"The Indian security apparatus remains edgy and will react forcefully to any hint of increased insurgency in the valley. We fear that the political and stability gains in Jammu and Kashmir may be threatened by any increase in terrorist activity. "

24648 12/1/2010 12:09 10NEWDELHI201 Embassy New Delhi CONFIDENTIAL 10NEWDELHI2135 | 10NEWDELHI2155 | 10NEWDELHI2208 | 10NEWDELHI2355 | 10NEWDELHI2356 | 10NEWDELHI2455 | 10NEWDELHI2493 "VZCZCXRO2906OO RUEHBI RUEHCI RUEHDBU RUEHLH RUEHNEH RUEHPWDE RUEHNE #0201/01 0321209ZNY CCCCC ZZHO 011209Z FEB 10FM AMEMBASSY NEW DELHITO RUEHC/SECSTATE WASHDC IMMEDIATE 9351INFO RUCNCLS/ALL SOUTH AND CENTRAL ASIA COLLECTIVERUEHBJ/AMEMBASSY BEIJING 8223RUEHMO/AMEMBASSY MOSCOW 3911RUEHLO/AMEMBASSY LONDON 7240RUEHFR/AMEMBASSY PARIS 2121RUEHRL/AMEMBASSY BERLIN 1521RUEKJCS/SECDEF WASHDCRUEAIIA/CIA WASHDCRHEHNSC/NSC WASHDCRUEIDN/DNI WASHINGTON DCRHHMUNA/HQ USPACOM HONOLULU HIRUCNDT/USMISSION USUN NEW YORK 8852RUEHGV/USMISSION GENEVARUEKJCS/JOINT STAFF WASHDCRUMICEA/USCENTCOM INTEL CEN MACDILL AFB FL""C O N F I D E N T I A L SECTION 01 OF 03 NEW DELHI 000201

SIPDIS

DEPT FOR P, SCA, SRAP

E.O. 12958: DECL: 02/01/2020 TAGS: PGOV, PTER, PREL, PINR, IN SUBJECT: JAMMU AND KASHMIR: INDIANS FEAR CROSS-BORDER TERRORIST THREAT IS INCREASING

REF: A. NEW DELHI (NARAYANAN EXIT CABLE) B. NEW DELHI 2493 C. NEW DELHI 2455 D. NEW DELHI 2356 E. NEW DELHI 2355 F. NEW DELHI 2208 G. NEW DELHI 2155 H. NEW DELHI 2135

Classified By: Acting Political Counselor Les Viguerie, Reasons 1.5 (B,D)

1. (C) Summary: While there have been a few positive moves regarding Kashmir in the last month, the more significant developments have been negative and represent setbacks to peace and reconciliation. On the plus side, the Defense Minister unveiled a few more confidence building measures, and Kashmir policy became consolidated under the more forward leaning Home Minister P.C. Chidambaram after the exit of National Security Advisor M.K. Narayanan, who played a dominant, conservative and often obstructive role in GOI policy on Kashmir. Potential setbacks to the prospects for restoring peace and stability in the state, however, were more troubling. The GOI-separatist dialogue that kicked off last year stalled amid an assassination attempt, complaints and finger-pointing, with accusations that Pakistan has instructed the separatists to suspend the dialogue until India agrees to a bilateral dialogue with Pakistan. Most importantly, however, Kashmiris and government officials responsible for Kashmir policy are starting to sense that the cross border terrorists are regrouping and preparing to launch a new wave of attacks. The Indian security apparatus remains edgy and will react forcefully to any hint of increased insurgency in the valley. We fear that the political and stability gains in Jammu and Kashmir may be threatened by any increase in terrorist activity. End Summary.

Antony Offers More CBMs

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2. (U) The Indian government continued to unveil new confidence building measures in Jammu and Kashmir. In remarks to the security establishment in Jammu on January 11, Defense Minister A.K. Anthony announced that the Army would further reduce its visibility by handing over responsibility for patrolling the state's principal highway to the paramilitary Central Reserve Police Force by January 15. He disclosed that the Defense Ministry had urged the Home Ministry to discontinue use by the paramilitary and police of ""combat"" uniforms. He also observed that the State police would play a more prominent role in counterterrorism matters, especially in urban areas. At the same time, the Army announced that it would vacate all public hospitals and schools in the state in view of the improving security situation. (Note: Many of these public facilities were occupied by the Army when it began to flood into the state in the 1990s. The Army occupation of these public spaces has been an important grievance of the local population. End Note.)

3. (U) The latest CBM steps add to the flurry of moves that the GOI has taken since it began its reconciliation efforts in October 2009 (reftels). In his remarks in Jammu, Antony referred prominently to the withdrawal of 30,000 troops, one of the most visible CBMs India has taken in Jammu and Kashmir.

Separatists Disheartened on Srinagar-Delhi Dialogue

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4. (C) The senior leadership of the All Party Hurriyat Conference (APHC) told Poloff that they are discouraged by the turn of events recently and the high hopes they had in the Srinagar-Delhi dialogue have been deflated, at

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least for now. Mirwaiz Omar Farooq, Professor Abdul Ghani Bhat, Bilal Lone and Syed Agha Hassan said that the attempted assassination of their moderate APHC colleague Fazal ul Qureshi was intended to be a clear message to them of the perils faced by those that talk to the GOI. They conceded that the attack on Qureshi had made them more cautious in engaging with the GOI.

