The U.S.-India Civil Nuclear Deal was finalized in 2008 after a long struggle. The Coalition for Partnership with India, a group of businesses, Indian-Americans and academics, led efforts to pass U.S. legislation. Despite strong opposition, the deal became legal under U.S. law.

The United States–India Civil Nuclear Agreement: In Detail

The United States–India Civil Nuclear Agreement also known as the 123 Agreement- is a landmark pact that redefined bilateral relations. Its framework was established on July 18, 2005, through a joint statement by Prime Minister Manmohan Singh and President George W. Bush.

India committed to:

• Separating civilian and military nuclear facilities.
• Placing all civilian nuclear facilities under International Atomic Energy Agency (IAEA) safeguards.

In return, the United States pledged to provide full civilian nuclear cooperation.

Steps Leading to the Agreement

The agreement underwent several complex stages:

1. Amendment of United States Laws: Modifications were made to the Atomic Energy Act of 1954 to allow cooperation.
2. India’s Civil-Military Separation Plan: Identified 35 civilian nuclear installations to be subjected to international inspections.
3. India-IAEA Safeguards Agreement: Approved by the IAEA Board of Governors on August 18, 2008, and implemented in a phased manner.
4. Nuclear Suppliers Group (NSG) Waiver: Granted on September 6, 2008, allowing India to engage in nuclear commerce despite not being a signatory to the Nuclear Non-Proliferation Treaty (NPT).

READ ALL ABOUT NUCLEAR NON-PROLIFERATION TREATY (NPT): https://www.iasgyan.in/daily-current-affairs/nuclear-non-proliferation-treaty

READ ALL ABOUT IAEA: https://www.iasgyan.in/daily-current-affairs/international-atomic-energy-agency-iaea-49

Implementation Milestones

• On October 1, 2008, the United States Senate approved the agreement.
• President George W. Bush signed it into law on October 8, 2008.
• India-France Nuclear Pact: Signed shortly before the United States agreement it made France the first partner to engage with India under similar terms.

Key Provisions

The agreement:

• Allows civilian nuclear cooperation but prohibits the transfer of sensitive technologies, such as uranium enrichment and reprocessing equipment.
• Places identified civilian nuclear facilities under permanent IAEA safeguards.

Key Terms of the Deal:

• Inspection by the International Atomic Energy Agency (IAEA): India agreed to place 14 out of 22 reactors under IAEA safeguards by 2014 and signed an Additional Protocol allowing more intrusive inspections.
• Non-proliferation Commitments: India pledged a moratorium on nuclear weapons testing, strengthened arsenal security, and support for a Fissile Material Cutoff Treaty (FMCT).
• Civilian and Military Separation: India retains discretion over designating facilities as civilian, exempting military ones from inspections.
• Access to Technology: India can purchase dual-use nuclear technology and imported nuclear fuel.

Challenges in Implementation

• 2015: Full implementation of the deal was delayed due to unresolved issues like liability concerns.
• 2016: Both countries agreed to build 6 United States designed nuclear reactors in India, marking progress in implementation.

Strategic Significance

The deal marked a turning point in U.S.- India relations. It strengthens India’s access to nuclear technology as well as fuel. It enhances energy security and also aligns with global non-proliferation norms. It fostered trust and enabled cooperation in areas like defence purchases, military exercises, technology transfer and intelligence sharing. The deal integrates India into the non-proliferation regime without NPT membership.

Unfulfilled Energy and Commercial Goals

The deal’s energy potential remains unrealized:

• S. companies were expected to build nuclear plants in India, but no plants have been constructed.
• The plan for six nuclear reactors by Westinghouse, announced in 2016, remains stalled.
• The promise of clean, nuclear energy to reduce reliance on fossil fuels has not been met.

The Liability Risk Issue

India’s Civil Liability for Nuclear Damage Act, 2010, created barriers. It placed liability on suppliers, not operators, deterring U.S. firms like GE and Westinghouse.

Insurance Mitigation

India introduced insurance measures through the General Insurance Corporation and other companies. Russia accepted this, but U.S. firms remain unwilling to proceed.

Technology and Cost Challenges

U.S. companies face additional hurdles:

• They must offer advanced nuclear technology.
• Costs must be reasonable to avoid burdening Indian consumers.
• Past cost overruns in U.S. projects raises concerns.

Regulatory Issues and Entity List

Many Indian entities were removed from the U.S. Entity List after the deal. However, concerns about dual-use technology and export controls persist.

Recent Developments

U.S. is working to resolve regulatory barriers. U.S. National Security Adviser Jake Sullivan announced steps to ease restrictions on Indian nuclear entities. This progress still requires agreement from U.S. security and foreign policy agencies.

The Path Forward

The deal’s full potential depends on:

• Resolving liability risks.
• Offering affordable, advanced technology.
• Aligning regulatory systems.

The benefits include energy security, economic growth and a stronger U.S.-India partnership. However, both governments must act swiftly to address these challenges.