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C O N F I D E N T I A L NEW DELHI 001220 
 
SIPDIS 
 
SIPDIS 
 
DEPARTMENT FOR SECRETARY RICE AND UNDER SECRETARY BURNS 
DEPARTMENT PASS USTR FOR AMBASSADOR PORTMAN 
 
E.O. 12958: DECL: 02/15/2015 
TAGS: PREL ETTC ETRD KSCA TSPA KNNP IN OVIP POTUS
SUBJECT: EXPANDED CSLA SCOPE IS BLOCKING AGREED PROGRESS IN 
SPACE 
 
REF: A. NEW DELHI 1173 
     ¶B. NEW DELHI 1063 
     ¶C. NEW DELHI 357 
 
Classified By: Ambassador David C. Mulford for Reasons 1.4 (B, D) 
 
¶1.  (C) Summary: Approaching the President's visit to India, 
we need action by Washington principals in order to 
consolidate recent progress on civilian space cooperation and 
disentangle this from our trade agenda.  The original NSSP 
goal to permit Indian launch of US satellites and foreign 
satellites containing US components is in danger of being 
stalled by the suggestion to expand the scope of a commecial 
launch agreement to include satellite services, which the GOI 
rejects as a unilateral change to the carefully negotiated 
NSSP quid-pro-quos.  Without action to put satellite services 
on a separate track from our satellite launch agreement, 
there will be no space-related deliverable for the POTUS 
visit.  Post strongly recommends that we allow the 
NSSP-initiated space launch agreements to come to a 
conclusion including the signing of the TSA and negotiations 
on a CSLA that encompasses only satellite launch services, an 
achievable goal before the President's arrival.  We recommend 
that we continue discussing satellite services with India in 
other fora such as the Trade Policy Forum and the WTO/Doha 
Development Agenda.  End Summary. 
 
ADDITION OF SATELLITE SERVICES THREATENS NSSP GOAL 
--------------------------------------------- ----- 
 
¶2.  (C) The NSSP narrative that then-DNSA Hadley outlined in 
2003 called for allowing "Indian launch of foreign satellites 
containing US-licensed components, and US satellites," once 
we sign a space launch agreement.  Successful negotiations on 
space launch resulted in unprecedented speed in achieving US 
and Indian agreement in January 2006 on a text for the 
Technical Safeguards Agreement (TSA) (Ref C).  We understand 
that USG agreement on signing the TSA has now been linked to 
agreement of a Commercial Space Launch Agreement (CSLA), 
which includes not only launch services but also satellite 
services.  The GOI objects to this "moving the goalposts" for 
concluding the agreed-upon roadmap for bilateral cooperation 
in space launches. 
 
¶3.  (C) MEA Joint Secretary S Jaishankar told the DCM and 
PolCouns on February 15 that the GOI's "final and official" 
interagency perspective is that the CSLA we proposed in 
January 2006 is "unnecessary" to fulfilling the space launch 
agenda.  Jaishankar said that the Indian Space Research 
Organization (ISRO) is unwilling to even discuss the issue of 
satellite services in this context, adding satellite launches 
should proceed in a "market economy" like India's through 
agreements between the satellite companies.  He reiterated 
the GOI view that a commercial satellite launch agreement 
could be encompassed in a one paragraph description of market 
principles.  The US and India, he suggested, should focus on 
signing the TSA during the President's visit to officially 
open the satellite launch market, and address satellite 
services through out trade dialogue.  Post believes that 
trying to add satellite services to the mix at this late date 
is a bridge too far for ISRO, the GOI, and an economy that is 
just now opening FM radio to private entrants. 
 
