Indo-US Relations

U.S. tries to armtwist India on Dow issue

Special Correspondent
New Delhi: A recent exchange of emails between Planning Commission Deputy Chairperson Montek Singh Ahluwalia and U.S. Deputy National Security Adviser Michael Froman, accessed by Times Now, would suggest that the United States is trying to pressure India to take back its demand for 1,500 crore in compensation from Dow Chemicals in the Bhopal gas tragedy case. However, government sources say the emails only prove that the U.S. is exerting pressure, not that the government has succumbed to it.

The revelations come in the wake of the government working on a petition demanding 1,500 crore from Dow Chemicals for the victims of the Bhopal tragedy, following recommendations made by a Group of Ministers on June 22.

According to Times Now, Dr. Ahluwalia emailed Mr. Froman on July 30, just two days before a matter of crucial importance to India was to be reviewed at the World Bank. A copy was also sent to senior bureaucrat Pulok Chatterji, who was earlier with the Prime Minister's Office but is now with the World Bank.

The email, which relates to India's borrowing from the World Bank, says: “We are about to hit the arbitrary single borrower limit in IBRD which will force IBRD to cut new lending to India drastically unless the limit is relaxed. You may remember I had mentioned this as an issue when we discussed the IBRD capital increase in G20. The matter is coming up in the IBRD Board audit committee on Monday. The U.S. is a member. The management wants a relaxation for India. Could you speak to the Treasury to get the U.S. ED on our side? At a time when countries are graduated out of soft assistances it is normal to switch them to IBRD. But we are faced with a sharp reduction. I am asking our ED's office to send you on my behalf a note which will be self-explanatory. Larry will fully understand. Hope you can help.”

Revealing reply

Mr. Froman's reply — the same day — is very revealing: “We are aware of this issue and we will look into it. While I've got you, we are hearing a lot of noise about the Dow Chemical issue. I trust that you are monitoring it carefully. I am not familiar with all the details, but I think we want to avoid developments which put a chilling effect on our investment relationship.”

US nudges India to go easy on Dow Chemicals

NEW DELHI: Ahead of the November visit of President Barack Obama, US has stepped up efforts to push India to drop its demand on Dow Chemicals for Rs 1,500 crore compensation for victims of the 1984 Bhopal gas tragedy.

Senior government sources said that almost at every level, US officials were telling the Indian government to "resolve it and move ahead".

On Wednesday, Times Now, in an exclusive report, said US deputy NSA Michael Froman wrote to Montek Singh Ahluwalia, deputy chairman of Planning Commission, in an email that the "noise" in India over Dow Chemicals could have a "chilling effect" on the India-US investment relationship.

Froman's email came as a response to a request by Ahluwalia for US help in getting India access to more World Bank loans for development. India is the world's biggest recipient of World Bank loans and would be reaching the single borrower limit beyond which it is difficult to access more funds.

In response to this request, Froman said in an email dated July 30, "We are aware of this issue and we will look into it. While I've got you, we are hearing a lot of noise about the Dow Chemicals issue. I trust that you are monitoring it carefully. I am not familiar with all the details, but I think we want to avoid developments which put a chilling effect on our investment relationship."

Apart from the compensation package, the US chemical giant must also be apprehensive of the insistence of the group of ministers on Bhopal tragedy that the polluter must pay for the clean-up of the site of the Union Carbide gas plant in Bhopal and the neighbouring areas.

Dow Chemicals, which took over the US-based Union Carbide Corporation in 2001, claims that it owes no liability for the Bhopal tragedy. It says that the incident happened much before it took over UCC. It also points out that the Indian operations of UCC had been sold off before they took over the US-based parent company.

However, the Indian government's demand for compensation marks a rejection of Dow Chemicals' plea. As does the government's decision to make Dow Chemicals a respondent in existing cases in various courts related to the liability for decontamination of the Bhopal site.

US's activism jars with the anger in India over the denial of justice to the victims of the gas tragedy. "It's typical US short-sightedness," said officials when questioned. No Indian government, they said, can ignore sentiment on such an issue which has been hanging fire for almost a quarter of a century. There is no question of India giving in to the US, they said.

