Pranab leaves for Tehran today for joint commission meet and though concerns remain over the cost, project structure and security of the gas pipeline, Indian officials say India intends seriously to pursue the project...
31 October 2008
The Hindu
India to make fresh proposals on Iran pipeline
Siddharth Varadarajan
New Delhi: Falling oil prices and the successful conclusion of the Indo-U.S. nuclear agreement have come together to produce a renewed Indian interest in the $7.4 billion natural gas pipeline from Iran.
According to senior officials, External Affairs Minister Pranab Mukherjee, who departs for Tehran on Friday for the 15th meeting of the India-Iran Joint Commission, will carry with him a new set of proposals aimed at addressing the few outstanding concerns still remaining over the cost, project structure and security of the Iran-Pakistan-India pipeline.
The discussion India and Iran will have on the pipeline will build on the issues touched upon by both sides in their exchange of ‘non-papers’ earlier this year. During the visit to Delhi of Iranian President Mahmoud Ahmadinejad on April 29, India has drawn Tehran’s attention to a number of its concerns. The Iranian side replied to these concerns in July but matters did not progress any further as the Manmohan Singh government was wary of provoking the Bush administration at a time when Washington’s help was needed in the Nuclear Suppliers Group.
In its non-paper, Iran identified, for the first time, phases 19, 20 and 21 of the South Pars offshore gas field as the source for the gas to be fed into the IPI pipeline. Iran also said it was willing to examine a trilateral arrangement for the delivery of gas to India on the Pakistan-India border, as the Indian note had suggested.
In the absence of active Indian interest in the project, Pakistan has been suggesting running the pipeline northwards into China. But the Iranians are keen to reach agreement with India.
Among the specific ideas India intends to discuss with Iran on November 1 and 2 are the role that cross-investments in both upstream and downstream projects in all three countries could play in fostering co-dependency and confidence in the project. In addition, India would like to explore the possibility of Iran undertaking to provide alternative fuel to IPI gas-fed downstream projects in India in the event of supply disruption for any reason.
“The project is viable and good but the hype about a ‘peace pipeline’ has meant that we haven’t really been hard-nosed about the commercial details,” a senior Indian official told The Hindu. But given the country’s growing energy needs, India intends seriously to pursue the project, the official said.
If the passage of the NSG exemption and the 123 Agreement has eased some of the diplomatic pressure the Manmohan Singh government was feeling, the recent fall in oil prices is seen as strengthening the country’s negotiating hand on the prickly question of gas tariffs. With oil prices set to rise eventually as the world slowly pulls out of recession, India has a limited window to take advantage of.
31 October 2008
30 October 2008
India and the U.S. presidential election
Barack Obama will not cure the pathology that is U.S. foreign policy but a McCain victory, improbable though it seems, will exacerbate tensions across the globe.30 October 2008
The Hindu
India and the U.S. presidential election
Siddharth Varadarajan
Why is it that when the American people and pretty much the entire world want Barack Obama to be elected President of the United States, India’s strategic and business elites seem to be rooting for John McCain? As the Republican contender’s star has faded, the cries of support from Delhi have become less muted but the subliminal desire of the average decision-maker in Delhi is still for the Senator from Arizona. What makes the contrast all the more glaring is t he obvious civilisational affinity India ought to have with the ethos, tenor and symbolism of Senator Obama’s campaign and candidacy. Besides, the Bush presidency has so littered our wider neighbourhood with new conflicts and so exacerbated old ones that it is hard to see what possible interest India could have in the ‘four more years of the same’ that Senator McCain stands for.
To the extent to which it was a Republican administration that took the initiative to open the doors for international nuclear commerce with India, the elite say they are justified in wishing Mr. McCain well. Their argument goes something like this. President Bush might have launched a disastrous war in Iraq and may be responsible for unleashing a financial tsunami across the world through his promotion of unregulated capitalism but at least he was “good for India.” And of the two presidential contenders, they say, Mr. McCain is most likely to continue pursuing a strategic partnership with India, even if his other foreign policy moves generate tension between the U.S. and major powers like Russia and China.
In contrast, Mr. Obama is seen as less likely to treat India as a special partner. His lukewarm support for the civil nuclear initiative, his successful attempt in the Senate to limit the amount of nuclear fuel India can receive under the Hyde Act, his advocacy of the Comprehensive Test Ban Treaty and his critical remarks on outsourcing are all cited by strategic analysts as evidence that an Obama presidency might lead to a return to the equivocation of the Clinton era. No serious analyst in India seriously expects a return to Washington’s “hyphenated” South Asian policy of political equidistance between New Delhi and Islamabad. But the fear is that a Democratic administration might try and revive the old Clinton policy of cozying up to China as a means of putting pressure on India.
What this simplistic narrative ignores is the broad bipartisan backing that President Bush’s opening up to India enjoys. Perhaps no vector of foreign policy other than Israel so unites the disparate ideological, political, institutional and corporate agendas of America than the U.S. drive to build a strategic partnership with India centred around fully opening up the Indian economy and establishing close military-to-military relations. No doubt the neoconservatism of Mr. Bush and his advisers gave this agenda a certain cutting edge but the broad contours of the U.S.-India relationship as they emerged in the past eight years were in some sense already determined by the events of the 1990s, from the end of the Cold War to the end of the ‘unipolar moment’ and the 1998 Pokhran-II tests. And given American compulsions and the continuing state of flux in international politics, there is every reason to expect continuity in U.S. policy towards India regardless of who gets elected to the White House next month.
From the Indian point of view, predictability of this kind is always better than uncertainty. But the key question is for India to know what it wants. Indeed, one of the biggest foreign policy challenges facing the country over the next decade will be handling the mismatch between what Washington and Delhi expect from their relationship. Having cleared the way for India to access nuclear supplies globally, the U.S. will look for payoffs across a range of areas. Unfortunately for India, this expectations-mismatch is not static but dynamic. And it will be a function of how America’s relations with other centres of world power undergo change.
Though India has managed to keep its political relations with Russia, China and Europe on a more or less even keel, the strains of attachment to Washington can already be seen here and there. Now that the Nuclear Suppliers Group has amended its rules, however, there is no reason why India cannot — to paraphrase the 19th century Austrian diplomatist Schwarzenberg — astonish the world by “the depth of her ingratitude” and deny the U.S. the special consideration it is expecting. In the absence of tension between the big powers, this would be a viable strategy, even if it would require nerves of steel. But as America’s relations with Russia deteriorate, as they surely will under a McCain presidency, India will find it difficult to maintain a policy of strategic promiscuity. Likewise, India will have to weigh its options carefully if U.S. policy towards China under either Mr. McCain or Mr. Obama swings dramatically away from the centre, where it is now, towards either greater confrontation or greater entente. Both these swings could have adverse consequences for India.
As in 2000, when Mr. Bush was elected President, and again in 2004, the Indian elite must not make the mistake of believing what is bad for the world can actually be good for India. The dynamic of international politics is such today that any exacerbation of tension between the major powers or within regions in the extended neighbourhood of India such as East, Central or West Asia and the Caucasus will end up reducing the country’s space for manoeuvre. And under Mr. McCain, such tensions will be a constant factor, especially with his half-baked plan for a ‘concert of democracies.’
This is not to say that an Obama presidency will fully end the pathology of Machtpolitik that has made America such a dangerous country. He is holding out the promise of change, and if he wins it will partly be on the basis of the appeal of that promise. Nevertheless, the future of U.S. foreign policy will be guided by larger considerations of political economy, especially the restructuring of American capital which the current financial crisis has started. Certainly, the fact that Mr. Obama seems as committed to military Keynesianism as Mr. McCain is not a good omen for a world tired of the use of force.
But if Mr. McCain will be worse for the world and India as U.S. President, this does not mean an Obama presidency will not pose a specific set of challenges to New Delhi.
Return of CTBT
Depending on the scale of the wave in Mr. Obama’s favour, the Democrats may well achieve the two-thirds majority they need in the Senate to ratify the CTBT. The Illinois Senator has made no bones about the priority he attaches to the CTBT’s early entry into force. Even without a Democratic clean sweep, the political and military terrain in the U.S. is no longer as hostile to a test ban as it was in 1999 when the Senate rebuffed President Clinton and sent the treaty into cold storage. As such, India would do well to prepare itself for the inevitability of the CTBT coming back on to the international agenda about a year or two from now. U.S. ratification would make Beijing’s formal accession almost inevitable. Would India at that point do what Atal Bihari Vajpayee implied when he told the United Nations as Prime Minister in 1998 that the country would not “stand in the way of the CTBT entering into force”, that is, sign the treaty, as it must, for it to enter into force? Either way, Indian policymakers need to seriously reopen the CTBT docket and prepare a coherent strategy for dealing with this eventuality.
The second major challenge an Obama presidency is likely to pose for India is on the Pakistan front. The Democratic frontrunner has made no bones about what he would do as President if Islamabad is found wanting in its commitment to the ‘war on terror’ in Afghanistan. Come 2009, there is a sense in which Islamabad is increasingly going to be in Washington’s cross-hairs if it continues to maintain subterranean links with those sections of the Taliban that American military commanders feel they are unable to cut a deal with. The gradual but steady movement of the locus of the ‘war on terror’ eastward, from Iraq to Afghanistan to Pakistan, may please some observers but the consequences of Pakistan imploding will be extremely negative for Indian security.
A prudential Indian strategy would be one which aims to create incentives for the Pakistani state and military establishment to make the course correction they badly need to make if Pakistan is to survive as a viable nation state. To the extent to which Pakistan’s ambitions and sense of insecurity vis-À-vis India is driving its Afghan policy, New Delhi needs to find ways of working with Islamabad on a broad set of confidence-building measures. Whether Mr. Obama or Mr. McCain, the 44th occupant of the White House is likely to preside over a major expansion of American military power in India’s immediate neighbourhood. Dealing with the reality of that expansion — and seeking its eventual reversal on the basis of stability in Afghanistan — will be a major challenge for Indian diplomacy.
25 October 2008
Dateline Beijing: Manmohan blames it on ‘casino’ capitalism, regulatory failure
The Prime Minister finally said what he should have been saying two years ago ...
25 October 2008
The Hindu
Manmohan blames it on ‘casino’ capitalism, regulatory failure
Siddharth Varadarajan
Beijing: On a day when stock markets plummeted by more than 10 per cent worldwide, Prime Minister Manmohan Singh put on his professorial hat to tell Asian and European leaders that a “collective international effort” to the international financial crisis must involve infrastructure investments in developing countries as a “counter-cyclical device” as well as the creation of a “global monitoring authority to promote global supervision” of cross-border investment, trade and banking.
In candid and even hard-hitting remarks to the first closed session of the Asia-Europe Meeting summit which got under way here on Friday, Dr. Singh said globalisation without the structure of global financial governance had led to severe problems. “Clearly there has been a massive failure of regulatory and supervisory powers. Speculators have had a free run for far too long a period,” he said. “International institutions like the IMF have also not covered themselves with glory. There has been an unacceptable failure of effective multilateral supervision of major developed economies and in particular of what has been going on in their financial markets.”
