Deal breather, not deal breaker

By setting boundary conditions for the Government, the CPI(M) has opened a door for addressing India's concerns over the nuclear agreement with the U.S. In my view, the Prime Minister should seriously consider amending the Indian Atomic Energy Act to incorporate all the Article 14 protections against the "right of return" contained in the draft 123 agreement. If the Americans can have their Hyde Act, so can the Indians.


20 August 2007
The Hindu

Deal breather, not deal breaker

By setting boundary conditions for the Government, the CPI(M) has opened a door for addressing India's concerns over the nuclear agreement with the U.S.

Siddharth Varadarajan

New Delhi: Saturday's statement by the Communist Party of India (Marxist) on the Indo-U.S. nuclear deal is as unyielding as the Left parties' earlier stand but the recommendation that the Government not proceed "till all the objections are considered" opens a passage for moving forward provided the Prime Minister chooses to do so. The Left statement of August 7 had baldly asked the Government "not to proceed further with the operationalising of the agreement". In contrast, Saturday's announcement allows the debate to move from general or outright rejection to a consideration of specific objections.

At the same time, the CPI(M) statement reminds the United Progressive Alliance that "a majority in Parliament [does] not support the nuclear cooperation deal". The threat implied is clear: If negotiations with the International Atomic Energy Agency begin without "all the objections [being] considered" and the Hyde act's implications being evaluated, the future of the Government will be jeopardized. The Prime Minister and his advisers may resent this kind of ultimatum but they have only themselves to blame. After all, Dr. Manmohan Singh should have known better than to seek publicly to call the Left's bluff, and to do so in an interview to a newspaper published from the Red bastion of Kolkata.

Whatever the Government's discomfiture, there is a silver lining for the country in the opposition the 123 agreement has evoked inside Parliament. Until now, it is Washington which has leveraged the executive-legislative divide to extract more than its pound of flesh from Delhi. The Hyde Act passed by U.S. Congress last December subverted the finely wrought reciprocity of the July 18, 2005 (J18) joint statement and the fuel supply assurances of the March 2, 2006 separation plan (M2). India's negotiators fought their way back in the 123 agreement but the spectre of Hyde remains to be exorcised.

On the eve of crucial interactions with the IAEA and Nuclear Suppliers Group, with one major element of the nuclear deal already "frozen", it is vital that the sentiments of the majority of elected representatives be used to strengthen the hands of India. The NSG is particularly vital. In J18, the U.S. pledged to "work with friends and allies to adjust international regimes to enable full civil nuclear energy cooperation and trade with India". This means the NSG waiver allowing nuclear trade must be unconditional and non-discriminatory. However, given the Hyde Act's provisions and recent statements by U.S. officials, it would be naïve to assume this is what Washington intends to secure. No doubt India has supporters at the NSG – Russia and France are more anxious for the 45-nation cartel to alter its guidelines than even the U.S. – but America's capacity to play both sides of the fence in order to wrest back concessions made to India in the 123 negotiations should not be underestimated. In this respect, the current controversy in Parliament sends a clear message to the U.S. that India will walk away if the NSG waiver does not meet the J18 benchmark.

As for the concrete technical and foreign policy objections the CPI(M) wants the Government to consider, many of these have already been articulated inside Parliament as well as by commentators outside. The more tightly these objections are framed in the weeks ahead, the greater is the likelihood of MPs forcing the Prime Minister to address them.

Even on issues where the Government can trot out an easy answer, the Prime Minister should consider using Parliament to strengthen his hand. By taking Parliament into confidence about the contours of the civil-military nuclear separation plan on February 27, 2006, Dr. Singh was able to present Washington with a fait accompli and fend off pressure to place India's fast breeder reactors and most of its pressurised heavy water reactors under international safeguards. The Prime Minister repeated this exercise in August 2006 to draw red lines as far as reprocessing, fall-back safeguards and some other issues were concerned. But since the majority of MPs feel the 123 agreement still contains ambiguities – especially when read together with the Hyde Act – a similar exercise is called for today.

