VZCZCXYZ0001
PP RUEHWEB

DE RUEHRO #1585/01 1441156
ZNR UUUUU ZZH
P 241156Z MAY 06
FM AMEMBASSY ROME
TO RUEHC/SECSTATE WASHDC PRIORITY 4898
INFO RUEHNE/AMEMBASSY NEW DELHI PRIORITY 0704
RUEHFR/AMEMBASSY PARIS PRIORITY 2010
RUCPDOC/DEPT OF COMMERCE WASHDC PRIORITY
RUEANAT/NASA WASHDC

UNCLAS ROME 001585 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
STATE FOR ISN/CATR, PM/DDTC, EUR/WE, SCA, OES/SAT, PARIS 
FOR NASA REP, PLEASE PASS TO USTR 
 
E.O. 12958: N/A 
TAGS: ETTC TSPA KFPC ETRD IT IN
SUBJECT: GOI INQUIRY REGARDING ITALIAN SATELLITE LAUNCH 
FROM INDIA 
 
REF: A. KESSLER-BYRNES MAY 11 
     ¶B. 2006 E-MAIL AND PREVIOUS 
 
SENSITIVE BUT UNCLASSIFIED - NOT FOR INTERNET DISTRIBUTION 
 
¶1.  (SBU)  SUMMARY AND ACTION REQUEST:  Embassy requests 
Department assistance to follow up on several pending export 
license requests for U.S.-origin components for the Italian 
Space Agency's (ASI) AGILE scientific satellite mission, 
which ASI would like to launch from India in October.  The 
Ministry of Foreign Affairs warned us in April (Ref E-mails) 
that if by the end of May it is not clear that the licenses 
will be granted, ASI is prepared to purchase the needed 
components from non-U.S. manufacturers to enable ASI to 
launch from India by January 2007.  We note that NASA 
announced May 9 that the U.S. Space Agency plans to launch 
scientific payloads on India's Chandrayaan-1 lunar orbiter in 
late 2007 or early 2008 as part of the President's Vision for 
Space Exploration. 
 
¶2.  (SBU) ASI has been a trusted partner for 40 years, and 
U.S.-Italy space cooperation is ongoing.  While the value of 
the U.S. components in the AGILE satellite may be not be very 
great, we do not want to prejudice U.S. industry's access to 
Italy's nine billion euro aerospace and defense market. 
Background on the primary contractor for the satellite, Carlo 
Gavazzi Space S.p.A., and on the AGILE mission is in 
paragraphs 8 and 9.  ACTION REQUEST:  Please see paragraph 7. 
 END SUMMARY. 
 
ITALIAN SPACE AGENCY (ASI) DECEMBER 2005 INQUIRY 
--------------------------------------------- --- 
 
¶3.  (SBU)  Last December, the Italian Space Agency publicly 
announced that AGILE would launch January 26, 2006 from 
India.  Also in December, ASI inquired about several export 
license applications pending with the Departments of State 
and Commerce.  A list of application numbers, components, and 
U.S. suppliers is included in paragraph 10.  In January, 
following E-mail consultation with the Department of State, 
Emboffs informed ASI that U.S. export control policy did 
not/not allow for U.S.-origin components to be used in 
satellite equipment launched from India.  We also informed 
ASI that the U.S. had begun negotiations on two U.S.-India 
bilateral agreements (a Technology Safeguards Agreement and a 
Commercial Space Launch Agreement) that must be in place in 
order for U.S. policy to change and to allow the AGILE 
satellite to be launched from India.  At that time, we also 
noted that in order for the contractor Carlo Gavazzi to 
transfer the satellite, the company would have to make 
comprehensive requests to the Departments of State and 
Commerce for authorization to re-export each U.S.-origin 
components. 
 
