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DE RUEHFR #4580/01 1841524
ZNY CCCCC ZZH
O 031524Z JUL 06
FM AMEMBASSY PARIS
TO RUEHC/SECSTATE WASHDC IMMEDIATE 9209
INFO RUEHTA/AMEMBASSY ALMATY PRIORITY 0194
RUEHAH/AMEMBASSY ASHGABAT PRIORITY 0137
RUEHBJ/AMEMBASSY BEIJING PRIORITY 1262
RUEHEK/AMEMBASSY BISHKEK PRIORITY 0318
RUEHLM/AMEMBASSY COLOMBO PRIORITY 0247
RUEHKA/AMEMBASSY DHAKA PRIORITY 0093
RUEHDBU/AMEMBASSY DUSHANBE PRIORITY 0015
RUEHIL/AMEMBASSY ISLAMABAD PRIORITY 0623
RUEHBUL/AMEMBASSY KABUL PRIORITY 0369
RUEHMO/AMEMBASSY MOSCOW PRIORITY 5411
RUEHNE/AMEMBASSY NEW DELHI PRIORITY 0953
RUEHNT/AMEMBASSY TASHKENT PRIORITY 0170
RUEHVEN/USMISSION USOSCE PRIORITY 3057
RUEHBS/USEU BRUSSELS PRIORITY 1682
RHEBAAA/DEPT OF ENERGY WASHINGTON DC PRIORITY

C O N F I D E N T I A L SECTION 01 OF 03 PARIS 004580 
 
SIPDIS 
 
SIPDIS 
 
E.O. 12958: DECL: 07/02/2016 
TAGS: PREL IEA OSCE PGOV ENRG ELAB ETTC TRGY ZK IN
PK, CH, RS, CE, FR 
SUBJECT: FRENCH STILL CONSIDERING OSCE BID, BOUCHER TOLD 
 
 
Classified By: Political Minister-Counselor Josiah Rosenblatt, reasons 
1.4 (b) and (d). 
 
¶1.  (C) SUMMARY. Concerned officials say they will tell 
Kazakh Foreign Minister Tokayev that Kazakhstan will have to 
meet higher standards if it wants to Chair the OSCE in 2009. 
But, they admit, the personal relationship between the two 
Presidents may carry the day.  During other meetings in 
Paris, Boucher asked for support for U.S. priorities in 
Afghanistan and Pakistan, as reflected by the Secretary's 
visit.  International energy officials said that Turkmenistan 
has plenty of gas but not much governance.  In any case, 
export pipelines to China made more sense that the 
trans-Afghan pipeline. END SUMMARY 
 
¶2. (U) A/S Boucher met with Jean-Francois Terral, 
A/S-equivalent for Continental Europe, and Aurelia Bouchez, 
DAS-equivalent for Russia and the former Soviet space, to 
discuss Central Asia.  Terral said the important country in 
Central Asia, from France's point of view, is Kazakhstan, 
because of its energy resources and because its 
democratization efforts are "less bad than the others."  The 
other "big guy," said Terral, is Uzbekistan.  France follows 
the EU line on Uzbekistan, but believes it would be unwise to 
"corner" Uzbekistan, especially because of the threat of 
radical Islamic groups on Uzbek territory.  Boucher replied 
that President Karimov is dealing with the radical Islamic 
threat in the worst possible way.  Terral agreed and said he 
saw little potential for any positive evolution in Uzbek 
behavior. 
 
¶3. (C) A/S Boucher raised Kazakhstan's bid for the OSCE 
Chairmanship in 2009, and noted he had heard France was 
considered by the Kazakhs to be supportive.  He reviewed the 
U.S. position that Kazakhstan was a long way from meeting 
OSCE standards, and it appeared unlikely that it would do so 
by 2009.  Terral said France was not opposed to a Kazakh 
chairmanship "in principle," but clearly they had to comply 
with OSCE standards.  No final GOF decision had been made, 
but he believed that France would not support Kazakhstan's 
bid.  He added, however, that certain French Senators (Senate 
President Poncelet and Senator Montesquiou, the latter for 
"private reasons") recently gave the Kazakhs the wrong 
impression regarding GOF support.  Terral noted that 
President Chirac had a close relationship with President 
Nazarbayev, but nonetheless Terral "could not imagine" that 
France would support Kazakhstan's 2009 bid.  France, said 
Terral, was "very happy" with the U.S. position. 
 
¶4. (U) Terral said Russia's role was key to Central Asia, and 
it was very important to engage Moscow in a strategic 
dialogue.  Europe, said Terral, was not in a "competitive" 
mood regarding Central Asia.  Boucher replied that the U.S. 
was not "playing the game" either, but it was important for 
the development of the Central Asian countries that they have 
greater economic and political options than they have had in 
the past.  Terral said Russia clearly had a common interest 
with the West in combating trafficking and Islamic extremism 
in Central Asia.  Bouchez added that the EU is "almost 
invisible" in Central Asia, and needs to expand its 
engagement.  Boucher said that a visible Europe in Central 
Asia is good, and added it would be useful to discuss how the 
U.S., the EU and other countries such as Japan could orient 
their programs in the region.  Programs dealing with good 
governance, democracy and civil society would be especially 
useful, said Boucher. 
 
