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India and America : A nuclear test of wills

Apr 26th 2007
From The Economist print edition
The deal in difficulty


DID they celebrate too soon? It was billed as an epoch-making deal between the world's two biggest democracies that would turn decades of estrangement into partnership. Last December, when America's Congress gave its initial blessing to a controversial nuclear deal that President George Bush had struck earlier with India's prime minister, Manmohan Singh, supporters in both capitals were euphoric. No longer. India's top diplomat is due in Washington on April 30th to try to rescue the plan. So why has the fizz suddenly gone out of it all?

India has been barred for years from even civilian nuclear trade with America—and most other countries—for having armed itself with nuclear weapons and stayed outside the Nuclear Non-Proliferation Treaty (NPT). Now it has agreed to separate its civilian nuclear industry from its bomb-building and put the energy-producing bits under safeguards, and America has agreed to beckon it in from the cold. But Congress's Hyde Act sets out other steps needed for the deal to get a final nod: a bilateral “123 agreement” (named after the clause in America's Atomic Energy Act that governs nuclear trade with other countries), and the relevant safeguards agreement with the International Atomic Energy Agency (IAEA), the UN's nuclear guardian. In expectation of both, America has been lobbying for an India-sized waiver of the rules of the informal but influential Nuclear Suppliers Group that bar nuclear dealings with countries that don't have all nuclear facilities under full safeguards. And all this must be done before Congress approves the deal.


America had hoped India would move swiftly to take advantage of this unprecedented nuclear opening (it upsets other governments who fear it will undermine the already shaky anti-proliferation regime). But India has dragged its feet in talks with the IAEA. And the 123 negotiations have stumbled; unless they can be concluded by next month, worries Nicholas Burns, America's point-man for the deal, the package may not be ready before Congress gets embroiled in America's 2008 presidential election.

For India, however, the devil in the 123 agreement is not just in the technical detail. Above all, Mr Singh is under strong pressure from his nuclear establishment, and from the opposition Bharatiya Janata Party, which supervised India's most recent bomb tests in 1998, not to agree to anything that would curtail India's right to test again, should it so choose. But the Hyde Act is clear: if India tests, the deal is off.

India would still be free to test, of course, and damn the consequences. But it is these—from increased pressure not to test in the first place to accusations that India had trashed the deal—that it wants to avoid. And the Hyde Act rules out ruses such as getting others to supply India with nuclear fuel if America backs out, or helping it build up large enough fuel stocks to test with at least nuclear impunity. Crafting words that satisfy India's wish to keep all its nuclear options open, and yet could squeak past Congress, is hard.

For although India has not signed the NPT, America has; it is not supposed to assist others' weapons building in any way. To India's frustration, the Hyde Act therefore also rules out selling India (or bending NSG rules far enough to allow others to sell) equipment and technology for three processes used in making nuclear fuel that are also crucial for producing the fissile material for bombs: uranium enrichment, plutonium reprocessing of spent fuel and the production of heavy water (used as a moderator in reactors fuelled by natural uranium that can be ideal for producing bomb-useable plutonium). Nor is India to be allowed to reprocess American-origin spent nuclear fuel to extract its plutonium.

Might India test again? How many more bombs does it want? If the deal goes through, the foreign fuel it can import will anyway take the pressure off its own tight uranium stocks, enabling more of these to be used in its military programme. It has also exempted its plutonium-producing fast-breeder reactor from safeguards.

In the discussions that followed its 1998 tests, India indicated to America that its need for plutonium was not open-ended, and that it would not seek nuclear parity with China. Since then, says Robert Einhorn, who took part in those talks and is now at the Washington-based Centre for Strategic and International Studies, India seems to have changed its strategic goals; its insistence on the option for large-scale plutonium production suggests a revised view of where it thinks it should be in the global pecking order, he says.

Privately, some Bush administration officials would not be unhappy if India's growing nuclear arsenal gave China more pause. But as the momentum behind the deal slows, the going gets tougher.

India's Communists, Mr Singh's sometime-allies in Parliament, resent America's leaning on India to join in pressuring Iran over its illicit nuclear activities. Yet India's developing military co-operation with Iran is also unsettling some in America's Congress: a bipartisan group of eight senators has just sent Mr Singh a letter calling on him to suspend such ties. Henry Sokolski of the Non-Proliferation Policy Education Centre also points to the danger of sharing sensitive space-launch technologies with India, given the risk that these could someday end up aiding Iran's missile programmes

It would be premature to write off the nuclear deal. Unlike Congress, India's Parliament does not need to give formal assent. Mr Bush and Mr Singh have much invested in it. But it is not a done deal yet. And India could still walk away from it.

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