[R-G] Indian Officials Bracing Themselves for U.S. Draft on Changes to NSG Guidelines + What China Thinks about the N-deal Progress

Yoshie Furuhashi critical.montages at gmail.com
Fri Jul 25 14:31:47 MDT 2008

Indian officials bracing themselves for U.S. draft on changes to NSG guidelines

Siddharth Varadarajan

Washington has so far not shared its plans with Delhi

Actual text is likely to be made available by Saturday

"If NSG imposes conditions, India will reserve the right to walk away"

New Delhi: In a sign of the uphill territory still left to traverse on
the nuclear front, Indian officials are bracing themselves for a round
of tough negotiations when the Americans finally share the text of
their proposed amendment to the Nuclear Suppliers Group guidelines
later this week.

A short draft comprising six paragraphs was circulated by the U.S. in
March 2006 but it is believed to have undergone substantial revision
in Washington since then. An unnamed State Department official was
quoted in a recent report of the Congressional Research Service (CRS)
as saying the new draft had deliberately not been circulated for fear
that it would trigger fresh objections to the nuclear deal within

Though South Block is familiar with elements of the new draft, the
actual text is only likely to be made available to New Delhi on Friday
night or Saturday, officials told The Hindu on Friday.
Unconditional exemption

At previous meetings with the Indian side on the NSG issue, U.S.
officials have taken the view that while they fully support India's
demand for an unconditional exemption from the NSG's restrictive
export guidelines, a number of European members of the 45-nation
nuclear cartel are pressing for inclusion of conditions and

Asked whether it was not rather late in the day to be receiving a copy
of the proposed changes to the NSG guidelines, a senior official said
India had been saying right from the outset that it would accept only
a "clean, clear and unconditional" exemption. "There is nothing to
negotiate. The last thing we wanted was to get stuck whittling down a
huge list of conditions to something smaller. Instead, we are saying,
'You know what we want, and that's a text which is unconditional',"
the official added.
Trial balloons

Among the conditions that have already been floated as trial balloons
by the U.S. in previous discussions with India are provisions for
periodic review, Indian compliance with future NSG guidelines, a
reversion of the ban in case India conducts a nuclear test explosion,
and a ban on the sale of enrichment and reprocessing equipment.

India, say the officials, has no option but to stick to its guns. "If
anything, the fierce debate and the trust vote that the Manmohan Singh
government has just won demonstrate that the Prime Minister has
absolutely no wiggle room," said an official. "If the NSG imposes
conditions, India will reserve the right to walk away." Part of the
problem are the mixed signals the Indian side has sent on what might
and might not be acceptable to the government.

For example, India has maintained that its nuclear testing moratorium
is a unilateral commitment and that the NSG rule change should not be
conditional on it. While U.S. law may require the cessation of
cooperation in the event of a nuclear test, the laws of other
suppliers like Russia and France do not. Yet, in an interview to The
Asian Age on April 9, Shyam Saran, the Prime Minister's Special Envoy,
said it was "unrealistic" for India to expect the NSG not to insist on
a no-testing condition. This statement has since been seized upon by
the Americans as evidence that India might be flexible on its demand
for a clean exemption. In its May 20, 2008 report, the CRS quoted Mr.
Saran's statement to speculate that "New Delhi may be willing to
accept some conditions" on the NSG exemption front after all.
New rules

Though the NSG was set up in 1975 to tighten the rules of nuclear
commerce in the wake of India's 1974 nuclear test, its guidelines did
not prohibit nuclear sales to India until 1992. That year, new rules
were adopted stipulating that the export of so-called "trigger list
items" could be made to non-nuclear weapon states only if all their
nuclear activities were under safeguards.

Under the terms of the July 18, 2005 India-U.S. agreement, Washington
is committed to working with its friends and allies to "adjust
international regimes to enable full civil nuclear energy cooperation
and trade with India." New Delhi maintains that this means the NSG
must unconditionally waive the applicability of its full-scope
safeguards rule to India and not impose any other extraneous

India also objected to a prescriptive clause in the March 2006 NSG
guideline draft which said members would "continue to strive" for the
"earliest possible implementation" of full-scope safeguards in India.
Fear of U.S. vendors

In Congressional testimony, U.S. officials have assured legislators
that they would oppose the adoption of NSG guidelines which would
place U.S. firms at a disadvantage vis-a-vis competitors. The fear of
U.S. vendors is that since their nuclear exports to India would be
governed by the NSG guidelines as well as the more restrictive
provisions of the Hyde Act and the 123 Agreement, New Delhi should not
be able to send its business to countries with less restrictive
national rules.

What China thinks about the N-deal progress

D S Rajan | July 24, 2008 | 22:58 IST

While the party and the State-controlled media in China have so far
confined themselves to giving a factual account of the trust vote in
New Delhi on the nuclear deal with the US, an authoritative and
well-connected strategic affairs journal in Chinese language, has
chosen to come out with a prompt independent comment on the subject.

Appearing at a time when there are expectations of Beijing's support
to India's case in the Nuclear suppliers Group (NSG), what has been
said in the comment assumes significance.�

The commentary, under the caption�India extends hand, the US is to
hold, written by "Zhan Lue" ("Strategy" in English), ostensibly by a
high-level party cadre, has remarked (China Institute of International
Strategic Studies, Beijing, Chinese language Online Edition, 23 July
2008) that the deal which was being considered almost dead due to the
opposition coming from the 'anti-American' communist groups supporting
the 'Centrist government', could be rescued by Prime Minister Singh
through his act of 'adventure and courage'; he could replace the
erstwhile support of the communist groups with that of� 'regional
small parties".

