VZCZCXRO1780
OO RUEHDIR
DE RUEHNE #5137 3340113
ZNR UUUUU ZZH
O 300113Z NOV 07
FM AMEMBASSY NEW DELHI
TO RUEHC/SECSTATE WASHDC IMMEDIATE 9490
INFO RHEBAAA/DEPT OF ENERGY WASHDC
RUCPDOC/DEPT OF COMMERCE WASHDC
RUEATRS/DEPT OF TREASURY WASHDC
RUCNIRA/IRAN COLLECTIVE

UNCLAS NEW DELHI 005137 
 
SIPDIS 
 
SENSITIVE 
 
SIPDIS 
 
DEPARTMENT FOR EEB JAMES EIGHMIE 
DEPARTMENT FOR SCA/INS and P. 
 
E.O. 12958: N/A 
TAGS: ENRG PREL EPET EINV PGOV IN IR
SUBJECT: FOREIGN MINISTER TELLS PARLIAMENT NO U.S. PRESSURE ON GAS 
PIPELINE WITH IRAN 
 
 
¶1.  (SBU) Media reported on November 28, 2007 that India's 
Minister of External Affairs, Pranab Murkherjee, had 
sent to the Lok Sabha a written reply to a question 
in which he denies that the U.S. has asked India not 
to move forward with the proposed Iran-Pakistan-India (IPI) natural 
gas pipeline. EMBASSY COMMENT.  This written assertion is factually 
incorrect.  Over the past two years, Ambassador Mulford has conveyed 
US opposition to the IPI pipeline repeatedly to the Petroleum 
Minister and other senior MEA and GOI officials; and USG officials 
and other Embassy officer have made similar demarches.  END COMMENT 
 
¶2.  (SBU) According to the press report, Minister Mukherjee 
"informed the House that the Ministry of Petroleum 
and Natural Gas (MPNG) has been negotiating the 
pipeline project with Pakistan and Iran. The Sixth meeting 
of the tripartite Joint Working Group was held in 
Delhi on 28-29 June 2007.  Three meetings of the 
India-Pakistan Joint Working Group and five meetings of the 
India-Iran Special Joint Working Group have been held so far. 
Several key issues including price formula, transit fee and 
transportation tariff are under discussion." The article also noted 
that with Pakistan now in a state of emergency, the GOI has 
indicated that it is waiting for the political climate to cool down 
before initiating talks on the transit fees. 
 
¶3. (SBU) In a separate, related development the same day, Congress 
MP Jyotiraditya Scindia, defending the US-India civilian nuclear 
energy cooperation initiative in the face of withering attacks 
during Parliamentary debate by the BJP and Left about the deal's 
supposed erosion of Indian sovereignty, mentioned on-going 
negotiations on the IPI as one of several signs of continued Indian 
sovereignty and independence in foreign policy formulation. 
 
¶4. (SBU) COMMENT:  Post sees Mukherjee's statement as factually 
correct but prudently evasive as a response to a parliamentary 
question, in that: the statement avoids mentioning the GOI's and 
MPNG's continued skepticism toward the IPI negotiations and towards 
Iran's reliability as a commercial partner for long-term energy 
projects; and it is consistent with official statements designed to 
placate public opinion with assurances that the problematic 
negotiations are continuing.  As previously reported India's main 
negotiator for the IPI, MPNG Secretary Srinivasan, did not attend 
the last two scheduled meetings with Iran. 
 
¶5.  (SBU) COMMENT CONTINUED. Moreover, the topics cited as "under 
discussion" have remained over the last two years as central 
stumbling blocks for India's potential agreement to a final deal. 
Post's past reporting has underscored India's frustration with 
Iran's shifting position on pricing and its two-thirds reduction in 
the proposed volume of natural gas deliveries via the IPI as well as 
with Iran's reneging on its other LNG and petroleum exploration 
agreements with India.   Post continues with its long-standing 
assessment that GOI statements, including this 
latest from Mukherjee, are designed mainly to assuage 
public opinion among leftist and Muslim voters who support close 
ties with Iran, and that the GOI and MPNG remain skeptical of Iran's 
reliability as a commercial energy partner. 
 
¶6. (SBU) COMMENT CONTINUED:  The main benefit to the UPA and the 
Congress leadership from the IPI, it seems, is the ability to say, 
as Scindia did, that the talks - however glacial - preserve India's 
cherished independence and national sovereignty over foreign policy. 
 Despite sixty years of independence, many here remain paranoid 
about the evil designs of "imperialist" powers.  The pipeline talks 
play well with the large Muslim vote block and with the many 
socialists and left-leaning members of India's elites.  In their 
view, even if not even one drop of oil comes out of the whole 
pipeline process, the very act of "defying" the U.S. is laudable in 
and of itself.  The UPA, recognizing the need to choose its fights 
carefully, bends to these opinions so it can eak out a much-hoped 
for victory on an agreement of far greater importance to it:  the 
nuclear deal with the U.S. 
MULFORD