Dr. Singh was chosen by ASEM’s Chinese hosts to be the last speaker in the key session devoted to an informal exchange of views on the financial crisis. Underlining the sense in which objective developments have made Beijing and Delhi the focus of the heightened international attention on the relative resilience of the Asian economy, Chinese television showed Wen Jiabao enthusiastically welcoming Dr. Singh to the inaugural session of the ASEM summit.
The closed session, which was relayed live on closed circuit television to ministers and officials assembled in another room, was limited to the leaders themselves, many of whom sat in the room without even a single aide.
Speaking to the assembled leaders immediately after Dr. Singh’s intervention, Premier Wen said everyone in the room was aware of the Prime Minister’s long experience in successfully managing the Indian economy.
ASEM, now into its seven meeting, has 45 members from the two continents. India, which recently joined the grouping along with Pakistan, is attending the biannual summit for the first time.
25 October 2008
The Hindu
Manmohan blames it on ‘casino’ capitalism, regulatory failure
Siddharth Varadarajan
Beijing: On a day when stock markets plummeted by more than 10 per cent worldwide, Prime Minister Manmohan Singh put on his professorial hat to tell Asian and European leaders that a “collective international effort” to the international financial crisis must involve infrastructure investments in developing countries as a “counter-cyclical device” as well as the creation of a “global monitoring authority to promote global supervision” of cross-border investment, trade and banking.
In candid and even hard-hitting remarks to the first closed session of the Asia-Europe Meeting summit which got under way here on Friday, Dr. Singh said globalisation without the structure of global financial governance had led to severe problems. “Clearly there has been a massive failure of regulatory and supervisory powers. Speculators have had a free run for far too long a period,” he said. “International institutions like the IMF have also not covered themselves with glory. There has been an unacceptable failure of effective multilateral supervision of major developed economies and in particular of what has been going on in their financial markets.”
Dr. Singh was chosen by ASEM’s Chinese hosts to be the last speaker in the key session devoted to an informal exchange of views on the financial crisis. Underlining the sense in which objective developments have made Beijing and Delhi the focus of the heightened international attention on the relative resilience of the Asian economy, Chinese television showed Wen Jiabao enthusiastically welcoming Dr. Singh to the inaugural session of the ASEM summit.
The closed session, which was relayed live on closed circuit television to ministers and officials assembled in another room, was limited to the leaders themselves, many of whom sat in the room without even a single aide.
Speaking to the assembled leaders immediately after Dr. Singh’s intervention, Premier Wen said everyone in the room was aware of the Prime Minister’s long experience in successfully managing the Indian economy.
ASEM, now into its seven meeting, has 45 members from the two continents. India, which recently joined the grouping along with Pakistan, is attending the biannual summit for the first time.
Dateline Beijing: Manmohan Singh attacks speculators, warns of impact on real economy
Of course, critics of the Prime Minister are likely to ask why these sage words were not remembered when booming stock markets in India and the world created the impression that the real economy was firmly on the ascendant and that deregulation and reform was all that was needed to generate growth... 25 October 2008
The Hindu
Manmohan Singh attacks speculators, warns of impact on real economy
Siddharth Varadarajan
Beijing: Quoting a celebrated passage from John Maynard Keynes’ The General Theory of Employment, Interest and Money, Prime Minister Manmohan Singh said on Friday that any international agenda to reform the international financial system would have to take on board the “economically damaging role of excessive speculative activity.”
Dr. Singh’s remarks came on a day that saw President Nicolas Sarkozy of France question the role of international credit agencies and appeal to Asia to stand firmly with Europe in pushing for fundamental reforms in the international financial system when the G-20 countries meet in Washington next month.
Speaking to a closed session of the Asia Europe Meeting summit over dinner here, Dr. Singh reminded the leaders of 44 key Asian and European nations of Keynes’ dictum that speculators did no harm as bubbles on a steady stream of enterprise. “But the position is serious when enterprise becomes the bubble on a whirlpool of speculation. When the capital development of a country becomes a byproduct of the activities of a casino, the job is likely to be ill-done.”
Critics of the Prime Minister are likely to ask why these sage words were not remembered when booming stock markets in India and the world created the impression that the real economy was firmly on the ascendant and that deregulation and reform was all that was needed to generate growth. And as the Sensex plunged 11 per cent in one day, Dr. Singh’s government is already coming under pressure to bail out the same speculators by committing public financial institutions to a rescue package aimed at shoring up equity values even at the cost of their own balance sheets.
But with several European leaders looking to Asia and to China, India and Japan in particular to show a way out of the current economic free-fall, the Prime Minister presented the most detailed analysis of the crisis he has offered to date, including a number of proposals that senior officials said were aimed at striking a balance between the ‘business as usual’ approach of the United States and the call for a radical overhaul of the Bretton Woods system that many European leaders have begun talking about.
Blaming the international financial crisis on the failure of regulation and supervision in major developed countries, risk management in private financial institutions and the market discipline mechanism, Dr. Singh said “the sad truth is that in this age of globalisation we have a global economy of sorts but it is not supported by a global polity to provide effective governance.”
The immediate task facing the world was the declogging of credit markets the world over. This, in turn, required coordinated global action to restore confidence in these markets.
In terms of concrete proposals, the Prime Minister said the International Monetary Fund and World Bank had to provide assistance to vulnerable countries “with less service conditionalities and greater flexibility.”
Among his other proposals were: countries with strong foreign exchange positions could make additional resources available to the international financial institutions; as a counter-cyclical device, increased infrastructure investments in developing countries, if backed by increased resources flows from multilateral financial institutions, can act as a powerful stabilizer; the IMF should consider creating liquidity through a fresh allocation of Special Drawing Rights (SDRs) in favour of multilateral development finance institutions
With France advocating a more dramatic restructuring and China, Japan, Korea and the Asean countries proposing expanding their Chiang Mai initiative into a $80 billion regional stabilisation fund, these Indian proposals seem firmly anchored in the Bretton Woods system.
At the same time, Dr. Singh said the world must objectively analyse why the failures which led to the financial crisis have occurred with such ferocity. “This is necessary to put in place a new set of rules which will prevent recurrence of such failures.”
Though he expressed confidence in the ability of the Indian economy to grow at 7 to 7.5 per cent this year, Dr. Singh said the country “cannot remain totally unaffected when the global economy and financial system are in deep trouble.” Noting that the stock market and rupee were under pressure due to capital outflows caused by panicky foreign institutional investors, he warned, “Sooner or later, the real economy is bound to experience the pain.”
In his speech, to the ASEM summit, President Hu Jintao of China called for policy coordination and strengthened cooperation so that the international community could come up with a “common response” to a crisis which had caused “shockwaves” throughout the world.
Like India, China has also not yet conveyed its acceptance of U.S. President George W. Bush’s invitation to attend a G-20 summit to discuss the international financial crisis in Washington next month. Though Beijing has adopted domestic measures and has joined hands with Asian partners to examine ways of restoring confidence and stability to regional markets, it is wary of being asked to use its resources to bail out a system that is in crisis because of regulatory failures in the U.S.
Most European leaders who spoke on Friday spoke of Asia as an outpost of relative stability in real economic terms and warned against protectionism as a response to the hard times which seem around the corner.
24 October 2008
Dateline Beijing: Financial crisis to dominate Asia-Europe summit
Everyone agrees on the need for discussions, but solutions remain elusive ... 24 October 2008
The Hindu
Financial crisis to dominate Asia-Europe summit
Siddharth Varadarajan
Beijing: With the omens of a global recession swirling around them, leaders from 45 Asian and European countries will meet here Friday to discuss a collective response to the ongoing international financial crisis. The seventh summit of the Asia-Europe Meeting (ASEM) was scheduled a while ago but its entire agenda has been overtaken by the need for an emergency response to the liquidity and credit squeeze radiating outwards from the United States that has seen stock market values, commodity and asset prices plummet in recent weeks across every continent.
Arriving here from Tokyo on Thursday night, Prime Minister Manmohan Singh said he hoped “the meeting of minds between Europe and Asia will produce a solution to many global problems, including the international financial crisis.” Other leaders — like Nicolas Sarkozy of France, Gloria Macapagal Arroyo of the Philippines and Somchai Wongsawat of Thailand — also arrived in Beijing with ideas for an emergency response to the crisis. But if ASEM stalwarts like France, China, Germany and Japan — now joined by India for the first time — agree that the old Bretton Woods system has come to an end and needs to be replaced by a new financial order, no one has yet come up with a concrete alternative, let alone a road map for an orderly transition from the current anarchy that has taken hold of the international capitalist system.
In the absence of well-formulated proposals, the only firm suggestion that has been made so far is for more meetings. Thus, at U.S. President George Bush’s invitation, the G-20 countries — the G-8 plus Argentina, Brazil, Mexico, China, India, Indonesia, Saudi Arabia, South Korea, South Africa, the European Union, Turkey and Australia — will meet in Washington, D.C. on November 15 to discuss the crisis. Indian officials said Prime Minister Singh had been invited to attend but that the government would take a final decision based on how the discussions at the ASEM summit proceed on Friday and Saturday.
Having been caught on the wrong foot during the 1997 crisis, East and South-East Asian countries seem anxious to play a leading role in crafting both the emergency response as well as the scaffolding of a new system.
Thus, at Tokyo’s urging, Japan, China and South Korea are likely to announce the creation of a well-funded joint financial regulatory body to help stabilise Asian financial markets, the Yomiuri Shimbun reported on Thursday. Thailand, the current chair of Asean, is proposing an Asian financial pool of $350 billion to be set up and managed by the Asean countries plus Japan, China and South Korea to bolster regional markets and fund infrastructure projects. Ms. Arroyo has also suggested a similar fund, drawn on a fraction of the region’s foreign exchange reserves, to be deployed for making soft loans to Asian banks holding non-performing assets.
Most of these emergency measures involve the redeployment of Asian surpluses from dollar-denominated instruments to those in yen and the euro. Insofar as the Bretton Woods system has been underpinned by the centrality of the dollar, it is likely that the restructuring generated by the current financial crisis will involve a shift in the relative hierarchy of currencies. This, apart from tighter oversight and regulation of money and capital markets whose unfettered excesses caused the current meltdown in the first place.
A two-day summit is unlikely to provide answers to all of these questions. But the fact that Asian and European leaders will be discussing a crisis that is essentially of America’s making underlines the fact that any overhaul of international financial architecture is bound to have profound geopolitical implications as well.
23 October 2008
Dateline Tokyo: India, Japan say new security ties not directed against China
but Joint declaration creates framework for closer political, military interaction in Asia...23 October 2008
The Hindu
India, Japan say new security ties not directed against China
Siddharth Varadarajan
Tokyo: On a day that saw India and Japan sign a declaration on security cooperation and assert that their partnership would be “an essential pillar for the future architecture of the region,” it was left to Prime Minister Manmohan Singh to introduce a harsh dose of reality by reminding an elite gathering of Japanese and Indian businessmen that the increase in India’s bilateral trade with China in the past one year alone is more than the whole of India’s total trade with Japan.