5. (C) The Mirwaiz and his colleagues added that the Srinagar-Delhi dialogue has for all practical purposes been suspended by them, at least for now. They admitted that they had lost some political ground in the valley, not because the Kashmiri people were opposed to talks with the GOI but because opponents had run an effective campaign which questioned the ""quiet"" nature of the talks, with warnings about cutting secret deals and selling out.

6. (C) The separatists felt that everyone was conspiring against the Srinagar-Delhi talks. Elements within the GOI's security apparatus that are opposed to negotiations are undermining the talks by leaking and publicizing information about the meetings despite Home Minister Chidambaram's insistence that the dialogue occur behind closed doors. The political leadership of the GOI is itself undercutting the separatists by its refusal to associate the separatists with any of the confidence building measures it has implemented in the state. The separatists said that the mainstream parties, despite their public support for a GOI-separatist dialogue, are now working to sabotage it for fear of the separatists gaining political ground. The separatists reserved their special scorn for hardliner Syed Ali Shah Gilani, who they see as simply looking for his own legacy instead of the wellbeing of the Kashmiri people.

Pakistan Stepping on the Brakes?

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7. (C) There is growing consensus among Kashmir watchers in India that the Srinagar-Delhi talks will not yield results unless they are accompanied by Islamabad-Delhi talks. The Mirwaiz told Poloff that it is essential that Islamabad and Delhi open discussions on Kashmir. Jammu and Kashmir Police Director General Kuldeep Khoda believed that talks with the separatists will get nowhere unless India and Pakistan begin to talk because the separatists are afraid of getting too far ahead of Pakistan. This was echoed by Jawahar Lal Nehru Professor Amitabh Mattoo, who told Poloff said that the ability of Pakistan to influence the separatists with threats casts a dark shadow on the Srinagar-Delhi talks. The underlying rationale behind this line of thinking, reflected in the op-ed columns of the media, is that: Pakistan fears India and Kashmiris of the valley will cut a deal, leaving Pakistan out of the mix; and this motivates Pakistan to undercut GOI-separatist dialogue. Recent media stories reported that the Mirwaiz and his separatists were told by the Pakistani High Commissioner and the visiting Pakistan National Assembly speaker to cease their dialogue with the GOI.

Regrouping of Terrorist Forces?

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8. (C) There appears to be a growing uneasiness among Kashmiris and government officials with Kashmir responsibility that terrorist elements are regrouping and preparing to launch a new wave of terrorist attacks. Foreign Secretary Nirupama Rao expressed concern with SRAP Holbrooke over a sharp increase in unseasonal incidents of cross-border shelling along the line of control and in Punjab, increased infiltration, and transfer of terrorist hardware. In her view, Pakistan is clearly trying to ""stir the pot"" in Kashmir. There were reports of an hour

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exchange of cross-LOC fire on January 18 and there were a few reports of rockets/shells across the border into India in the last several weeks.

9. (U) Defense Minister A.K. Antony, while congratulating the security forces on their successful efforts to battle the militancy, urged them not to be complacent and to consolidate the gains of recent years. He voiced concern about the increase in infiltration of terrorists into the state from Pakistan. ""It is a matter of major concern ... inimical forces across the border are jittery"" because they are desperate to break the lull with some big attacks, he said, According to media reporting, security personnel briefed Antony on the counterinsurgency and counter-infiltration efforts and on the intercepted cross-border chatter relating to plans for violence in the valley.

10. (U) Army Chief General Deepak Kapoor echoed Anthony at a press conference a day ahead of Army Day on January 15 when he claimed that 700 terrorists are waiting across the line of control to infiltrate into Jammu and Kashmir and that infiltration in 2009 (110) was significantly higher than in 2008 (57) as were infiltration attempts. He added that the ""terrorist infrastructure across the LOC is very much intact and all-out efforts are being push inside as many infiltrators as possible.""

11. (C) The Mirwaiz and his moderate separatists told Poloff that they sense a change in approach from across the border. They felt that a string of violent incidents in the valley during the last three months have characteristics that they have not seen in the last three years. They pointed to a series of events -- the fidayeen-style attack and 24-hour siege at the Panjab Hotel in Lal Chowk/Srinagar, cross-border shelling, deaths of Border Security Force soldiers in firing across the line of control in Poonch, a series of encounters in Sopore district between paramilitary forces and cross-border terrorists, the more sophisticated hardware used in these encounters, the assassination attempt on moderate separatist Fazal ul Qureshi -- as evidence that terrorist organizations are ""regrouping"" and preparing for a new offensive. Bilal Lone told Poloff that he lives in Sopore and it is unmistakable from the chatter on the street that ""something is being planned.""

Comment: Narayanan Departure Positive for Kashmir

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12. (C) The exit of M.K. Narayanan from the National Security Advisor position in the Prime Minister's Office (Ref A) has potentially important implications for India policy on Kashmir. Narayanan cast a huge shadow over decision-making on internal security issues and, due to his intelligence and security background as well as his ties to the Nehru-Gandhi family, he seldom lost a bureaucratic or policy battle. (Journalist Aditi Phadnis described Narayanan as too assertive and domineering, ready to intervene in every decision-making exercise.) Narayanan's natural instinct on Kashmir (and Pakistan) was cautious, conservative, and obstructionist. With his departure, Home Minister Chidambaram will become the primary source of decision-making on Kashmir and in the last six months he has shown that he is willing to be a risk-taker on this intractable issue.

ROEMER

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