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FM AMEMBASSY WELLINGTON
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C O N F I D E N T I A L WELLINGTON 000257 
 
SIPDIS 
 
STATE FOR EAP/ANP 
 
E.O. 12958: DECL: 08/19/2023 
TAGS: PARM PREL ETTC NZ
SUBJECT: NEW ZEALAND HAS CONDITIONS FOR US-INDIA DEAL 
 
REF: STATE 85948 
 
Classified By: DCM David J. Keegan; Reason 1.4 (b) and (d) 
 
¶1.  (C)  In an August 20 meeting between the Ambassador and 
Minister for Disarmament Phil Goff, the Ambassador pointed 
out the strategic and historic importance of the US-India 
deal, and the very real possibility that the Indians could 
shelve it if the NSG demands proved too politically difficult 
for the GOI. 
 
¶2.  (C)  Goff responded that New Zealand strongly supports 
the objectives the U.S. had in negotiating the US-India 
Civilian Nuclear Cooperation Initiative.  It does not want to 
be "unnecessarily obstructive" in reviewing the deal in the 
Nuclear Suppliers Group (NSG), but he said that the GNZ sees 
a downside to an India exemption.  Other countries gave up 
nuclear programs and signed the NPT; that raises the prospect 
of a double standard if India gets something without being 
held to the same criteria, noted Goff.  However, because New 
Zealand recognizes that this deal represents an opportunity 
for the international community, the question is how to get 
an NSG agreement that does not negatively impact on the 
global nonproliferation regime. 
 
¶3.  (C)  Goff outlined five areas where New Zealand had 
concerns which it needed addressed before it could support 
the proposed initiative and approve the exemption for India: 
 
--  The first area is nuclear testing; New Zealand wants to 
add language that would extend to all NSG states the Hyde 
Act's sanctions in the event of a future Indian nuclear test. 
 
 
--  New Zealand would like to see the IAEA Additional 
Protocol established as a condition for supply of nuclear 
materials to India. 
 
--  New Zealand wants measures in place to restrict the 
transfers of sensitive technology, such those related to 
enrichment and reprocessing.  The GNZ concern is the 
possibility of India engaging in nuclear proliferation 
activities for military purposes. 
 
--  The GNZ believes a review and reporting mechanism should 
be in put into place, perhaps to occur every two years. 
 
--  If India unilaterally terminates the safeguards 
agreement, the return of nuclear fuel and supplies should 
apply to all NSG countries. 
 
Goff said that he thought the U.S. would share the same 
objectives that led New Zealand to propose these conditions. 
However, New Zealand suspected that others -- he named France 
and Russia -- might allow commercial interests to outweigh 
non-proliferation concerns.  These conditions would make that 
more difficult. 
 
¶4.  (C)  Goff explained that New Zealand does differentiate 
India from Pakistan on nonproliferation matters and accepts 
that India has been a better nuclear citizen despite 
remaining outside the Non-Proliferation Treaty (NPT), 
although he criticized India's nuclear testing record and 
military weapons program.  And while New Zealand is "not a 
great fan of nuclear energy," Goff allowed that New Zealand 
is blessed with other options.  He noted that the GNZ 
understands that other countries' energy security and GHG 
emission profiles are different and New Zealand does not want 
to stand in the way of their pursuit of legitimate energy 
needs. 
 
¶5.  (C)  Goff regretted that he was out of the country during 
Secretary Rice's July 26 visit to Auckland, and would have 
liked to engage with her on the India deal.  He said that New 
Zealand appreciates the USG desire for a clean exemption and 
India's domestic political situation, but that New Zealand 
and like-minded countries such as Ireland, Sweden, Norway, 
and the Netherlands want to ensure that this is the best deal 
possible.  He said that an NSG discussion will be focused on 
possible changes to the text to reflect the concerns of the 
like-minded group, and that a second meeting will be likely. 
New Zealand, he continued, will go into the meeting with 
flexibility but must adhere to its bottom lines.  If there is 
no flexibility on addressing New Zealand's concerns, it would 
be very difficult for New Zealand to support the deal, said 
Goff. 
 
¶6.  (C)  Separately, Ministry of Foreign Affairs Deputy 
Secretary Caroline Forsyth (who heads the disarmament group 
at MFAT) told us that Goff had outlined these five areas to 
the GOI delegation that visited New Zealand recently, and 
none of them balked at the prospect of having to address 
these issues at the NSG meeting. 
 
¶7.  (C)  Comment.  Minister Goff clearly understood the 
emphasis the Ambassador placed on the strategic and 
historical importance of the US-India deal, and the 
possibility of the Indians walking away if the NSG demands 
are politically impossible for New Delhi.  However, New 
Zealand is on the cusp on an election and Phil Goff's party 
(Labour) is seriously lagging in the polls.  It would be 
political suicide for Goff, who is touted as the next Labour 
Party leader should Helen Clark lose this election, to appear 
soft on a core policy plank for Labour like nonproliferation. 
 Goff emphasized at the end of our meeting that he would be 
meeting later this week with the Prime Minister and the 
Cabinet to review this issue.  Another factor in Goff's 
assessment of the necessity to be tough with India in the NSG 
is his experience during the WTO Doha negotiations as Trade 
Minister.  Goff was clearly frustrated with India and its 
adamant refusal to compromise during the recent WTO sessions. 
   End Comment. 
McCORMICK