Counting the beans

After some hectic, last-minute negotiations the N-deal has been concluded. The concerns of Indian nuclear scientists which we highlighted were rightly justified resulting in a hard bargain. The Prime Minister had earlier announced that the fast breeder reactors cannot be placed on the civil list nor can it be cut off from the civilian grid - respecting the reciprocity clause as we had pointed earlier. To the “in-perpetuity” safeguards demands put forth by Dr. Condoleezza Rice just hours before President Bush landed - there will now be a tri-lateral agreement with India, the U.S. and the IAEA to work out a guaranteed fuel supply plan and work with a group of friendly nations should the U.S. fail to ensure supply. The price India paid for coming late to the party was to offer much more reactors (14 out of the 22 reactors existing/under construction) to be open to phased international safeguards by 2014 than any of the existing weapons states. Also all the future civilian reactors will have to be under such safeguards though it is upto India’s prerogative to decide which ones are going to civil or military. Another contentious issue which the non-proliferation lobby had raised is the small 40 MW CIRRUS reactor which India imported from Canada in the 50s will soon be shutdown.

We are happy that the deal has been welcomed by the nuclear scientists who were taken into confidence during the negotiations after the initial slip-up. The market in general and the shares of Indian power companies like BHEL and Tata Power which have shown interest in operating nuclear plants too responded favorably to the deal.

The game now shifts to the U.S. Congress where the deal has to be ratified by changing existing U.S. laws and the IAEA where the nature of safeguards have to codified in the form of an India-specific Additional Protocol. It may be worthwhile to do a SWOT analysis to examine where the deal stands and how it is likely to proceed. While we are not professionally qualified to do a comprehensive study, we nevertheless present an amateur version.

Strengths

The favorable public opinion of Americans about India and viceversa augurs well for the passage of the deal in the Congress (despite minor irritants like Lou Dobbs (debunked here) and the one hit wonder Arundhati Roy (fisked among elsewhere here)). Also, contrary to the opposition from Atlanticist mouthpieces like the New York Times, a roundup of several respected American newspapers shows that the deal is viewed with cautious optimism or even welcomed in many cases.

Important members of U.S. legislative bodies like Bill Frist, the Senate majority leader, Tom Lantos ranking Democrat on the House International Relations Committee, John Warner chairman of the Senate Armed Forces Committee, have all welcomed the deal terming it as ‘historic’ and a ‘positive step’, albeit cautioning close scrutiny in the coming months.

The agreement has been enthusiastically supported by major nuclear powers like France, Russia, the UK and even Japan (which fiercely opposed India’s 1998 nuclear tests) and very importantly, the IAEA. This will undoubtedly carry forward the deal among the Nuclear Suppliers Group cartel and the IAEA.

Weaknesses

A lame duck: The relative weakness of a lame duck President Bush after the near civil war conditions in Iraq the domestic mismanagement to Hurricane Katrina and the Dubai ports deal somewhat reduces the political maneuvering of the executive power in the American democratic set up.

Proud, but prickly: Domestically, Dr. Manmohan Singh will face virulent opposition from the Communist parties whose loyalties lies elsewhere. Muslim organizations, irrespective of their opposition to American foreign policies elsewhere should understand the importance of the deal and avoid political blackmailing and derail national interest. Both these groups are well-organized with big vote banks and media clout and can cause significant political trouble when Dr. Singh attempts to take the Parliament into confidence.

Opportunities

All politics is local: Even with a reduced political capital, the Republican National Committee still is loyal to the President. It plays a great role in garnering funding for Congressmen’s re-election in November later this year. Indian-Americans with economic clout too can play an important part by lobbying with their Congressmen and Senators. Ultimately, it is in their interest for Congressmen and Senators to look at their your backyard more than listening to the unelected non-proliferation ayatollahs.

It is the economy stupid: President Bush’s speech at the Old Fort highlights a growing Indo-US strategic partnership with co-operation in several important areas for the 21st century which can result in increased trade and mutual benefits for the two countries. American reactor makers like General Electric and Westinghouse Electric Co. (recently purchased by Japan’s Toshiba Corp.) who will benefit enormously in any future nuclear trade with India should remind Congressmen of the American jobs created as a result. U.S. defense contractors like Lockheed Martin Corp. and Boeing Co. are keen on getting a share on India’s multi-billion dollar MRCA deal. U.S. politicians need to be reminded that none of the above can happen sans the ratification of the agreement.

America’s second ‘Red Menace’: In geo-political terms, China’s fast increasing military spending and the sophisticated naval assets has been worrying many American strategists who clearly see an alliance with India as a counter-weight to China. The U.S. Defense Department in a rare gesture cheered the agreement with India. Though some of the Chinese strategic maneuvers in the Indian Ocean should also set-off alarm bells, India has ‘officially’ expressed that it has no intention to toe that line. But like it or not, India will be increasingly viewed as a serious contender to keep China tied. If it helps procure the deal - pourquoi pas?

Threats

The Revenge of the Ayatollahs: Predictably, they have quickly voiced their opposition. Make no mistake, they will not go down without a fight. Leonard Weiss - the chief architect of the Nuclear Nonproliferation Act of 1978 who has retired but nevertheless was leading the charge against the deal. The torch has since been passed on to his “shishyaas”. In the coming months during Congressional and Senate testimonies, watch out for noise from: David Albright (Institute for Science and International Studies), Joseph Cirincione (Carnegie Endowment for International Peace), Robert Einhorn (Center for Strategic and International Studies), Daryl Kimball (Arms Control Association), Michael Krepon (Henri Stimson Center), George Perkovich (Carnegie Endowment for International Peace), Henry Sokolski (Non-Proliferation Policy Education Center), Leonard Spector (Center for Nonproliferation Studies). They will be covertly supported by the traditional Atlanticist lobby in the U.S. State Department opposed to India or the Bush administration policies. Also expect its mouthpieces like the New York Times to give plenty of media space in the form of one-sided op-eds and ‘hard-hitting’ editorials.

The Chicoms Strike Back: Some analysts see this deal as a loss of face for China. The Chicoms for their part have already started a massive lobbying against the deal among NSG countries like Australia (currently the biggest Uranium supplier). Some in the Australian administration are already showing their dissent despite hands of friendship extended to India from that country. China carries enormous clout in Australia as a big buyer of Australian commodities like iron ore. Similar opposition can be expected from some ASEAN, African and Latin American countries where China is flexing its newly-acquired economic muscle.

The challenge begins now

It is clear that the we have just entered the hard part. So far we have not seen any statements from Indian diplomats countering the campaign by the Chicoms and the NP Ayatollahs - perhaps the champagne is still flowing in South Block. No doubt, they deserve all the celebration after some hard-won negotiations. But the party is far from over - they should soon jump start their diplomatic offensive. There are so many variables in this equation and several geo-political adjustments to make. All this calls for active engagement with the various stakeholders of the game. Interesting times ahead.