Saran on the US-India Deal

Shri Shyam Saran, Special Envoy of Inida’s Prime Minister, recently gave a presentation about the US-India deal that, IMO, is one of the best summaries of New Delhi’s reasons for wanting the deal.

I don’t have a direct link to the speech, but “this one”: is for the Ministry of External Affairs site. The whole thing can be downloaded “here.”:

Some excerpts are below:

Let me share with you the mandate which Prime Minister gave to us as negotiators when we took up this initiative with the United States. *Since 1974, India had been the target of an increasingly selective, rigorous and continually expanding regime of technology-denial, not only in the nuclear field but encompassing other dual use technologies as well. It was our aim to seek the dismantlement of these inequitable regimes, which would become progressively more detrimental and significantly impact upon India�s maturing economy, as its key sectors, required constant technological upgradation.*

In pursuing this objective, we were acutely aware of the following:

(i) The multilateral technology-denial regimes whose targeting of India we sought to end such as the Nuclear Suppliers� Group (NSG) and the Missile Technology Control Regime (MTCR) would *require the United States to take the initiative as the principal initiator and leader of these regimes, and also because it remains the world�s pre-eminent source of new and innovative technologies.*

(ii) Since our PNE in 1974, *technology denial was first limited to nuclear-related technologies and then progressively expanded to cover a growing range of dual-use technologies. For this historical reason, it was clear to us that unless we tackled the nuclear issue, we would not be able to obtain access to other useful technologies. It is only by turning the nuclear key that we would be able to open the door to enter global trade in dual use and sophisticated technologies.*

There was another important consideration behind the initiative we took in July 2005. We were becoming increasingly aware that we would face a progressively more depleted market for conventional energy resources. Concerns over climate change would act as a further constraint on us. We had to adopt a strategy of diversifying our energy mix, with a graduated shift from fossil fuels to non-fossil fuels, from non-renewable to renewable sources of energy and from conventional to non-conventional sources of energy. Nuclear energy occupies a key place in this strategy and for good reasons. Despite the technology denial regimes which we had to contend with, our scientists had succeeded in putting in place a comprehensive, sophisticated and innovative nuclear industry, with a highly trained manpower able to sustain a major expansion in nuclear power. *Our constraints in this regard were availability of domestic uranium and a technological capability still limited to smaller capacity reactors of about 700 MW, when the world was moving to 1600 MW reactors. If we were to envisage a major expansion in nuclear power in the medium term, to say 60,000 MW plus by the year 2030, then import of higher capacity reactors and uranium fuel, would be necessary.*

This in no way detracts from the continued pursuit of Dr. Bhabha�s visionary 3-stage nuclear energy development programme, which may yield significant results in the longer term. But *in the short and medium-term, a significant expansion of nuclear power is only possible if the constraints we face on import of uranium and of large-capacity reactors, are removed.*

Furthermore, it is not really correct to put indigenous development and international collaboration as antithetical to one another. In fact they are integrally linked. Each cycle of international collaboration prepares the ground for higher level of indigenous development. A higher level of technological sophistication then enables a much more discriminatory and productive new cycle of technological collaboration and eventually partnerships. Let us not forget that Dr. Bhabha himself vigorously promoted international cooperation in nuclear energy which enabled India to lay the foundation of our current nuclear programme. He was, in his time, one of the most highly respected scientists among the international nuclear community.

Let me repeat, *the mandate to the negotiators was:*

*(i) to seek the dismantlement of the multilateral technology denial regimes targeting India;*

*(ii) to seek an accelerated development of our nuclear power generation capability to enable a significant contribution to India�s energy security in an environmentally sustainable manner.*

The negotiators were also given a firm guideline: *in seeking to achieve the above objectives, we should not accept any limitation whatsoever on our strategic weapons programme, which must remain inviolate and fully autonomous.* In practical terms, this implied that

(i) our strategic weapons programme would be outside the purview of any international safeguards regime or any form of external scrutiny;

(ii) *our ability to further develop and produce such weapons would not be constrained in any manner;* and

(iii) *we would retain our legal right to conduct a nuclear test should that, at any time in the future, be deemed necessary in our over-riding national interest.*


The July 18 Joint Statement was then translated into more elaborate and specific arrangements in a Separation Plan, presented to Parliament in March 2006 and in the text of a bilateral cooperation agreement, or the so-called 123 Agreement, between India and the U.S., concluded in July 2007.