That one statistic was not intended to minimise the importance India attaches to its “strategic and global partnership” with Japan, Indian officials said, but merely to drive home the point that India was not going to allow its ties with Tokyo to affect its relations with Beijing. Indeed, in a press conference at the residence of Japanese Prime Minister Taro Aso on Wednesday evening, Dr. Singh sought to emphasise that India’s economic relations and security cooperation with Japan would not be “at the cost of any third country, least of all China.”
Though the security declaration largely contains elements like joint exercises, disaster management and counter-terrorism which figure in Indian agreements with many countries, what is likely to raise eyebrows around Asia is the fact that Japan considers India so crucial to its strategic calculus that it is only the third country — after the United States and Australia — with which it has signed such a document. And that India appears to have picked Japan as its most important partner for the task of fashioning the political and security dimensions of Asia’s emerging institutional structure.
Like Japan’s agreements with the U.S. and Australia, the “common commitment” of India and Japan to “democracy, open society, human rights and the rule of law” is foregrounded again, though the scope of security cooperation envisaged is far less than Tokyo’s military alliance-driven arrangements with Washington and Canberra. Terrorism, piracy and non-proliferation are covered but there is no reference in the Indo-Japan text to the “new security challenges and threats” referred to in the Japan-Australia agreement — a code phrase for the rise of China.
Mindful of the symbolism, however, Mr. Aso, who is also the intellectual author of the growing security-centric dimension to Japanese foreign policy, sought to play down any suggestion that Tokyo was still pursuing his earlier idea of trilateral or even quadrilateral military cooperation in Asia. Asked whether the Japan-India joint declaration could serve as the framework for an eventual security framework involving the U.S. with China as the special object of concern, he said: “We regard security cooperation with India as very important ... There was a mention of China — and we do not have any assumption of a third country as a target such as China.”
In terms of its contents, the new security declaration essentially builds on the existing momentum in defence ties while seeking to gradually widen the ambit with a view to influencing the nature of Asia’s emerging security architecture. Among the elements of cooperation listed are “policy coordination on regional affairs in the Asia-Pacific region,” “bilateral cooperation within multilateral frameworks in Asia, in particular the East Asia Summit, Asean Regional Forum and the ReCAAP process” against piracy in South-East Asia.
The mechanisms of cooperation include regular foreign office consultations, and defence ministry and armed forces interactions, including “bilateral and multilateral exercises.”
While bilateral exercises are routine, some multilateral exercises have been controversial, like the 2007 Malabar war games at sea involving ships from India, Japan, Australia, the U.S. and Singapore. Both China and Russia conveyed their concerns at the time, saying Asia should avoid “exclusive” groupings.
As the Foreign Minister in the Shinzo Abe government, Mr. Aso had advocated a trilateral security dialogue involving Japan, India and the U.S., an idea South Block was lukewarm to. However, a Track-II interaction involving the former U.S. Deputy Secretary of State, Richard Armitage, the Confederation of Indian Industry and the Japan Institute of International Affairs issued a document in Tokyo this week urging a deepening of Indo-Japan security ties as a stepping stone for working closely with the U.S. towards fashioning “an open and inclusive regional framework in Asia that advances our shared norms and strengthens cooperation on new challenges.”
While acknowledging that the form the security declaration took was new as far as Indian foreign policy was concerned, Foreign Secretary Shiv Shankar Menon told reporters here that this was more a product of Japan’s long-standing reluctance to cooperate in matters other than economic with India. “I wouldn’t say the ideas [in the declaration] are new,” Mr. Menon said, when asked about the significance of the document. “We have 24 counter-terrorism joint working groups, for example, and military exercises with several states. But the format is new because of the particularity of Japan.” He said political and security cooperation was now the “second leg” of the bilateral relationship. And he made it clear India still believed the first leg, economic cooperation, had yet to realise its full potential.
Japan was committing more than $4 billion at this time of global uncertainty to the Delhi-Mumbai freight and industrial corridors, he said, and the number of Japanese companies involved in India had grown dramatically.
While defending the security declaration as one which gave India the opportunity to build on what it was already doing, senior officials concede that the document is largely the product of Mr. Aso’s exertions. Indeed, one official said the erstwhile Yasuo Fukuda government would probably not have considered the security agreement a priority, perhaps because of greater sensitivity over not wanting to send the wrong signals to Beijing and the rest of Asia.
But Mr. Menon emphasised that India did not believe any of its relations were exclusive. He said that at the lunch with Japanese and Indian businessmen, for example, Prime Minister Singh had spoken of India and Japan as part of an ‘arc of prosperity’ that could come up with an “Asian response” to the global financial crisis. “But this is a conversation we will have later this week in Beijing as well, during the Asia-Europe Meeting, with other countries.”
Dateline Tokyo: Japan not keen on nuclear cooperation with India
We think it is more important you stick to your no-test moratorium, says Prime Minister Aso...23 October 2008
The Hindu
Japan not keen on nuclear cooperation with India
Siddharth Varadarajan
TOKYO: Despite finally supporting the United States-India civil nuclear initiative at the International Atomic Energy Agency and Nuclear Suppliers Group, Japan is less interested in exporting nuclear material to India than in ensuring New Delhi sticks to its non-proliferation pledges.
Asked whether his government would now be prepared to encourage Japanese firms to export reactor components to India, Japan’s Prime Minister, Taro Aso, baldly told a joint press conference with Prime Minister Manmohan Singh on Wednesday that “we are not engaged in discussions regarding nuclear energy with India.”
He revealed that Dr. Singh had raised the subject in their summit-level talks here. “Prime Minister Singh did express his desire to have future cooperation, and I said it is important that India lives up to its commitments and actions, including continuing its moratorium on nuclear testing.” As for a Japan-India nuclear cooperation agreement — considered by some Japanese industry analysts as a legal requirement for any nuclear exports from here — he said somewhat cryptically, “We will have to take into account various factors.”
Asked what he expected from Tokyo in the civil nuclear field, Dr. Singh said India was very grateful to the Government of Japan for the support it had extended at the IAEA and NSG. “It is our sincere desire to strengthen and develop our cooperation with Japan in civil nuclear energy but I do recognize the sensitivity of this in Japan and therefore I mentioned [to Prime Minister Aso] that we will move at a pace at which the Japanese people and government are comfortable.”
The joint statement issued at the end of the summit only noted that the two Prime Ministers “shared the view that nuclear energy can play an important role as a safe, sustainable and non-polluting source of energy.”
22 October 2008
India will wait till Japan is “ready” for nuclear cooperation
Ties with Tokyo will play a significant role in the emerging Asian security architecture, says Manmohan Singh on an official visit to Japan...22 October 2008
The Hindu
India will wait till Japan is “ready” for nuclear cooperation
The Japanese side has been keen to expand security cooperation with India
Siddharth Varadarajan
Tokyo: Japan was one of the eight countries — alongside China — to hold out till the end on the waiver for India at the Nuclear Suppliers Group meeting in Vienna last month and is in no hurry to embrace the idea of nuclear cooperation with New Delhi. But Indian officials say that as far as they are concerned, there are at present no legal obstacles to Japanese firms like Hitachi and Toshiba supplying reactor components for safeguarded nuclear power projects in India.
According to senior Indian officials, a bilateral nuclear cooperation agreement between the two countries is not on the agenda and will not be the subject of discussion between Prime Minister Manmohan Singh and his Japanese counterpart Taro Aso when the two leaders meet here on Wednesday. The officials said India was mindful of the special sensitivity nuclear issues had in Japan. “When it comes to [nuclear] cooperation between us, when they are ready, we are ready,” a senior official told reporters. He said more time was needed for everyone to factor in the changes that had been ushered in as a result of the NSG’s decision to allow nuclear commerce with India. “It’s not just a question of Japan, this is new for everybody, including for us. So don’t expect a big bang.”
“Internally divided”
Indian officials concede that Japan is internally divided on the question of nuclear cooperation with India. Under corporate pressure, the Ministry of Economy, Trade and Industry (METI) favours a more liberal approach towards India. But the Ministry of Foreign Affairs — as well as Japanese civil society — is continuing to stick to a hardline non-proliferation stance in which any encouragement to civil nuclear energy in India is seen as tantamount to legitimising India’s nuclear weapons programme.
As Foreign Minister in 2006, Mr. Aso had told a Diet panel that the U.S.-India nuclear agreement could weaken the Nuclear Non-Proliferation Treaty. In an interview to PTI on Tuesday, he sidestepped a question on whether Japanese firms would be allowed to export nuclear components to India, saying only that “Japan has pursued steadily the construction of nuclear power plants, while making an effort to conform with” non-proliferation standards and “seeking international understanding and trust.” At the same time, he did plug Japanese capabilities in the field, saying, “Japan’s nuclear industry, which has a solid record of constructing power plants even during difficult times for the industry, is one of the most experienced and the most advanced industries.”
Japan’s reluctance to countenance cooperation with India in civil nuclear matters became evident last month when the Third Japan-India Energy Dialogue steered clear of any concrete discussion on the subject. The dialogue, held in Tokyo on September 17 between Deputy Chair of the Planning Commission Montek Singh Ahluwalia and Toshihiro Nikai of METI envisaged cooperation only in conservation and efficiency, coal, oil and natural gas.
The only concession to nuclear was a reference to the NSG’s September 6 waiver and a promise to “exchange views and information of their respective nuclear energy policy.” At the same time, the door to nuclear cooperation was kept slightly ajar, with the two emphasising that “bilateral cooperation based on the Japan-India Energy Dialogue will not be limited to what has been identified above and that [the two countries would] continue to further deepen their bilateral cooperation.”
Speaking about the bilateral relationship and the growing economic and political cooperation between the two countries, Indian officials accompanying the Prime Minister on his official visit here said Japan, in recent years, had obviously made a “strategic bet” on India. Thirty per cent of all of Japan’s foreign aid was now directed at India and “not a single week goes by without a Japanese business delegation coming to India,” an official noted.
Admitting the proposed Comprehensive Economic Partnership Agreement had hit a temporary roadblock on the questions of agriculture, pharmaceuticals and country-of-origin rules, the officials said this was hardly surprising given the very different economies the two countries had. “But we’ve made tremendous progress since January 2007.” Japan, they said, was “tightly protectionist” but New Delhi could not afford to take a holier-than-thou attitude since it was asking Tokyo to do many things that it was itself reluctant to do.
Japan has seen five prime ministers in as many years and is heading for elections again soon. Despite this, however, there has been no let-up in the expansion of ties with India across a wide number of areas. Indian officials say the Japanese proposals to help finance the country’s western freight and industrial corridors will give a new thrust to economic ties, which is still seen as the backbone of the bilateral relationship.
Key component
But if India’s other preoccupation is energy and nuclear power, Japan has tended to be fairly security-oriented in its approach to New Delhi.
In his book, A Beautiful Country, the former Japanese Prime Minister Shinzo Abe described India as a key component of a new Asian order whose other pillars would be Japan, Australia and the United States. Mr. Aso, who as Foreign Minister in Mr. Abe’s government actively canvassed for a trilateral security dialogue linking Delhi, Tokyo and Washington, is also a proponent of this sort of Sino-centric architecture.
