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Fact Sheet
Bureau of South and Central Asian Affairs
Washington, DC
October 15, 2008

U.S.-India Civil Nuclear Cooperation Initiative

President Bush and Indian Prime Minister Singh announced the U.S.-India Civil Nuclear Cooperation Initiative in their Joint Statement on July 18, 2005. This Initiative simultaneously provides a process for developing civil nuclear cooperation to help meet India’s growing energy requirements and strengthens the nonproliferation regime by bringing India into closer conformity with international nonproliferation standards and practices.

The U.S.-India Agreement for Peaceful Nuclear Cooperation (the so-called “123 Agreement”) was approved by the U.S. Congress on October 1, 2008, the culmination of an unprecedented three-year effort by the U.S. and India, working together as never before. Approval of the Agreement bolsters our partnership with the world’s largest democracy and a growing economic power, provides trade and investment opportunities for the U.S. economy, and helps India’s population of more than one billion to meet its rapidly increasing energy needs in an environmentally responsible way while reducing the growth of carbon emissions. The U.S.-India 123 Agreement will also enhance our global nonproliferation efforts and reflects a common commitment to share both the benefits of the international system and also the burdens and responsibilities of maintaining, strengthening, and defending it.

CURRENT STATUS/BACKGROUND:

Several key objectives were accomplished to bring us to this moment in history. In December 2006, the U.S. Congress passed the Henry J. Hyde U.S.-India Peaceful Atomic Energy Cooperation Act (Hyde Act), which provides a framework in U.S. law for facilitating civil nuclear cooperation with India. In July 2007, the United States and India concluded negotiations on the 123 agreement, which required approval by the U.S. Congress to be brought into force. The Board of Governors of the International Atomic Energy Agency (IAEA) in Vienna, Austria approved the India Safeguards Agreement on August 1, 2008. Another key prerequisite for submitting the 123 Agreement also took place in Vienna, with the Nuclear Suppliers Group (NSG) consensus decision on September 6, 2008 to grant an exception to its full-scope safeguards requirement to permit civil nuclear supply to India.

The 123 Agreement establishes the legal framework for the U.S. to engage in civil nuclear cooperation with this key strategic partner. The President submitted the Agreement to Congress on September 10, 2008, with the requisite determinations on India’s progress on a number of commitments it made in the 2005 Joint Statement, as provided for under the Hyde Act. The U.S. Congress approved the U.S.-India Agreement for Cooperation Concerning Peaceful Uses of Nuclear Energy on October 1, 2008 with strong bipartisan support and cooperation. These historic events reflect the transformation of U.S.-India relations and recognition of India’s emergence on the global stage. The Agreement was signed by Secretary of State Condoleezza Rice and Indian External Affairs Minister Pranab Mukherjee on October 10, 2008. Its entry into force opens the door for American and Indian firms to participate in each other’s civil nuclear energy sector.

BENEFITS OF THE INITIATIVE

There are powerful security, political, economic, and environmental reasons to support this Initiative. The U.S.-India Initiative provides significant gains: 1) deepens our strategic partnership with India – the world’s largest democracy and a rising economic power; 2) enhances energy security by helping India’s large and growing population meet its accelerating energy needs; 3) helps protect the environment (since nuclear energy presents a cleaner alternative than other available options); 4) increases trade, creates new jobs and investment opportunities for U.S. companies; and 5) welcomes India into the nonproliferation mainstream. With respect to the last point, India’s enhanced nonproliferation commitments strengthen the nuclear nonproliferation framework and constitute a net gain for the global nonproliferation regime.

