123 Agreement: The Great Indian democracy circus Part 1

After the Arushi Murder case the Indo- US nuclear deal has been the latest entertainment act in the Great Indian Circus. Will the deal sink the govt. and a lot of taxpayers money in re-elections? -- we shall know in 24 hrs. But while the athletes of Indian parliament engage in there pole vaults and acrobatics across parties, I think it is important for we the citizens to know what the deal is all about. A random sample of people around me shows that most of us -- much like our politicians -- are "emotional' of the deal without necessarily having "factual" information on the same and that the deal has in fact taken a back seat in view of the trust vote . In this three part series I intend to make an attempt to explain the deal/ agreement, its implications on Indian power reforms and analyse the drama as it unfolds in the parliament .
The India - US Nuclear deal
What is Nuclear agreement and why is it called the 123 agreement?
The India US Nuclear deal is also called the 123 agreement in reference to Sec. 123 of the U.S. Atomic Energy Act. There is a ban on transfer of nuclear technology to other countries under this Act. The Hyde Act was passed by U.S.A to make an exception for India, to enable transfer of technology for civil nuclear energy.
So whats the whole fuss in this agreement all about?
Under the agreement India will be able to develop a strategic reserve of nuclear fuel to guard against any disruption of supply over the lifetime of its nuclear power reactors. This will mean that India can go ahead and develop Nuclear power plants adding up to 40,000 MW of Nuclear energy to reduce dependence on the depleting Coal, costlier Water and increasingly costly Oil energy. (More analysis on the power situation and how the deal changes it in next part). It will also be able to reprocess US-origin nuclear fuel at a special facility under International Atomic Energy Agency (IAEA) safeguards. This would make India the third region unrestricted in that respect by US lawmakers - after the European Union and Japan - and the first to host such a facility under such international safeguards arrangements. Since the processed raw uranium supplied by US can be used for Nuclear weapons manufacturing as well as power generation, the US govt. has incorporated a clause which allows them to inspect the facilities where the raw material is used, so as to ensure it is used for "peaceful" purposes. Fair? I think so. Wouldn't we do the same if we have a similar treaty tomorrow with say Korea???
So the deal is not about building Nuclear plants and only about the raw material?
Correct. The deal only provides the raw material. India still needs to invest over US $ 100 billion over the next 10 years to build Nuclear reactors. The deal is however necessary since the providers of Nuclear reactors and spare parts is a closely held group - Nuclear Supplier Group (NSG) which has US stronghold -- and would not enter agreements unless mutually agreed.
Wow! So that's the underlying game of the agreement --Add to the profits of US companies from securing contracts to build these nuclear plants?
If you thought this, you could be the next candidate for the left parties. Please note that the world is not a big NGO and we live in capitalism. People work for profit and mutual gains. So while one of the elements for the deal was profit for US companies like GE Energy, USEC and Westinghouse electric, the game has not played out as well for these US companies. According to the latest buzz the Russian and French nuclear reactor producers like Areva NP SAS, Atomenergoproekt, and ZAO Atomstroyexport are already taking advantage of their long-standing ties with India's nuclear community, and the fact that India has yet to sign the Convention on Supplementary Compensation (CSC) - an international treaty that created a global pool of money to pay victims of nuclear disasters, and since India's not a party to it, any American-built reactors would have to shoulder their own civil liabilities—a cost that would likely prove prohibitive. So, if the deal were to be signed today it would be the Russians and French who would really gain. I am sure if the govt. publicised this well enough the left parties would have sought some solace in a communist nation gaining.
What is the duration of the deal?
The deal is for 40 years and can be extended by another ten years.
Where does the signing stand today?
As on date the agreement has been stalled in the Indian Parliament by opposition leaders (60% of whom have never read the agreement) . By the way India's parliamentary democratic system does not require a government to have its foreign policy decisions endorsed by parliament. Which essentially means that the opposition can ‘vote” on issues and voice concerns but the act of bringing the democracy on its knees is morally unconstitutional – especially when most of the opposition leaders have no clue of what the mechanics of Nuclear deal and care a damn about it.If and when the agreement is signed by both governments, the next step is to enter into agreement with the IAEA ( international atomic energy agency) for safeguards of the civil nuclear reactors to be set up under the 123 agreement and to enter into an agreement with the NSG ( nuclear suppliers group) for supply of nuclear fuel i.e uranium for the civil nuclear reactors. Once India completes the agreements with IAEA and NSG, then the U.S. Congress will vote on the 123 agreement. Once it is approved by the U.S. Congress, then the deal is complete and India and U.S.A can enter into nuclear commerce i.e supply of nuclear reactors, transfer of technology, supply of nuclear fuel etc.
Why do the left and opposition oppose it?
Simple answer -- That's there nature and birth right to oppose anything the ruling party proposes. However lets look at the various reasons which some "intellectuals" have used to oppose the deal.

