Nuclear Deal

The best of intentions, the worst of results
 
Brahma Chellaney
International Herald Tribune
MONDAY, JUNE 26, 2006
 
NEW DELHI With its first anniversary approaching, the vaunted U.S.-India nuclear deal, far from adding momentum to the building of close ties between the world’s most powerful and most populous democracies, threatens to become a political albatross for both countries.

This week, Senate and House committees in the U.S. Congress are likely to take up their own versions of the bill that seek to attach tougher conditions. In New Delhi, the main opposition coalition, concerned over limits on India’s nuclear program, petitioned the president last week to stop the deal.

The nuclear deal has needlessly injected controversy and complications into a relationship whose direction already had been set toward closer engagement through a global strategic partnership. The bitter debate the deal has triggered in both countries could end up terminally poisoning the relationship.

Since the deal was signed last July, America’s image has slipped in India. The 2005 global opinion poll by the Pew Research Center disclosed that more respondents in India (71 percent) expressed a positive view of the United States than in any other nation surveyed. The 2006 Pew survey showed that America’s rating has plummeted 15 points in India.

The nuclear deal may have been founded on good intentions, and its goal is certainly bold – to eliminate a decades-long source of acrimony between the two countries by removing U.S.-fashioned multilateral controls on the export of commercial nuclear power reactors and fuel to India. At the practical level, however, the deal is rooted in several myths.

Myth: The deal will eliminate discrimination against India and end its nuclear isolation.

With or without the deal, India will stay in a third aberrant category – neither a formal nuclear power nor a nonnuclear nation, but a nonsignatory to the Nuclear Nonproliferation Treaty that possesses nuclear weapons. In fact, continued discrimination is built into the deal, with India agreeing to put 35 of its nuclear sites under international inspections of a type applicable only to nonnuclear states – permanent and legally irrevocable.

Far from seeking a blanket lifting of the nuclear embargo against India, the deal only calls for limited civilian nuclear commerce, tightly regulated by export-licensing requirements and subject to Indian "good behavior."

Myth: The way for India to meet its burgeoning energy demands is to import nuclear power reactors.

This argument is fundamentally flawed because generating electricity from imported reactors dependent on imported fuel makes little economic or strategic sense. Even if India spent tens of billions of dollars to import reactors, nuclear power would still make up a tiny share of its total electricity production, given that nuclear plants take exceptionally long to complete and the share of other energy sources is likely to rise faster.

A wiser approach for India would be to secure clean-coal and renewable energy technologies to exploit its huge coal and hydroelectric reserves, among the largest in the world.

Myth: Nuclear energy, according to President George W. Bush, will reduce India’s oil dependence and help stabilize world oil prices.

The truth is it won’t cut or slow down India’s fast- rising oil imports even marginally. India does not use oil to generate electricity.

In any case, India cannot correct its current oil reliance on the Gulf region by fashioning a new dependency on a tiny global nuclear-supply cartel made up of a few state-guided firms. While oil is freely purchasable on world markets, the global nuclear reactor and fuel business is the most politically regulated commerce in the world.

The Bush administration has a strong commercial motivation to press ahead with the deal. Having failed to use tax breaks and other incentives to revive the U.S. nuclear power industry, which has not received a single reactor order in more than 30 years, the administration is banking on India, which has agreed to import within the next six years eight reactors worth from $14.4 billion to $20 billion.

Yet the deal is already a drag on the U.S.-India relationship. It would be best to let it lapse to allow the relationship to develop without any encumbrance.

Brahma Chellaney, professor of strategic studies at the Center for Policy Research in New Delhi, is the author of "Nuclear Proliferation: The U.S.-India Conflict."

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