Focus: United States – India

By Colin Kimberlin
Staff Writer

Although India has become an economic powerhouse in recent years, supporting that growth with available energy options to sustain development has become a concern. A recent agreement between United States President Barack Obama and Indian Prime Minister Narendra Modi attempted to address these concerns along the lines of industry reliability and has opened a door to billon-dollar investments from the United States into Indian nuclear power projects.

The agreement sets a framework for the U.S. energy industry to enter commercial talks on building nuclear reactors in India, according to Reuters. By unlocking this access, U.S. industries are bound to conduct regular inspections of current reactors and any future ones while also addressing any possible liabilities regarding a reactor meltdown or any other form of a nuclear accident, according to NPR.

Still, the question arises as to how both of these areas are going to be addressed. As for inspections, India is seeking to tie up loose ends dating back to the landmark nuclear cooperation deal signed in 2008. President Modi, a month after taking office last year, agreed to tighter checks and inspections by the International Atomic Energy Agency (IAEA).

The agreement endorses principle of strict liability. This entails channeling any costs produced from a nuclear accident to the plant operator and requires it to pay no-fault compensation for such accidents. Along with this agreement, India is presenting a body of law and precedent to ensure its laws and regulations meet IAEA international standards.

In 2008, the Indian government agreed to sign a 123 Agreement, more commonly referred to as the U.S.-India Civil Nuclear Agreement. But the deal ran into considerable opposition within India, according to German international broadcaster DW. A variety of issues drove Indian opposition against the deal, including concerns about liability, which were addressed in the more recent agreement, and the prospect of Washington enjoying heightened leverage over India’s energy market.

The resulting impasse was one of the main reasons for Obama’s visit to India in January 2015. Even more pressing to the U.S. visit was the previous deal’s impact on the nuclear arms race between India and Pakistan. At first glance it may seem that the deal should have made no impact; however, the technology and fuel covered by the deal were meant to be used strictly for civilian purposes, specifically producing electricity. They were used in the exact opposite way, causing a pressing concern for the new proposition between the two countries.

Until the May 2014 election of Prime Minister Narendra Modi, many Indian politicians treated the U.S. with considerable suspicion because the previous deal from the Bush administration circumvented many issues, including delivering uranium to India from neighboring Pakistan. Other critics also noted that the deal highlighted the imperialistic tendencies of the U.S.

Yet this “breakthrough” agreement has been seen as a means to pave the way for implementing both the United States and India’s civilian nuclear cooperation on any further developments of nuclear energy production. But what does this new agreement actually do? It does not function as a legal document or treaty. It is, in its entirety, a fact sheet that both India and the U.S. can draw from on any future nuclear deals, but is not in any way legally binding. Thus, this agreement only sets forth a colloquial understanding between both countries that energy production requires a joint effort and both are willing to make compromises to pursue such goals.