U.S. warns India of sanctions over defense deal with Russia

September 23, 2018

TEHRAN - Last week, Narendra Modi government in New Delhi cleared the way for a lucrative $2.2-billion frigates deal with Russia, which came after India had signed a historic defense deal with the U.S.

Trump administration has imposed sanctions on Russia and declared that any country that engages in defense or intelligence sharing with Russia could also be subject to sanctions. So, there was lot of pressure on New Delhi to cancel the deal, but it still went ahead with it.

According to a report in India’s state-owned news agency, the Countering America's Adversaries through Sanctions Act (CAATSA) that imposes sanctions on Iran, North Korea and Russia, has the potential to affect India's defense purchases as it is planning to buy five S-400 Triumf missile air defense systems from Russia for around $4.5 billion.

The purchase of major military equipment like the multi-billion-dollar S-400 Triumf missile system from Russia would be considered as a “significant transaction” and has a potential for imposing tough US sanctions, the Trump administration said on Friday.

Donald Trump on Thursday signed an executive order, paving the way for slapping crippling sanctions on countries and foreign entities and individuals violating the Countering America's Adversaries through Sanctions Act (CAATSA).

A U.S. official, quoted in the report, said that the ultimate target of these sanctions was Russia. “CAATSA sanctions in this context are not intended to undermine the defense capabilities of any particular country. They are instead aimed at imposing costs upon Russia in response to its malign activities,” he said.

“Those malign activities are undertaken to compete with the U.S. and its allies and partners. This is for the first time that the US has sanctioned anyone under Section 231 of CAATSA, which focuses upon, those who engage in significant transactions with entities that appear on the LSP (List of Specified Persons),” the official added.

U.S. Defense Secretary James Mattis, at the recent 2+2 Dialogue in New Delhi, had said that the sanctions aren't intended to adversely impact countries like India. “They are intended to have an impact the sanctioned country, which is Russia."

India and Russia had signed an intergovernmental agreement to proceed with the deal in October 2016, but price negotiations and technical consultations, which also involved the Indian shipyard, delayed the final clearance, which could be one of the big takeaways from the Modi-Putin summit that is scheduled to take place in New Delhi on October 5, a report in Economic Times stated.

The popular opinion in India is heavily tilted in favor of Russia. Brahma Chellenay, a geostrategic and commentator, told Tehran Times that the ties between Russia and India should not be affected by U.S. sanctions. “Russia is a tried and tested friend of India. Although the U.S. has now become the largest seller of arms to India, Russia remains important to India’s interests. India has made it clear to the U.S. that it will go ahead with the S-400 purchase and other defense deals with Russia,” he said.

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