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July 3, 1998


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Japan does not recognise India, Pak as N-weapon states

Japan does not recognise India and Pakistan as nuclear weapon states despite their having conducted nuclear tests, Japanese Ambassador Hiroshi Hirabayashi said on Thursday.

''India and Pakistan are not nuclear weapon states. The Indian government has not asked for that kind of a recognition and we do not recognise them as nuclear states,'' Hirabayashi said at a meeting organised by the Federation of Indian Chambers of Commerce and Industry.

He said the Indian government is right in saying that it has not violated any international agreement by conducting the nuclear tests. ''But these tests have sent negative signals to foreign companies and the non-proliferation system is now faced with danger,'' he added.

He further stated that Japan does not intend to be a third party in resolving the Kashmir dispute. ''We want all the regional (South Asian) disputes to be over but we do not want to be a third party in the Kashmir issue,'' Hirabayashi added.

Regarding the sanctions imposed on India by some developed countries, the ambassador said these would not end soon given the rigid stance being maintained by the Indian government over the nuclear issue.

Though India was the second best investment destination for Japan, the rigid stance maintained by the Indian government was making it uncertain when the sanction by various countries could be lifted.

''While the Indian government maintains that it is confident of facing the sanctions imposed by various countries, the market on the other hand is apprehensive, the value of currency declining, stock prices falling down and government bonds are being downgraded,'' he added.

The nuclear tests, Hirabayashi said, have cast a negative shadow on the Indian economy which has been worsened by swadeshi rhetoric of the present government and the imposition of four per cent additional customs duty in the Union budget 1998-99. ''Given such a scenario, the foreign investors, including those from Japan are adopting a cautious wait and watch attitude while others like the FIIs are even pulling out of the country.''

However, he assured that trade, investment, technical cooperation, assistance to grassroot and non-governmental projects as well as humanitarian aid and disaster relief measures would not fall under the purview of the economic sanctions imposed by Japan.

Tokyo has no intention of discouraging Japanese trade and investment into India. The sanctions could be lifted if India agrees to sign the Comprehensive Test Ban Treaty, he said.

According to the ambassador, outraged by India's action of conducting a series of nuclear tests, Japan has immediately suspended yen loan, soft loans and official development assistance loans except for ongoing projects.

Seeking to clarify the purview of sanctions, the ambassador said, ''It is not true that we have stopped all assistance. These measures do not represent anything more or anything less.'' he further stated that the Exim Bank of Japan has also been kept out of the purview of the economic measures. ''The restriction is only on foreign assistance and that too for new projects.''

The measures were not imposed with any intention to penalise India. It was rather an expression of dismay and disappointment of the Japanese people over nuclear tests.

The ambassador further stated that contrary to the announcements being made by the Indian politicians, the security situation in the region has worsened after the nuclear blasts.

He said the whole rationale of having conducted the tests because of security reasons does not hold any ground. ''You cannot justify this act. No country in the region can afford to attack India and no nation would attack unless provoked to do so. According to reports appearing now, the security situation in India has not improved but has deteriorated. There are more incidents on the Kashmir front now than before.''

However, Hirabayashi stated that the Indian government has been lately sending some positive signals in the form of measures introduced for promoting investment, which includes resolving the government-Suzuki tussle over Maruti Udyog Limited.

The other positive signals, he said, are the assurances by the Indian government that they will also engage in the cut-off of fissile material and that the nuclear technology would not be transferred to any other nation. "But this is not enough,'' he added.

On the economic relations between India and Japan, the ambassador said the current level of bilateral trade stood at around Rs 148.1 billion with Japan's major import items being marine products, gems and jewellery and iron ore. The country, he said, now aims to expand the trade basket and ''structurally transform the existing vertical to a horizontal trade pattern''.


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