Mushroom cloud over US-India nuclear talks

Posted in India , United States | 10-Apr-07 | Author: Sudha Ramachandran| Source: Asia Times

Missiles are displayed during India's Republic Day celebrations in New Delhi, 26 January 2007.

BANGALORE - Even as the tortuous process of operationalizing India-US civilian nuclear cooperation entered a critical phase last week with the two sides beginning negotiations on the details of the bilateral agreement, a new bump has emerged on the road to finalizing the deal.

The alleged use of subterfuge by Indian government officials and entities to bring sensitive US missile and navigation technology to India is expected to put the nuclear agreement under greater congressional scrutiny in Washington.

Four Indian nationals - the chief executive officer of Cirrus Inc, an electronics firm operating in South Carolina, Singapore and Bangalore, and three other employees - were indicted by a US court this week on charges of exporting sensitive technology to India in violation of US laws, the International Emergency Economic Powers Act and the Arms Export Control Act.

According to the US Federal Bureau of Investigation (FBI), the items exported include special heat-resistant computer chips with applications in missile-guidance systems, capacitors, semiconductors, rectifiers, resistors and microprocessors for use in aircraft navigation systems.

Cirrus apparently exported the dual-use items from the US through Singapore to three Indian government entities - the Vikram Sarabhai Space Center (VSSC), Bharat Dynamics Ltd (BDL), and the Aeronautical Development Establishment (ADE).

What is embarrassing to Delhi is that the entities for which the US laws were allegedly flouted are government ones. ADE, for instance, is an organization set up under India's Ministry of Defense, while the VSSC comes under the Department of Space. What is more, the FBI has named two Indian government officials as "co-conspirators"; one of them, it claims, is an official posted at the Indian Embassy in the United States and the other an official of ADE.

India has said it will investigate the allegations.

B N Sureesh, director of the VSSC, has denied that his organization used subterfuge to secure the high-tech items. The VSSC always provides an end-user certificate whenever it imports items, he told Times of India. "So there is no question of us trying to obtain items by stating one purpose and quietly using it for another.'

The allegations and the indictments couldn't have come at a worse time for India.

Last week, Indian and US officials began negotiating details of the 123 Agreement ("123" refers to Section 123 of the US Atomic Energy Act of 1954). The 123 Agreement is the bilateral pact that will define the legal and administrative nature of civilian nuclear cooperation between India and the US. At a time when the agreement is in the process of negotiation, India would not want to be seen to be irresponsible.

Negotiations on the 123 Agreement are crucial for India. The Henry Hyde Act, which was passed last December by the US Congress, removing legal obstacles to US nuclear trade with India, has provisions that are of concern to New Delhi. India believes that the act "significantly deviates" from the India-US understanding of July 18, 2005, and the separation plan of March 2006.

Under the July 2005 agreement, the US agreed to "full nuclear cooperation" with India in return for the South Asian country placing its civilian nuclear reactors under international safeguards, but the cooperation envisaged under the Henry Hyde Act (named for the former Republican chairman of the House of Representatives International Relations Committee) excludes the sale of equipment related to uranium enrichment, spent-fuel reprocessing, and heavy-water production to India.

There are important differences between the two countries. India is concerned that the US wants to include a condition in the 123 Agreement that entails termination of nuclear cooperation - Delhi will be required to return all nuclear equipment and fuel given to it by Washington - if it conducts a nuclear-weapon test, which is unacceptable to India. India wants a clear commitment of assured fuel supplies by the US to its reactors.

Another issue of concern for India regards reprocessing of spent fuel. India wants its rights over this to be clearly written into the 123 Agreement.

According to media reports, in January India sought clarification from the US on provisions in the Henry Hyde Act that run counter to the letter and spirit of the July 2005 agreement. It followed this up in February with its draft of the 123 Agreement. The Americans were not happy with the draft.

At the two-day talks in New Delhi last week, the two sides said they had narrowed the scope of some of their disagreements. But the talks seem to have not met expectations on both sides.