The email exchange between Ahluwalia and Froman occurred two days before India's case with the IBRD was scheduled to come up in World Bank. In the email, Ahluwalia said that while New Delhi enjoys UK's support, it would also need help from US, which is a member of the World Bank audit committee. Ahluwalia said, "The management wants a relaxation for India. Could you speak to the Treasury to get the US ED on our side? At a time when countries are graduated out of soft assistances it is normal to switch them to IBRD. But we are faced with a sharp reduction."

When confronted with the email exchange, Ahluwalia conceded, "It is true that US businesses, US government may be concerned about what is happening on that front." He, however, denied that he had interacted on that issue.

This is the second time in a week that US and India have been on opposite sides of the fence. Last week, the US Congress passed a border security bill that makes H1-B visas more expensive for Indian firms, which New Delhi loudly protested. India's commerce secretary has threatened to take US to WTO on this.

In the run-up to the Obama visit, the level of dissonance between the US and India is rising. There is deep irritation in India that the US has been using India as a punching bag in its domestic politics. Even though in private conversations, US officials seem to be telling their Indian counterparts that the main object is China. But US does not seem willing to take on Beijing publicly, given the depth of their economic relationship along with the fact that China can return the favour.

The US-India relationship doesn't have the same kind of investment, but also India is still hesitant in clarifying its position and its interests to the US. That contributes to a situation where the US believes it can pressure India on sensitive domestic issues without fearing a tough response.

Read more: US nudges India to go easy on Dow Chemicals - India - The Times of India http://timesofindia.indiatimes.com/i...#ixzz0x1GRqk2w

India wins $42 million tax case against NYC

WASHINGTON: It wasn't as easy as Washington sticking a $ 600 million tab on Indian companies through legislation to fund immigration control. A Federal Appeals Court on Tuesday foiled a New York City move to extract a $ 42 million property tax from India on permanent housing for its diplomats in a long and bitter spat that set the city against centre and Washington against foreign capitals.

The dispute has its origins in 1991 decision by New York City to demand property taxes from India and some other countries (in all amounting to more than $ 250 million) on diplomatic housing located in what was deemed commercial buildings in a city once reputed for being the most expensive real estate on the planet.

In India's case, which the city considered most egregious, the dispute centered around its 26-storey building at 235 East 43rd street, where the city alleged the top 20 stories were dedicated to rent free housing for diplomats and security personnel. New Delhi's point that the case rested on reciprocity, with US diplomatic housing in India similarly exempt from taxes, fell on deaf years.

Even Hillary Clinton, who represented NY as senator in 2003 when the city took India to court, backed the city (New York's other senator is Charles Schumer, architect of the immigration bill that stiffed Indian companies with enhanced fees for work visas). Philippines, Mongolia, Turkey, and Hungary were other countries that attracted NYC's wrath.

Read more: India wins $42 million tax case against NYC - India - The Times of India http://timesofindia.indiatimes.com/i...#ixzz0x1GlM8kL

US at it again. Probably UK might have responded the same way after the BP spill.And our pro US manmohan sing who dont at all care about the lives of the people at home will simply blink to the US concerns.When the US own nuclear liability bill is in billions of dollar he got us settled to just some 1500 crores.Manmohan desperately helping US and its companies to make India a live testing laboratory.The funny part is,US wants India to blink about the loss of 15000 Indians in Bhopal tragedy,who knows whats gonna happen with the reactors constructed by US companies?India has to even blink on the new visa rules and fees,yet US wont even accommodate itself to consider India`s concerns.Why the heck are we still naive into buying of billions of dollars of US weapons?

Bhopal case: US Deputy NSA warns of chill in investment

NEW DELHI: The US appears to be piling pressure on the Manmohan Singh government for providing relief to Dow Chemicals. In an e-mail to Planning Commission deputy chairman Montek Singh Ahluwalia, US deputy National Security Advisor Michael Froman, warned that India’s emphasis on Dow could have “a chilling effect on the investment relationship” between the two countries.

