Both sides can really say ‘What a deal!’
Ten years ago, a civil nuclear deal transformed India from being a target of a determined US non-proliferation policy to becoming a partner in its geopolitical endeavours
T en years ago this day, on July 18, 2005, the United States and India moved boldly to cement their bilateral relationship. President George W Bush and Prime Minister Manmohan Singh issued a historic joint statement that renewed civil nuclear cooperation, thus eliminating the singular discord that had bedevilled mutual ties for over thirty years.
Although it often appears as if the July 18, 2005 initiative inaugurated this fresh start, in reality, it only capped a deeply transformative phase of bilateral cooperation that had begun earlier under Prime Minister Atal Bihari Vajpayee — and which reached its apotheosis during Bush’s first term. During this period, it was India that had seized the initiative to boldly support the United States.
By endorsing Bush’s plans for deep nuclear reductions and missile defence, offering Indian military facilities for the US campaign in Afghanistan, refusing to lead the international chorus of opposition to the US war in Iraq, and coming close to contributing even an Indian Army division for post-conflict stabilisation in Iraq, Vajpayee demonstrated that New Delhi could behave as Washington’s “natural ally” because it served, first and foremost, India’s own deepest national interests. What Condoleezza Rice would declare to be India’s willingness to “think differently,” then, laid the foundations for closing the deal that was finally announced a decade ago today. Although Vajpayee was not in office to enjoy the full fruit of what his courage had begotten, it was appropriate that Singh should have been the beneficiary of his legacy because he too viewed the US as India’s true and most valuable friend.
That his government, his party, and sometimes his own diffidence, came in the way of demonstrating this sentiment as boldly as Vajpayee had done before — and as Prime Minister Narendra Modi does now — does not change the fact that his acceptance of the US offer on July 18, 2005 codified the transformation in bilateral ties indelibly and for a startled world to see.
US-Indian ties since then have progressed so dramatically that it is often easy to forget the recrimination that dominated bilateral encounters since 1974.
Yet, amidst the amity that now characterises the relationship, it is often charged, both in Washington and New Delhi, that the deal has turned out to be the breakthrough that wasn’t. This accusation is astounding — and wrong. First, the deal revolutionised the terms of engagement between the United States and India. Prior to July 18, 2005, New Delhi was the principal target of a dense global non-proliferation regime erected and managed by the United States.
India was the example to be made of for any future state seeking to develop nuclear weapons: It was subjected to continuous diplomatic haranguing, denied access to all high-technology goods of strategic import, and treated as an outcaste in all the international regimes that regulated trade in controlled commodities. The nuclear deal transformed India overnight from being a target of this determined US non-proliferation policy to becoming a partner in America’s larger geopolitical endeavours. As a result, New Delhi today, can contemplate admittance to the very cartels that penalised it for many decades but, more importantly, be endorsed by Washington as the linchpin of its strategy for preserving peace and security throughout the IndoPacific. India’s metamorphosis from antagonist to associate thus has consequences that go far beyond civil nuclear cooperation.
Second, the nuclear deal bailed out India’s indigenous nuclear program. Ever since its founding, this programme has been one of the three crown jewels in India’s effort to domesticate advanced technology for defence and development. For all its achievements, however, India’s nuclear reactors were running out of fuel at the turn of the century, thanks, partly, to Delhi’s enforced isolation from international nuclear commerce. At the time of the deal’s announcement, 11 of India’s 17 nuclear power reactors were operating below capacity with load factors reputedly ranging from 23-68%.
The overall capacity utilisation for India’s nuclear power plants then was an abysmal 50%. Since receiving fuel supplies from abroad — a key benefit of the nuclear deal — capacity utilisation in 2014 has shot up to 82%, consistent with the global average. The ability to import fuel, components, and even complete nuclear reactors if desired, has rescued India’s nuclear programme from the jaws of death.
And its new entrée into advanced global R&D initiatives, such as the International Thermonuclear Experimental Reactor (ITER), provides the assurance that it will stay au courant with cutting-edge innovations for a long time to come.
Third, the nuclear deal paved the way for altering India’s status in the US export control system. The US opposition to India’s nuclear programme ever since its 1974 test resulted in the progressive tightening of its export control regime which regulates all nuclear resources, dual-use commodities of strategic import, and advanced weapon systems and components.
This regime, which Indian commentators loosely refer to as “technology sanctions,” was aimed not simply at denying India the capacity to build nuclear weapons and delivery systems but rather at choking its entire nuclear industry, stifling its ability to incorporate any controlled dualuse item even in purely civilian applications, and denying it advanced arms because of the challenge posed by India to US interests. The conclusion of the nuclear deal altered these traditional US policy objectives. The vast majority of US advanced technology exports to India presently do not require a licence. US imports of high technology from India have in fact more than doubled since 2005, while exports to India have almost tripled since then.
By treating India now as aligned, even if not allied, with the US, the Obama administration has changed India’s standing in the US export control system to further accelerate New Delhi’s access to those technologies that eluded it for the past thirty years. If the nuclear deal has thus been a spectacular success on three counts, it is only on the fourth count — the sale of foreign reactors to India — that progress has been slower than desirable. In fairness, however, reactor acquisition decisions are slow almost everywhere and, in any case, the nuclear deal was never principally about selling reactors to India. How that became the story line is indeed another story. But until that tale is told, what bears repeating is that the nuclear deal was never aimed at securing quid pro quos from India. It was never meant to be transactional, only transformative. It was conceived and implemented as an American investment in enabling India’s rise as a global power. And because it has already made remarkable contributions toward that end — even if it is still batting only three out of four — both sides can, with great satisfaction, say, “what a deal!”