GOI WANTS TO COOPERATE DESPITE HOSTILE MEDIA ATTENTION 
--------------------------------------------- --------- 
 
¶4.  (C) The GOI, led by MEA, has made substantial progress 
since the commencement of the NSSP in changing the 
fundamental culture of ISRO to reach the point where the TSA 
negotiations took only a few hours of discussion.  At a 
recent seminar in Bangalore, ISRO Director G. Madhavan Nair 
spoke enthusiastically about the partnership with the U.S., 
calling it central to India's international outreach.  Since 
the inception of the NSSP, reactionary holdouts within the 
Indian space bureaucracy and in the media and policy 
community have savaged the concept of greater ties with the 
US, pointing to the progress that India's indigenous programs 
made without assistance from the West.  The legacy of 
bitterness mingled with pride at US sanctions continues in 
the present debate, with commentators frequently referring to 
US actions to block the sale of Russian cryogenic engines in 
the 1990s as proof that American interest continues to focus 
on hobbling and/or displacing India's indigenous launch and 
satellite capabilities. 
 
US "INTRANSIGENCE" ON SPACE AS REASON TO DIG IN ON NUKES 
--------------------------------------------- ----------- 
 
¶5.  (C) Critics of the July 18 President Bush-PM Manmohan 
Singh joint statement have recently dragged ISRO's 
willingness to engage with the US on space launch into the 
debate on civil nuclear cooperation, and have used the same 
language of "moving the goalposts" to oppose both tracks. 
While proponents point to ISRO's pragmatism and scientific 
openness (a point we endorse), opponents of the nuclear deal 
have accused ISRO of selling out India's domestic prowess in 
space launch vehicles and satellite construction in order to 
serve the political goal of closer ties with the US.  They 
compare ISRO's "caving to political pressure" unfavorably 
with Atomic Energy Commission Anil Kakodkar's public 
statements (Refs A and B) drawing a red line on what India's 
nuclear establishment would not accept under hypothetical 
civil-military nuclear separation plans.  If Washington is 
unwilling to make commercial cooperation easier in the space 
sector even after ISRO has made so many concessions, critics 
ask, why should India be 
willing to make concessions on its nuclear separation plan? 
 
COMMERCIAL OPPORTUNITIES COULD BE AT RISK 
----------------------------------------- 
 
¶6.  (C) A recent opinion piece by R Ramachandran argued that 
while ISRO has willingly firewalled its military and civilian 
programs, the US regulatory and licensing process remains so 
cumbersome that the "big promise of Indo-US space cooperation 
did not materialize largely due to Washington's 
intransigence."  He highlighted how Boeing abandoned plans to 
cooperate with ISRO on 2-3 tonne satellites because of 
burdensome licensing requirements, upon which the European 
EADS swooped in to conclude an agreement on joint 
manufacturing in that class.  Europeans are also forging 
ahead on commercial launches, with ISRO announcing in January 
that Astrium and Arianespace had agreed to launch two 2.5 
tonne satellites on ISRO rockets.  In the meantime, the 
Embassy has fielded inquiries from US-based companies asking 
about progress in US-India commercial space cooperation, as 
they too would like to establish a foothold in India. 
 
 
RECOMMENDATION: MOVE AHEAD ON LAUNCHES, LEAVE SATELLITES OUT 
--------------------------------------------- --------------- 
 
¶7.  (C) Ambassador strongly recommends that we use the 
President's upcoming visit to New Delhi as an opportunity to 
sign the TSA and a CSLA that will focus solely on launch 
services, as agreed in the NSSP.  It is clear that we will 
not get an Indian agreement to add satellite services to a 
process that was intended to clear the way for commercial 
space launches before the President's arrival in New Delhi, 
and maintaining their linkage will result in no space-related 
deliverable for the President's visit to India.  We should 
continue to discuss satellite services, including 
non-discriminatory treatment of foreign satellite service 
providers, in appropriate fora including bilaterally in the 
services focus group of the Trade Policy Forum, and 
multilaterally in the Services negotiations under the ongoing 
WTO Doha Development Agenda. 
 
¶8.  (U) Visit New Delhi's Classified Website: 
(http://www.state.sgov.gov/p/sa/newdelhi/) 
MULFORD