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India dumps old friend Iran for US nuclear carrot

Reuters

Posted: Sep 26, 2005 at 1411 hrs IST

India's unexpected vote against old friend Iran over its nuclear programme stemmed from eagerness to project itself as a responsible nuclear power and safeguard a landmark atomic energy deal with Washington.

Although this will strain traditional ties with Iran, a key supplier of India's oil and gas, the damage could be offset by the emergence of other energy sources, officials and analysts said.

"India decided that a bird in hand is worth two in the bush," Manoj Joshi, editor of a daily newspaper, wrote on Monday.

"While the Iran-Pakistan-India pipeline remains to be negotiated, the Indo-US nuclear agreement is poised delicately in the US Congress," he said.

"Any Indian waffling on the Iran vote would have cost India the agreement crafted with so much difficulty and upon whom India's future energy requirements rest."

In a dramatic diplomatic turnaround over the weekend, India voted for reporting Iran to the UN Security Council over its nuclear plans which the United States and European Union say is aimed at developing nuclear weapons.

Until Saturday's International Atomic Energy Agency (IAEA) vote, India had walked a tightrope between its traditional ties with Iran and a blossoming relationship with the United States.

But with US Congress due to vote on President George W. Bush's decision to help India's nuclear energy programme and Congressmen threatening that the India-US deal would be in danger if New Delhi did not oppose Iran, India had few options.

"TEST CASE"

"This became a test case for our credentials as a responsible nuclear power," a senior Indian government official told Reuters.

"How could we tell the world that we are opposed to proliferation, so give us atomic energy, and then support Iran, especially when we knew the IAEA vote would go through even without us.

"We had to be realistic," said the official, who spoke on condition of anonymity.

But wary of domestic political criticism, New Delhi denies the vote had anything to do with the India-US nuclear deal.

India and the United States, once on opposite sides during the Cold War, grew closer in the last years of Bill Clinton's presidency, and ties were further strengthened after New Delhi quickly backed Bush's war on terror.

Growing cooperation between the two countries has seen them explore huge arms deals and boost diplomatic and economic ties.

The relationship hit a new high in July when they signed a sweeping nuclear pact to help New Delhi with ambitious civilian nuclear plans after India -- a non-signatory to the global Nuclear Non-Proliferation Treaty -- made strong commitments to prevent proliferation.

The deal, however, hit a roadblock over Iran.

Not only do India and Iran share historic links, the Islamic country accounts for more than 5 percent of India's crude oil imports. Iran is also one spot where New Delhi -- a late starter in the global race for petroleum assets -- has met with success in its search for energy security.

ALTERNATIVE SOURCES

India's plans for a $7 billion gas pipeline from Iran through Pakistan did not go down well in Washington, which has pressured New Delhi to abandon it, some analysts say, in return for US help for India's civilian nuclear programme.

Saturday's vote clearly threatens any special treatment India received from Iran.

"Iran has the largest gas reserves in the world. We should have kept a clear corridor with Iran. Now there will be certain goodwill lost," said Vishvjeet Kanwarpal, chief executive of New Delhi-based Asia Consulting Group.

But others point to India's potential nuclear energy output -- which now generates just 3 per cent of its total energy -- as well as the discovery of new gas reserves in India and possible supplies from Iraq once the war-torn country stabilises.

"Like the energy seller has a choice to sell to one or the other country, even a buyer can have a choice to buy from one or the other," said Shashank, a former foreign secretary, who uses only one name.

"Just because Iran is giving us assured, long-term supply of oil, but at market prices, it cannot say: 'Let us do what we want on the nuclear front.' That is somewhat disingenuous."

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