US Senate passes bill with amendment in CAATSA, under which India may get waiver from US
John McCain National Defence Authorization Act-2019, named after the Chairman of Senate Armed Services Committee, John McCain, was passed by the US senate with vote of 87 to 10. After certification from President Donald Trump, this bill will become a law.
Section 231 of CAATSA has been modified in this bill. Under which some countries, including India, can get waiver from CAATSA sanctions on buying arms from Russia.
Former US National Security Council officer, Joshua White said, “The CAATSA waiver that the Congress has made available to India in the 2019 National Defense Authorization Act should provide ample flexibility for New Delhi to proceed with the purchase of the Russian S-400 system.”
Here’s the most detailed info yet on the CAATSA waiver, from the NDAA Joint Explanatory Statement. With the caveat that it’s still a summary of unreleased text, the good news for India-watchers is that it contains loopholes within loopholes. (1/6)https://t.co/WWnKwAwIpb pic.twitter.com/y65T8cJrhU
— Joshua White (@joshuatwhite) July 24, 2018
He said, “The legislative language is designed to look very tough, as though the Congress is tightening its secondary sanctions on countries that procure Russian equipment. In reality, the language contains multiple loopholes that benefit India.”
White further said, “The most significant (such) loophole allows the President to certify that a country is cooperating with the United States Government on other matters that are critical to United States strategic national security interests. As certifications go, this one is relatively easy to justify in the case of India.”
— Business Line (@businessline) August 2, 2018
Under CAATSA, which was signed by President Trump in August last year, there is provision to put sanctions on countries that purchase arms from and trade in energy sector with Russia, Iran and North Korea.
Latest updates: Tuesday, July 31, 2018
US granted STA-1 status to India
On Monday, July 30, 2018 US Secretary of Commerce, Wilbur Ross said that US has simplified export control of high technology products to India by granting India Strategic Trade Authorization status STA-1. The STA-1 status given to India is equivalent to the status given to Japan, South Korea, Australia and NATO by US.
At an event of US Chamber of Commerce, Ross said, “STA1 provides India greater supply chain efficiency, both for defence, and for other high-tech products.”
— India in USA (@IndianEmbassyUS) July 31, 2018
Indian ambassador to US, Navtej Sarna said in the same event, “It is a sign of trust, not only in the relationship, but also (in) Indian’s capabilities as an economy and as a security partner, because it also presupposes that India has the multilateral export control regime in place which would allow the transfer of more sensitive defense technologies.”
Status of STA-1 granted to India, indicates the growth of defense trade among India and US. At the same time this can also be seen as a US strategy to counter Russia’s influence in the region by reducing India-Russia defense trade.
Latest Updates: Tuesday, July 24, 2018
India to get waiver from US on defence purchase from Russia
As stated in our previous article on, “Will India US relations survive? (2018 Latest Update + Our Prediction)”. Here’s one more article depicting the same.
On Monday, July 23, 2018 the U.S. Senate and House Armed service Committee agreed on the final version annual Defense Policy Bill, which would amend the US’ CAATSA (Countering American Adversaries through Sanctions Act) act. Under this, India, Indonesia and Vietnam are chosen for waiver from sanctions and they will be able to continue to buy Russian military equipment.
US Defense Secretary Jim Mattis said on Friday about the sanctions on India under CAATSA, “The fundamental question we must ask ourselves is: Do we wish to strengthen our partners in key regions, or leave them with no other option than to turn to Russia, thereby undermining a once-in-a-generation opportunity to more closely align nations with the US vision for global security and stability.”
After cancelling the 2+2 dialogue, that was to be held on July 6, 2018, by the United States, India announced to not bow under US pressure and to go ahead for purchase of S-400 air defence missile system from Russia. Also, the Indian foreign minister Sushma Swaraj declared beforehand, that India will follow only UN sanctions not the unilateral sanctions imposed by any specific country like US.
But, India is still not completely safe from US sanctions. The amendment in CAATSA has not been explicitly stated yet and under which India can be forced to comply with many other rules. This is required to keep India out of US sanctions which may not be in the interest of India, such as not to minimize the oil import from Iran to zero and not to do trade with Iran and other sanctioned countries.
