Seizing U.S.-India nuclear deal under Trump Administration

Context:

The 2008 U.S.-India civil nuclear deal allowed India to access advanced nuclear technology while supporting global non-proliferation goals. However, its full potential in energy and business remains untapped and Under the Trump administration both countries will look forward to seizing the deal .

Key Features of the U.S.-India Nuclear Deal

Historic Agreement: Signed in 2007 and approved in 2008, the deal allowed India to purchase dual-use nuclear technologies, equipment, and materials.
Energy Security: Facilitated India’s access to civilian nuclear fuel and technologies, diversifying its energy mix.
Global Standing: Elevated India’s role in the global nuclear energy market without requiring it to sign the Nuclear Non-Proliferation Treaty (NPT).

Strategic Gains from the Deal

Defence Cooperation: Strengthened military exercises, technology transfers, and defence purchases.
Technological Collaboration: Enhanced intelligence sharing and crisis management capabilities.
Economic Opportunities: Envisioned job creation and bilateral trade expansion.

Challenges Hindering Progress

Regulatory Barriers
Entity List Restrictions: Initially, over 200 Indian entities were on the U.S. Entity List post-2008, impeding technological cooperation. Although most entities have been removed, some concerns persist regarding dual-use technologies.
Recent Reforms: U.S. National Security Advisor Jake Sullivan announced steps to eliminate longstanding restrictions and streamline civil nuclear cooperation.
Liability Risks
Civil Liability for Nuclear Damage Act (2010): Deviates from international norms by placing liability on suppliers rather than operators, deterring major U.S. companies like GE and Westinghouse.
Indian Insurance Mechanism: Introduced by the General Insurance Corporation, this mechanism covers supplier liabilities for 20 years. While Russia’s state-backed entities have accepted it, U.S. firms remain reluctant.
Technological and Cost Barriers
Rapid Evolution: U.S. companies must offer state-of-the-art technologies to remain competitive.
Cost Sensitivity: Nuclear technology must be affordable for Indian consumers to avoid high electricity tariffs.
Lessons from U.S. Failures: Past cost overruns in U.S. nuclear facilities caution Indian policymakers.

Importance of the Nuclear Deal for India

Energy Security and Transition
Expanding nuclear capacity is vital to meeting India’s growing energy demands while achieving decarbonisation goals.
Nuclear energy can serve as a reliable alternative to fossil fuels, reducing greenhouse gas emissions.
Economic and Strategic Benefits
Strengthens India’s position in global nuclear markets.
Deepens India-U.S. collaboration in critical and emerging technologies (ICET), such as AI, quantum computing, and clean energy.
Geopolitical Impact
Enhances India’s strategic autonomy and bolsters its role in maintaining regional stability.