Will overtures to India's PM bear fruit — or embarrassment?

The two countries reached an understanding on two issues that, despite a groundbreaking 2006 agreement, had stopped U.S. companies from setting up reactors in India and had become one of the major irritants in bilateral relations.

"We are committed to moving towards full implementation," Obama told a joint news conference with Modi. "This is an important step that shows how we can work together to elevate our relationship."

The new deal resolved differences over the liability of suppliers to India in the event of a nuclear accident and U.S. demands on tracking the whereabouts of material supplied to the country, U.S. ambassador to India Richard Verma told reporters.

confuzzled dude wrote:

The two countries reached an understanding on two issues that, despite a groundbreaking 2006 agreement, had stopped U.S. companies from setting up reactors in India and had become one of the major irritants in bilateral relations.

"We are committed to moving towards full implementation," Obama told a joint news conference with Modi. "This is an important step that shows how we can work together to elevate our relationship."

The new deal resolved differences over the liability of suppliers to India in the event of a nuclear accident and U.S. demands on tracking the whereabouts of material supplied to the country, U.S. ambassador to India Richard Verma told reporters.

http://www.reuters.com/article/2015/01/25/us-india-obama-idUSKBN0KX0OW20150125

Wonder what does this mean, Did India cave in? or the US won't monitor nor track the nuclear material? Also, looks like the US companies won't be liable should another Bhopal like disaster occur.

"For 10 years BJP opposed.Today before they claim credit let it be known what a destructive opposition they have been #Uturn..""

Accusing BJP of "political chicanery" on the matter, former Information and Broadcasting Minister Manish Tewari tweeted "BJP said Indo-US Nuclear Deal compromised India's sovereignty. If that is true, why is BJP bending over backwards to operationalize it now?

“The Indian government is going to town saying ‘breakthrough, breakthrough,’ but there are a lot of questions that still remain,” said R.R. Subramanian, a senior scholar of nuclear disarmament at the Institute for Defense Studies and Analyses in New Delhi.

U.S. companies and their advisers, meanwhile, said they had received no details about an agreement on liability or the tracking of U.S. nuclear materials that would be exported to India. On the liability issue, Bloomberg News quoted an Indian official as saying that an insurance pool worth $122 million would be set up, with the government contributing an unspecified amount at a later date.

A key adviser to U.S. nuclear contracting firms — who spoke on the condition of anonymity to protect business relationships — said, “That doesn’t do it.”

U.S. nonproliferation experts also questioned whether Obama has the authority to waive a requirement to track nuclear materials that is part of the 2006 legislation that eased other restrictions on exporting to India. “It would appear that the U.S. side has caved on a requirement set by Congress in the ‘Hyde Act’ of 2008 for implementation of any nuclear cooperation between the two countries that there must be an extensive ‘end-use monitoring’ program to help ensure that no U.S.-origin nuclear material or technology is diverted for military purposes,” Daryl G. Kimball, executive director of a nongovernmental group called Arms Control Association, wrote in an e-mail to National Security Council officials asking for clarification.

India has accepted that it will share data on nuclear material and equipment in order to secure the U.S. agreement to waive its “tracking requirements” on that material.

According to sources, India’s concession on the issue was the reason for the “breakthrough” in agreement on the administrative arrangements for the Indo-U.S. civilian nuclear deal during President Barack Obama’s visit. The data collected would be shared during annual consultations between a U.S.-Indian group to be specially set up to implement the administrative arrangements that will guide the nuclear deal.

The source also denied that President Obama had issued any “executive waiver” to bypass the requirement to monitor the use of nuclear material in India. The American requirement, under the Hyde Act of 2006 stipulates that the U.S. President must certify to U.S. Congress that India (for whom the law was specially drafted) is in compliance with U.S. “tracking and flagging” requirements on fissile material and nuclear equipment at reactors supplied by the U.S., even if it is from third parties.

“In effect, we have no right to recourse after these talks. Ultimately the liability is on the Indian side and lies with the Indian taxpayer now,” a former Foreign Secretary told The Hindu. “It seems as if the government is not being honest and clear about what we have agreed to.”

The talks focused on two key issues. The first was whether, in the event of some catastrophe, victims could sue in Indian courts and win unlimited sums, as permitted under India’s 2010 legislation. The other main concern hinged on coming up with a way of keeping track of U.S. nuclear fuel sold to India to make sure it doesn’t go to military use.

On the liability front, Indian officials said that they will create an insurance pool to cover $250 million in damages in the event of a major accident, and the government would cover an additional $200 million after that. The country is also planning to align itself with the Vienna Convention on Supplementary Compensation, which governs nuclear liability globally. Still, critics charge, those sums are nowhere near the $200 billion estimated from the Fukushima disaster in Japan.

The key issue will be whether the conflict between international law and Indian law can be waved away by a memorandum from India’s attorney general. The memorandum would have to say that the 2010 liability law “doesn’t mean what it says,” said a Washington lawyer familiar with the issues but who asked for anonymity to protect his professional relationships.

“The fear is that the U.S. government will say this is good enough,” the lawyer added. “Even if the [Indian] attorney general comes out with a memorandum saying the law doesn’t apply to suppliers, that’s not binding on Indian courts.”

The second obstacle has been the requirement in the Hyde Act of 2006 that the Indian government and an independent auditor annually provide information about the form, amounts and location of any uranium supplied to make sure it is not diverted for military use.

Members of Congress will want to make sure that India cannot skirt the Bush-era legislation and that India did not simply wear down American negotiators.

“To get this contentious issue off the table, the Administration simply signed off on the same measures taken by India that the Administration had previously said were unacceptable,” said House Foreign Affairs Committee Chairman Edward R. Royce (R-Calif.) in a statement.

M.V. Ramana, a researcher at Princeton University who has written a book about India’s nuclear industry called “The Power of Promise,” said importing nuclear reactors from America may be an expensive choice. Ramana studied the costs of electricity at a proposed French-backed nuclear plant that would be built on India’s western coast and found that the electricity rates could be three times as high as those tied to other forms of energy.

“There is going to be a huge economic challenge,” Ramana said. “How can they make electricity affordable?”

In the end, M.K. Bhadrakumar, a former Indian ambassador and analyst, said the “breakthrough” touted by Obama and Modi may well end up being more of a diplomatic success than a commercial one.

“It was a sensible thing because the next time Modi meets Obama they don’t have to talk about something they are not going to resolve,” Bhadrakumar said. “They set it aside. It was creating bad air.”