Oct 2, 2008

World - US Congress OKs India Nuclear Deal,sends to bush

By Susan Cornwell

WASHINGTON (Reuters) - The U.S. Congress on Wednesday approved a landmark deal ending a three-decade ban on U.S. nuclear trade with India, handing a victory to President George W. Bush on one of his top foreign policy priorities.

Final approval came as the Senate voted to ratify the deal, 86-13, sending the legislation to Bush to sign into law. The Senate's move came just ahead of an expected trip to India this weekend by U.S. Secretary of State Condoleezza Rice.

Bush said he looks forward to signing the bill into law.

"This legislation will strengthen our global nuclear nonproliferation efforts, protect the environment, create jobs, and assist India in meeting its growing energy needs in a responsible manner," Bush said in a statement.

The Bush administration says the pact will secure a strategic partnership with the world's largest democracy, help India meet its rising energy demand and open up a market worth billions.

But critics say the deal does grave damage to global efforts to contain the spread of nuclear weapons, by letting India import nuclear fuel and technology even though it has tested nuclear weapons and never signed the Non-Proliferation Treaty (NPT).

"The U.S.-Indian Agreement for Nuclear Cooperation is, nonetheless, a nonproliferation disaster," said Daryl Kimball, head of the Arms Control Association.

"Contrary to the counterfactual claims of proponents and apologists, it does not bring India into the "nonproliferation mainstream."

The ACA is a non-partisan Washington-based arms control policy organization.

India has a yawning energy deficit, and the accord opens up this market worth billions to American companies such as General Electric and Westinghouse Electric, a unit of Japan's Toshiba Corp.

Rice spent much of the past month in an all-out effort to persuade Congress to approve the pact, which the Bush administration says will transform the U.S.-India relationship. Bush wanted the deal approved before leaving office in January; Congress is expected to adjourn soon for elections.

The accord enjoys bipartisan support in Congress, where many lawmakers favored it as a way to create jobs in the U.S. civil nuclear industry while cultivating the small but affluent Indian-American community.

Critics said the deal was deeply unwise, overturning decades of U.S. policy of refusing to sell nuclear technology to nations lacking full safeguards against that technology's diversion into nuclear weapons programs.


"Why are we rushing to pass this gravely flawed agreement?" demanded Sen. Tom Harkin, an Iowa Democrat, before the vote. There was nothing in it, he said, to prevent India from resuming nuclear testing. India, which first detonated a nuclear device in 1974, last tested in 1998.

The deal would also weaken U.S. efforts to deny Iran a nuclear weapon, Harkin said. He said Indian entities already had sold sensitive missile technologies to Iran, which the Bush administration suspects is pursuing a nuclear bomb.

But supporters said they expected India to move quickly to negotiate a new safeguards agreement with the International Atomic Energy Agency.

"The benefits of this pact are designed to be a lasting incentive for India to abstain from further nuclear weapons tests and to cooperate closely with the United States in stopping proliferation," Indiana Republican Sen. Richard Lugar said.

Before approving the pact, the Senate rejected an amendment by Sen. Jeff Bingaman of New Mexico and Sen. Byron Dorgan of North Dakota, both Democrats, making clear that another Indian nuclear test would lead to termination of the deal.

Lugar argued the amendment was unnecessary, saying India had been warned repeatedly that the consequences of another test would be "dire": U.S. nuclear trade would be cut off.

The deal could open up around $27 billion in investments in 18-20 nuclear plants in India over the next 15 years, according to the Confederation of Indian Industry.

But there is global competition. France announced on Tuesday that it had signed a nuclear cooperation agreement with India, and Russia is already building two 1,000 megawatt reactors in the southern Indian state of Tamil Nadu.

Local media say India's monopoly Nuclear Power Corp has tentatively picked four suppliers, including Westinghouse Electric and France's Areva, for planned new projects.

India is also reported to be negotiating with General Electric, Japan's Hitachi Ltd and Russia's atomic energy agency Rosatom.

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