¶5.  (U) French MFA Director for Asia, Herve Ladsous, said 
that meeting with A/S Boucher in Washington the week before 
and hearing his remarks earlier in the day (A/S Boucher gave 
an afternoon speech as part of the conference) reinforced his 
belief that France and the U.S. share the same objectives in 
the region.  A/S Boucher offered Ladsous a synopsis of 
Secretary Rice's visit to Afghanistan and Pakistan saying 
 
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that she praised Pakistan for what it has done while prodding 
it to do more.  Ladsous said that the GoF would take the same 
 
PARIS 00004580  002 OF 003 
 
 
approach with Pakistani FM Kasuri when he visits the 
following Tuesday (July 4) adding that he would also discuss 
the matter of conventional nonproliferation. 
 
¶6.  (U) Ladsous pointed out that on July 20 China and 
Pakistan would celebrate 55 years of official ties between 
the two countries.  However, he said, he was not convinced 
that China would push too hard on behalf of  Pakistan with 
regards to the civilian nuclear issue. 
 
¶7.  (U) Ladsous said France, with its 200,000 strong Tamil 
population, was looking into terrorist financing.  He said 
that the GoF knows that racketeering is taking place, but it 
is a challenge to pinpoint.  Nevertheless, he said, with the 
UN listing of the Tamil Tigers, France is building up its 
legal mechanisms to deal with the problem. 
 
¶8.  (U) In a meeting with the International Energy Agency 
that included IEA Deputy Director Ramsay and an assembled 
team of regional energy specialists, IEA Manager for South 
Asia, Dagmar Graczyk, gave a summary of IEA studies and 
activities focused on India's energy sector while 
highlighting the challenges in addressing the country's 
energy inefficiencies.  She explained that India's dialogue 
with the IEA began with a Memorandum of Understanding that 
was signed in 1998 and that preliminary work focused on 
indicators and statistics.  As the relationship evolved, the 
focus turned to examining specific sectors, such as coal and 
electricity.  She explained that India's energy sector is 
complicated, with five different energy-related ministries 
that, until recently, never communicated.  In 2003, she said, 
the IEA sponsored a conference that allowed the Indian 
Ministry of Power and Ministry of Coal to meet for the first 
time.  Ramsay added that Indian Prime Minister Manmohan Singh 
has recently tried to hold regular meetings to allow 
ministries to interface, and Ramsay suggested that the U.S. 
needs to encourage the practice to continue. 
 
¶9.  (U) The coal market in India, Graczyk explained, was 
strangled by labor unions that refuse to allow the government 
to open the market.  The unions themselves, she said, tended 
to blame the railroads for inefficiencies while the 
government, currently reliant on the support of Marxists, was 
powerless to institute real change.  Supplies of coal, 
meanwhile, were not provided in the quantity, or quality, 
needed. 
 
¶10.  (U) Although the IEA has developed a list of 
recommendations which their Indian contacts agree with, they 
have stagnated in the implementation phase.   On the issue of 
transmission losses  Graczyk noted that high percentages 
attributed to transmission losses may not be entirely 
accurate as they include not just transmission losses but 
energy theft and uncollected energy bills.  She added that 
there has been some progress in India's regulatory framework 
and they can contribute to the IEA in the relatively new 
field of biomass. 
 
¶11.  (U) With regard to the issue of gas in Turkmenistan, 
Caspian expert Christof Van Agt said that there is gas in 
Turkmenistan, although corporate governance and market 
diversity is in short supply.  Given the difficulties of 
sending Turkmen gas southward, he said, it was more logical 
and feasible to send it to China.  Russia has been pulling 
gas in to control markets to the east.  Gazprom has been 
willing to pay a higher price for gas because it can sell it 
for higher still in the West.  Ambassador Ramsay said that he 
had hoped that the G8 summit would do more with the gas 
issue.  It was noted that Ukraine transports 80 percent of 
Russian gas and that there are many countries in Europe who 
are likely to have more disruptions ahead. 
 
¶12.  (U) In closing, Ukrainian expert Mereydd Evans forecast 
difficult days ahead on Eurasian gas, as Ukraine has no 
apparent contract for gas imports as of 1 July 2006. 
 
 
PARIS 00004580  003 OF 003 
 
 
¶13.  (U) A/S Boucher has cleared the unclassified portions of 
this document. 
 
 
 
 
Please visit Paris' Classified Website at: 
http://www.state.sgov.gov/p/eur/paris/index.c fm 
 
STAPLETON