Mr Froman wrote this on July 30 in reply to an e-mail from Mr Ahluwalia seeking US support for borrowing from World Bank. “We are hearing a lot of noise about the Dow Chemicals issue. I trust that you are monitoring it carefully. I am not familiar with all the details. But I think we want to avoid developments which put a chilling effect on the investment relationship,” Mr Froman wrote in the e-mail to Mr Ahluwalia. In other words, New Delhi, which seeks US help, should be sensitive to its concerns.

In his e-mail to Mr Froman, Mr Ahluwalia had sought American help at the World Bank meeting. “I wonder if I can enlist your help on a matter relating to India’s borrowing from the World Bank. We are about to hit the arbitrary single borrower limit in IBRD which forces IBRD to cut new lending to India drastically unless the limit is relaxed. You may remember I had mentioned this as an issue when we discussed the IBRD capital increase in G-20. The matter is coming up in the IBRD board audit committee on Monday. The US is a member. The management wants a relaxation for India. The British prime minister was in Delhi yesterday. We raised it with him and he said that the UK ED would be instructed to support us. Could you speak to treasury to get the US ED on our side? At a time when countries are graduated out of soft assistance, it is normal to switch them to IBRD. But we are faced with a sharp reduction...Larry will fully understand. Hope you can help,” Mr Ahluwalia had said in his mail to Mr Froman.

In a subsequent communication, Mr Ahluwalia briefed Mr Pulok Chatterjee, ED at World Bank, about Mr Froman’s demand to go soft on Dow. While agreeing that quid pro quos are not unknown, he conceded that meeting the demand on Dow could be difficult. “There is always a quid pro quo though I fear on this we are helpless,” Mr Ahluwalia wrote to Mr Chatterjee on July 30. ET is possession of the copies of the e-mail.

In 1999, Dow bought Union Carbide, whose pesticide plant in Bhopal leaked a poisonous gas which has killed more than 15,000 people. The Madhya Pradesh high court is considering a suggestion that Dow should be made to deposit `100 crore to fund the removal of the tons of toxic waste that still lie in and around the Carbide plant.

http://www.state.gov/r/pa/prs/dpb/2010/08/146103.htm

Statement by Mike Froman, Deputy National Security Advisor

August 19, 2010

With regard to recent reports about my private correspondence with Mr. Ahluwalia, I want to make clear that I was not making any link between what are two separate and distinct issues nor issuing a ‘threat’ of any sort – any assertion to the contrary is absolutely wrong, both in intent and in fact.

I am dismayed to think that anything I wrote could be interpreted as minimizing the toll of the Bhopal disaster. The human suffering as a result of Bhopal is a terrible tragedy. Resolving the Bhopal issue is for the Indian people to decide. The U.S. does not seek to interfere in this process.

I value the opportunity I have to work with Mr. Ahluwalia and others in India to strengthen and deepen the ties between our two countries, both bilaterally and through the G20. Such efforts are key to building our strategic partnership and facing our common challenges together for the benefit of both our peoples.

Border security bill discriminatory: India to US

WASHINGTON: The provisions of the border security bill, which allows massive increase in the fees on on categories of H-1B and L1 visas, is discriminatory against the Indian companies, India has said and asked the United States to amend it.

Indian Ambassador to the US Meera Shankar had lodged an official protest to the US Trade Representative Ambassador Ron Kirk in a letter dated August 9, about five days before Obama signed the border security bill into law ignoring India's concerns.

The letter, a copy of which is in possession, has been sent this week to the US Congress informing the lawmakers the views of Indian Government on the issue.

The US President Barack Obama, last week, had signed the bill into the law.

"We feel that the 'pay for' provisions of the Bill are not in keeping with the substantive cooperative agenda which the two governments are pursuing. We would ask that those provisions of the Bill that discriminate against companies of Indian origin may be suitably amended to create a level playing field for all companies," Shankar said.

The 'pay for' provisions of the Bill, Shankar said, stipulate that the amount for the security of US-Mexico border would be provided through higher fees on H1B and L visas from those applicants who employ 50 and more people and 50 per cent of whom are non-immigrants in H-1B or L visa categories.

