NEW DELHI: In early July, India and US get ready for a ‘2+2’ dialogue between the foreign and defence ministers, US’ linkage of sanctions on Russia with India may bring the two countries to a very uncomfortable place, making the first high-level interaction potentially difficult. For the first such dialogue Sushma Swaraj and Nirmala Sitharaman are expected to travel to Washington, which has been postponed a couple of times.
Using the precedent of the previous sanctions regime, India can hope to negotiate a carve-out for Chahbahar port in forthcoming Iran sanctions, the extreme nature of the CAATSA sanctions regime would make it impossible for India to follow. Recent reports said In October, before the official summit India and Russia had completed price negotiations for the Rs 40,000 crore S-400 Triumf anti-missile defense system, and IS likely to announce about it.
As per Indian officials, the sanctions regime could kick in on any defence buys above $15 million, which is really small change in defence transactions. The deal may go through finding a way around CAATSA (Countering America’s Adversaries Through Sanctions Act) which mandates the Trump administration to punish entities engaging in a significant transaction with the defence or intelligence sectors of Russia.
India and US are preparing for some friction on that front, with the US threatening to remove preferential trade privileges for India, although the economy czars of both countries are not going to be at the dialogue.