The Japanese side has been keen to expand security cooperation with India beyond the current level of bilateral visits, exchanges and exercises. Indian officials said Dr. Singh and Mr. Aso would issue a joint declaration on security on Wednesday.
In a statement just before his departure for Tokyo on Tuesday, Prime Minister Singh described ties with Japan as “one of the most important bilateral relationships we have.” He added that a strong India-Japan relationship “will play a significant role in the emerging Asian security architecture and will contribute to the peace, stability and prosperity of Asia and the world.”
Though nuclear cooperation is not a bilateral priority right now, India feels there is enough economic and political momentum to propel the relationship to a level where Tokyo may also eventually come around to seeing merit in working with India in the civil nuclear field.
In any case, since Japanese export regulations tend to be more administrative than statute-based, Indian officials say Japanese entities would be able to send safeguarded nuclear components to India without the approval of the Diet. At any rate, this has been India’s experience on non-nuclear high technology trade. Since January 2006, India and Japan have held three rounds of discussions on the easing of restrictions, leading to seven India entities being taken off Tokyo’s export blacklist.
Nuclear rules
According to the authoritative trade newsletter Nuclear Fuel, however, trade between India and Japan may not be that straightforward a matter.
Quoting Japanese industry and diplomatic sources, the newsletter said the two countries “must conclude a bilateral nuclear trade agreement in order for Japanese nuclear industry firms to sell [NSG] trigger-list items to India.”
The two principal Japanese nuclear vendors are Hitachi, which partners GE, and Toshiba, which owns the American nuclear supplier, Westinghouse. Other firms like Mitsubishi also manufacture nuclear components like pressure vessels for nuclear reactors.
These firms, says Nuclear Fuel, “may not export to India equipment triggering IAEA safeguards under the Zangger Committee export control list without a bilateral cooperation agreement between Japan and India.” Current Japanese law, it said, allowed nuclear exports only to countries that were either a party to the Nuclear Non-proliferation Treaty (NPT) or allowed the International Atomic Energy Agency to safeguard all its nuclear facilities.
But a nuclear cooperation agreement Japan signed with China before Beijing’s accession to the NPT may serve as a precedent for India, said Nuclear Fuel, quoting unidentified “experts”.
While not ruling out the desirability of a bilateral cooperation agreement, Indian officials say the NSG’s new guidelines were expected to simplify matters considerably. “Many Zangger Committee countries take the view that its requirements have been subsumed by the NSG, so now that India has a waiver, a bilateral agreement may no longer be a strict requirement” for safeguarded exports, an official said.
15 October 2008
IBSA united front at the NSG
The Delhi Declaration of the India-Brazil-South Africa (IBSA) forum summit has this interesting line in its paragraph on the peaceful use of nuclear energy:
India is not in the NSG but so long as South Africa and Brazil -- which are also the targets of the wider drive towards limiting ENR technology to a handful of countries -- stick to this line, the U.S. and others will find it difficult to develop a new consensus around denying India access.
I wonder if this could be the beginning of wider cooperation within IBSA on ENR for peaceful purposes? After all, Brazil has a comparative advantage in enrichment (think Resende) and India in reprocessing.
[The leaders] also reiterated the importance of ensuring that any multilateral decisions related to the nuclear fuel cycle do not undermine the inalienable right of States to pursue nuclear energy for peaceful purposes in conformity with their international legal obligations.With the NSG due to resume discussions on tightening the rules governing international trade in enrichment and reprocessing technology and equipment next month -- and with the U.S. administration committed to working towards developing restrictions for countries like India -- this statement sounds very much like the forging of a United Front by the three IBSA partners.
India is not in the NSG but so long as South Africa and Brazil -- which are also the targets of the wider drive towards limiting ENR technology to a handful of countries -- stick to this line, the U.S. and others will find it difficult to develop a new consensus around denying India access.
I wonder if this could be the beginning of wider cooperation within IBSA on ENR for peaceful purposes? After all, Brazil has a comparative advantage in enrichment (think Resende) and India in reprocessing.
12 October 2008
India reiterates ‘legally binding’ nature of 123 pact’s provisions
Pranab Mukherjee signing statement links commercial deals to implementation of text... but in press conference, the minister says India is "aware of expanding relationship with the U.S." when asked about awarding contracts to American companies... (May be that's why Ratan Tata just happened to drop in for the signing ceremony?!)12 October 2008
The Hindu
(In the print edition of The Hindu, this story was split into two. The url of the second part is here
India reiterates ‘legally binding’ nature of 123 pact’s provisions
Pranab Mukherjee signing statement links commercial deals to implementation of text
Siddharth Varadarajan
New York: Even as it signed a bilateral nuclear cooperation agreement with the United States on Friday, India sought to draw a line under assertions Washington has made about the "non-binding" nature of its fuel supply commitments by declaring that the "[123 Agreement's] provisions are now legally binding on both sides once the Agreement enters into force".
The agreement was signed at the State Department in a formal ceremony for which External Affairs Minister Pranab Mukherjee specially flew in. Secretary of State Condoleezza Rice signed the agreement on behalf of the U.S.
In a statement prior to the actual signing, Mr. Mukherjee noted that the Agreement was the "first step" to civil nuclear cooperation and trade between India and the United States. The Agreement, he said, was about civil nuclear cooperation "and reflects a careful balance of rights and obligations". He added: "The Agreement has been passed by the US Congress without any amendments. Its provisions are now legally binding on both sides once the Agreement enters into force. We look forward to working with US companies on the commercial steps that will follow to implement this landmark Agreement".
In a second statement issued to the press after the signing, Mr. Mukherjee emphasised another key Indian position: "We intend to implement this Agreement in good faith and in accordance with the principles of international law and I am confident that the US will also do the same".
No such reassurance was forthcoming from the U.S. side other than the State Department saying the agreement provided the "legal framework" for nuclear cooperation. The 123 text itself calls the agreement a "legal framework and basis", and it is clear that despite India moving to protect its legal position,problems of interpretation are likely to persist.
Asked how much of the agreement rested on interpretation and trust, the minister told reporters the two sides were bound by the agreed text of the 123 as well as the July 2005 and March 2006 Indo-U.S. joint statements. "It is not merely a question of the interpretations, it's the question of the agreed text on which we are depending", he said. Pressed on the significance of the interpretative statements o fuel supply made by the U.S. administration and Congress, Mr. Mukherjee said he "would not like to make any comment on the process of legislation in the US Congress and their observations on it. The fuel supply assurance is being provided in the text of the 123 itself in Article 5.6".
The most important part of the External Affairs minister’s statements in Washington, DC on the occasion of the signing of the 123 Agreement on Friday was the paragraph on the legally binding nature of the agreed text and the link draw there between its implementation and the “commercial steps that will follow.”
This formulation, which took final shape after days of intense debate involving the Ministry of External Affairs, Prime Minister’s Office and the Indian Embassy in Washington, is intended to clarify four fundamental points considered important by the Indian side.
First, that India’s obligations under the 123 Agreement could not be separated from its rights and that the text itself reflected a “careful balance” between the two which was not to be disturbed. Mr. Mukherjee amplified on this point when he told a press conference later that the text of the agreement “has entrusted responsibilities and obligations on both sides – I have pointed out there is a balance between the obligations and the rights, which we will comply with”. This linking of India’s compliance with its obligations under the agreement – for example safeguards in perpetuity – to the “responsibilities” of the other side (to deliver on fuel) is precisely the balance India has emphasised since the March 2006 separation plan.
The second point that Mr. Mukherjee’s statement sought to make was that India did not accept that the U.S. legislature had entered any reservations to the agreement. This did not mean Congress had not attached riders in passing HR 7081 – the law which approved the 123 Agreement -- but merely that India did not believe these allowed for any derogation of American commitments contained in the 123 text.
The third point was that India regarded the 123 Agreement’s provisions as legally binding on both itself and the U.S., regardless of President Bush’s assertion in his letter to Congress on September 10 that the fuel assurances were only a political and not a legal commitment.
Fourthly, the minister’s statement dropped a broad hint that any commercial contracts with American companies would be possible only once the agreement is implemented , obviously as per its legally binding provisions.
Taken together with the minister’s statement that India expects the U.S. to implement the 123 Agreement in accordance with the principles of international law, New Delhi essentially sought to serve notice that American nuclear vendors cannot hope to do business in India unless the reactors they propose to sell come with legally binding fuel contracts as well as reprocessing consent.
India is likely to repeat these key formulations in the diplomatic note it will exchange with the U.S. at the time of the 123 Agreement entering into force.
Before the agreement can enter into force, however, HR 7081 requires the President to certify that it is the policy of the United States to work with members of the Nuclear Suppliers Group to further restrict transfers of equipment and technology related to uranium enrichment and reprocessing of spent nuclear fuel (ENR).
Though this restriction is not explicitly scripted to be India-specific, the U.S. has been pressing, inter alia, for a special ban on ENR equipment and technology to countries which are not signatories to the Nuclear Non-Proliferation Treaty. India is one of only three states who fall under that category. The NSG will meet again in November and it is understood that Washington will try and push for consensus on new rules, something it has not managed to do so far.
Even though such a policy runs counter to the U.S. promise of full civil nuclear cooperation with India and is seen by New Delhi as a breach of trust, Dr. Rice painted a rosy picture of a “vast potential partnership” between the two countries that could now “be fully realized”. In her remarks at the signing ceremony, she said that “what is most valuable about this agreement is how it unlocks a new and far broader world of potential for our strategic partnership in the 21st century, not just on nuclear cooperation but on every area of national endeavor”.
Mr. Mukherjee echoed the same theme of cooperation in diverse areas like defence and agriculture “gaining momentum” as a result of the signing of the nuclear agreement.
In his press conference, he parried a question on whether India had given the U.S. assurances about giving its companies a certain share of the commercial nuclear contracts to be awarded. “We are entering into commercial nuclear cooperation with the U.S., France, Russia. And these are essentially the commercial contracts and surely the commercial aspect will be taken into account”. “But”, he added, “we are aware of our expanding relationship with U.S.”.
Asked again whether there would be preference given to U.S. vendors, Mr. Mukherjee replied: “I have not used the word preferential treatment. These are commercial transactions and as and when these commercial transactions take place, they can be commented like that.” He also declined to comment on estimates of the value of future business the U.S. might garner in India. Last month, India gave the U.S. a Letter of Intent promising to purchase up to 10,000 MW of nuclear power generating capacity provided the per unit cost of electricity involved was competitive. “In terms of value, other ingredients”, said the minister on Friday, “it is too early… These are all estimates and as and when it materializes, then we will see”.
Among those present at the signing ceremony were Atomic Energy Chairman Anil Kakodkar, Foreign Secretary Shiv Shankar Menon, Special Envoy Shyam Saran and industrialist Ratan Tata, whose conglomerate has expressed a keen interest in entering the nuclear powersector.
