123 is a bilateral agreement between India and the US. It aims to give India access to US nuclear fuel and equipment, overturning a three-decade ban imposed after, New Delhi, which has not signed the Non-Proliferation Treat, conducted a nuclear test in 1974. [Under the treaty, the nuclear weapon states party to the agreement pledge not to transfer nuclear weapons or any other nuclear explosive devices (such as possible peaceful nuclear explosives for large-scale excavations) to any recipient or to "assist, encourage, or induce" any nonnuclear weapon state to manufacture nuclear weapons or any other nuclear explosive devices. The nuclear weapon states are not required by the treaty to give up nuclear weapons
The civil nuclear deal will remain in force for a 40-year period and can be extended by an additional 10 years at a time.
The US will help India secure uninterrupted supplies of nuclear fuel as well as maintain a strategic fuel reserve for its safeguarded nuclear reactors.
In return, India will put its agreed civilian nuclear reactors in perpetuity under (possibility of US inspections of Indian nuclear facilities given in article 10.4 of the 123 text, though not explicitly, "If the IAEA decides that the application of IAEA safeguards is no longer possible, the supplier and the recipient should consult and agree on appropriate verification measures, but this should be considered a remote incident)
If India does a nuclear test, the agreement will be terminated only after one year's written notice by the US. The US will take into account whether "circumstances that may lead to termination" resulted from "changed security environment" or "a response to similar actions by other actions" in deciding the termination of the agreement. (In other words, if Pakistan or China conducted nuclear test, the US would take that into account if India responded.) (Also India can terminate the agreement giving one year's notice)
On termination, the US will have the right to seek return of all equipment and nuclear material transferred under this agreement.
Before exercising the right of return, the US will compensate India by providing an alternative or the money spent by India. (Like, the two countries would jointly convene a group of friendly supplier countries such as Russia, France and Britain to restore supplies to India) (Article 14.5 of the text clearly states protections built by India into the agreement)
The US will support India's case for high dual-use technology and nuclear fuel with the NSG.
The two countries had wanted to sew the agreement because India had wanted the US to allow it to reprocess spent nuclear fuel, assure permanent fuel supplies and not penalise India by ending nuclear trade if it conducts a nuclear test. The text shows that the first two demands had largely been met, while there was no direct mention of the consequences of another Indian test. (this problem can be very tactfully handled, for commencing nuclear trade India needs to get an exemption from the Nuclear Suppliers' Group which does not trade with a non-NPT state, the exemption will be facilitated by the US influence in the group and after that New Delhi could do an end-run around America to buy power reactors from Russia and France)
India will set up a dedicated facility under IAEA safeguards for reprocessing
Likely benefits for both the sides:
For the US - A US chamber of commerce anticipates $100 billion worth of opportunity from the re-opening of India's nuclear sector to foreign companies and countries
For India
- global civilian nuclear cooperation
- right to retain nuclear weapons while being outside the Non- Proliferation Treaty (Article 2 of the text allows advance nuclear R&D and the setting up of a reserve stockpile of nuclear fuel to guard against any disruption of supply during the lifetime of the reactors (thus India has got a humorous but wise option too, that of stockpiling the fuel and then ditching America by terminating the agreement and starting nuclear commerce with other countries).
- Access to high and dual-use technology even when India is not a member of the NSG and the Missile Technology Control Regime(MTCR)
- India will be the only country, outside the NT, in the world to have both nuclear weapons as well as benefits of trade as available to a nuclear weapons state
- While outside the NPT, India will be allowed to have nuclear weapons
- Partnership with the US supports India's rising stature in the world
- Without being a signatory to the NSG and MTCR, India can trade in restrictive technology with members of these elite clubs
- India gets resources to meet its declared target of 20, 000 MW of nuclear power by 2020.
- Uncertainty over the eventual shape of national reprocessing facilities under IAEA safeguards (and the present deadlock in the higher echelons of the coalition govt is all about this, the consensus reached at the last November’s meeting of the coordination committee, set up for resolving the issues related to the deal within the govt machinery, had agreed to wait upon the results of the discussions with the IAEA and then after going through the draft agreement will proceed to the next step. But the govt is not revealing the details of the agreement citing security and other reasons)
- Transfer of nuclear fuel and components by the US will be governed by US laws and not by 123. ( and the US congress has passed the notorious HYDE act in December,2006 which has negated all the negotiations reached between the two countries)
- the likelihood of US interference in India's national security/foreign policy issues ( the Hyde Act desires that India aligns its national security and foreign policies with that of the US)
- signing of 123 agreement , which has already been done in august 2007
- safeguard agreement and India-specific additional protocol with the IAEA
- acceptance of India by the nsg as a country possessing advanced nuclear technology
- final up/down (approval) vote by the US Congress
- This final step is all the more difficult as the Hyde act has specified stiff conditions which any NSG rule-0change must mirror - from a permanent test ban and tightly regulated uranium access to a continued prohibition on all civil nuclear fuel-cycle technologies and the right to demand the return of transferred items and materials
123 agreement is too tempting and its advantages are beyond doubt true and far reaching. But if the Hyde Act has its shadow on it, it appears dwarfed and darkened. A 123 Agreement without a Hyde Act is what is feasible and desirable for our country otherwise the future is rather bleak which is rightly the concern of the Left parties of the UPA coalition. But a way is to be found out for amicable nuke deal. All the Best India!