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Iran sanction waiver for India, China irks US Congress

July 18, 2012 14:20 IST

Immediately on its return from the July 4th holiday recess, an angry Republican dominated US House of Representatives has lashed out against the Obama administration for providing India and several other nations waivers from sanctions for cutting its oil imports from Iran, and threatened to take legislative action to rebut the administration's reprieve to these nations, by passing tough new sanctions.

Last month, on the eve of the US-India strategic dialogue, held in Washington, DC, US Secretary of State Hillary Clinton announced that India had been granted a sanctions waiver, and most recently, she also said China would also be granted a similar waiver for significantly decreasing its oil imports from Iran.

But last week, after Congress reconvened, Congresswoman Ileana Ros-Lehtinen, Florida Republican, and chair of the House Foreign Affairs Committee, pilloried the administration's actions in granting India, China and several other countries waivers, and warned that Congress would take the necessary steps to offset the administration's failings and pass tough new US sanctions laws to force the Iranian regime to abandon its nuclear pursuits.

An incensed Ros-Lehtinen said, "Rather than placing Iran on life-support, the administration needs to be willing to pull the plug."

Thus, she said, "It is deeply disappointing that the administration has provided free passes to what the Wall Street Journal referred to as Iran's 20 major trading partners," and predicted, "The administration's actions allow companies in these countries to continue to do business with Iran."

"If we're not willing to sanction Iran's biggest partners, who are we willing to sanction?" she asked.    

Ros-Lehtinen complained, "As a result, the regime in Tehran has more breathing room to continue its nefarious activities, and the deterrent effect of our sanctions is weakened."

She said, "While our current sanctions are having a positive impact, the administration should be working to make them even stronger.  Only when economic pressure on Iran is maximised will the regime be forced to abandon its destructive activities." 

Consequently, Ros-Lehtinen declared, "Congress will again have to lead where successive administrations have failed."  

Besides India and China, the countries which have received exemptions from sanctions are: Japan, South Korea, Singapore, Malaysia, South Africa, Sri Lanka, Turkey, Taiwan, Belgium, Britain, the Czech Republic, France, Germany, Greece, Italy, the Netherlands, Poland, and Spain. 

Ros-Lehtinen is the author of HR 1905, the Iran Threat Reduction Act, which strengthens US sanctions against Iran in order to compel Tehran to abandon its pursuit of nuclear weapons and other threatening activities. The bill overwhelmingly passed the House in December 2011.  On May 21, the Senate passed a version of this legislation. 

Last month, the administration's point man for South Asia, Assistant Secretary of State Robert Blake indicated that India is apparently not completely off the hook with the waiver from the sanctions for importing oil, albeit about 12-15 percent less from Iran than earlier.

Blake, in a meeting with journalists at the Foreign Press Center, where he offered up a read-out of the Strategic Dialogue, asked if the controversy over India's oil imports and the treat of US sanctions that hovered over it was now completely resolved and done with after the waiver by Clinton, said, it was far from over.

"No, no.  We're certainly not done," he said. "And again, this is something that we're asking of all of our partners around the world.  This is not something that's focused on India.  But the current exceptions that have been granted apply for a period of 180 days – so for a period of six months."

Thus, Blake reiterated, "So we're asking all of our friends and all countries around the world to continue to reduce their imports of oil from Iran and to discontinue transactions with the Central Bank of Iran and that there needs to be continued progress on that.  So we hope we'll see that."

"And again, I think that as many others have said, these sanctions have had a real impact, and they've helped to bring Iran to the negotiating table.  And so – and have again helped to dramatically reduce Iranian oil exports from I think a high of 2.5 million barrels to down to a range of 1.2 to 1.8 million barrels a day. So that's quite significant and it's, again, it's just important to keep the pressure on Iran so that they will come and negotiate with in good faith with the P-5+1 and with -- and to continue, again, to work very closely with the IAEA and allow the IAEA access to all relevant facilities inside Iran."

After Clinton announced the waiver, that would have otherwise automatically kicked in sanctions against India and several other countries by month's end, there was a huge sigh of relief by both US and Indian officials because otherwise it would have hung over like a pall over the US-India strategic dialogue. 

On June 11, Clinton said, "Today, I have made the determination that seven economies -- India, Malaysia, Republic of Korea, South Africa, Sri Lanka, Turkey and Taiwan -- all have significantly reduced their volume of crude oil purchases from Iran."

Thus, she said that as a result of her determination, she would report to Congress that these countries and their financial institutions would not be subject to the relevant sanctions that would kick in against countries that had not made significant reductions in their oil imports from Iran as the US had been demanding in order to isolate Iran for its alleged clandestine efforts to develop nuclear weapons.

"We have implemented these sanctions to support our efforts to prevent Iran from acquiring a nuclear weapon and to encourage Iran to comply with its international obligations," Clinton said, and declared, "Today's announcement underscores the success of our sanctions implementation."

She argued that "by reducing Iran's oil sales, we are sending a decisive message to Iran's leaders, until they take concrete actions to satisfy their concerns of the international community, they will continue to face increasing isolation and pressure."

Later at a joint news availability with India External Affairs Minister S M Krishna in the Treaty Room of the State Department after the completion of their discussions as part of the bilateral strategic dialogue, Clinton acknowledged, "We recognise the important energy needs that India has, and we're working with India not only to ensure stable oil markets, but to do more to open up other sources of energy for India."

Sources said that Blake's making clear that India was not off the hook, was because the administration was aware that it would now have to explain to Congress and provide lawmakers with evidence that India and the other countries that had been provided with a waiver, that they has significantly reduced their oil imports from Iran.

Sources told that Clinton would soon have to come before the House Foreign Affairs Committee and the Senate Foreign Relations Committee and convince lawmakers like Ros-Lehtinen on the justification for the waiver and furnish facts and figures of the "significant reductions" undertaken by India and the other countries provided the waiver.

They acknowledged that going by Ros-Lehtinen's angry salvo fired immediately Congress reconvened last week, was a clear indication that Clinton would have her work cut out to explain the waivers, now that the negotiations with Iran seemed to have once again reached yet another impasse, so much so that the administration has imposed additional sanctions against Iran.

On July 12, the administration imposed additional sanctions  on Iran's nuclear and ballistic missile proliferation networks, and took additional steps to prevent the evasion of sanctions by publicly identifying a group of Iranian front companies and banks. These actions, the administration said, "are part of the United States government's dual-track approach of increasing pressure to convince Iran to engage seriously and address the international community's concerns about its nuclear program.

"Iran today is under intense, multilateral sanctions pressure, and we will continue to ratchet up the pressure so long as Iran refuses to address the international community's well-founded concerns about its nuclear program," said Treasury Under Secretary for Terrorism and Financial Intelligence David S Cohen.  "Today's actions are our next step on that path, taking direct aim at disrupting Iran's nuclear and ballistic missile programs as well as its deceptive efforts to use front companies to sell and move its oil."

Aziz Haniffa in Washington, DC