India ‘encourages’ U.S. nuclear cooperation with Pakistan
Pranab Mukherjee seeks to allay Islamabad's concerns....
12 October 2008
The Hindu
India ‘encourages’ U.S. nuclear cooperation with Pakistan
Siddharth Varadarajan
New York: In a statement that marks a significant shift in India’s public attitude towards the prospect of Pakistan entering into nuclear agreements with other countries, External Affairs Minister Pranab Mukherjee said on Friday that he was in favour of the United States cooperating with Islamabad in the civil nuclear area.
Asked at a news conference in Washington shortly after the signing of the 123 Agreement about his views on possible nuclear cooperation between Pakistan and the U.S. and China, Mr. Mukherjee said India would encourage greater use of civil nuclear energy by its neighbour. “In respect of civil nuclear cooperation between Pakistan and the U.S., we would like to encourage civil nuclear cooperation — its full use of nuclear energy — as we believe every country has its right to use nuclear energy for peaceful purposes.
The Minister also praised the recent remarks made by Pakistan President Asif Ali Zardari following his meeting with Prime Minister Manmohan Singh last month.
He did not identify the remarks but Indian officials have welcomed statements made by the Pakistani President in an interview to the Wall Street Journal that Islamabad did not feel threatened by India.
“The recent statement issued by President Zardari is really encouraging and there is no reason of any apprehension by Pakistan,” he said. “India’s commitment to non-proliferation is second to none and we have, in my 5 September statement, reiterated our continuation of the voluntary moratorium [on testing] which we declared in 1998.”
12 October 2008
The Hindu
India ‘encourages’ U.S. nuclear cooperation with Pakistan
Siddharth Varadarajan
New York: In a statement that marks a significant shift in India’s public attitude towards the prospect of Pakistan entering into nuclear agreements with other countries, External Affairs Minister Pranab Mukherjee said on Friday that he was in favour of the United States cooperating with Islamabad in the civil nuclear area.
Asked at a news conference in Washington shortly after the signing of the 123 Agreement about his views on possible nuclear cooperation between Pakistan and the U.S. and China, Mr. Mukherjee said India would encourage greater use of civil nuclear energy by its neighbour. “In respect of civil nuclear cooperation between Pakistan and the U.S., we would like to encourage civil nuclear cooperation — its full use of nuclear energy — as we believe every country has its right to use nuclear energy for peaceful purposes.
The Minister also praised the recent remarks made by Pakistan President Asif Ali Zardari following his meeting with Prime Minister Manmohan Singh last month.
He did not identify the remarks but Indian officials have welcomed statements made by the Pakistani President in an interview to the Wall Street Journal that Islamabad did not feel threatened by India.
“The recent statement issued by President Zardari is really encouraging and there is no reason of any apprehension by Pakistan,” he said. “India’s commitment to non-proliferation is second to none and we have, in my 5 September statement, reiterated our continuation of the voluntary moratorium [on testing] which we declared in 1998.”
11 October 2008
India reiterates ‘legally binding’ nature of 123 Agreement’s provisions
New York: Even as it signed a bilateral nuclear cooperation agreement with the United States on Friday, India sought to draw a line under assertions Washington has made about the “non-binding” nature of its fuel supply commitments by declaring that the “[123 Agreement’s] provisions are now legally binding on both sides once the Agreement enters into force”.
11 October 2008
India reiterates ‘legally binding’ nature of 123 Agreement’s provisions
Pranab Mukherjee signing statement links commercial deals to implementation of text
Siddharth Varadarajan
New York: Even as it signed a bilateral nuclear cooperation agreement with the United States on Friday, India sought to draw a line under assertions Washington has made about the “non-binding” nature of its fuel supply commitments by declaring that the “[123 Agreement’s] provisions are now legally binding on both sides once the Agreement enters into force”.
The agreement was signed at the State Department in a formal ceremony for which External Affairs Minister Pranab Mukherjee specially flew in. Secretary of State Condoleezza Rice signed the agreement on behalf of the U.S.
In a statement prior to the actual signing, Mr. Mukherjee noted that the Agreement was the “first step” to civil nuclear cooperation and trade between India and the United States. The Agreement, he said, was about civil nuclear cooperation “and reflects a careful balance of rights and obligations”. He then added: “The Agreement has been passed by the US Congress without any amendments. Its provisions are now legally binding on both sides once the Agreement enters into force. We look forward to working with US companies on the commercial steps that will follow to implement this landmark Agreement”.
In a second statement issued to the press after the signing, Mr. Mukherjee emphasised another key Indian position: “We intend to implement this Agreement in good faith and in accordance with the principles of international law and I am confident that the US will also do the same”.
These formulations, which took final shape after days of intense debate involving the Ministry of External Affairs, Prime Minister’s Office and the Indian Embassy in Washington, are intended to clarify four fundamental points considered important by the Indian side.
First, that India’s obligations under the 123 Agreement could not be separated from its rights and that the text itself reflected a “careful balance” between the two which was not to be disturbed.
Second, that India did not accept that the U.S. legislature had entered any reservations to the agreement. This did not mean Congress had not attached riders in passing HR 7081 – the law which approved the 123 Agreement -- but merely that India did not believe these allowed for any derogation of American commitments contained in the 123 text.
Third, that India regarded the 123 Agreement’s provisions as legally binding on both itself and the U.S., regardless of President Bush’s assertion in his letter to Congress on September 10 that the fuel assurances were only a political and not a legal commitment.
Fourth, that any commercial contracts with American companies would be possible once the agreement is implemented , obviously as per its legally binding provisions.
Taken together with the minister’s statement that India expects the U.S. to implement the 123 Agreement in accordance with the principles of international law, New Delhi has essentially served notice that American nuclear vendors cannot hope to do business in India unless the reactors they propose to sell come with legally binding fuel contracts as well as reprocessing consent.
India is likely to repeat these key formulations in the diplomatic note it will exchange with the U.S. at the time of the 123 Agreement entering into force.
Before the agreement can enter into force, however, HR 7081 requires the President to certify that it is the policy of the United States to work with members of the Nuclear Suppliers Group to further restrict transfers of equipment and technology related to uranium enrichment and reprocessing of spent nuclear fuel (ENR).
This restriction is not explicitly scripted to be India-specific but the U.S. has been pressing for a special ban on ENR equipment and technology to countries which are not signatories to the Nuclear Non-Proliferation Treaty. India is one of only three states who fall under that category. The NSG will meet again in November and it is understood that Washington will try and push for consensus on this issue, something it has not managed to do so far.
Even though such a policy runs counter to the U.S. promise of full civil nuclear cooperation with India and is seen by New Delhi as a breach of trust, Dr. Rice painted a rosy picture of a “vast potential partnership” between the two countries that could now “be fully realized”. In her remarks at the signing ceremony, she said that “what is most valuable about this agreement is how it unlocks a new and far broader world of potential for our strategic partnership in the 21st century, not just on nuclear cooperation but on every area of national endeavor”.
Mr. Mukherjee echoed the same theme of cooperation in diverse areas like defence and agriculture “gaining momentum” as a result of the signing of the nuclear agreement.
11 October 2008
India reiterates ‘legally binding’ nature of 123 Agreement’s provisions
Pranab Mukherjee signing statement links commercial deals to implementation of text
Siddharth Varadarajan
New York: Even as it signed a bilateral nuclear cooperation agreement with the United States on Friday, India sought to draw a line under assertions Washington has made about the “non-binding” nature of its fuel supply commitments by declaring that the “[123 Agreement’s] provisions are now legally binding on both sides once the Agreement enters into force”.
The agreement was signed at the State Department in a formal ceremony for which External Affairs Minister Pranab Mukherjee specially flew in. Secretary of State Condoleezza Rice signed the agreement on behalf of the U.S.
In a statement prior to the actual signing, Mr. Mukherjee noted that the Agreement was the “first step” to civil nuclear cooperation and trade between India and the United States. The Agreement, he said, was about civil nuclear cooperation “and reflects a careful balance of rights and obligations”. He then added: “The Agreement has been passed by the US Congress without any amendments. Its provisions are now legally binding on both sides once the Agreement enters into force. We look forward to working with US companies on the commercial steps that will follow to implement this landmark Agreement”.
In a second statement issued to the press after the signing, Mr. Mukherjee emphasised another key Indian position: “We intend to implement this Agreement in good faith and in accordance with the principles of international law and I am confident that the US will also do the same”.
These formulations, which took final shape after days of intense debate involving the Ministry of External Affairs, Prime Minister’s Office and the Indian Embassy in Washington, are intended to clarify four fundamental points considered important by the Indian side.
First, that India’s obligations under the 123 Agreement could not be separated from its rights and that the text itself reflected a “careful balance” between the two which was not to be disturbed.
Second, that India did not accept that the U.S. legislature had entered any reservations to the agreement. This did not mean Congress had not attached riders in passing HR 7081 – the law which approved the 123 Agreement -- but merely that India did not believe these allowed for any derogation of American commitments contained in the 123 text.
Third, that India regarded the 123 Agreement’s provisions as legally binding on both itself and the U.S., regardless of President Bush’s assertion in his letter to Congress on September 10 that the fuel assurances were only a political and not a legal commitment.
Fourth, that any commercial contracts with American companies would be possible once the agreement is implemented , obviously as per its legally binding provisions.
Taken together with the minister’s statement that India expects the U.S. to implement the 123 Agreement in accordance with the principles of international law, New Delhi has essentially served notice that American nuclear vendors cannot hope to do business in India unless the reactors they propose to sell come with legally binding fuel contracts as well as reprocessing consent.
India is likely to repeat these key formulations in the diplomatic note it will exchange with the U.S. at the time of the 123 Agreement entering into force.
Before the agreement can enter into force, however, HR 7081 requires the President to certify that it is the policy of the United States to work with members of the Nuclear Suppliers Group to further restrict transfers of equipment and technology related to uranium enrichment and reprocessing of spent nuclear fuel (ENR).
This restriction is not explicitly scripted to be India-specific but the U.S. has been pressing for a special ban on ENR equipment and technology to countries which are not signatories to the Nuclear Non-Proliferation Treaty. India is one of only three states who fall under that category. The NSG will meet again in November and it is understood that Washington will try and push for consensus on this issue, something it has not managed to do so far.
Even though such a policy runs counter to the U.S. promise of full civil nuclear cooperation with India and is seen by New Delhi as a breach of trust, Dr. Rice painted a rosy picture of a “vast potential partnership” between the two countries that could now “be fully realized”. In her remarks at the signing ceremony, she said that “what is most valuable about this agreement is how it unlocks a new and far broader world of potential for our strategic partnership in the 21st century, not just on nuclear cooperation but on every area of national endeavor”.
Mr. Mukherjee echoed the same theme of cooperation in diverse areas like defence and agriculture “gaining momentum” as a result of the signing of the nuclear agreement.
Pranab on the 123
He's still speaking live but he just said these words on the 123
"The agreeement has been passed by the U.S. Congress without amendments. Its provisions are now legally binding on both parties once it enters into force."
A good first step in clarifying India's understanding.