"We were hopeful that we would be able to make progress to close out all of the issues on the 123 [Agreement] talks. Some progress was made, but in our view, not enough," said Nicholas Burns, US Under Secretary of State and the Bush administration's main interlocutor with India on the nuclear deal. "The US has done its part. We've met every commitment we said we would meet."

US State Department spokesman Sean McCormack told reporters: "Certainly, we have acted in good faith in these negotiations to see that they move forward, and we can only assume that that is the motivation of the Indian government as well."

Indian officials disagree. They maintain that it is India that has acted in good faith so far and point to the way Washington has shifted the goalposts since the July 2005 agreement.

Indian analysts have drawn attention to US efforts to pressure India to hurry up with the deal.

Siddharth Varadarajan wrote in The Hindu that in "the run-up to the [Henry] Hyde Act, the Bush administration played the executive-legislature division in Washington to the hilt in order to shift the goal posts of the July 2005 agreement. Today, US officials are pressing India to conclude the 123 negotiations quickly, citing domestic political uncertainties caused by the ascendancy of the Democrats. As the US slips into presidential election mode, it is said Congress' appetite to give President Bush a foreign-policy boost by approving the 123 agreement will diminish ...

"By seeking to introduce an artificial deadline, the US hopes to browbeat India into abandoning its concerns."

It is in this context that the allegations regarding the flouting of US law for procurement of sensitive technology by Indian government entities should be seen, a former diplomat told Asia Times Online. "It is possible that this is aimed at putting India on the defensive, to make it more willing to back down on contentious issues," he said.

Indian officials point out that the recent allegations are not related to nuclear proliferation. India's record on that remains unblemished. But "the allegations, if true, are embarrassing nonetheless", an official in the Ministry of External Affairs admitted, and "couldn't have come at a worse time for India".

Indian officials point out that while the allegations have put India in a bit of an embarrassing spot now, in the long run the Bush administration could also feel the heat as the non-proliferation lobby in the US and critics of the India-US nuclear deal can be expected to use the controversy to derail the deal.

"If the Indian government has attempted to circumvent US export controls over sensitive missile technology, as is alleged in the indictment, then it has violated its explicit agreements to become a responsible international actor in the context of non-proliferation," Ed Markey, a member of the House of Representatives and a vociferous critic of the nuclear deal, has said.

After the finalizing of the 123 Agreement, it will need to be passed by the US Congress. There is concern that the allegations against India will now put the agreement under greater congressional scrutiny.

Indian proponents of the deal want India to be less intransigent about getting things clearly stated in the 123 Agreement. They are calling on India to quibble less about its concerns.

An editorial in the Indian Express said: "New Delhi wants its rights unambiguously written into the 123 Agreement. Washington is looking at finesse by kicking the can down the road ... For the US, it makes little sense to let the technical quibble over plutonium undermine the huge strategic investment it has made in transforming the relationship with India. In its embrace of legalism, New Delhi is in danger of forgetting the real objective of liberating itself from the straitjacket of a global regime that prevents any nuclear cooperation with India."

But would "kicking the can down the road" - ie, overlooking its concerns in the agreement just to get a deal with the US - be in India's interests?

An agreement with the US is essential for India's nuclear trade with that country. It is also essential to get the Nuclear Suppliers Group - a group of countries that seeks to contribute to the non-proliferation of nuclear weapons through the implementation of guidelines for nuclear exports and nuclear-related exports - to lift its restrictions on nuclear trade with India.

Yet, as Varadarajan pointed out, the 123 Agreement "will form the template for changes to the Nuclear Suppliers Group guidelines". So backing down on core concerns and kicking the can further down the road, as some suggest, might not be the best strategy for India. Postponement of tackling the concern will only result in more goalposts being shifted. This is evident from India's experience over the past two years.

India and the US have entered the home stretch in their effort to operationalize their civilian nuclear energy cooperation, and this last lap is proving to be more daunting than expected.

Sudha Ramachandran is an independent journalist/researcher based in Bangalore.