"Even though the Bill doesn't mention Indian companies specifically, the manner in which it is currently worded appears to be aimed at Information Technology companies from India, creating an unequal playing field," Shankar said.

"The impact on Indian companies of the higher fee increases would be substantial. While we appreciate and understand the US desire to strengthen Border Security, we have concerns about the proposed funding mechanism," the Indian Ambassador said days ahead of the bill being signed.

However, the Obama Administration decided to ignore the concerns of India on this issue.

Noting that India and the US have a Strategic partnership and the trade and economic engagement is deepening and widening, she said Indo-US overall trade in goods and services is balanced.

"Indian leadership is looking forward to a successful visit of the US President later this year. Indian Industry has played a constructive role in the US economy. Several Indian companies have invested billions of dollars in the US economy and have created thousands of jobs in the US. Bilateral trade creation, especially in high technology trade, including in Civil Aviation and Defense, is responsible for further job creation in the US economy," Shankar said.

There was no immediate response from the office of US Trade Representatives.

Read more: Border security bill discriminatory: India to US - India - The Times of India Border security bill discriminatory: India to US - India - The Times of India

Obama is now revisiting the Nixon-Kissinger Saga.

A little romance in Indo-US tango


A little romance in Indo-US tango | The Asian Age

Indo-US strategic ties won't be easy, feels Brajesh

India's growing strategic partnership with the US is never going to be easy as New Delhi might have to say 'no' to Washington on some occasions, former National Security Advisor Brajesh Mishra believes.

Mishra, a close aide of former Prime Minister Atal Bihari Vajpayee, said India had said 'no' to the US on some issues like not agreeing to send troops to Iraq, and opening a number of consulates in Afghanistan even after Washington had advised against it.

"A superpower forces its agenda on others and if you want to talk with it, you will have to accommodate some of its concerns," he said at a brainstorming session on the Indo-US Strategic Partnership organised by the Indo America Friendship Association.

He said the relationship between a superpower and a country like India, which has had a tradition of following an independent foreign policy, is therefore "never going to be easy... For sometimes you will have to say no".

He also said there is resentment in India on certain American policy issues, particularly related to Pakistan.

"In this country there is resentment. US Af-Pak envoy Richard Holbrooke has talked about Kashmir, and in saying that wishes of Kashmiri people should be taken into view have endorsed Pakistan's point of view," he pointed out.

He also said that the US might be a friend of India, but its policies towards Pakistan have had the same adverse impact on New Delhi as that of China, a manifestation of the fact that the strategic partnership is not going to be easy.

"China has been cooperating with Pakistan politically, military and economically, and so is the US... Having the same adverse impact on India... In India too there is a certain view that going with the US is full of risks," he said.

He warned that all the billions of dollars flowing into Pakistan to "strengthen democracy" are not going to help as equal importance is also being given to Pakistani Army, whose supremacy in the country depends upon the "enmity with India".

He said despite common strategic interests to keep the Taliban away in Afghanistan, the way the situation is being handled might take the country back to 1996.

Speaking during the session, former Indian Ambassador to Washington, Lalit Mansingh described the upcoming visit of President Barack Obama as a 'make or break' said and its success depends on him bringing in "deliverables" like progress on dual technology exports.

He said a feeling of being sidelined in the political settlement of Afghanistan, the recent H1B visa fee hike issue and export controls are some of the irritants in bilateral relationship.

State adds new official for India policy

Posted By Josh Rogin Wednesday, August 25, 2010 - 5:13 PM Share

State Department sources confirm that Alyssa Ayres will soon come on board as deputy assistant secretary in the Bureau of South and Central Asian Affairs, covering U.S. policy toward India.

Ayres worked at State during the latter years of the Bush administration as a special assistant to then under secretary for political affairs Nicholas Burns and she was involved in the crafting of and negotiations surrounding the U.S.-India civilian nuclear agreement. Since then, she has been leading the India and South Asia practice at the consulting firm McLarty Associates, according to her personal website. Last year, she authored a book on language and nationalism in Pakistan entitled, Speaking Like a State.