"The agreeement has been passed by the U.S. Congress without amendments. Its provisions are now legally binding on both parties once it enters into force."
A good first step in clarifying India's understanding.
Chinese analysis on 'aims behind on U.S.-India nuclear deal'
In a nutshell, Zhang Quanyi, an associate professor at Zhejiang Wanli University in Ningbo, argues:
October 9 2008
UPI Asia
Aims behind the U.S.-India nuclear deal
By Zhang Quanyi
Ningbo, China — U.S. President George W. Bush signed the long-expected nuclear deal with India into law on Wednesday, following its approval by the U.S. Congress last week. A formal bilateral document will be signed Friday by U.S. Secretary of State Condoleezza Rice and Indian Foreign Minister Pranab Mukherjee.
With this deal, the United States is formally embracing India as its nuclear partner, breaking Washington’s three-decade barricade against transferring nuclear technology to New Delhi, which conducted nuclear tests in 1974 and again in 1998.
Critics of the deal say that it undermines years of international efforts in banning weapons of mass destruction, and could weaken efforts to persuade countries like North Korea and Iran to give up their nuclear programs.
Before the Senate vote, Democratic Senator Tom Harkin voiced objections to the bill. "If we pass this legislation, we will reward India for flouting the most important arms control agreement in history, the Nuclear Nonproliferation Treaty, and we will gravely undermine our case against hostile nations that seek to do the same," Harkin said.
Daryl Kimball, head of the Washington-based Arms Control Association, called the agreement “a non-proliferation disaster."
Geopolitical analysts see this deal as a U.S. move to balance the rise of Chinese influence. In addition to its global economic clout, China’s successful hosting of the Beijing Olympics in August and completion of a spacewalk mission last month have raised its profile in the world.
In the eyes of some countries, including India, China looks set to resume its historical position as a dominant power in Asia, and is thereby seen as a threat or at least a challenge to the present international system. In reality China is still a developing country, lagging far behind developed countries in many fields, including governance and rule of law.
Another target of the U.S.-India deal is Russia. While India has been a nonaligned country, in fact it had a quasi-alliance with the former Soviet Union during the Cold War, giving it some leverage against its neighbors China and Pakistan. India fought a border war with China in 1962; in 1947 and 1965 it fought Pakistan over Kashmir, and in 1971 over what is now Bangladesh.
U.S. anxiety over India’s engagement with Russia is not unfounded. Under former President Vladimir Putin Russia has sought to exert greater influence militarily and economically on the global level. Russia is viewed historically as an ambitious, if not aggressive, country. Its recent clashes with Western countries over Georgia’s independence and military cooperation with Venezuela, as well as the two 1,000-megawatt reactors it is building in the southern Indian state of Tamil Nadu, have raised concerns in the United States.
Of course, the nuclear deal will also bring economic benefits, opening up a market worth billions of dollars to U.S. companies able to meet India’s huge energy needs. The deal will give U.S. companies an advantage in the Indian market, where other countries with nuclear technology, such as Russia, France, Japan and even China, are also aiming for a piece of the pie.
U.S. companies are expected to have even greater opportunities as India gradually opens its vast market, in areas ranging from investments in Indian real estate to selling soybean oil and fighter planes.
The deal may also have been conceived as a remedy for the current U.S. financial crisis, even though it was conceived three years ago. In 2006, financial writer Peter D. Shiff published a book, “Crash Proof: How to Profit from the Coming Economic Collapse,” in which he warned of a looming period of sizeable tax hikes, loss of retirement benefits and double-digit inflation. He compared the United States to a house of cards – impressive on the outside, but a disaster waiting to happen. He predicted that the country would go from the world's largest creditor to its greatest debtor; that the value of the dollar would decline; and that domestic manufacturing would give way to non-exportable services.
Perhaps U.S. President George W. Bush also saw this coming and viewed the India deal as a precautionary measure?
There is also the democracy factor. The United States regards India as a model of democracy in Asia, at least among the developing countries. Despite its numerous problems – including unemployment, starvation, ethnic conflicts and inefficient governance – the United States still sees India as a natural ally in Asia and a model for other countries to follow because of its democratic system.
Senator Joseph Biden, running mate to Barrack Obama in the U.S. presidential election next month, described the nuclear bill as implicit recognition of India's long-term value to the United States, "as a counterweight to China, as a rising military power, as an energy consumer, as an economic force, as a bulwark against terrorism and extremism, as a cultural beacon throughout Asia and the world."
Whether or not India meets U.S. expectations as a responsible citizen, partner or beacon of democracy, it is still a bold decision for Bush to decide to ignore international regimes and norms by allowing India to flout the NPT. It sets a precedent that other would-be nuclear states may be all too ready to follow.
--
(Dr. Zhang Quanyi is associate professor at Zhejiang Wanli University in Ningbo, China, and a guest researcher at the Center for the Study of Non-traditional Security and Peaceful Development at Zhejiang University in Hangzhou. His research interest revolves around the creation of a world state. He can be contacted at qyzhangupi@gmail.com. ©Copyright Zhang Quanyi)
Geopolitical analysts see this deal as a U.S. move to balance the rise of Chinese influence... In the eyes of some countries, including India, China looks set to resume its historical position as a dominant power in Asia, and is thereby seen as a threat or at least a challenge to the present international system...In case the link above dies, the full text is posted below as well.
Another target of the U.S.-India deal is Russia... U.S. anxiety over India’s engagement with Russia is not unfounded. Under former President Vladimir Putin Russia has sought to exert greater influence militarily and economically on the global level. Russia is viewed historically as an ambitious, if not aggressive, country. Its recent clashes with Western countries over Georgia’s independence and military cooperation with Venezuela, as well as the two 1,000-megawatt reactors it is building in the southern Indian state of Tamil Nadu, have raised concerns in the United States...
Of course, the nuclear deal will also bring economic benefits, opening up a market worth billions of dollars to U.S. companies able to meet India’s huge energy needs... The deal may also have been conceived as a remedy for the current U.S. financial crisis, even though it was conceived three years ago.
Senator Joseph Biden, running mate to Barrack Obama in the U.S. presidential election next month, described the nuclear bill as implicit recognition of India's long-term value to the United States, "as a counterweight to China, as a rising military power, as an energy consumer, as an economic force, as a bulwark against terrorism and extremism, as a cultural beacon throughout Asia and the world."
Whether or not India meets U.S. expectations as a responsible citizen, partner or beacon of democracy, it is still a bold decision for Bush to decide to ignore international regimes and norms by allowing India to flout the NPT. It sets a precedent that other would-be nuclear states may be all too ready to follow.
October 9 2008
UPI Asia
Aims behind the U.S.-India nuclear deal
By Zhang Quanyi
Ningbo, China — U.S. President George W. Bush signed the long-expected nuclear deal with India into law on Wednesday, following its approval by the U.S. Congress last week. A formal bilateral document will be signed Friday by U.S. Secretary of State Condoleezza Rice and Indian Foreign Minister Pranab Mukherjee.
With this deal, the United States is formally embracing India as its nuclear partner, breaking Washington’s three-decade barricade against transferring nuclear technology to New Delhi, which conducted nuclear tests in 1974 and again in 1998.
Critics of the deal say that it undermines years of international efforts in banning weapons of mass destruction, and could weaken efforts to persuade countries like North Korea and Iran to give up their nuclear programs.
Before the Senate vote, Democratic Senator Tom Harkin voiced objections to the bill. "If we pass this legislation, we will reward India for flouting the most important arms control agreement in history, the Nuclear Nonproliferation Treaty, and we will gravely undermine our case against hostile nations that seek to do the same," Harkin said.
Daryl Kimball, head of the Washington-based Arms Control Association, called the agreement “a non-proliferation disaster."
Geopolitical analysts see this deal as a U.S. move to balance the rise of Chinese influence. In addition to its global economic clout, China’s successful hosting of the Beijing Olympics in August and completion of a spacewalk mission last month have raised its profile in the world.
In the eyes of some countries, including India, China looks set to resume its historical position as a dominant power in Asia, and is thereby seen as a threat or at least a challenge to the present international system. In reality China is still a developing country, lagging far behind developed countries in many fields, including governance and rule of law.
Another target of the U.S.-India deal is Russia. While India has been a nonaligned country, in fact it had a quasi-alliance with the former Soviet Union during the Cold War, giving it some leverage against its neighbors China and Pakistan. India fought a border war with China in 1962; in 1947 and 1965 it fought Pakistan over Kashmir, and in 1971 over what is now Bangladesh.
U.S. anxiety over India’s engagement with Russia is not unfounded. Under former President Vladimir Putin Russia has sought to exert greater influence militarily and economically on the global level. Russia is viewed historically as an ambitious, if not aggressive, country. Its recent clashes with Western countries over Georgia’s independence and military cooperation with Venezuela, as well as the two 1,000-megawatt reactors it is building in the southern Indian state of Tamil Nadu, have raised concerns in the United States.
Of course, the nuclear deal will also bring economic benefits, opening up a market worth billions of dollars to U.S. companies able to meet India’s huge energy needs. The deal will give U.S. companies an advantage in the Indian market, where other countries with nuclear technology, such as Russia, France, Japan and even China, are also aiming for a piece of the pie.
U.S. companies are expected to have even greater opportunities as India gradually opens its vast market, in areas ranging from investments in Indian real estate to selling soybean oil and fighter planes.
The deal may also have been conceived as a remedy for the current U.S. financial crisis, even though it was conceived three years ago. In 2006, financial writer Peter D. Shiff published a book, “Crash Proof: How to Profit from the Coming Economic Collapse,” in which he warned of a looming period of sizeable tax hikes, loss of retirement benefits and double-digit inflation. He compared the United States to a house of cards – impressive on the outside, but a disaster waiting to happen. He predicted that the country would go from the world's largest creditor to its greatest debtor; that the value of the dollar would decline; and that domestic manufacturing would give way to non-exportable services.
Perhaps U.S. President George W. Bush also saw this coming and viewed the India deal as a precautionary measure?
There is also the democracy factor. The United States regards India as a model of democracy in Asia, at least among the developing countries. Despite its numerous problems – including unemployment, starvation, ethnic conflicts and inefficient governance – the United States still sees India as a natural ally in Asia and a model for other countries to follow because of its democratic system.
Senator Joseph Biden, running mate to Barrack Obama in the U.S. presidential election next month, described the nuclear bill as implicit recognition of India's long-term value to the United States, "as a counterweight to China, as a rising military power, as an energy consumer, as an economic force, as a bulwark against terrorism and extremism, as a cultural beacon throughout Asia and the world."
Whether or not India meets U.S. expectations as a responsible citizen, partner or beacon of democracy, it is still a bold decision for Bush to decide to ignore international regimes and norms by allowing India to flout the NPT. It sets a precedent that other would-be nuclear states may be all too ready to follow.
