By Steven Mufson
Washington Post Staff Writer
Tuesday, July 18, 2006; D01
Like his father, who once headed covert operations for the Central Intelligence Agency, Graham Wisner has constructed a matrix about people he believes to be of special interest.
But Wisner, a lawyer and lobbyist at Patton Boggs LLP, is seeking passage of a bill that would allow nuclear energy cooperation between the United States and India. So his matrix includes such useful lobbying details as these: The independent-minded Sen. Paul S. Sarbanes (D-Md.) cares more about nonproliferation issues than about corporate interests; Sen. Barbara Boxer (D-Calif.) is anxious about India's relationship with Iran; and two-thirds of the physicians in the district represented by House Democratic Whip Steny H. Hoyer (D-Md.) are Indian Americans.
His efforts and those of Indian American groups, leading U.S. companies and other lobbyists paid off last month, as foreign relations committees in both the House and Senate approved by wide bipartisan margins the gist of a deal struck last July by the Bush administration. That deal would eliminate obstacles to U.S. participation in India's civilian nuclear energy sector, brushing aside restrictions in effect since 1974 when India tested its first nuclear bomb.
American business executives think a lot is riding on the bill. The deputy chairman of India's planning commission, Montek Singh Ahluwalia, said in a visit here in April that India "ought to be targeting something of the order of $200 billion" in infrastructure spending -- half public money, half private -- over the next five years. And U.S. companies hope that the passage of this deal, after three decades of U.S. bans on the sale of nuclear equipment to India, will help them get their share.
The sanctions have been a "cinder in the eye of India," said Wisner, quoting his brother, Frank, a former U.S. ambassador to India and now vice chairman at American International Group Inc. While proliferation experts say that lifting restrictions would enable India to channel more nuclear material to its weapons program, the Indian government has made the vote a test of U.S. reliability and India's prestige.
It's possible that few U.S. companies would directly benefit from U.S.-Indian cooperation on civilian nuclear power plants. Only four companies worldwide build the most sensitive components of such plants: France's state-controlled Areva; Toshiba Corp., which is buying Westinghouse's nuclear unit from British Nuclear Fuels PLC; Russia's newly consolidated Atomprom; and General Electric Co.
One executive said the French and Russian firms are already in the advanced stages of negotiations to build the eight nuclear plants India is planning. "We're afraid that they may get all eight," said the executive, who spoke on the condition of anonymity because his company does not want to comment on the status of talks.
Even if the French and Russians prevail, U.S. companies are hoping to win related contracts either building containment structures, selling turbines or providing services for the handling of waste.
Above all, U.S. companies hope the goodwill from lifting nuclear restrictions will spill over to other types of business just when the world's 11th largest economy is racing ahead. U.S. exports to India have nearly doubled in three years, to $8 billion, still less than 1 percent of total U.S. exports.
GE, which had about $1.1 billion in sales in India in 2005, has set a goal of $8 billion in sales there by 2010. It hopes to achieve that mostly through big infrastructure projects providing water, energy and aviation equipment.
"Expectations in the business world have been growing for the past decade, and they are beginning to be requited," said Thomas R. Pickering, a six-time ambassador, including a stint as the U.S. envoy to India. Boeing Co., where Pickering has been vice president of international relations for five years, signed an $11 billion deal in January to sell 68 planes to Air India. Boeing is also eyeing sales to private airlines there, which, Pickering said, "are growing by leaps and bounds."
Pickering said Boeing also is seeking to supply more than 120 fighter planes to the Indian air force. "That would be the largest fighter sale for the decade, if not the century," he said. Lockheed Martin Corp., another supporter of the U.S.-India Business Council, also hopes to win contracts from India's military, which has a $23.5 billion budget this year. India has not bought arms from the United States since 1965, when President Lyndon B. Johnson cut sales during the India-Pakistan war.
Experts such as Barry M. Blechman, chief executive of consulting firm DFI International, doubt India will abandon its low-cost Russian equipment and its own indigenous arms industry. "American equipment is superior, but it also comes with strings attached," Blechman said.
