India Withdraws Request to World Bank for Funding in Arunachal Pradesh

March 6 (EIRNS)—In what is considered by many in India as a volte face, India's executive director for the World Bank, Pulok Chatterjee, conveyed to the Bank on Feb. 12 that India will not seek bank funds for any project specific to the state of Arunachal Pradesh.

Months ago, when India sought World Bank funding for some infrastructure projects in Arunachal Pradesh, which is included in the ongoing Sino-Indian border talks, China objected, calling Arunachal Pradesh a "disputed territory" and saying that the proposal, if entertained by the Bank, would be tantamount to international acceptance that the state is "an integral part of India." China also reacted sharply when Indian Prime Minister Manmohan Singh visited Arunachal Pradesh about eight months ago.

During the verbal skirmishes with Beijing at the time, New Delhi had said that China has no business to interfere in the affairs of a territory that is an integral part of India.

The Feb. 12 meeting was attended by China's executive director for the World Bank Shaolin Yang, the Bank's general counsel (legal), and its vice-president for South Asia, and Chatterjee. The Indian representative, on his own, offered not to name individual states in the project document or seek World Bank assistance for projects to be implemented in Arunachal Pradesh. He said that these were national projects, under implementation for many years, and that the World Bank assistance was by way of budgetary support. "Both these projects received World Bank assistance earlier without the disclaimer clause being triggered and without any objection from China.... [T]he present assistance being considered was more like additional financing of the earlier projects," he argued.

New Delhi's Re-Think on the Afghan Situation

March 6 (EIRNS)—Discussions have begun at the top level of India's government to open talks with Pakistan's Inter-Services Intelligence (ISI) and the Afghan Taliban, in light of evidence that U.S.-NATO troops are losing ground rapidly, and that the Obama Administration is now looking at bringing the Taliban in to share power in Kabul. Indian National Security Advisor Shivshankar Menon is now in Kabul, ostensibly to investigate the latest attack on Indian citizens there; he reportedly holds this view.

The re-think on New Delhi's behalf stems from a number of factors. There is a realization that with the deterioration of the Afghan security situation, and further weakening of support for President Hamid Karzai by the U.S. and NATO, the control of Afghanistan is steadily slipping into the hands of the Pakistani Army and ISI, and the Taliban. India, having invested about $1.7 billion into various infrastructure projects in Afghanistan, is now fearful that if it does not quickly build ties to the ISI and the Afghan Taliban, India may become irrelevant in the future Afghanistan. India is also considering paring down its reconstruction projects in Afghanistan, however. Projects underway may be wrapped up quickly, and there may be even a freeze on new projects. Pakistan has made clear that a strong Indian presence in Afghanistan poses a security threat to Islamabad.

According to media reports, the advice to engage with sections of the Taliban and start a limited and regulated dialogue with the ISI came from the Indian Prime Minister's Office. The advice is controversial, but stems from India's need to ensure that Afghanistan is not handed over on a platter to Pakistan. India is also considering helping prop up a friendly political alliance and intensively engage with Russia and Iran.

Russian Prime Minister Vladimir Putin will be in New Delhi in mid-March. One of the major subjects under discussion between the two prime ministers will be the changing situation in Afghanistan and how to develop a common ground, to jointly counter the challenges that the Taliban's coming to power might pose to the region as a whole.

China Warns: 'Helpless' Obama May Provoke Israeli War on Iran

March 2 (EIRNS)—Retired senior Chinese diplomat Hua Liping, Ambassador to Iran in the 1990s, wrote an article in the China Daily today, with a severe warning that the Obama Administration is increasingly "helpless," as a result of having continued the failed, confrontational policies of the Bush Administration against Iran, and that "this helplessness could ultimately make the US use force or give Israel the go-ahead to launch a military attack against Iran."

Iran had agreed to allow uranium enrichment overseas in 2003, in the U.K., France, and Germany, Hua wrote, and was planning to renew that agreement in 2004, when the Bush Administration "rejected it outright, forcing the Iranian nuclear issue to take a turn for the worse. Iran restarted its uranium conversion facilities in Isfahan in August 2005 and resumed uranium enrichment six months later." Hua added: "The US snubbed the Iranian moderates, represented by Seyed Mohammad Khatami, even though they were willing to compromise, forcing them to withdraw from the country's politics. This led to the election of Mahmoud Ahmadinejad, a hardliner with a strong anti-US stance, as Iran's president, who immediately resumed the country's uranium enrichment program."

Hua concluded: "But now, US-led sanctions on Iran seem imminent. That Washington knows full well how ineffective sanctions are, [but] still wants to impose them on Iran, indicates the helplessness of the Obama administration. This helplessness could ultimately make the US use force or give Israel the go-ahead to launch a military attack against Iran. This is exactly what China does not want to see. That's why it suggests that as long as Iran keeps its doors open to negotiations, the international community should not impose sanctions on it."

Lyndon LaRouche has made similar points, adding that the Mossad assassination of a PLO leader in Dubai was intended to provoke a violent response, which would in turn be used to justify an Israeli attack on Iran.

Japanese Cabinet Deadlocked Over CO₂ Industrial Suicide

March 6 (EIRNS)—The Japanese Cabinet has postponed a decision on its major environmental measures until March 12 because of internal conflict and outside industry pressure, according to a Financial Times report. Failure to reach agreement by that date would delay the bill until parliament reconvenes after elections in July. It now looks very unlikely that, with plummeting poll results, the governing coalition can maintain its hold in those elections.

Industry pressure on Prime Minister Yukio Hatoyama around his carbon emission proposal is so great that he described the bill as "in danger of being pummelled" by industry groups and their allies. The three major industry umbrella groups came out with an unprecedented combined statement attacking the proposed 25% cuts by 2020, last week. That was followed by nearly identical statements from nine energy-intensive industrial sectors.

Within the government, Industry Minister Masayuki Naoshima said yesterday: "There is a problem with the way the government has put this bill together. We need to collect a broader range of opinions." This is the same language used by industry groups to signal the necessity of moving decisions on the future of Japanese industry out of the hands on environmental fanatics. Naoshima indicated his support for an industry proposal to cap greenhouse gases as a proportion of output, instead of in absolute terms, a change environmental radicals say would weaken any carbon trading system, but which would correspond to China's approach to limiting emissions.

Also within the Cabinet, the Social Democratic Party has blocked proposals to include expansion of Japan's nuclear power industry in climate change legislation. However, the government has in recent weeks joined industry initiatives to promote the sale of nuclear power plants to Vietnam, Southwest Asia, and other localities.