--
(Dr. Zhang Quanyi is associate professor at Zhejiang Wanli University in Ningbo, China, and a guest researcher at the Center for the Study of Non-traditional Security and Peaceful Development at Zhejiang University in Hangzhou. His research interest revolves around the creation of a world state. He can be contacted at qyzhangupi@gmail.com. ©Copyright Zhang Quanyi)
10 October 2008
Watch Pranab sign the 123 live @ 0130 IST
I gather NDTV will show the 123 Agreement signing ceremony with Pranab Mukherjee and Condoleezza Rice live from Washington at 0130 IST on October 11 (that's 1600 EST on October 10 if you are in the US). This link ought to work.
There is some talk of Mr Mukherjee now making a statement about how India considers the 123 Agreement to be legally binding. This is a good first step but GOI needs to do a lot more to send the proper signal out to the U.S. and the world so that there are no political or legal misunderstandings in the future.
Contrary to Ronen Sen' s statement that Indian concerns have been addressed by President Bush, I can tell you that trust levels between the two governments -- especially on the Indian side and especially in those sections of officialdom which will have to work this agreement and any equipment that comes with it -- is very, very low.
There is some talk of Mr Mukherjee now making a statement about how India considers the 123 Agreement to be legally binding. This is a good first step but GOI needs to do a lot more to send the proper signal out to the U.S. and the world so that there are no political or legal misunderstandings in the future.
Contrary to Ronen Sen' s statement that Indian concerns have been addressed by President Bush, I can tell you that trust levels between the two governments -- especially on the Indian side and especially in those sections of officialdom which will have to work this agreement and any equipment that comes with it -- is very, very low.
09 October 2008
Bush signing statement on 123 leaves flaws intact
President endorses fuel assurances, but U.S. interpretation of agreement is unchanged... India needs to be candid about its own reservations from here on...10 October 2008
The Hindu
Bush signing statement on 123 leaves flaws intact
President endorses fuel assurances, but U.S. interpretation of agreement is unchanged
Siddharth Varadarajan
In a well-attended ceremony that underlined the strategic importance of the Indian nuclear deal to the United States, President George W. Bush on Wednesday signed into law the ‘U.S.-India Nuclear Cooperation Approval and Nonproliferation Enhancement Act’. The Act, known as H.R. 7081, was passed by Congress on October 1 and represents the American legislature’s formal approval of the U.S.-India bilateral nuclear cooperation agreement – the ‘123 Agreement’ – concluded in July 2007.
Flanked by Vice-President Dick Cheney, Secretary of State Condoleezza Rice, Energy Secretary Samuel Bodman and a bipartisan sprinkling of top legislators from Congress, Mr. Bush made a brief statement on the occasion of the signing in which he sought to allay Indian concerns about the United States derogating from its obligations under the 123 Agreement. These concerns arose because of the statement the President himself made in a letter to Congress last month that the fuel supply assurances contained within the 123 represented a “political” rather than a legally binding commitment.
By incorporating an explicit reference to Mr. Bush’s letter – as well as other “authoritative representations” on the subject by the administration – Congress gave these interpretations a definite legislative status which will live well beyond the life of the current presidency. Congress also sought to put an end to the Government of India’s spin that the 123 Agreement – once it became law – would trump the provisions of the Hyde Act as far as American obligations were concerned. This it did by explicitly inserting rules of construction stating that nothing in the Agreement should be construed to supersede the legal requirements of the Hyde Act.
By itself, none of this amounted to a change in the text of the 123, which has been frozen for over a year and which, in any case, cannot unilaterally be amended by one side. Thus, President Bush’s assurance in his October 8 signing statement that HR 7081 “does not change the terms of the 123 Agreement as I submitted it to the Congress” is redundant. There is no reason for India to feel comforted by this statement of the obvious. What Congress did, however, was to enter legal reservations or qualifications, thereby serving advance notice to India about how exactly the United States intends to implement the text. And on these, Mr. Bush remained completely silent, presumably because his office originated these reservations in the first place.
As Prof. Michael J. Glennon explained in a 1983 essay on ‘The Senate Role in Treaty Ratification’ in the American Journal of International Law, the U.S. Senate conditions its consent to treaties – which is what the 123 Agreement is -- in one of two ways. “It may amend its resolution of ratification by adding material (normally called a reservation, understanding, interpretation, declaration, or statement), or it may amend the resolution of ratification by inserting a condition that the text of the treaty be amended… Each form of alteration is equally binding on the President… International law, similarly, regards a reservation to a bilateral treaty as tantamount to a proposed amendment. The principal reason that the Senate sometimes prefers the "reservation" mode to the "amendment" mode is diplomatic: domestic political considerations in the nonreserving state may make it easier for its government to accept a treaty alteration that is cosmetically less glaring”.
HR 7081, as it emerged finally from the Senate, subjected the 123 Agreement to precisely this kind of “cosmetically less glaring” alteration by embedding riders about the fuel supply assurances being mere political commitments.
President Bush’s signing statement sought to address Indian objections to these riders by the cosmetic use of words and phrases that reiterated Washington’s commitment to its obligations in the abstract while leaving undisturbed the concrete, legislatively-embedded interpretations that India believes run counter to the letter and spirit of the 123 Agreement. Thus, Mr. Bush could observe that “the legislation does not change the fuel assurance commitments that the U.S. Government has made to the Government of India, as recorded in the 123 Agreement”, without in any way contradicting his earlier statement, as reflected in HR 7081, that these fuel assurance commitments were not legally binding. He wisely avoided using the words ‘Hyde Act’. And he spoke positively of reprocessing consent, ignoring the fact that the law he was signing had created a tough new, India-specific provision for Congressional approval of this consent.
What gives a diplomatic document its legally binding nature is the intent of its drafters to conclude an agreement in written form governed by international law. It is also a settled position in U.S. law that documents intended to have mere moral or political weight, but not to be legally binding, are not international agreements. Since the 123 Agreement is manifestly an international agreement, it follows that all of its provisions are equally binding in a legal sense. India is thus on strong legal grounds to insist on the text of the 123 Agreement, as signed by the two Parties, being the sole reference point for elaborating the rights and obligations of both sides. But it needs to break its silence on the U.S. reservations that have already been entered rather than declaring, as Ambassador Ronen Sen did on Wednesday, that India was “completely satisfied” by the statements President Bush made.
India can cite, in defence of its position, the U.S.’s own legal understanding on the matter. In a 1991 ‘Article-by-Article Analysis of START Documents’ submitted to Congress, the State Department wrote: “An undertaking or commitment that is understood to be legally binding carries with it both the obligation of each Party to comply with the undertaking and the right of each Party to enforce the obligation under international law. A “political” undertaking is not governed by international law and there are no applicable rules pertaining to compliance, modification or withdrawal. Until and unless a Party extricates itself from its “political” undertaking, which it may do without legal penalty, it has given a promise to honor that commitment, and the other Party has every reason to be concerned about compliance with such undertakings. (Cited in John H. McNeill, ‘International Agreements: Recent U.S.-UK Practice Concerning the Memorandum of Understanding’, American Journal of International Law, October 1994). (Emphasis added)
But if the 123 Agreement has the status of a legally binding treaty in international law, how does the U.S. propose to derogate from some of its obligations on the specious plea that they are not legally binding? By entering reservations, which it has effectively done. India, therefore, needs to contest these. If the diplomatic note the U.S. hands over as part of the process of making the 123 Agreement enter into force contains references to HR7081 and its reservations, quietly accepting this instrument of ratification without a similar strong statement from the Indian side would be tantamount to accepting that the 123 Agreement does not give India legal rights to fuel for any U.S. reactor it imports.
There is no reason for the Indian side to by shy or coy about this. Candour is better than discretion and stating one’s position upfront offers the best protection against accusations of bad faith later. India “choked” when it decided to drop – from its September 10 Letter of Intent on the purchase of 10,000 MW worth of American reactors – an explicit reference conditioning any future purchase on the establishment of permanent reprocessing consent. And India choked again when External Affairs Minister Pranab Mukherjee stood next to Condoleezza Rice in Delhi on October 4 and failed to state the country’s position forcefully when the U.S. Secretary of State reiterated her government’s intention of pressing for a ban on enrichment and reprocessing (ENR) equipment and technology sales to India when the Nuclear Suppliers Group meets again in November.
Dr. Rice cleverly described the proposal to ban ENR sales to countries that are not signatories to the Nuclear Non-Proliferation Treaty as a “criteria-based approach” that was not singling out India. Instead of responding in generalities, Mr. Mukherjee should have said that India would consider any such move by the U.S. at the NSG to be an unfriendly act, one unbecoming of a ‘strategic partner’. He should have said any such move would represent a dilution of the July 2005 Indo-U.S. agreement in which India accepted a number of obligations in exchange for full civil nuclear cooperation. And he should have said such a move by the U.S. would violate Article 18 of the Vienna Convention on the Law of Treaties which obliges Parties to an agreement to refrain from acts which would defeat the object and purpose of an agreement – in this case, full civil nuclear cooperation with India. By remaining silent, however, India allowed the impression to gain ground that it is prepared to drop this issue without a fight.
On Friday, the U.S. and India will sign the 123 Agreement at a ceremony in Washington. Whatever the Agreement’s original merits, the executive and legislative branches of U.S. government have stripped it of any concrete meaning. President Bush’s signing statement does little to fix the situation. India needs to clarify its position on all of these questions. And send a signal to the world that it cannot be taken for granted.
Bush statement before signing 123 Agreement law
Some preliminary thoughts, minutes after seeing President Bush sign the 123 enabling At into law...
His spoken remarks were cleverly crafted to go as far as he can in accommodating Indian concerns without withdrawing his own earlier statements to Congress. Thus -
* None of the administration's offensive interpretations have been repudiated even as the textual sanctity of the 123 Agreement as submitted to Congress is emphasised.
* No offensive reiteration of Hyde. Act isn't even explicitly mentioned, though Bush says "the Agreement is consistent with the Atomic Energy Act and other elements of U.S. law".
* Positive acknowledgment that USG has made "fuel assurance commitments" which remain unchanged despite the new legislation (which says these assurances are political and not legal)
* Positive statement about the new law enabling the President to "accept, on behalf of the U.S., the obligations contained in the agreement".
* Positive acknowledgment of advance reprocessing consent rights.
In my opinion, India should still formally reiterate its understanding of what the balance of rights and obligations within the 123 Agreement are because President Bush has not repudiated any of the reservations that have been entered by the U.S. about the meaning and scope of the Agreement via the new law as well as the administration's written communications to Congress.
This should be done via a statement in Parliament, as well as in a communication to the U.S. at the time when the 123 is to enter into force.
There is still some merit in the world being told the U.S. too is now competing for a slice of the Indian nuclear world. But GOI will still be foolish as hell to commit any money to American nuclear equipment and material...
8 October 2008
White House
His spoken remarks were cleverly crafted to go as far as he can in accommodating Indian concerns without withdrawing his own earlier statements to Congress. Thus -
* None of the administration's offensive interpretations have been repudiated even as the textual sanctity of the 123 Agreement as submitted to Congress is emphasised.
* No offensive reiteration of Hyde. Act isn't even explicitly mentioned, though Bush says "the Agreement is consistent with the Atomic Energy Act and other elements of U.S. law".