In working out these arrangements, the mandate given to the negotiators was to stay within the parameters of the July 18 Joint Statement and to ensure that there would be no repeat of the Tarapur experience. *In practical terms this meant ensuring that there would never again be a threat of reactor operations being disrupted due to a suspension of fuel supplies. We would also need to ensure that India has the right to reprocess foreign origin spent fuel. In both these respects, the U.S. aided Tarapur nuclear facility had suffered and this hung over the negotiations as a negative legacy. There had been U.S. unilateral suspension of fuel supplies, just as there had been a refusal to allow India to reprocess spent fuel, which kept accumulating as hazardous waste, which the U.S. was also not willing to take back.*

This is the background to the multi-layered fuel supply assurances which were spelt out in the Separation Plan, and incorporated in toto in the 123 Agreement. This is also the reason why India was prepared to engage in difficult and sometimes frustrating negotiations to ensure its upfront entitlement to reprocess foreign origin spent fuel. Eventually, the U.S. side agreed to India�s demand.

The negotiators have been criticized by some for having agreed to permanent IAEA safeguards on its civilian facilities. Our position right from the outset had been that *we have no problem with permanent safeguards provided there are permanent supplies of fuel. The multi-layered fuel supply assurances are unique in international nuclear negotiations and include India�s right to take �corrective measures�, should any disruption still occur despite these assurances. India�s entitlement to build strategic reserves of fuel for its civilian reactors, to last the lifetime of such reactors, is also unique.* Frankly, I do not think that we could have secured any better safeguards for our interests.

Criticism has been leveled at various provisions of the Hyde Act and it is argued that irrespective of what the 123 Agreement may say, we would be subject to the several onerous provisions of the Act.

Let me clarify that the operative heart of the Hyde Act, incorporates three permanent and unconditional waivers from relevant provisions of the U.S. Atomic Energy Act of 1954. In layman terms, the Hyde Act allows the U.S. Administration to engage in civil nuclear cooperation with India, waiving the following requirements:

(i) that the partner country should not have exploded a nuclear explosive device in the past; this waiver is necessary because India exploded a series of nuclear explosive devices in May 1998;

(ii) that the partner country must have all its nuclear facilities and activities under full-scope safeguards; this waiver is necessary because India has a strategic programme which would not be subject to international safeguards; nor would its indigenous R&D programme; and

(iii) that the partner country is not currently engaged in the development and production of nuclear explosive devices; this waiver is required precisely because there is no freeze or capping of India�s strategic weapons programme. It is an acknowledgement that we will continue to develop and produce additional strategic weapons.

Irrespective of what else the Hyde Act may contain, *these 3 permanent and unconditional waivers are extremely significant because they acknowledge that India has an ongoing strategic programme. No restraint on this programme is envisaged as a condition for engaging India in civil nuclear energy cooperation. This is a significant gain for India and should not be lost sight of. Just juxtapose this with the UNSC Resolution 1172 of June 6, 1998, which called upon India to stop, roll-back and eliminate its strategic programme and join the NPT as a non-nuclear weapon state.*

*There are, of course, several extraneous and prescriptive provisions in the Hyde Act which we do not agree with and in negotiating the 123 Agreement we have been more than careful to exclude such provisions. If the U.S. Congress considers the 123 Agreement, as currently drafted, as being in contravention with their own understanding of the Hyde Act, the agreement would be voted down. That would be the end of the matter. If, however, the U.S. Congress does approve the 123 Agreement, then this would confirm that the provisions of the Agreement are what would govern the commitments of the two sides.*

*While there has been intense focus on the Indo-US bilateral agreement, much of the commentary on the subject has lost sight of the multilateral regime whose adjustment in favour of India is what we are aiming at. Our objective is not merely to seek the U.S. as a partner. Our objective is to enable India to have a wide choice of partners in pursuing nuclear commerce, and high technology trade. But we cannot attain this objective without the U.S. taking the lead on our behalf.* Yes, Russia and France are countries which are friendly to India and extremely keen to engage in nuclear commerce with us. However, there should be no doubt that neither they nor others will make an exception for India unilaterally unless the Nuclear Suppliers Group adjusts its guidelines in the same manner as the U.S. is prepared to do. Whatever be the reservations that have been expressed about our relations with the U.S., *no other friendly country, member of the NSG has the necessary standing to lead the process of opening up the existing multilateral regime to accommodate India. The U.S. is in a unique position precisely because it initiated these restrictive regimes in the first place and also because it remains the pre-eminent source of new sensitive technologies.*

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