Devil's Advocate: 'N-deal India's passport to the world'

DEAL OR NO DEAL? If N-deal is not processed in the present Congress, it is unlikely it will be offered again, says Mulford.

          

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US Ambassador David Mulford completed four years in India last week. Karan Thapar spoke to him about the Indo-US nuclear deal on Devil’s Advocate.

Karan Thapar: Ambassador Mulford, critics and opponents of the Indo-US nuclear describe it as dangerous folly. They say the only reason your government is interested because it wants to convert India into a subordinate ally in South Asia. How do you respond to that?

David Mulford: It is completely untrue. The reasons why this deal was initiated by the President of United States were based on the statement he made shortly before that initiative was taken. The United States wanted to assist India in achieving its global vision of emerging as a major economic power in the world, and in doing so he focused on one of the items that were thought to be a major constraint for India's future development: namely, energy.

Karan Thapar: Advocates of the deal have absolutely no doubt that it is in India's best interest, but what is in it for the United States?

David Mulford: First of all, the United States would like to see India continue to grow and emerge as a major player in Asia. Secondly, we would like to see India pursue cleaner energy policies and a key part of that is civilian nuclear development.

Finally, we think it is very, very important that the global architecture for non-proliferation should include India, which has been outside that system for 35 years. In other words the President believes it was not sensible to leave one-sixth of humanity outside of the system for the indefinite future.

Karan Thapar: Many people in India say that the United States itself hasn't installed a new nuclear reactor for over two decades. They suspect that in fact the motivation might be that this is the best way of keeping your nuclear industry alive.

David Mulford: The fact is that the United States has built, within its current nuclear industry, 27,000 MW of new nuclear facilities in the way of upgrades and reforms of existing old facilities. It is true we have not built a new facility but this construction represents the largest activity in the past years and with the highest possible technologies.

Karan Thapar: The Indian papers are speculating that in fact the American government might have put pressure on the Indian government not to pursue the Iranian gas pipeline. Is there any truth to that speculation?

David Mulford: I don't think that is true at all. What we have done—and it is true for as long as I have been here—when that issue has come up—we have indicated to members of the government that we have legislation on our books which is well known and which is directed towards discouraging development of natural resources in Iran. This is legislation, which has not been used but it is there and could come into play, and we feel it is only appropriate to remind people that it is there.

Karan Thapar: So it is just a reminder, nothing more?

David Mulford: Yes.

Karan Thapar: Let us come to some specific concerns with the 123 Agreement. To begin with if the 123 Agreement goes through, would India lose its right to conduct further nuclear tests?

David Mulford: Not at all. It can make that decision any time—it is a sovereign state.

Karan Thapar: To paraphrase, are you suggesting that India retains its sovereign right to carry out further nuclear tests but America at the same time retains its right to respond as per its own domestic legislation?

David Mulford: Well it is very clear that India is free to do as it wishes—with regard to future testing—(but) it also clear that if it does test then certain things may or may not happen that are prescribed in the agreement. So it is all visible—there transparently for everybody to see.

Karan Thapar: Secondly, critics of the deal, like Dr Gopalakrishnan, a former director of the Atomic Energy Regulatory Board, say the 123 Agreement doesn't have sufficiently binding assurances on lifetime supplies of fuel. How could you reassure him that he is in fact incorrect?

David Mulford: I would suggest that he read the language that was negotiated between the President and the Prime Minister in March 2006 and which became the language governing the issue of fuel and safeguards in perpetuity. This language was accepted by the Indian government and was thought by both sides to serve the purposes, so I think that's a closed issue.

Karan Thapar: So you think this is an invalid concern?

David Mulford: I think it is.

Karan Thapar: Thirdly, critics point out that the 123 Agreement doesn't have a clear and unequivocal right to reprocess. Is that a fact?

David Mulford: That is not true. The negotiations on that point were long and drawn out and the right was granted up front for reprocessing as part of the 123 Agreement. That is clear.

Karan Thapar: When you say it is granted upfront are you saying it is a prior consent, to use the language the Indian government uses?

David Mulford: It was granted as a right upfront, but of course there has also to be—as India proposed itself—a special reprocessing facility, which they have agreed to and which they have put forward as their proposal and which we found acceptable. That (special reprocessing facility) has to be put into existence before reprocessing actually begins but the right to reprocess is recognised in the agreement.

Karan Thapar: I tell you why there is a certain amount of ambiguity, perhaps even doubt, in that score. The 123 Agreement says parties grant each other consent to reprocess but then it adds to bring these rights into effect they have to agree on arrangements and procedures within 18 months. What would happen if after 18 months that agreement on arrangements and procedures isn't happening?