* Positive acknowledgment that USG has made "fuel assurance commitments" which remain unchanged despite the new legislation (which says these assurances are political and not legal)
* Positive statement about the new law enabling the President to "accept, on behalf of the U.S., the obligations contained in the agreement".
* Positive acknowledgment of advance reprocessing consent rights.
In my opinion, India should still formally reiterate its understanding of what the balance of rights and obligations within the 123 Agreement are because President Bush has not repudiated any of the reservations that have been entered by the U.S. about the meaning and scope of the Agreement via the new law as well as the administration's written communications to Congress.
This should be done via a statement in Parliament, as well as in a communication to the U.S. at the time when the 123 is to enter into force.
There is still some merit in the world being told the U.S. too is now competing for a slice of the Indian nuclear world. But GOI will still be foolish as hell to commit any money to American nuclear equipment and material...
8 October 2008
White House
 |  |
For Immediate Release
Office of the Press Secretary
October 8, 2008
Statement by the President on the Occasion of Signing H.R. 7081
I am pleased today to sign into law the United States-India Nuclear Cooperation Approval and Nonproliferation Enhancement Act, which approves the U.S.-India 123 Agreement. The passage of this legislation by the Congress marks another major milestone in achieving the vision that Prime Minister Singh and I set forth on July 18, 2005, to transform the relationship between our two countries and to establish a strategic partnership. This Act will strengthen the relationship between the United States and India and deliver valuable benefits to both nations. The legislation does not change the terms of the 123 Agreement as I submitted it to the Congress. That Agreement is consistent with the Atomic Energy Act and other elements of U.S. law. This legislation is important as it enables me to bring the 123 Agreement into force and to accept on behalf of the United States the obligations contained in the Agreement. The Agreement grants India advance consent to reprocessing which will be brought into effect upon conclusion of arrangements and procedures for a dedicated reprocessing facility under IAEA safeguards. In addition, the legislation does not change the fuel assurance commitments that the U.S. Government has made to the Government of India, as recorded in the 123 Agreement. The passage of this legislation reflects the common view of my Administration and the Congress as to the value of nuclear cooperation and is in the interest of the United States and India.
# # #
07 October 2008
Bush signing statement - Don't hold your breath
Some preliminary thoughts (suggestions/corrections/emendations welcome)
President Bush will sign the 123 enabling Act into law around 2330 IST on Wednesday. But don't hold your breath about its contents. All Indian concerns about the way the 123 has been qualified and approved remain. So here's what we should do from here on...
1. After Bush statement is out, MEA issues statement in name of the External Affairs Minister making an assessment of the 123 Act, and stating clearly what India believes are its rights and obligations under the 123 and International Law.
2. Do not send EAM to DC to sign the 123 as is currently proposed but have the unpleasant deed done by the Indian ambassador or acting ambassador. Why waste fuel, and the Indian taxpayer's money for the event, which is of far less practical significance for the Indian nuclear industry than the NSG guideline change of September 6 or the French agreement or the forthcoming Russian agreement?
3. The Indian ambassador/ dy. amb signs it.
4. MEA again notes, in response to all the questions that will be asked, what the GOI view on the 123 is.
5. Manmohan Singh makes statement in Parliament on October 17 and is very blunt about what Indian and US obligations are. MMS also makes it clear that no commercial contracts are possible for reactors which do not come with suitable fuel arrangements and permanent reprocessing consent rights.
6. MMS statement to parliament is worked into Note Verbale that is handed over along with the diplomatic notes required to allow the 123 to enter into force.
7. Practical elements of the Indian position, esp. mandating reprocessing, and fuel as prerequisites for reactor imports with private sector participation are worked into the amended Indian Atomic Energy Act. Also, no reactor or material can leave India if it affects normal running of Indian reactors.
8. Open negotiations for reprocessing arrangements and procedures with the U.S. and allow one year to elapse without suitable result.
9. Put the 123 into deep freeze. Or the same storage tanks in Tarapur where all that American spent fuel is (not) rotting.
Additional Point:
10. MMS declares that any dilution of the "full cooperation" part of the July 18, 2005 bargain either through an adverse post-facto change of national legislation or a proposal at the NSG to ban ENR sales to non-NPT signatories will not only be seen as an unfriendly act but will lead to zero nuclear business being transacted with the concerned state.
President Bush will sign the 123 enabling Act into law around 2330 IST on Wednesday. But don't hold your breath about its contents. All Indian concerns about the way the 123 has been qualified and approved remain. So here's what we should do from here on...
1. After Bush statement is out, MEA issues statement in name of the External Affairs Minister making an assessment of the 123 Act, and stating clearly what India believes are its rights and obligations under the 123 and International Law.
2. Do not send EAM to DC to sign the 123 as is currently proposed but have the unpleasant deed done by the Indian ambassador or acting ambassador. Why waste fuel, and the Indian taxpayer's money for the event, which is of far less practical significance for the Indian nuclear industry than the NSG guideline change of September 6 or the French agreement or the forthcoming Russian agreement?
3. The Indian ambassador/ dy. amb signs it.
4. MEA again notes, in response to all the questions that will be asked, what the GOI view on the 123 is.
5. Manmohan Singh makes statement in Parliament on October 17 and is very blunt about what Indian and US obligations are. MMS also makes it clear that no commercial contracts are possible for reactors which do not come with suitable fuel arrangements and permanent reprocessing consent rights.
6. MMS statement to parliament is worked into Note Verbale that is handed over along with the diplomatic notes required to allow the 123 to enter into force.
7. Practical elements of the Indian position, esp. mandating reprocessing, and fuel as prerequisites for reactor imports with private sector participation are worked into the amended Indian Atomic Energy Act. Also, no reactor or material can leave India if it affects normal running of Indian reactors.
8. Open negotiations for reprocessing arrangements and procedures with the U.S. and allow one year to elapse without suitable result.
9. Put the 123 into deep freeze. Or the same storage tanks in Tarapur where all that American spent fuel is (not) rotting.
Additional Point:
10. MMS declares that any dilution of the "full cooperation" part of the July 18, 2005 bargain either through an adverse post-facto change of national legislation or a proposal at the NSG to ban ENR sales to non-NPT signatories will not only be seen as an unfriendly act but will lead to zero nuclear business being transacted with the concerned state.
04 October 2008
Uncertainty over signing of 123 agreement during Rice visit
India ‘ok’ with draft Bush statement, will contest U.S. interpretations later...
4 October 2008
The Hindu
Uncertainty over signing of 123 agreement during Rice visit
Siddharth Varadarajan
New York: Even as Secretary of State Condoleezza Rice wends her way across to New Delhi, there is uncertainty over whether the bilateral nuclear cooperation agreement passed by Congress earlier this week will be ready for signing during her two-day visit to India.
Days after the House of Representatives acted to approve the ‘123 agreement,’ the Senate, on October 1, passed an identical version of the United States-India Nuclear Cooperation Approval and Nonproliferation Enhancement Act. However, an ‘engrossed’ copy of the Act — an official copy certified by the Secretary of the Senate — had yet to be sent across to the White House at the time of going to press on Friday.
The U.S. is keen for the 123 to be formally concluded during Dr. Rice’s visit and had suggested to India that the two sides could always sign the text even before President Bush signs it into law. However, the Indian government insisted that all legal formalities, including the release of a presidential signing statement, be concluded on the U.S. side first.
According to sources, the White House has shared the text of the statement Mr. Bush will make when he signs the Act, known as the HR 7081, into law with the Indian side and the latter are “basically OK with it.” The statement is intended to address Indian concerns by seeking to “improve the atmospherics” and stressing the importance of nuclear commerce with India rather than by undoing the riders Congress has attached to the 123.
While India fully intends to place its own understandings about the 123 Agreement in the public domain — thereby contesting these American reservations — the sources said this would be done at the time of India’s own choosing. Though a final decision has yet to be taken, one of the options being considered is the handing over of a Note Verbale to the U.S. at the time when diplomatic notes are formally exchanged for the 123 Agreement to enter into force.
Assurances
The sources said the presidential statement would not repudiate any of the Act’s legal provisions such as those which provide for an India-specific procedure for Congress to approve the yet-to-be-negotiated reprocessing arrangements. Nor will it repudiate the provision that the 123 Agreement shall be “subject to the provisions” of the Hyde Act, the Atomic Energy Act and “any other applicable U.S. law.”
The sources said that even as far as the ‘declaration of policy’ part of HR 7081 are concerned, Mr. Bush’s statement will not repudiate section 102(a) which stipulates that the 123 Agreement’s provision “have the meanings conveyed in the authoritative representations provided by the President and his representatives to the Congress and its committees prior to September 20, 2008, regarding the meaning and legal effect of the Agreement,” i.e. that the fuel supply assurances in the 123 will not be legally binding.
4 October 2008
The Hindu
Uncertainty over signing of 123 agreement during Rice visit
Siddharth Varadarajan
New York: Even as Secretary of State Condoleezza Rice wends her way across to New Delhi, there is uncertainty over whether the bilateral nuclear cooperation agreement passed by Congress earlier this week will be ready for signing during her two-day visit to India.
Days after the House of Representatives acted to approve the ‘123 agreement,’ the Senate, on October 1, passed an identical version of the United States-India Nuclear Cooperation Approval and Nonproliferation Enhancement Act. However, an ‘engrossed’ copy of the Act — an official copy certified by the Secretary of the Senate — had yet to be sent across to the White House at the time of going to press on Friday.
The U.S. is keen for the 123 to be formally concluded during Dr. Rice’s visit and had suggested to India that the two sides could always sign the text even before President Bush signs it into law. However, the Indian government insisted that all legal formalities, including the release of a presidential signing statement, be concluded on the U.S. side first.
According to sources, the White House has shared the text of the statement Mr. Bush will make when he signs the Act, known as the HR 7081, into law with the Indian side and the latter are “basically OK with it.” The statement is intended to address Indian concerns by seeking to “improve the atmospherics” and stressing the importance of nuclear commerce with India rather than by undoing the riders Congress has attached to the 123.
While India fully intends to place its own understandings about the 123 Agreement in the public domain — thereby contesting these American reservations — the sources said this would be done at the time of India’s own choosing. Though a final decision has yet to be taken, one of the options being considered is the handing over of a Note Verbale to the U.S. at the time when diplomatic notes are formally exchanged for the 123 Agreement to enter into force.
Assurances
The sources said the presidential statement would not repudiate any of the Act’s legal provisions such as those which provide for an India-specific procedure for Congress to approve the yet-to-be-negotiated reprocessing arrangements. Nor will it repudiate the provision that the 123 Agreement shall be “subject to the provisions” of the Hyde Act, the Atomic Energy Act and “any other applicable U.S. law.”
The sources said that even as far as the ‘declaration of policy’ part of HR 7081 are concerned, Mr. Bush’s statement will not repudiate section 102(a) which stipulates that the 123 Agreement’s provision “have the meanings conveyed in the authoritative representations provided by the President and his representatives to the Congress and its committees prior to September 20, 2008, regarding the meaning and legal effect of the Agreement,” i.e. that the fuel supply assurances in the 123 will not be legally binding.
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