CAATSA is a tough U.S. law that authorises the administration to impose sanctions on countries that purchase major defence hardware from Russia
GS Paper 2: International Relations- Bilateral, Regional and Global Groupings and agreements involving India
Discuss the features and significance of CAATSA.
Why in the news
An Indian-American Congressman has introduced a legislative amendment in the United States House of Representatives seeking a waiver for India from the punitive CAATSA (Countering America’s Adversaries Through Sanctions Act) sanctions in exchange for its purchase of Russia’s S-400 missile defence system, arguing that this will strengthen US-India defence ties and deter “aggressors.”
What exactly is the CAATSA?
- CAATSA is a tough US law that allows the administration to impose sanctions on countries that buy major defence hardware from Russia in response to Russia’s 2014 annexation of Crimea and alleged meddling in the 2016 US presidential elections.
- The law was passed in 2017 and allows the US government to take punitive action against any country that conducts business with Russia’s defence and intelligence sectors.
- In addition to Russia, North Korea and Iran are on its radar.
- It stated that countries that engage in “significant transactions” with Russian intelligence and military agents will face at least five types of sanctions.
- Ordinary transactions will not be sanctioned, and who is sanctioned is determined by the interpretation of “significant transaction.”
- This is one of the various waivers or exemptions mentioned, such as the transaction not affecting US strategic interests, not jeopardising alliances, and so on.
Why is CAATSA used?
- The US cited Russia’s alleged meddling in the 2016 presidential elections and its role in the Syrian war as reasons for punishing engagement with it.
- EU countries with even stronger ties to Russia for oil and gas supply prior to the Ukraine-Russia conflict in 2022 had also criticised CAATSA.
- Countries subject to sanctions
- The United States has sanctioned China and Turkey for purchasing the S-400.
- •Export licences were denied, foreign exchange transactions were prohibited, all property and interests in property within US jurisdiction were frozen, and visas were denied.
Could it be applicable to India?
- India has acquired S-400 Triumf missile systems, which have advanced capabilities for calculating distance from a target and launching a surface-to-air missile attack.
- India purchased five such systems in 2018 for US$ 5.5 billion, and delivery began in November of that year.
- However, the application of CAATSA is not limited to the S-400, but may also include future joint ventures for manufacturing or developing weapons, as well as other types of major deals with Russia.
The likely consequences of India’s purchase
- The Biden administration has not stated its position on India’s case.
- Several senators (US lawmakers) have urged the Biden administration to consider a special waiver for India.
- This is due to India’s importance as a defence partner as well as a strategic partner on US concerns about China and the Quad.
- Other US leaders believe that granting a waiver to India would send the wrong signal to other countries considering similar deals.
- What is the significance of the S-400 deal for India?
- Security paradigm: Due to the threats posed by China, Pakistan, and now Afghanistan, the S-400 is critical for India’s national security considerations.
- Air defence capability: The system will also compensate for the IAF’s dwindling fighter squadron strength in terms of air defence capability.
- Russian legacy: Because India has a large number of legacy Russian air defence systems, integrating the S-400 will be much easier.
- Strategic autonomy: The deal has reached a point of no return, both politically and operationally.
Narrative in Support of Indo-US Relations
- While India faces immediate needs to maintain its heavily Russian-built weapons systems, a waiver to sanctions under the Countering America’s Adversaries Through Sanctions Act (CAATSA) during this transition period is in the best interest of the US and the US-India defence partnership to deter aggressors in light of Russia and China’s close partnership.
- The historic amendment will strengthen the US-India defence partnership and ensure that India does not face crippling sanctions at a time when we need to build the alliance.
The Way Forward
- The US has yet to make a decision on potential sanctions or waivers for India under CATSAA law for its purchase of Russia’s S-400 missile defence system. Any sanction could jeopardise the Indo-US relationship.
- India has always pursued its own foreign policy. This also holds true for its defence purchases and supplies, which are guided by our national security interests. As a result, India should prioritise its interests first.