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    CAATSA: What it is, why it is in news & how it can hurt India

    Synopsis

    According to statements made by US officials, Biden administration is yet to decide whether or not to apply sanctions on India under CAATSA.

    CAATSA: What it is, why it is in news & how it can hurt India
    Biden administration is yet to decide whether or not to apply sanctions on India under CAATSA.
    After a high-ranking US official dwelt on the spectre of possible Ukraine-related sanctions on parties yesterday, CAATSA has begun doing the rounds in India's media and defence policy circles.

    Here is a look at what CAATSA is, and why and how it might matter to India.
    1. What is CAATSA?
      CAATSA is a US law, its full form being "Countering America's Adversaries through Sanctions Act". Under this federal law, the American government can impose sanctions on any country that has "significant transactions with Iran, North Korea or Russia". The law entail economic & financial penalties for any nation that transacts with Russia on arms. The law has been in force since August 2017.
    2. What exactly did the US official talk about?
      Donald Lu, Assistant Secretary of State for South and Central Asia, told members of the Senate Foreign Relations Subcommittee on the Near East, South Asia, Central Asia, and Counterterrorism, that it was for President Joe Biden to decide whether to apply or waive CAATSA sanctions on India.
    3. Where does the case against India currently stand?
      According to statements made by US officials, Biden administration is yet to decide whether or not to apply sanctions on India under CAATSA.As it is, it already tough for India as well as any other country to buy weapon from Russia, because Russia's banks have come under sweeping Western sanctions.As per reports, over the past few weeks, India has cancelled orders for MiG 29, helicopters and anti-tank weapons.
    4. Should India be worried?
      Russia has historically been one of the major suppliers of arms and ammunition to India.India is still heavily dependent on Russian arms. Russian arms make up half of India’s total military imports (as per SIPRI data for 2020).As things stand, the Ukraine situation has the potential to significantly reduce India's wiggle room in this matter.
    5. How strict is this law?
      CAATSA is a significantly stringent law. In the context of the Ukraine war, it can authorise the imposition of strict sanctions on countries that buy defence hardware from Russia.
    6. How did Russia come into its ambit?
      Russia came into the laws ambit in the aftermath of its annexation of Crimea in 2014 and its alleged meddling in the 2016 US presidential elections.
    7. Is this India's first brush with the spectre of these sanctions?
      No. In October 2018, India had signed a USD 5 billion deal to buy five units of the S-400 air defence missile systems from Russia. At that time, Trump administration had sent India a clear warning that it might draw major sanctions.Sanctions were eventually not imposed on India due to a waiver clause, which took note of India's commitments diversify defence purchases over time.India had also previously come under CAATSA cloud over buying oil from Iran.
    8. What other major countries have so far faced CAATSA sanctions?
      Turkey. It is under CAATSA sanctions for its purchase of a batch of S-400 missile defence systems from Russia.


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    ( Originally published on Mar 04, 2022 )
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