For example, some commentators have noted that the Indian 123 agreement does not contain a sentence found in Article 2.1 of China's 123 agreement with the U.S., namely that "the parties recognize, with respect to the observance of this agreement, the principle of international law that provides that a party may not invoke the provisions of its internal law as justification for its failure to perform a treaty." Thus, it is felt the U.S. administration can always claim the Hyde Act's restrictions trump the 123 agreement's more generous commitments.

Though the Indian negotiators had an identical line in all their drafts and tried till the end to incorporate it in the final agreed text, the U.S. remained unyielding, claiming that Congress would shoot it down. But the Indian side did manage to push through another article – 16.4 – that the agreement "shall be implemented in good faith and in accordance with the principles of international law". The phrase "principles of international law" is a clear reference to the
Vienna Convention on the Law of Treaties. Article 27 of the Convention – which, as a part of customary international law, does not have to be cited to be applicable -- states: "A party may not invoke the provisions of its internal law as justification for its failure to perform a treaty".

Balance Hyde with Indian law

Insofar as the text of an agreement can protect one side when the other is bent on reneging on its commitments, Article 16.4 of the Indian 123 and the Vienna Convention give New Delhi as much legal cover as Article 2.1 of the Chinese 123 gives Beijing. Of course, India would get more effective protection by building a strategic fuel reserve on its territory. There is, however, the issue of the U.S. "right of return" of exported material in the event of termination of cooperation and the fear that this strategic reserve may not be fully immunised from returnability.

Though Article 14 of the 123 provides effective protection for India, the Government should consider the merit of adding a further layer of insurance under domestic statute just to be doubly sure. Specifically, Parliament could enact an amendment to the Atomic Energy Act of 1962 as well as a change in the Special Chemicals, Organisms, Materials, Equipment and Technologies (SCOMET) guidelines making it illegal for nuclear material or equipment to be transferred out of the country if the transfer would disrupt the continuous operation of our power reactors or pose an environmental or security risk. Similarly, the AEA could be amended to make it illegal to import into India any reactor under a commercial contract which does not explicitly provide for the reprocessing of spent fuel.

In other words, rather than seeing the Left's call for Parliament to play a role in validating the nuclear deal as something adversarial, the Prime Minister should realise the legislature is very much an instrument of modern diplomacy. By amending its domestic statute, India can effectively balance the provisions of the Hyde Act. If the U.S. insists in the future that internal law trumps the 123 agreement and uses that to build a case for demanding the return of material even when the strict conditions of Article 14 have not been met, India would be bound by its own internal law not to oblige Washington.

All of this, of course, begs the question of India's capacity to hold its own internationally. Washington's aim is to build a strategic relationship in which India can act as an outsourcer of U.S. hegemony in Asia. But there is a dialectic here as well. The U.S. created the NSG after the 1974 Pokhran nuclear test to isolate Delhi from all high technology trade; but today, in order to allow itself to enjoy the strategic and economic benefits of nuclear commerce with India, it must perforce open the door for everyone else as well. What Washington intends to be a chain that will tie New Delhi down could very well turn into its opposite.

Unfortunately, the Manmohan Singh government's lack of confidence in the country's negotiating strength has led it to make vital concessions over the past two years. Even today, many decisions of enormous foreign policy significance are taken casually, without due application of mind. Next month's Quadrilateral Power naval exercise (with an embedded Singaporean ship thrown in as cover) is one example. In this respect, it is perhaps more crucial that the Government be urged not to operationalise the June 2005 Indo-U.S. Defence Framework Agreement rather than the nuclear initiative.

Deal or no deal, there will always be pressure on the foreign policy front. In a country like India with sharply polarised class interests, compromising decisions can be taken even without external pressure. India's ability to withstand external and internal pressures will depend crucially on the configuration of political forces within the country at any given moment in time. The balance of forces today favours an independent foreign policy. There is no reason why this should change tomorrow.