APRIL MFA INQUIRY:  SERIOUS THREAT TO REPLACE U.S. ITEMS 
--------------------------------------------- ----------- 
 
¶4.  (SBU)  In mid-April, Gianni Manfredi, the Office Director 
responsible for space cooperation at MFA's Directorate for 
Multilateral Economic and Financial Cooperation inquired 
about the status of the pending licenses.  He explained that 
ASI wanted to reschedule the launch for October 2006, and 
needed to know by the end of May whether export licenses for 
five U.S.-origin components could be approved by then. 
Manfredi informed SCIoff that if Carlo Gavazzi Space (the 
main contractor, see background in paragraph 8) or ASI did 
not hear positively by that time, ASI was prepared to replace 
the equipment with components manufactured outside the U.S. 
Our main contact from ASI's bilateral and international 
department confirmed that ASI would acquire components 
elsewhere.  At the roll-out of the Italian National Space 
Plan for 2006-2008 this spring, ASI President Prof. Sergio 
Vetrella confirmed that ASI plans to launch AGILE this year. 
COMMENT:  Based on these public statements, and the fact that 
ASI has upped the ante by involving the Ministry of Foreign 
Affairs in the matter, we believe the Space Agency is serious 
about replacing U.S.-manufactured equipment with non-U.S. 
origin components in time for launch NLT January 2007.  From 
what we understand, ASI has not considered launching from 
another venue permissible under U.S. export control 
regulations.  END COMMENT. 
 
U.S. COMPANIES/EQUITIES AND POSSIBLE LONG-TERM EFFECTS 
--------------------------------------------- --------- 
 
¶5.  (U)  To the best of our knowledge, the U.S. suppliers for 
AGILE are:  Eagle-Picher Technologies, Goodrich Corporation, 
AEROFLEX (Formerly UTMC), BAE Federal Systems, Honeywell, and 
International Rectifier.  We have no information on the 
retail value of any of the equipment supplied to Carlo 
Gavazzi and subcontractor Alcatel Alenia Spazio, except for 
the reaction wheel assembly manufactured by Goodrich (USD 
155,000).  While the total value of U.S. equipment for AGILE 
is relatively small, the aerospace and defense industry in 
Italy represents a potential nine billion euro market for 
American manufacturers.  This market could be jeopardized if 
ASI (USD 700 million dollar budget in 2005) and Italian 
aerospace companies decide it is more predictable to purchase 
non-U.S. components in order to have the flexibility to 
launch on a timely basis from India. 
 
NASA MAY 9 ANNOUNCEMENT:  INDIA LAUNCH PLANNED 
--------------------------------------------- - 
 
¶6.  (SBU)  NASA announced on May 9 that as part of the 
President's Vision for Space Exploration, the U.S. Space 
Agency will include two U.S. scientific payloads on India's 
lunar orbiter, Chandrayaan-1, expected to launch in late 2007 
or early 2008.  We anticipate that the MFA and ASI will 
request a detailed explanation of U.S. policies if 
regulations woulQnot allow U.S.-origin equipment on an 
Italian satellite controlled by the GOI, but launched by 
India, while they would permit U.S. instruments to be 
exported and used in an Indian-assembled space vehicle.  For 
the record, ASI has assured us that the AGILE satellite would 
be shipped to India under guard and would always remain under 
the control of an ASI team on the ground in India, where no 
one else (including the Indians) would have access to it 
before launch.  Professor Vetrella, President of ASI, also 
confirmed that the GOI would officially guarantee that only 
ASI would have access to AGILE in India. 
 
ACTION REQUEST 
-------------- 
 
¶7.  (U)  Embassy would appreciate Department's assistance to 
provide points for our reply to the MFA's and ASI's 
inquiries.  Will U.S. authorities be able to approve export 
control licenses for the U.S.-origin equipment for the AGILE 
satellite by the end of May, or within a timeframe that would 
allow for assembly and launch of AGILE from India by October, 
2006? 
 
BACKGROUND INFORMATION:  CARLO GAVAZZI SPACE S.P.A. 
--------------------------------------------- ------ 
 
¶8. (U)  Carlo Gavazzi is one of the leading medium-sized 
privately owned European aerospace and telematics companies. 
Founded in 1981 and owned 100 percent by the German Fuchs 
family (Prof. Manfred Fuchs - President; Dr. Marco Fuchs - 
Vice President), the company is headquartered in Milan, with 
branches and a research laboratory in five other central and 
northern Italian locations.  Gavazzi employs 180 engineers 
and physicists and claims share capital worth 2.4 million 
euro.  The company is one of 40 manufacturing the 
recently-completed European Space Agency Columbus Module for 
the NASA-led International Space Station (ISS).  Gavazzi 
provides facilities and payloads for experiments in 
microgravity conditions for all Columbus internal 
laboratories and for many experiments carried out on the 
external platforms of the ISS, including the Remote Power 
Distribution Assembly on ISS's American laboratory.  The 
company also produced the overall thermal control system of 
NASA's Alpha Magnetic Spectrometer.  Carlo Gavazzi has also 
contributed to ASI's Unmanned Space Vehicle (USV), unveiled 
in May and scheduled for its first test flight between June 
and August this year.  The USV is Italy's candidate to lead 
the European Space Agency's effort to develop a 
next-generation launch system to replace the Ariane 5 booster. 
 