With the Prime Minister winning the trust vote in the Indian
Parliament on 22 July 2008, a question, which remains, is whether the
deal can now successfully go through the political process in the US.
The write-up admitted several legal questions may confront the deal in
the US, but at the same time felt that the US Congress should be able
to find time to express support for the deal, as overall it suits
Washington's interests.�

"Zhan Lue" has further observed that New Delhi's nuclear explosion in
1974 resulted in a stop to the Indo-US nuclear cooperation; but the
time has changed now. The writer listed the following as constituents
of the President Bush's logic behind the US nuclear deal with India:

1. The advantages of the US-India Strategic Partnership outweigh the
risks which were perceived as per Washington's old policy towards New

2. Availability of clean nuclear energy to India through the deal, can
contribute to India's capacity to reduce green house gas emissions.

3. Unlike Pakistan, India's nuclear weapon programme has not led to
any proliferation

4. Most important factor is that India is a democratic nation with
common values and common interests with the US -- Contain China and
resist Islamic terrorism.

5. Worth paying attention is that India's recycling of nuclear
material will come under more and more international supervision as a
result of the deal.

The Chinese strategist has nevertheless visualised worries to the US.
Firstly, the deal can erode into the US aggressive open stand that if
India is to carry out further nuclear tests, it will cut nuclear
supplies to India. Next, Washington may have to worry about India's
economic relations and military contact with Iran. Lastly, New Delhi's
traditional habit of displaying a 'non-alignment' attitude towards
American interests may also be of concern to Washington. On the other
hand, the US could also feel 'hopeful', as to get closer to
Washington, the Indian Prime Minister has successfully discarded the
communists, triggering relaxation in the conditions concerning the
deal. Zhan Lue has added that a refusal by the US Congress to endorse
the deal, can not only lead to New Delhi's dissatisfaction, but also
to India's approach to France and Russia for procuring 25000 MW of
nuclear power, taking advantage of the permission to it accruing from
the IAEA and NSG for buying nuclear material and technology. In the
conclusion of the analyst, the ball is move into the court of the US


What looks significant is the reappearance, after some gap, of Chinese
media criticisms on the US intentions to contain China through its
nuclear deal with India. In the past, publications in China had
accused the US of adopting a 'double standard' in signing the deal; a
message was given on one occasion that Beijing might like to conclude
similar pacts with friendly nations. An analysis (People's Daily, 30
August 2007) criticised India by name with the remark that the desire
of Washington is to enclose India into the camp of its global partners
and that fits exactly with India's wishes.�

In contrast, Beijing's apparent signals at diplomatic levels have been
circumspect on the deal. The cautious statements of the PRC Foreign
Ministry officials welcoming civil nuclear cooperation between nations
keeping in view the non-proliferation interests, have given rise to
Indian optimism on China supporting India's case in the NSG. China's
offer to India for civil nuclear cooperation, made for the first time,
has by implication been positively interpreted by Indian officials.
During recent India-China leadership meetings, signs have been
available to suggest Beijing's stance favourable to India.

One has to take a composite view of the seemingly contradictory
perspectives of Chinese strategists and the government on the Indo-US
nuclear deal. In reality, however, they are two components of the same
Chinese policy -- one to suit strategic interests and the other based
on tactical factors. Under the former, the US is looked upon by China,
as a potential threat and China would like to keep India outside the
US influence. Tactically, China needs friendship with the US and India
in the present stage to guarantee its "peaceful development'.

Beijing's support to New Delhi in the NSG, if it comes, needs to be
seen in such tactical context. But China is expected to maintain a
careful watch on whether the deal can lead to strengthening of India's
nuclear weapon programme at a level capable of competing with China or
threatening its ally Pakistan. What stand Beijing will adopt to the
reported objections of Pakistan on approval of the Indian nuclear
safeguards agreement in the IAEA, particularly based on its perceived
arms race in the region, is likely to generate great interest in

The writer, Mr D.S.Rajan, is the Director, Chennai Centre for China
Studies, India.

 PM calls Russian president, seeks NSG support
25 July, 2008 12:26:07

After winning the trust vote in parliament and putting the India-US
nuclear deal on the fast track, Prime Minister Manmohan Singh called
up Russian President Dmitry Medvedev and sought Russia's support in
the IAEA board and the Nuclear Suppliers Group. Medvedev has assured
that Russia will help build consensus in the NSG.

"The prime minister on Thursday evening sought Russia's support in the
IAEA and NSG. The Russian president assured him that his country will
help to build consensus for India in the NSG," an official source told

Medvedev congratulated Manmohan Singh on winning the trust vote in
parliament on Tuesday and his decision to go ahead with the next steps
required to wrap up the nuclear deal, the official said.

The two leaders also discussed dates for Medvedev's forthcoming visit
to India which is likely to take place in December.

The prime minister's telephonic conversation with Medvedev took place
much before US President George W Bush rang up Manmohan Singh and
discussed the next steps in concluding the civilian nuclear deal.

The two last met on the sidelines of the G8 summit in Hokkaido early
this month where Medvedev assured India his country's strong support
for global nuclear cooperation.

The accord envisages Russia helping India to build four additional
nuclear reactors at Kudankulam in Tamil Nadu.

Russia is building two light water 1,000 MWe reactors at the
Kudankulam nuclear power plant.

The India-US nuclear accord will be signed by the two counties after
the IAEA board approves the India-specific safeguards agreement and
the NSG amends its guidelines to allow global nuclear trade with

The NSG is likely to meet in the first week of August after the
approval of the India-specific safeguards agreement by the IAEA board
at its meeting Aug 1.

The NSG process is likely to be completed in August.

The 123 agreement is likely to be endorsed by the Congress by
September before India and the US ink the bilateral civil nuclear
cooperation agreement, opening the doors of global nuclear trade for
New Delhi after a gap of three decades.

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