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India to seek Iran oil waiver when Pompeo visits, US is hoping to foil S-400 missile deal

Iran oil and India's S-400 deal with Russia are likely to dominate the discussions when US Secretary of State Mike Pompeo visits next week.

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New Delhi: Oil from Iran and Russia’s S-400 Triumf missile system will top the talks agenda when US Secretary of State Mike Pompeo arrives in India next week, official sources told ThePrint.

The two issues have emerged as new irritants in India’s relationship with the US amid efforts by the latter to punish those doing business with countries Washington sees as adversaries, namely, Iran, Russia and North Korea.

According to the sources, as Pompeo lands in India ahead of the G20 Summit in Osaka, India is expected to once again try to convince the US to let it resume buying oil from Iran. Washington, meanwhile, will attempt to get New Delhi to abandon the S-400 missile deal with Russia, the sources added.

While these topics are likely to dominate the discussions, issues concerning trade and visas will also be touched upon, the sources said.

Pompeo, who will be in India between 25 and 27 June, is scheduled to meet Prime Minister Narendra Modi and External Affairs Minister S. Jaishankar on 26 June, with other meetings in the pipeline too.

This will be the first such high-level engagement of the Modi government since coming back to office in May.

Pompeo’s visit will set the ground for a bilateral meeting between Prime Minister Modi and US President Donald Trump on the sidelines of the G20 Summit, which will be held on 28-29 June in Japan.

Also read: India rejects Pakistan media reports on talks, says first environment must be terror-free

‘A challenge to India-US technology transfer’

The Modi government stopped buying oil from Iran on 2 May after a “waiver” granted to New Delhi by the US, which is locked in a fresh spate of tensions with Tehran under Trump, expired.

However, Iran remains a strategic partner for India and New Delhi believes continued oil trade with Iran is imperative.

The US has also expressed its discontent with India’s plans to complete its $5.4 billion purchase of the S-400 Triumf air defence system from Russia. The Trump administration has already slapped China with sanctions under the Countering America’s Adversaries Through Sanctions Act (CAATSA) for buying the missile system from Russia, with Turkey likely to face blowback too.

“S-400 and Iran oil will come up and Delhi will likely make its case to be spared from any US punitive measures on both,” said Michael Kugelman, deputy director of the Asia programme and senior associate for South Asia at the Washington-based thinktank Wilson Centre.

“The US has suggested previously that it may give India a pass on the S-400, and so the Indians will likely want to get more assurances from Pompeo,” he added.

“The S-400 is a giant Russian radar that, if located in continuous proximity to American stealth technology, would reveal the secrets of that stealth and compromise it,” said Benjamin Schwartz, head of aeropsace and defence at the Washington-based US-India Business Council.

“Indian Acquisition of the S-400 would, therefore, challenge increased technology transfer to the Indian military,” he added.

‘Data localisation remains a concern for US firm’

Yet another subject Pompeo might push India to relent on is the Modi government’s directive that multinational firms establish their data servers in India instead of storing local information abroad.

“Talks are going on between both countries on the issue of data localisation. We continue to remain engaged with the US on this issue,” Ministry of External Affairs spokesperson Raveesh Kumar said at a media briefing Thursday.

Earlier this week, Commerce & Industry Minister Piyush Goyal met stakeholders for discussions on e-commerce and data localisation, including the ownership and sharing of data as well as the costs of its cross-border flow.

“The data localisation issue is significant. It’s a big concern for US companies, and I’ve heard American officials single it out as a top issue,” said Kugelman. “So there will be discussion on this front.”

Also read: Japan plans to start bullet train services in 5 more Indian cities

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  1. Another issue of concern is the talk about restricting H 1 B visas for one country – read India – to about 10 – 15% of the annual figure of 85,000. At present, India accounts for 70%. This facility helps Indian IT firms service US clients more efficiently.

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