• The deal prevents India from making any Nuclear tests akin to Pokhran II in 1998

Fact- There is nothing in any agreement India has signed that commits it to cap or reduce its weapons-grade fissile material stockpiles. The agreement does say that if India "unilaterally" detonates a nuclear device the US govt. shall have the right to terminate the agreement with one year notice. However even there under section 13 of the agreement the US govt. needs to undergo a "consultation"process before termination. Here it is important to note that -

First, India has already "bilateralised" its unilateral moratorium in a joint statement with Pakistan issued during Atal Bihari Vajpayee's visit to Lahore as Prime Minister in 1999. Any unilateral India test, therefore, would violate that agreement to begin with.

Secondly, sub-critical tests and computer simulations of the kind the U.S. conducts in order to validate weapon designs would not attract any penalty.

Thirdly, there would, in any case, still be no legal obligation on India not to conduct an explosive test. However it will make the Indian Govt. pause and think of the collateral economic damage it could have in spoling ties with the US govt. While the nuclear deal leaves intact the government's prerogative to accumulate fissile material and build bombs and even test them, it will, presumably, force policymakers to take into account these associated costs. To the extent that this has a rational effect on the size and structure of the country's nuclear weapons programme, this is not necessarily a bad thing.

Finally, the agreement says that that it will take into account the circumstances in which India conducts a nuclear test. These include a ''changed security environment'' or action, which could impact national security. Essentially what it boils down to is that the right to terminate the agreement may not be invoked if Pakistan or China conduct nuclear tests and India responds to that by conducting a test of its own. In a way, this is the first international agreement, which would justify the circumstances in which a nuclear test is conducted. So India is not giving up its right to test and right of return of nuclear fuel does not automatically comes into play.

• Even if the deal doesn't directly force India not to conduct tests, US could cause huge damage to India by terminating the treaty anytime in its duration and hence turning all its nuclear reactors into a junk pile.

Fact - The deal interestingly says that the "right of return" - basically the right to terminate the agreement and stop further supplies - that the Americans have does not automatically comes into effect. It is something the US administration chooses to do. They would have to stop cooperation with India. But whether or not they take back fuel is something they would have to choose to do. Even if, for some reason, they were to take back nuclear fuel, India retains the right to seek alternate sources of fuel for itself. US will have to ensure that it makes necessary arrangements from other third party nations like Russia and France to secure supplies for the remaining period of the agreement to ensure the smooth operation of 'peaceful use of the nuclear fuel' read - power plants. Of course they don't ensure supplies for Nuclear Bomb manufacture if that's why they decide to terminate the agreement. Logical???

There are some other reasons but they are completely bizzare and do not even merit a presence on this blog, but just to provide an example ""The nuclear deal will hamper the Iran-Pakistan-India gas pipeline project, Mayawati tells a press conference in Delhi" -- Duh!!!"

If the deal is good why doesn't the govt make the details public?

The agreement and the deal are public and available here. They have however been subject to the usual Indian 'chalta hai" attitude by we the people who care for nothing "politics" and more sinfully by the complete incompetence of the Congress PR machinery to drum up enough support and let the facts known.

Could this ruckus and Blackmail of democracy have been avoided?
Sure. There was only one thing which could have prevented the situation going out of hand and that was PR and Communications. The govt. has miserably failed in educating the population at large on the nitty- gritties of the deal. They should ideally have created open forums for discussions of the deal and a climate of openness. It is easy for politicians to sow the seed of dissent in absence of transparency by making statements like " The govt. is pushing us into US slavery 50 years after freedom from British" - Aka Akali dal. These statements are however difficult to defend in a forum with facts and figures. These forums should have included Corporates and media personalities including the likes of M S Dhoni and Amitabh Bachan supporting the deal. I am sure if they can sell Priya Gold biscuits and Sona chandi chawanprash they can sell a nuclear deal to a nation who thinks thru their eyes. You could win the whole south by enrolling Rajnikant to support the deal. An example of an excellent PR campaign was the voting on Lisbon treaty for Irelands accession to EU conducted earlier this year (which ultimately lead to Ireland not signing up).
Bottom line the Indo-US deal has put the govt. in a "survival mode" purely due to lack of transparency and public propaganda on the deal allowing the conspiracy theorists to leverage this issue to murder democracy.
While this post objectively analyses the "agreement", I will attempt to answer whether the deal is good enough to solve India's power situation in the next part.