AGILE - AN ITALIAN NATIONAL SCIENTIFIC MISSION 
--------------------------------------------- - 
 
¶9.  (U) AGILE is an Italian Space Agency two-year scientific 
mission, the only European mission entirely devoted to 
high-energy astrophysics.  The 350-kilogram mini-satellite 
will be placed in an equatorial orbit 550 kilometers above 
the earth to detect hard X-rays and gamma ray bursts.  This 
mission will acquire information on black holes, supernovae, 
neutron stars, and yet-to-be-identified sources of gamma 
 
rays.  ASI planned to launch the satellite from the Satish 
Dhawan Space Centre in Sriharikota, India.  This launch site 
was selected for cost reasons.  Neither the U.S. nor the 
European Space Agency is participating in AGILE. 
 
STATUS OF U.S.-ORIGIN COMPONENTS IN AGILE SATELLITE 
--------------------------------------------- ------ 
 
¶10. (U) Below is the most complete list we have of 
U.S.-origin components in the AGILE, furnished by Carlo 
Gavazzi Space. 
 
--  DTC Case GC 0847-05 (nickel-hydrogen battery):  On August 
9, 2005 submitted license variation for Siriharihota, India 
launch site; end user ASI. 
 
-- DTC Case 862652, 9007988 (nickel-hydrogen battery): 
Manufacturer:  Eagle-Picher Technologies; End User:  Carlo 
Gavazzi Space S.p.A. (launch site listed as USA (Vandenberg). 
(See license variation GC 0847-05). 
 
--  DTC Case 931427 (reaction wheel assembly) or case 
TA-1177-03):  Exporter:  Goodrich Corporation; End User: 
Carlo Gavazzi Space S.p.A.  Total value stated on license: 
USD 155,000. 
 
--  DTC Case GC 0221-06 (GPS Receiver Component Rad-Hard IC 
(CAUGG ASIC) and GSP Receiver Component Single Chip Processor 
(RAD60006C) CMOS Static RAM (SRAM):  License variation 
submitted on February 21, 2006; Requested End User:  ASI; 
Requested Launch Site: Siriharihota, India. 
 
--  DTC Case 706176 (GPS Receiver Component Rad-Hard IC 
(GAUSS ASIC):  Manufacturer:  AEROFLEX (Formerly UTMC).  End 
User:  Laben S.p.A.  Final Destination:   Milan, Italy. (See 
License Variation Request GC 0221-06). 
 
--  DTC Case 709454 (GPS Receiver Component Single Chip 
Processor (RAD60006C) CMOS Static RAM (SRAM).  Manufacturer: 
BAE Federal Systems.  End User:  LABEN S.p.A.  Final 
Destination:  Milan, Italy.  (See License Variation Request 
GC 0221-06). 
 
--  DTC Case GC 0324-06 (Payload Component Rad-Hard 32K RAM): 
 License Variation submitted in February, 2006.  Requested 
end user:  ASI.  Requested launch site:  Siriharihota, India. 
 
-- DTC Case 675615 (Payload Component Rad-Hard 32K RAM): 
Manufacturer:  Honeywell.  End user:  Laben S.p.A.  Final 
Destination or Launch site:  USA (Vandenberg).  (See License 
Variation Request GC 0324-06). 
 
-- DTC Case 956359 (Magnetometer):  Manufacturer:  SAIC.  End 
user:  ASI.  Launch destination:  India.  NOTE:  Carlo 
Gavazzi Space informed Embassy that it has decided to switch 
to a different manufacturer for the magnetometer procurement. 
  The SAIC magnetometer will not be used for the AGILE 
satellite. 
 
-- Case number unknown:  MOSFETs (Metal-oxide semiconductor 
field effect transistors).  Manufacturer:  International 
Rectifier;  Supplier:  Consystem.  License was approved, per 
ASI. 
 
COMMENT: 
-------- 
 
¶11.  (SBU)  The Embassy urges the Department and Department 
of Commerce to expedite the review of this request given the 
negative press we could receive by a continued delay.  While 
we hope that Italy qualifies for the requested permits, at 
this point a quick no would be preferable to an uncertain, 
drawn out review process.  End Comment. 
SPOGLI