The position had been widely expected to go to Georgetown professor Christine Fair, but Fair took herself out of the running late last year for reasons that remain unclear.(So Chtrostine Fairs Balochistan lies became her waterloo or is it that indian pressure which made her/obama admin to back off) Ayres will report up to SCA's assistant secretary, Robert Blake.

Ashley Tellis of the Carnegie Endowment for International Peace, who has worked with Ayres, praised the choice while simultaneously lamenting the fact that it took the Obama administration more than 18 months to fill the slot.

"She has worked in the government before, she understands the importance of India strategically, and her heart is in the right place," he said. "This is a smart decision they've made, even if they've made it late."

Some in the State Department wondered privately why the administration didn't choose someone with more solid Democratic Party bona fides, as Ayres has only worked for a Republican administration. But Tellis said she is no ideologue and is eminently qualified.

"That she worked in a GOP administration is completely accidental because she came into government through a fellowship program from the Council on Foreign Relations," he said.

According to her McLarty bio, Ayres speaks fluent Hindi and Urdu and previously worked for the International Committee of the Red Cross as an interpreter in Jammu and Kashmir. She received an A.B. magna cum laude from Harvard, and an M.A. and Ph.D. from the University of Chicago.




her website....

http://alyssaayres.com/content/articles/

N-Bill to boost US economy: Reports
Describing it as a personal victory of Prime Minister Manmohan Singh before the visit of US President Barack Obama to India, American media on Thursday said the passage of the Nuclear Liability bill would pave the way for much needed foreign investment in the crucial atomic energy sector of the country.
"With the passage of the bill, Prime Minister Manmohan Singh emerges politically stronger, demonstrating a resolve to push the deal through ahead of US President Barack Obama's visit this year," The Wall Street Journal said.

"The bill will enable US companies to compete with state-run European rivals as India is expected to invest more than USD 100 billion in nuclear power," the newspaper said.

The Lok Sabha on Wednesday passed the Civil Liability for the Nuclear Damages Bill after government dropped the contentious provision of "intent" in case of accidents, ending months of wrangling between treasury benches and the Opposition.

"If the bill is passed by the Upper House of parliament as expected, it will start to open the door for overseas companies," The Journal said.

"Passage of the nuclear bill was a personal victory for Prime Minister Manmohan Singh, who forged a deal in 2008 giving India access to international nuclear technology, ending isolation imposed after it tested a nuclear weapon in the late 1990s," reported the Los Angeles Times.

"The Obama administration, having convinced many US allies that India was a reliable nuclear power that would not contribute to the proliferation of weapons, reportedly sought passage of the bill in advance of the president's trip," the daily said.

"The passage by the Lok Sabha — House of the People — ahead of a scheduled November visit by President Obama is seen as a personal victory for Prime Minister Manmohan Singh, who signed the landmark civilian agreement with President (George W) Bush in 2008," said The Washington Times. America's General Electric Co and Westinghouse Electric Corp are among the foreign energy suppliers that stand to gain a share of India's civilian nuclear business, estimated as possibly reaching $150 billion a year, it said.

"American companies consider a liability cap particularly important because, unlike the state-subsidized French and Russian nuclear suppliers, they are not underwritten by their government," it added.

What is Obama trying to achieve in this trip?? nothing is clear. What's the big deal if he visits Golden Temple?? After all he was to CHICKEN to visit the Dalai Lama.

http://www.telegraph.co.uk/news/worl...ina-happy.html
Barack Obama cancels meeting with Dalai Lama 'to keep China happy'

Maybe even the GOI is also puzzled on same so making several rounds of DC visits. How many Indian-origin votes Obama will be able to secure by pleasing Sikhs? LOL.. Whatever is that number, won't be enough to save him IMO.

GOI is again hoping for UNSC seat promotion but I think Obama is more interested to give speeches & act like Global Peacemaker by visiting CST/Taj Hotel.

This will be a useless trip a waste of taxpayer money, he is just trying to push US planes in the MRCA.