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An Uncertain Deal with India

Author: Jayshree Bajoria
Updated: July 22, 2008

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The U.S.-India agreement for civilian nuclear cooperation, touted as a significant step in strategic ties, has so far proved a difficult ride for both governments. Time is running out for both President George W. Bush and Prime Minister Manmohan Singh to seal the deal before their countries go to the polls. Earlier this month, Singh finally submitted India's plan for safeguarding (PDF) its civilian nuclear facilities for review (BBC) by the International Atomic Energy Agency (IAEA). But the IAEA's approval, required before the deal can move forward, is only the first of many challenges.

The deal also requires the approval of the forty-five member Nuclear Suppliers Group and the U.S. Congress. All member countries of the suppliers group, which includes China, will have to agree to exempt India from rules prohibiting nuclear sales to countries that do not accept full-scope safeguards agreements on all of their nuclear facilities. (India is not a signatory to the Nuclear Nonproliferation Treaty or the Comprehensive Nuclear Test Ban Treaty). Experts see irony if such an exemption were to occur, as the suppliers group was created in 1974 following India's first nuclear test to restrict the spread of nuclear technology for weapons programs. Meanwhile, Singh had to reshuffle his coalition and win a trust vote (NDTV) to stay in power after Communist allies, upset over the nuclear issue, withdrew their support (Hindu) for India's government.*

President Bush has his own problems persuading Congress to pass the deal before it adjourns for the year on September 26. The Center for Arms Control and Non-Proliferation, a Washington-based nonpartisan policy organization, has asked the suppliers group and Congress not to make a hasty decision on the nuclear agreement, saying it undermines global nonproliferation efforts. Both U.S. presidential candidates Sen. John McCain (R-AZ) and Sen. Barack Obama (D-IL) have indicated support for the deal, but it is not clear if they would present it to Congress in its current form.

Some analysts object to the deal because it fails to restrain India's nuclear weapons program. Henry Sokolski, executive director of the Nonproliferation Policy Education Center, argues in a Wall Street Journal op-ed that "fueling India's civilian reactors with foreign fuel is not all that peaceful." The Bush administration has tried to convince Congress that the enabling U.S. legislation for the nuclear deal, the Hyde Act, has mechanisms to check India's nuclear weapons ambitions. However, the Indian government is indicating the opposite. To win over its parliamentary allies, the prime minister's office insists the nuclear deal overrides the Hyde Act (Hindu). A July 15 government statement says, "the agreement will in no way impinge on our [India's] strategic programme, which is entirely outside the purview of the IAEA safeguards agreement."

Plus, India is seeking a suppliers group exemption from restrictive conditions on nuclear testing, such as those laid down by the Hyde Act. Unless the suppliers group puts similar conditions on sales to India, some experts say, New Delhi will be free to buy nuclear fuel from others without having to worry about U.S. law. While some experts tout the deal as a boon to U.S. civilian nuclear business, others say its commercial impact may be limited. The deal holds little advantage for the United States beyond symbolism, argues Leonard S. Spector, a nonproliferation expert at the Monterey Institute of International Studies. Russian and French firms are better positioned to reap the benefits of opening up nuclear sales to India, he says.

*Editor's Note: An earlier version of this report erroneously suggested that the Indian parliament has to vote on the deal. That is not a requirement.

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