"" for Iran. As New Delhi pursues this course, we will need to be very clear about our own red lines, especially if those diverge from the EU3. End comment.

BLAKE