JUNE 25, 2019
U.S Secretary of State Mike Pompeo holds flowers he received on arrival to New Delhi, next to U.S. Ambassador to India Kenneth Juster, as Pompeo arrives in New Delhi, India, Tuesday, June 25, 2019, from Afghanistan. (AP photo)
NEW DELHI – India believes it meets the criteria for a waiver from US sanctions on the $5.2-billion deal with Russia for the S-400 missile defence system and New Delhi cannot “wish away” its long-standing defence relations with Moscow, according to people familiar with the developments.
The S-400 deal, threatened with sanctions by the US, is expected to figure in talks on Wednesday between external affairs minister S Jaishankar and US secretary of state Mike Pompeo, who arrived in New Delhi late on Tuesday night.
Terrorism, trade-related differences and US-Iran tensions, too, are expected to be on the agenda for Pompeo’s meetings with his Indian interlocutors. Though there is no structured agenda for the talks between Pompeo and Jaishankar and the entire spectrum of India-US ties will be on the table, the people cited above said the Indo-Pacific is also expected to come up, with the Indian side expected to push for an inclusive policy that averts confrontations in the region.
The US has already acted against Turkey and China for acquiring the S-400 system and sanctions under the Countering America’s Adversaries Through Sanctions Act (CAATSA) are expected to kick in once India makes the first payment to Russia.
However, the people said there have been private and public discussions with the US regarding the circumstances that compelled India to acquire the S-400 system and the American side is well aware of India’s requirements.
“CAATSA is very clear as to the circumstances under which a waiver can be given by the US administration… If you look at it from the legal point of view, it is our assessment that India fulfils those requirements and the US administration has enough flexibility to give us the waiver,” one of the people cited above said on Tuesday.
India’s belief that it is entitled to a waiver is derived from a “combination of legal provisions in the US law and the political-strategic assessment by the US government keeping in mind the importance of the strategic partnership between India and the US”, the person said.
“We have to realise that we have a long-standing defence relationship with Russia which we cannot wish away,” the person added.
An official, who declined to be named, said India had been buying Russian weapons even before CAATSA was enacted and there were indications from the Pentagon and the US state department that a waiver would be given by the US. India, the official said, is taking adequate steps to address US concerns that the S-400 system could gather the electronic signatures of American military hardware used by India.
“Also, there is the fear that Russia could start selling weapons to Pakistan if India stops buying them. Let’s not forget that during the aerial engagement with Pakistan on February 27, it was an American missile that was fired at Indian jets,” the official said.
As India diversifies its defence procurements, it will remain committed to acquiring state-of-the-art US weapons systems, the people said.
The people described the increased tensions between the US and Iran in the Persian Gulf as a “matter of great concern”, especially because more than 8 million Indians live and work in the region and 60% of India’s energy supplies come from the region. “We have a strong and legitimate interest in maintaining peace and stability in the region,” a person said.
“We have been talking to both Iran and the US and asking both sides to de-escalate and to refrain from actions that affect peace and stability,” the person added.
Indian companies are not looking to further Iranian oil imports because of US sanctions that affect their operations in other parts of the world, the Indian side is expected to raise with Pompeo ways the US can help India find alternative energy supplies, the people said.
On the Indo-Pacific, the official cited above said India’s position is more in line with that of members of the Association of South East Asian Nations (Asean) and favours an inclusive approach that ensures freedom of navigation and makes the Indian Ocean a zone free of confrontation. All lanes of communication used for trade, especially the Malacca Strait, should be kept open and not affected by the tensions seen in the Persian Gulf or the South China Sea, the official added.
The issues of combating terrorism and the fast-moving developments in Afghanistan are also expected to figure in the talks and will be “very high” on the minds of the two ministers, the people said.
With trade expected to figure in the talks, the people said there had been substantial progress as trade has grown by double digits in the past three years while the deficit had also gone down by double digits in the same period, the people said. The issue of India’s tariffs is “misunderstood” and the country’s policy is in line with those of other developing countries, they added.
The US withdrew duty-free benefits for Indian exports under its Generalized System of Preferences (GSP) from June 5, and New Delhi retaliated by slapping tariffs on 29 American products. The US has also been irked by India’s planned rules for multinational firms to store private data of users locally. The people said they hoped there will be some “give and take” as the two sides discussed such issues.
The people said the two countries were at an advanced stage in negotiations on the “Industrial Security Annex” that will allow the transfer of defence technology. The Indian side has got the text from the US side and the systems on both sides are broadly in alignment to conclude the agreement.
Pompeo will have a working lunch with Jaishankar and call on Prime Minister Narendra Modi. He will meet Indian and US businesses at a roundtable and deliver a policy speech at the India International Centre.
Jaishankar, speaking to reporters in Gandhinagar after filing his nomination papers for the Rajya Sabha poll, said India will try to find common ground on trade issues during the discussions.
“We will be meeting with a positive attitude,” he said. “The meeting with Mike Pompeo will be an important one. We will definitely discuss issues related to trade between the two countries,” he said.
“Both countries are having their own interests and it is natural to have some conflicts because of that. We will find a common ground using diplomacy.”