Still, if U.S. arms makers are to have any chance, good bilateral relations will count, Pickering said. "Indian officials talk to us about the importance" of the nuclear cooperation agreement, "but it's not a blackmail thing," he said. Also moving through the Senate: an international accord that would limit the liability of companies building nuclear power plants.
With so much believed to be at stake, business groups and the Indian government have lined up the politically well-connected. Robert D. Blackwill, former ambassador to India, went to work for Barbour Griffith & Rogers LLC, which the Indian government hired last August for an annual fee of $700,000, according to filings with Justice Department. The Indian government is also paying $50,000 a month to Venable LLP, where former senator Birch Bayh Jr., father of Sen. Evan Bayh (D-Ind.), is a partner. Between April 15 and Sept. 30 last year, Barbour Griffith received $520,000 from the New Dehli-based Confederation of Indian Industry "to promote commercial trade."
The U.S.-India Business Council, which has been holding weekly calls or meetings with as many as 40 major companies, is paying Wisner's firm Patton Boggs. It has also hired Vickery International, a business consulting firm headed by Raymond E. Vickery, who was assistant secretary of commerce under President Bill Clinton and who accompanied him to India in 2001.
Lobbyists have also sounded nobler themes. "Without nuclear power, the only option for India is to burn extraordinary amounts of high sulfur coal, which would be devastating at this moment in the global-warming battle," Wisner said. Wisner has made a social equity point, too. "India's poor and emerging middle class deserve power," he said. In addition, many lawmakers and administration members see India as a strategic balance against China.
Critics of the U.S.-India nuclear deal say it harms efforts to stop the spread of nuclear weapons. They note that by allowing the United States and other countries to sell India fresh nuclear fuel, the agreement frees up more of India's own nuclear ingredients for weapons.
"I think there could be long-lasting damage done by this deal," said Robert Einhorn, who spent 29 years at the State Department, mostly on nonproliferation issues. "It spreads the notion that the U.S. doesn't have a principled approach to proliferation but rather a selective and self-serving one. It allows the Iranians to say that what the U.S. does is reward its friends and punishes its enemies."
But critics such as Einhorn have been outgunned by big business, Indian American groups and the administration. Even key congressional leaders on nonproliferation are supporting the deal, reassured by respected former diplomats such as Frank Wisner, who also served as special envoy on nonproliferation, and Henry A. Kissinger.
"A number of things happened. One is that the Indian American community started flexing its muscles and became an effective lobbying force," said Einhorn, now at the Center for Strategic and International Studies. The Indian American Friendship Council expects 100 lawmakers to attend a banquet at the Cannon House Office Building tonight.
This year, the U.S. India Political Action Committee gave $4,000 to key nonproliferation lawmaker Sen. Richard G. Lugar (R-Ind.) and $9,000 to Rep. Donald Manzullo (R-Ill.), who as chairman of the House Small Business Committee has been outspoken about the loss of jobs to India. The group gave to seven Democrats and three Republicans on the House Committee on International Relations, including $10,000 to Rep. Ileana Ros-Lehtinen (R-Fla.). In the first five months of this year, the political action committee gave $103,649 to congressional candidates, according to the Federal Election Commission.
Businessmen such as Boston's Ramesh Kapur and Swadesh Chatterjee of Raleigh, N.C., have marshaled more from fellow Indian Americans.
The lobbying effort came to a climax at the June 20 gala for the U.S.-India Business Council, which included a keynote address by Vice President Cheney and an after-dinner sitar performance by Anoushka Shankar, daughter of virtuoso Ravi Shankar.
One highlight was a speech by the Senate Foreign Relations Committee's ranking Democrat, Sen. Joseph R. Biden Jr. (Del.). Several Democratic senators had told lobbyists they were waiting for Biden. Biden said that Congress would not be a "rubber stamp" and asked that India ensure that U.S. help would be for civilian nuclear plants alone, but he also said that he would not insist on a renegotiation of the deal.
"Everyone hung on his every word," said Graham Wisner. "That was extremely important."
Staff researcher Madonna A. Lebling contributed to this report.