Under this initiative, India remains outside the Non-Proliferation Treaty (NPT) but assumes important nonproliferation responsibilities and obligations, including separating its civil and military nuclear facilities, accepting IAEA safeguards at its civil nuclear facilities, and signing and implementing an Additional Protocol. India has created a robust national export control system, including through harmonization with and adherence to the Nuclear Suppliers Group (NSG) and the Missile Technology Control Regime (MTCR) guidelines and annexes. Additionally, India has pledged to continue its unilateral moratorium on nuclear testing and is working with the United States to conclude a multilateral Fissile Material Cutoff Treaty – a longstanding objective of the international community. Individually, each of these activities helps strengthen the global nonproliferation regime. Together, they constitute a dramatic change in moving India into closer conformity with international nonproliferation standards and practices, and form a firm foundation for the U.S. and India to strengthen our efforts in the future to prevent WMD proliferation and to combat terrorism.

INTERNATIONAL ATOMIC ENERGY AGENCY (IAEA) SAFEGUARDS

On August 1, 2008, the IAEA Board of Governors approved the India Safeguards Agreement. The Safeguards Agreement provides for appropriate, effective safeguards in perpetuity, based on accepted IAEA safeguards principles, while taking into account India's unique circumstances. India also has pledged to sign and implement an IAEA Additional Protocol, which will provide IAEA inspectors with additional tools and information for conducting inspections under India’s Safeguards Agreement, as well as contribute to the universality of the Protocol and help establish it as the new international safeguards standard – an important nonproliferation goal for the United States, many other NPT States Party, and the IAEA.

India has made public a plan to separate its civil and military facilities, in which 14 reactors, including the 4 presently safeguarded reactors, and other facilities would be offered for safeguards under the agreement. The Agreement is based on INFCIRC/66, the IAEA safeguards system utilized for states not under NPT full-scope safeguards. The safeguards agreement provides that, once a facility is added to the Annex of the safeguards agreement, safeguards must remain in place until the IAEA and India jointly determine that the facility is no longer usable for nuclear activities. We have made clear to the Government of India that there will be no cooperation on unsafeguarded facilities. As its future civilian thermal power and civilian breeder reactors will be placed under safeguards, we expect that the proportion of India’s nuclear industry subject to such controls will increase over time.

These steps, which will bring more than 65% of India’s reactors under safeguards, have brought India closer to the nonproliferation mainstream, and the United States believes the India Safeguards Agreement represents an important step toward realizing the economic and energy benefits foreseen by the Initiative.

NUCLEAR SUPPLIERS GROUP (NSG)

On September 6, 2008, the Nuclear Suppliers group reached a consensus policy decision to grant an exception to its full-scope safeguards requirement to permit civil nuclear supply to India. This historic achievement brings us closer to realizing the important benefits – including nonproliferation benefits – that successful implementation of the U.S.-India Civil Nuclear Cooperation Initiative will bring about.

The United States thanks the participating governments in the NSG for their outstanding efforts and cooperation in forging this consensus on welcoming India closer to the international nonproliferation regime. We also congratulate the people of India on its accomplishments in carrying out the Initiative. India’s commitments will strengthen the international nonproliferation regime, and the NSG consensus policy decision has brought us another step closer to realizing full civil nuclear cooperation with India, thus helping the world’s largest democracy gain access to environmentally responsible energy supplies.

PEACEFUL NUCLEAR COOPERATION

The U.S.-India Initiative is about civil nuclear cooperation, not about India’s strategic weapons program. It seeks to enable civil nuclear cooperation with India, a state that faces real and growing energy needs, has a solid nuclear nonproliferation export record, has an established and widespread nuclear infrastructure, and has made enhanced nonproliferation commitments which strengthen the global nonproliferation regime. India’s commitment to continue its unilateral moratorium on nuclear testing, along with the other steps India has taken under the Joint Statement, made this Initiative achievable.

The NPT allows for nuclear energy cooperation with non-parties that do not have full-scope safeguards, as long as the cooperation itself is under safeguards. And a successfully implemented Civil Nuclear Cooperation Initiative will create strong energy and economic incentives for India to ensure that its civil nuclear energy sector is properly separated.

This Initiative establishes a firm foundation for additional nonproliferation and counterproliferation cooperation, areas we fully intend to advance through the course of our partnership. The United States looks forward to a new strategic partnership with India in a way that will provide global leadership in the years ahead.




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