David Mulford: I am not going to speculate on the future as it may unfold but what is clear that the language was negotiated carefully. It was aimed at closing that particular issue, which it did. Both sides agreed and we will go forward if this agreement is put into effect and honour our side of the agreement.

Karan Thapar: So what are you saying in effect is don't worry yourself with the unpredictable and the unknowable because it is not worth worrying about.

David Mulford: Well I just don't think you can predict the future. I think this agreement addresses the major issues, of which reprocessing was obviously one.

Karan Thapar: A fourth criticism made is that the 123 Agreement doesn't necessarily make for full civil nuclear cooperation. They say that India's ability to acquire technologies connected with enrichment, reprocessing and heavy water is dependent upon an amendment. Is there a problem?

David Mulford: I don't think it's a problem because that happens to be US law and it applies to the whole world, including to India. And if there ever to be a change in that it would be a change in the underlying fundamental law, it would not be a India-specific change.

Karan Thapar: So you are saying India is being treated like any other country in the world. It is not being discriminated against.

David Mulford: Yes.

Karan Thapar: Finally, there is a certain amount of concern about America's right to return in the event the 123 Agreement is terminated. In those circumstances would any strategic reserve that India were to develop be secure?

David Mulford: Well, yes, because the language that was agreed—coming back to the fuel supply language—made provisions for the creation of a strategic reserve with the help and assistance of the United States. If that strategic reserve is created in the right way, which is India's business to do, and managed in the right way, which again is India's business to do, there should be absolutely no problem in maintaining the sanctity of that reserve.

We have agreed that in the circumstances you mentioned our fuel might be subject to a right of return—by that time I suppose the fuel would be spent fuel—but the right of return would apply to our fuel. We have limited the application of that to fuel from other sources.

Karan Thapar: There is something very interesting in what you have said. You have said that if India develops its strategic reserve in the right way and then manages it in the right way it would be secure. Would the strategic reserves be secure if they were created with non-US fuel, which is not subject to a right of return?

David Mulford: In my view they would be.

Karan Thapar: So the sensible thing would be to build the reserve with non-European fuel, so that it is secure and use American fuel for actually running the plants.

David Mulford: Well, you could look at it that way, certainly.

Karan Thapar: And that would overcome these concerns and these fears almost completely.

David Mulford: Well it should do.

Karan Thapar: In which case, would you accept that what the 123 Agreement does is to make possible full civil nuclear cooperation with the NSG countries and any perceived deficiencies within the 123 itself could be made up by the rest of the NSG, but the important thing is without the 123 the door to the NSG would remain closed?

David Mulford: Yes, I think Minister (Pranab) Mukherjee put it succinctly when he said that the civil nuclear agreement was India's passport to the world. That is exactly correct. If this deal is embraced, if it is taken through the IAEA, safeguards are negotiated successfully between India and the IAEA and we go to the NSG and we get a rule change there by consensus India will be then free to deal with the entire civil nuclear world.

Karan Thapar: And the paradox is that once the 123 Agreement is through India doesn't necessarily have to deal with America but it will be then able to deal with the rest of the world. But without the 123 Agreement India couldn't deal with anyone.

David Mulford: That is a correct summary. We hope they will deal with us and we plan to be competitive as an industry but there is no agreement or undertaking that they have to do their business with the United States. It is a competitive market and my belief is that India—if this goes through—will become the centre of a major civil nuclear industry in the world and it will be effectively competing with China in the same field.

Karan Thapar: And all of that depends on the 123 Agreement because it is the key to a locked door?

David Mulford: That is correct, and that has to be passed through the NSG.

Karan Thapar: Let us look to the future. How confident are you that India can achieve a satisfactory safeguards agreement with the IAEA?

David Mulford: Well the United States is not a party to that negotiation, therefore I am not informed on what exactly is going in that negotiation. But I see no reason why a safeguards agreement can’t be achieved and I would be very surprised if that were not achievable.

Karan Thapar: After the IAEA the next stage is the NSG, where in effect America will shepherd the deal. India is hoping for a clean and unconditional clearance. Are you confident that you could deliver that?

David Mulford: We are all hoping for that. It has to be recognised that this is an extremely sensitive process. Just think about it: India has been granted a special exemption by the United States in the global system, and we are asking a variety of countries who were not given that opportunity to have a special exception.

Therefore, there are a mix of countries, some of which take the view that India is being rewarded inappropriately when it never signed the non-proliferation treaty. (There are) other countries who have very strong views on non-proliferation within their political structures, so that particular process is not going to be easy and we are very keen to get started with it.

