Europe and the Indo-US nuclear deal

As the US and India wrap up a historic nuclear cooperation deal, Russia, France, Germany and the UK prepare for a role in a potentially lucrative market, but the rest of Europe and China may make waves.

Commentary by C Raja Mohan for ISN Security Watch (23/07/07)

As the historic Indo-US atomic energy initiative moves from a bilateral to a multilateral setting, a divided Europe will soon have to make up its mind on accepting New Delhi as a nuclear armed power for all practical purposes.

After prolonged negotiations spread over months, last week in Washington, senior US and Indian officials wrapped up the so-called “123 Agreement,” which defines the legal framework for civilian nuclear cooperation between the two nations and is named after a section of the US Atomic Energy Act, 1954.

The next steps involve the negotiation of a safeguards agreement between India and the UN’s International Atomic Energy Agency (IAEA) and an endorsement of the 45-nation Nuclear Suppliers Group, which sets the rules for global nuclear commerce. Europe is well represented in both these bodies.

As ISN Security Watch reported in May, the historic agreement unveiled by US President George W Bush and Indian Prime Minister Manmohan Singh two years ago on 18 July 2005 involved a series of reciprocal commitments from Washington and New Delhi.

The Bush Administration promised to persuade the US Congress to change its domestic non-proliferation law and the NSG to revise the international rules to facilitate renewed international nuclear cooperation with India.

New Delhi, in turn, had agreed to separate its civilian and military programs and place the former under international safeguards. It had also offered to extend enduring support to the global non-proliferation regime.

Intense criticism from arms controllers from across the Atlantic greeted the Indo-US nuclear deal. They despaired at the US readiness to live with India’s nuclear weapons program and recast the global nuclear order built around the 1970 Nuclear Non-Proliferation Treaty (NPT). India never signed the NPT, which limits the number of nuclear weapon powers to the five permanent members of the UN Security Council.

Despite the backlash from the non-proliferation community in the US and Europe, New Delhi and Washington went ahead with the implementation of the deal. The two sides agreed on a nuclear separation plan for India in March 2006 and the US Congress approved a new law, the Hyde Act, to resume civilian nuclear cooperation in December 2006. The Hyde Act will come into force after the US Congress nods at the bilateral 123 Agreement in conjunction with the NSG approval and the IAEA safeguards agreement.

Since India is not a recognized nuclear weapons power under the NPT but is in possession of nuclear weapons, the IAEA will have to craft a special safeguards arrangement for New Delhi. This safeguards agreement will have to be approved by the IAEA’s 35-member board of governors. The current IAEA board includes 12 European nations. The NSG, representing the world’s leading industrial nations, has a stronger European representation at 31.

The three nuclear weapon powers of Europe – Russia, France and the UK – have already backed the Indo-US nuclear deal. Even before the Bush Administration’s special initiative towards India, Russia and France had begun to make the case for a nuclear accommodation with a rising India.

Since the unveiling of the Indo-US nuclear deal, Moscow and Paris have positioned themselves to make a big entry into the potentially lucrative Indian market for imported nuclear power plants. Germany too appears to have recognized the necessity of deeper a political relationship with India.

Some of the smaller European countries – including Austria, Ireland and Sweden – that have traditionally taken strong positions in favor of arms control and non-proliferation remain squeamish about making a nuclear exception for India.

The smaller European nations might not be able to stop the momentum behind a nuclear agreement sponsored by the US, and endorsed by Russia, France, Germany and the UK. India, however, is acutely conscious of their ability to create complications in the NSG debate by demanding additional non-proliferation commitments from India beyond those it has already undertaken in its negotiations with the US.

India, for example, is not a signatory to the Comprehensive Test Ban Treaty (CTBT), which prohibits all nuclear testing. Many European states have demanded that India sign the CTBT. While New Delhi has been abiding by a unilateral moratorium on further tests, it faces strong domestic political opposition to joining the CTBT.

New Delhi is concerned that the European opposition will be leveraged by China to either block the NSG approval or make it conditional and therefore unacceptable to India. Deeply concerned about the warming political and security ties between New Delhi and Washington, Beijing has argued against a country-specific exception to the nuclear rules.

Instead, it demands the negotiation of a set of universal criteria for changing the regime.

Implicit in the Chinese argument is a simple proposition: If a special political favor is on offer to India, it also needs to be extended to Pakistan, Beijing’s long-standing ally. That proposition in turn could lead to an indefinite delay in the NSG approval for the Indo-US nuclear deal.

In the next few weeks, India and the US are expected to intensify their outreach to the European nations and explain the high geopolitical stakes involved in a quick and unconditional approval of their nuclear agreement.

C. Raja Mohan is a Professor at the S Rajaratnam School of International Studies, Nanyang Technological University, Singapore.

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