U.S.-India Civil Nuclear Cooperation: A Doomed Deal

Nuclear Non-Starter

The U.S.-India civil nuke deal is doomed

By Brahma Chellaney

Wall Street Journal, May 9, 2007

The much-trumpeted 2005 civil nuclear deal between the United States and India always had one problem: the elastically worded accord itself. New Delhi, however, bears the brunt of the blame for the current deadlock. While the U.S. never hid its nonproliferation objectives, India’s policy makers embraced the political deal without fully understanding its implications. Now that the technical rules of nuclear commerce are to be defined, they find it difficult to meet the demands set by the U.S. Congress.

The root of the current stalemate over the fine print rests in the new U.S. legislation, dubbed the Hyde Act, governing the deal. The U.S. wants the right to cut off all cooperation and secure the return of transferred nuclear items if India, in Washington’s estimation, fails to live up to certain nonproliferation conditions, such as a ban on nuclear testing. The prohibition seeks to implicitly bind India to an international pact whose ratification the U.S. Senate rejected in 1999—the Comprehensive Test Ban Treaty. The Hyde Act also sets out conditions to block India from ending International Atomic Energy Agency inspections even if American fuel supplies are suspended or terminated.

While the political deal had promised India “full civil nuclear cooperation and trade,” what is on offer now is restrictive cooperation, tied to the threat of reimposition of sanctions if New Delhi does not adhere to the congressionally prescribed stipulations. India, however, insists that cooperation encompass uranium enrichment, reprocessing of spent fuel and heavy-water production, given that all such activities would be under International Atomic Energy Agency safeguards and for peaceful purposes.

Under the deal inked in 2005, India agreed to “assume the same responsibilities and practices and acquire the same benefits and advantages as other leading countries with advanced nuclear technology, such as the U.S.” It now complains that the Hyde Act denies it these “same benefits and advantages.” However, New Delhi itself laid the groundwork for higher standards when months earlier it agreed to place 35 Indian nuclear facilities under permanent, legally irrevocable IAEA inspections—not the token, voluntary inspections accepted by the U.S. on select facilities.

In any case, a growing perception that the U.S. was shifting the goalpost created outrage in India’s Parliament. Why the shock and horror? It’s simple: India embraced the U.S.-drafted deal hurriedly in July 2005 without fully grasping its significance. As Prime Minister Manhoman Singh admitted in Parliament on August 3, 2005, he received “the final draft from the U.S. side” only upon reaching Washington a day before signing. Until that point, India’s negotiators had only discussed submitting “power reactors” to international inspections, not all civilian nuclear facilities. And they certainly didn’t anticipate a test ban. Indeed, after signing the deal, Mr. Singh had assured Parliament that “our autonomy of decision-making will not be circumscribed in any manner.”

The current deadlock could have easily been avoided. During the nine-month legislative drafting of the Hyde Act last year, India ought to have made it clear that it wouldn’t allow its deal-related commitments to be expanded or turned into immutable legal obligations through the means of a U.S. domestic law. It was only after national outcry over the bill’s approval by the U.S. House of Representatives that Prime Minister Singh grudgingly defined India’s bottom-line: The “full” lifting of “restrictions on all aspects of cooperation” without the “introduction of extraneous” conditions. He went on warn that, “If in their final form, the U.S. legislation or the adopted Nuclear Suppliers’ Group guidelines impose extraneous conditions on India, the government will draw the necessary conclusions, consistent with the commitments I have made to Parliament.” That was too late to reverse the Congressional push for a tough law to govern the deal.

Last week, India’s top diplomat, Foreign Secretary Shiv Shankar Menon, tried to repair some of this damage by sitting down with his U.S. counterparts in Washington. But the reality is that each government finds its negotiating space severely constricted. The Bush administration is bound by the Hyde Act passed by Congress last December, and Mr. Singh is stuck with the deal-related benchmarks he defined in Parliament last August.

Even if the follow-up bilateral agreement did not incorporate the controversial conditions, it would hardly free India from the obligations the Hyde Act seeks to enforce. The U.S. has always maintained that because such a bilateral agreement is a requirement not under international law but under U.S. law—the Atomic Energy Act—it cannot supersede American law. In fact, an earlier U.S.-India bilateral nuclear cooperation accord, signed in 1963, was abandoned by Washington in 1978—four years after the first Indian nuclear test—simply by enacting a new domestic law that retroactively overrode the bilateral pact. That broke with impunity a guarantee to supply “timely” fuel “as needed” for India’s U.S.-built Tarapur nuclear power plant near Bombay, forcing India to turn to other suppliers to keep the station running to this day. India cannot get a similar lifetime fuel-supply guarantee for the new commercial nuclear power reactors it wishes to import thanks to the Hyde Act, which also bars reprocessing and enrichment cooperation even under IAEA safeguards.

Another sticking point is India’s insistence on the right—under international safeguards—to reprocess fuel discharged from imported reactors. The U.S. has granted such a reprocessing right to its European allies and Japan for decades. Given that the Tarapur spent fuel has continued to accumulate over the decades near Bombay, with the U.S. declining either to exercise its right to take it back or to allow India to reprocess it under IAEA inspection, New Delhi says it cannot get into a similar mess again. In fact, Washington has not compensated India for the large costs it continues to incur to store the highly radioactive spent fuel from Tarapur.

Faced with the Hyde Act’s grating conditions, misgivings over the deal have begun to infiltrate the Indian establishment. The U.S. currently has 23 different bilateral nuclear cooperation agreements with partner-states but none is tied to such an overarching, country-specific domestic law. Even if the present hurdle were cleared, the deal faces more challenges in securing approval from the 45-state Nuclear Suppliers’ Group and the 35-nation IAEA board.

New Delhi believes time is on its side. India’s economic and strategic influence is growing, strongly positioning New Delhi to conclude a deal on terms that are fairer and more balanced than those on offer today. Its interests also demand a deal not just restricted to civil nuclear export controls, but encompassing the full range of dual-use technology controls in force against India.

The present deal, despite the good intentions behind it, seems doomed.

Mr. Chellaney, a professor of strategic studies at the privately funded Center for Policy Research in New Delhi, is the author of “Nuclear Proliferation: The U.S.-India Conflict” (Orient Longman, 1993).

Copyright: The Wall Street Journal, 2007

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