Day after, a sobering reality check

US blacklists two Indian firms for missile business with bad boy Iran

A DAY after the US House of Representatives passed the legislation on the India-US nuclear deal, the US administration blacklisted two Indian private companies for selling missile-related technologies to Iran.

Under the US administration's statutory requirements, the companies will be reported to US Congress -- likely next week.

Sanctions will be imposed on the two companies and they will be prevented from conducting trade with the US or any US company for a two-year period, under the Syria-Iran Non-Proliferation Act of 2005. Sources said the companies have been sanctioned for selling missile-related technologies, formally categorised as trading in "dual-use technologies" that can "contribute to WMD programmes" (creating weapons of mass destruction). Under the US law, the State Department is required to keep Congress informed about companies that have been "trading in dual use technologies that can be diverted for making WMDs", sources said.  That the issue has come up now was "purely coincidental" and had nothing to do with the timing of the House vote, they said.

The Bush administration's embarrassment at the timing of the development is clear from efforts to project the sanctioning of the companies as "purely coincidental" and "not India-specific".

These companies have not been placed on the 'Entities List', which applies only to government organisations and companies, sources said. This is not the first time that Indian companies have been reported in the US. Last month, two private companies making chemical products, Sabero Organics Gujarat Ltd. and Sandhya Organics Ltd., were among nine foreign companies placed under sanctions for selling chemicals to Iranian firms.

Meanwhile, in an effort to blunt the attack on the Indian government, the Bush administration has released a Statement of Administration Policy, welcoming the passage of the bill on the nuclear deal in the House, and also expressing concerns. The statement, released by the office of the US president, speaks of concerns -- exactly reflecting Indian concerns -- relating to Section 4(d), Section 3, Section 49(c) and (o) of the House bill (H.R.5682).

According to analysts, this means the Bush administration has "carefully noted" Indian core concerns and projected them as their own.

They make two key statements of policy: there would be no re-negotiation of the July 18, 2005 agreement between India and the US, and civil nuclear cooperation with India was "not conditional on New Delhi's policies towards Iran".