U.S.-Indian Deal in Limbo as Clock Ticks

Wade Boese

Bush administration officials and some U.S. lawmakers are prodding India to accelerate its efforts to advance a civil nuclear trade initiative or risk losing it. At the same time, domestic political opponents in India are pressing the Indian government not to move ahead on the initiative or chance losing power.

President George W. Bush agreed with Prime Minister Manmohan Singh nearly three years ago to disassemble the legal and regulatory barriers to India’s participation in the civilian nuclear trade market. (See ACT, September 2005. ) The United States had taken the lead in erecting those barriers following India’s 1974 explosion of a nuclear device derived in part from U.S. and Canadian nuclear supplies designated for peaceful purposes.

Congress gave its preliminary and conditional approval to the initiative in December 2006 through legislation known as the Hyde Act after Rep. Henry Hyde (R-Ill.), who at that time chaired the House International Relations Committee. (See ACT, January/February 2007. ) Before Congress can take a final vote on an agreement granting India access to U.S. nuclear fuel and technologies, the voluntary 45-member Nuclear Suppliers Group (NSG) must first exempt India from a restriction against nuclear trade with non-nuclear-weapon states, like India, that do not subject their entire nuclear complex to international oversight. Although India possesses nuclear arms, it is classified as a non-nuclear-weapon state by the 1968 nuclear Nonproliferation Treaty, which India has never signed.

NSG members, which seek to coordinate their export controls, are waiting on India to complete a safeguards agreement with the International Atomic Energy Agency (IAEA) before considering exempting India from the group’s trade rule. Safeguards are mechanisms, such as inspections and remote monitoring, placed on a country’s civilian nuclear facilities and materials to verify that they are not being used for nuclear weapons purposes. In addition to six thermal nuclear reactors already under IAEA safeguards, Singh in March 2006 committed to place an additional eight of 16 such reactors under safeguards. (See ACT, April 2006. )

Confidential talks on a new, India-specific safeguards arrangement for those eight reactors began last November between India and the agency, but no final agreement has emerged. General speculation is that the delay stems from India linking its willingness to abide by safeguards, which are supposed to be in perpetuity, to guaranteed nuclear fuel supplies. In a Feb. 18 speech to the India International Centre in New Delhi, Shyam Saran, special envoy on the nuclear initiative for Singh, stated, “Our position right from the outset had been that we have no problem with permanent safeguards provided there are permanent supplies of fuel.”

Whatever the reason for the prolonged negotiations, U.S. supporters of the initiative are anxious. They had hoped that the safeguards agreement would be completed in time for the IAEA Board of Governors to take the necessary step of approving it at the board’s March 3-7 meeting. The next regular board meeting is not scheduled until June 2-6, which is after the planned May plenary of the NSG and presents a sequencing problem for the initiative. Both the IAEA Board of Governors and the NSG can convene extraordinary meetings to take decisions.

Some U.S. lawmakers say that the IAEA and NSG steps must be done before June in order for Congress to take up the initiative for a final vote because of the abbreviated congressional calendar caused by the upcoming November presidential and congressional elections. Visiting New Delhi Feb. 20 with Sens. John Kerry (D-Mass.) and Chuck Hagel (R-Neb.), Sen. Joseph Biden (D-Del.), chair of the Senate Foreign Relations Committee, told reporters, “It is important for India to move the agreement as rapidly as possible, preferably within weeks.”

Similarly, Nicholas Burns, undersecretary of state for political affairs, said Feb. 11, “[W]e don’t have all the time in the world.” David Mulford, U.S. ambassador to India, delivered the same message in a Feb. 10 interview with India’s CNN-IBN, and he added, “My opinion is that if this is not processed in the present Congress, it is unlikely this deal will be offered again to India.” The trio of senators similarly said that if the deal did not go through this year, it would likely be renegotiated by a future administration.

But Singh’s government is receiving pressure from the opposite direction from its domestic critics who assert the initiative will make India subservient to the United States or impinge on India’s nuclear weapons program. Leftist parties that align themselves with Singh’s governing coalition have threatened to withdraw their support from the government if they are unsatisfied with the final IAEA safeguards agreement. Such a move could trigger new elections that could oust Singh’s government.

The main opposition party, the Bharatiya Janata Party (BJP), also has stepped up its attacks on the initiative after Secretary of State Condoleezza Rice said in Feb. 13 testimony to the House Foreign Affairs Committee that the United States will seek an exemption for India at the NSG “consistent” with the Hyde Act. Indian politicians of all stripes dislike the Hyde Act because it conditions future trade on India’s behavior, including continuation of a nuclear test moratorium. The act also effectively bars, except in special circumstances, transfers to India of uranium-enrichment, plutonium reprocessing, and heavy-water production technologies, which can be used to produce essential nuclear bomb materials.

India prefers what it calls a “clean” NSG exception. As Saran explained in his Feb. 18 speech, “It is our expectation that there would be a fairly simple and clean exemption from these guidelines without any conditionalities or even expectations regarding India’s conduct in [the] future.”

The BJP responded to Rice’s statement by demanding that Singh’s government apologize for misleading and betraying India. BJP spokesperson Prakash Javadekar asserted Feb. 15, “[T]he primary objective of the Hyde Act is to cap, then roll back, and ultimately eliminate India’s nuclear weapons capability.”

Rep. Howard Berman (D-Calif.), who took over as acting chairman of the House Foreign Affairs Committee after Rep. Tom Lantos (D-Calif.) passed away Feb. 11, signaled that he would prefer an NSG exemption that reflected the Hyde Act and not a clean one. He told Rice that if the United States pursued a clean exemption for India, “we would essentially be creating two standards for nuclear trade for India, one for the United States and one for the rest of the world.”