Karan Thapar: Are you simply being cautious in the way you express yourself while you disguise a certain amount of doubt that India can get a clean and unconditional clearance.

David Mulford: I think that it is achievable (but) it will take some time and it will take political energy.

Karan Thapar: One of the reasons people are concerned is because countries like Australia and The Netherlands are said to be pushing for a right of return of their own. Would that be acceptable?

David Mulford: I can’t comment on what these other countries might or might not want or do. But I think it is fair to say our opinion is very strong that we hope the group would go for a relatively simple consensus and a clean solution to the problem and will not attempt to move beyond provisions that have been so carefully negotiated in the 123 Agreement. Our hope is—we are confident if we get the opportunity to manage the process—that we will achieve it.

Karan Thapar: So you are saying that the NSG shouldn’t bring back curbs and restrains, which the 123 Agreement has lifted.

David Mulford: Well I think if they do that it will make it impossible to conclude the deal.

Karan Thapar: Now you have repeatedly said that in an ideal world you would like the deal go back to the US Congress for a final up-down vote while George Bush is still President. What is the deadline for that?

David Mulford: I don’t think it is sensible, in the case of the US Congress, to set a deadline. The Congress will continue to function till it adjourns and it is always possible that some point in the process there will be a willingness, if the opportunity arises, to make that final vote, which after all is an up-down vote and not a vote based on amendments and long debate. It is a up-down vote based on the safeguards agreement, the NSG change and the 123 Agreement itself.

Karan Thapar: At the moment there is lot of political questioning about the deal in India. There is a certain amount of opposition to it. How do Americans view this debate in India?

David Mulford: I think in one word: puzzlement—if could describe that. Americans are deeply concerned about non-proliferation, it is part our culture (and) has been for 67 years. The US Congress with the President leading took an initiative of historic importance.

This resulted in a change of law to the Atomic Energy Act 1954, the only time it has ever been changed. The change had to be addressed by both Houses of Congress and in each case when the floor vote came there was strong bipartisan support.

At the time of the Senate vote, which was 30 days after the 2006 elections in which the Congress changed hands and there were deep, bitter partisan divides in American politics—at the time of that vote Democrats and Republicans stood up together and made a positive vote saying this is important for the world; this is important for India and this important for the US.

In other words they made a statesman-like stand together in our political system. Afterwards, as the 123 Agreement was negotiated, many members of the Congress took the view that this agreement is extremely favourable to India. So when you add up all those things, I think Americans are puzzled that this agreement wasn’t immediately embraced and activated by India.

Karan Thapar: If for some reason India were not to go ahead with the deal while President Bush is President, would it therefore be the case that in the next two or three years that follow before a second agreement can be reached with a new administration what might then be on offer to India may not be as advantageous or even as generous as is available now?

David Mulford: My opinion is that if this is not processed in the present Congress it is unlikely this deal will be offered again to India. It certainly would not be revived and offered by any administration, Democrat or Republican, before 2010, which is after the life of this particular administration in India.

If it were to be revived it would have to go through a committee process in the Congress and I think the non-proliferation groups would insist on changes in many of the terms. So I think the atmosphere is changing and therefore I believe and I know that both Democrats and Republicans believe in the US that this is the time to finish this deal and put it through the Congress.

Karan Thapar: In other words you are saying it is now or may be never.

David Mulford: That is pretty close to it.

Karan Thapar: Have you considered the possibility of personally meeting Prakash Karat and AB Bardhan and reassure them about their concerns?

David Mulford: I have the impression that Mr Karat is not interested in meeting with Americans, but I am ready to meet him anytime if he would wish to.

Karan Thapar: What would be the impact on the wider relationship if India doesn’t move ahead?

David Mulford: I think that is a very complicated question because the relationship has become so gigantic. I would say for the bulk of the relationship it will damage: the private relationship, civil, people-to-people, companies, foreign direct investment and all the aspects we follow every day.

I do think at the heart of the official bilateral relationship where in the past years there has been this effort—the civil nuclear deal is part of it, not the only thing—to overcome some of the distrust, suspicion, misunderstandings of the past.

This is very, very important: the civil nuclear deal was supposed to be the vehicle that would lay those things to rest forever. So I think there has to be some concern about elements of trust and discretion at the core of that relation. Not insurmountable but I think it won’t quite remove some of those problems that we both countries have been working to overcome.

Karan Thapar: You are saying to me that is a containable impact but it is not a damage?

David Mulford: I think it probably is.

Karan Thapar: Ambassador Mulford, thank you for talking to us.