If India does not follow and comply with the rules of the CAATSA amendment, as it is the internal law of US, it may not be in the national interest to India. Furthermore, the US may put sanctions on India if India goes ahead to buying arms from Russia.
Monday, July 16, 2018
Will India US relations survive? (2018 Latest Update)
India-US relations reached at its heights during Obama administration with US’ approval to India as growing world power. There are ups and downs in Indo-US relations after President Trump took the office. Indian leadership and Trump administration has differences over India’s relations with Russia, Iran and China. Changes in Visa rules by Trump administration, start of trade war by imposing tariffs on steel and aluminum by president Trump and repeatedly postponing the 2+2 dialogue with India by US shows that in the time of changing geopolitics all is not well in India-US relations.
On July 10, 2018 when Foreign secretary of US, Mike Pompeo, said to Sky News that some countries will come to US to get relief from sanctions on Iran, we’ll consider it. When he was questioned that what if some countries continue to trade oil with Iran and violate US sanctions after sanctions will be in effect? Pompeo’s signal was intended towards countries like India. In our previous article ‘Why India will do oil business with Iran even after US sanctions’ we mentioned about India’s stand on trade with Iran after US sanction on Iran.
US’ permanent envoy to UN, Nikki Haley was on visit to India on June 26-28, 2018. As per media reports, Nikki Haley suggested India to rethink about its relations with Iran and pressurized to reduce its oil import from Iran. Nikki Haley is known for its hard line approach towards Iran and Russia. Nikki Haley’s visit to India should have been to strengthen the Indo-US relations but the results seemed just opposite.
The U.S. Mission in India was honored to host Ambassador Nikki Haley in #NewDelhi last week. Here are some highlights of her visit. #AmbHaleyinIndia #USIndia70 @USUN @NikkiHaley pic.twitter.com/SyaoCkW9Tf
— Ken Juster (@USAmbIndia) July 2, 2018
India was forced to reduce the oil imports from Iran when US sanctions were in effect before JCPoA was signed in July 2015. During that time India used Rupee-Rial payment mechanism to bypass dollar payment system to make direct payment of oil imports from Iran.
Long time awaited 2+2 dialogue that was to be held on July 6, 2018 between Defence and Foreign ministers of India and US was again postponed by US indefinitely. Later, the defence secretary of US said that it may be in September 2018. Regarding postponement of 2+2 dialogue that was scheduled for July 6, 2018, Nikki Haley said in a TV interview that Prime minister Narendra Modi knows that why the dialogue was postponed.
Trump administration is not happy with India’s move to purchase S-400 missile defence system from Russia. US is preparing to impose sanctions under CAATSA (Countering America’s Adversaries through Sanctions Act) on countries that will purchase weapons and have defence deals with Russia and therefore, India is also under the threat of US sanction. If the meeting between Trump and Putin on July 16, 2018 goes well and if the common consensus prevail, then the pressure on India may be reduced. If it happens then India will not take any action that may harm enduring India Russia relations. India will also not become the victim of a specific internal law of US.
Recently US imposed 25 % and 10 % tariffs on Indian steel and aluminum, in retaliation India also increased import duties on 29 products of US. US has trade deficit of $ 31 billion with India and imposed tariffs to reduce the trade deficit.
On July 10, 2018, Defence minister of India, Nirmala Sitaraman said to media in Delhi that India is going ahead to purchase S-400 missile defence system from Russia, the defence deal with Russia is in the final stage and India is not bound to any internal law of US. Before this, India had declared that India will follow only UN sanctions and not to the sanctions unilaterally imposed by any specific country.
— Times of India (@timesofindia) July 13, 2018
US has changed laws related to Visa that will affect Indians working in US and under these changed laws for H1-B and H4, visa holders will be affected. Those whose visa will not be extended, they will be forced to deport from US.
India gives importance to its relations with US but not at the cost of its relations with other countries. India will not follow US sanctions on Iran and Russia and will not bow under US pressure. India will follow only UN sanctions. To maintain strategic partnership with India, US has to address its concerns. In the time of fast changing geopolitics there will be changes in India – US relations and these changes will bring challenges as well as opportunities for India.