There can be little question that the failure to reach agreement on the arrangements and procedures for reprocessing spent American fuel on Indian soil during Prime Minister Manmohan Singh’s visit to the United States is a let-down. The official Indian claim may be that the problems in settling the issue of reprocessing spent fuel under the 123 agreement are “minor” and of little practical significance since the U.S. and India have until February 2010 to settle matters. But the fact that the two sides were looking at the agreement as a major deliverable from the visit suggests the bilateral relationship is living on past credit rather than current commitments. The Obama administration has said and done enough in the past six months to raise doubts about its intention of sticking to the letter and spirit of the U.S. obligation to facilitate full civil nuclear cooperation with India. Getting the G8 to endorse a proposed Nuclear Suppliers Group ban on the sale of enrichment and reprocessing technology to India was not a friendly act; nor was Washington’s recent insistence that New Delhi accede to the Nuclear Non-Proliferation Treaty.

The reprocessing obstacles Indian and American negotiators seem to have hit are by no means minor — assuming that India’s nuclear establishment will not dilute its stand on certain key issues. The first sticking point appears to be the U.S. demand for intrusive access to the reprocessing facilities India will be building. The Indian stand thus far has been to accept only the safeguards and protocols of the International Atomic Energy Agency. The second problem relates to the U.S. insistence on limiting the number of reprocessing facilities that can be built in relation to the reactors. If accepted, this will place unreasonable restrictions on India’s civilian reprocessing options. An unrelated but significant issue is the liability legislation that needs to be passed through Parliament and has been delayed on the Indian side. How New Delhi will go about resolving these problems in the next few weeks will be watched closely everywhere. The fact that it has the NSG waiver under its belt means it has, at least on paper, more bargaining power than it did in the past. The Department of Atomic Energy has made it clear that absent a satisfactory agreement on reprocessing under the safeguards procedures of the IAEA, there can be no import of U.S.-made light water reactors. The planned import of Russian and French reactors, and of nuclear fuel from other countries, faces no such problems and must go ahead regardless of what happens with the U.S. India must act on the realisation that there is no reason for it to lose sleep over the delay in settling the reprocessing issue. If anything, it is Westinghouse and General Electric that should do the worrying. Without a reprocessing deal, there can be no question of them setting up reactors on Indian soil.

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