Tuesday, December 04, 2007

India US Nuclear Deal: An irretrievable state of debate

The debate on the India US nuclear deal is in an irretrievable state. No matter what one says or does, one cannot force a conclusion.

A number of hyper-active and extremely vocal groups have filled the air with inaccurate rubbish. These groups fall on the right and left extremes of the political spectrum and are driven exclusively by a desire to dominate the national debate in the media than any real national interest. If the nation burned to the ground, these groups would be happy, because then they would have more to whine about. They have set up a fantasical notion of India which can never be achieved in a measurable amount of time, and we are all to aspire - nay pine for it and in its absence, per their vision of things, we are to heap abuse on India and its leaders, and thus reject what little happiness we can have in India.

The sheer volume of material emerging from these polarising influences is so high that the entire political system is forced to respond to it and pretend it is somehow accomodating these people and their views. This paralysing resources within the political system.

A creative use of government propaganda resources could in theory be applied to subdue these groups, however this does not seem to be worth the effort at this time. A bare minimal exertion required to contain such views is obviously necessary but I really don't see any point in going to great lengths to shut these views down for the sake of the nuclear deal.

There was a limited window in which the deal could have been profitably operationalised from India's point of view. In this period, the dollar was about to drop and that gave India tremendous bargaining power. Now the dollar has dropped and India's bargaining power is considerably less. The deal can now only be operationalised in a way that benifits India less and perhaps benifits US corporate energy interests more. That should tell you a lot about who paid for all this media nautanki on this issue.

As alluded to in pieces by Sri. Vikram Sood and Mme. Arundhati Ghose, in its current state, the debate is a political struggle that is disconnected from the harsh economic realities confronting us. At this point as Sri. Sood carefully implies, even if the India-US deal were to go through, no pricing stability could be guarenteed on the electricity produced. Mme. Ghose goes one step further to indicate that the concerns of soverignity raised by hyper reactive types are completely hollow and that the technical and economic reality of the deal is lost on most who debate it.

The statements by Sri. Yashwant Sinha, represent the best anyone in India can do at this time : issue a carefully worded assurance to the US that India will renegotiate the deal at another time. Though the US will publicly say that it has no interest in a renegotiation, its actions will say otherwise. Needless to say this kind of talk will drive India into a confrontation with the US. However there appears to be no alternative to a confrontation at this point.

Without a nuclear deal of some kind energy shortages will occur in India and our dependence on heavy oil will become an extremely sensitive matter. As I said in an earlier post here, Coal may be India's great energy reserve, however heavy oil (i.e. diesel and kerosene) is our lifeline. In the short term, we are going to see a reduction in nuclear power production. If the diesel prices fluctuate excessively, these costs will propagate into costs of electricity from the grids. It is also likely that the grids may not be able to bear the additional load, and we will have to introduce fresh energy economisation measures to keep our industries functioning. This will mean more blackouts in the residential areas and a deeper reliance in the small scale sector on heavy oil based generation.

Dear readers, one will do well at this point to forget about the nuclear deal and carefully start watching the nation's fuel gauge. As the needle on the gauge strains towards empty, the problems will multiply. A pissed off and angry energy lobby in the US will making handling these issues very difficult.

Added later:

I suppose it is natural to ask if this kind of shift on our part constitutes a breach of trust. I do not think so but other may not agree with me.

I feel trust is important when you have an absence of information regarding intentions. In our case, we had to trust the Americans. The Americans use extremely advanced encryption and security on their internal government communications. This is beyond the ability of our intelligence agencies to penetrate. Thus, we had to rely on President Bush's word that the US possessed no ulterior motives with regards to the nuclear deal. This is where "trust" came in as far as we were concerned.

The Americans with the enormous intelligence gathering resources and numerous penetrations in India did not need to trust us. They had all the data intercepts they needed to form valid conclusions about our intentions and those intercepts should clearly show that we were sincere in our efforts but that circumstances beyond our control - specifically the unusual effectiveness of NPA inspired counter-deal propaganda has made it impossible for our side to achieve our stated aims.

That said - pulling away from the deal will negatively colour American perceptions of India. There is nothing we can do about this. While it is unlikely that the perceptions will fall as low as the did when a certain American ambassador remarked that India was good for nothing save exporting communicable diseases, it is likely that an extremely pissed off energy lobby in the US will force a degree of heavy handedness from the USG. If there is no US invasion of Iran, I suspect the hostility will remain muted and under wraps but if the US invades Iran, I think the sense of hostility will break out into the open.

Another important consequence that may be of relevance to a number of US NRIs who tend to believe ridiculous fantasies about India becoming a great power. What door may have laid open to India to attain great power status by piggybacking a US agenda - like for example - the Chinese in 60s and 70s is now closed.

India will have to find its own way.

There are a number of consequences to such an event. I leave it to my readers to work those out.


At 2:55 AM, Anonymous Anonymous said...

""issue a carefully worded assurance to the US that India will renegotiate the deal at another time.""

why does any GOI representative assure the US? Shouldn't India demand renegotiation from the US for a better deal? Why the other way round.

At 6:28 AM, Blogger maverick said...


How is that "better"?

The ball has visibly dropped in our court. The Americans are going to be very pissed off about this failure.

Why will "demanding" they give us a "better" deal reduce their bad feelings about this?

Being impolite will only make the renegotiation process more difficult.

At 8:27 AM, Anonymous Anonymous said...

the worst consequence of this deal tamasha is that the neutrons that could have been stored in India will now reside in China ...

but, rest assured, H&D and "right to test" are intact ...


At 2:32 PM, Blogger maverick said...

Hi Alok N,

Yes, that is exactly right.

In the final reckoning the Left-Indian AntiNukes - American NPA combine that China cobbled together with a few deftly placed dollars has served its interests extremely well.

The Chinese have run circles around Abbaji's men and if this keeps up, the Chinese will start mailing bangles to Abbaji's men. What to say of the dollar's sense of security the day Abbaji's men recieve bangles in the mail.

China has the neutrons and India .. well it would not be polite to say what India is currently holding.

By indulging in a search for H&D that cost us access to the neutrons we really could have used now, we have scaled new heights of Pakistani-ness.

I can't do anything about the DCH's perpetrual search for a superficial sense of national H&D. Nor can I have a serious conversation with people who seem to be utterly preoccupied with pandering to DCH whims. For christsake I outgrew this crap when I was fourteen. I am too much of a real patriot to buy into popular bullshit. I am simply too old to wet myself everytime around Hrithik Roshan makes a movie about the Army.

I am only going to talk about heavy oil now.

We are going to have to supply the Americans with heavy oils from Jamnagar for their murderous joyrides in Afghanistan and possibly Iran.

Are the DCH going to be happy supplying that while putting up with power cuts in their homes in India? or would they prefer that we simply cut supply to the Americans and give the energy to Indians instead?

What will the DCH choice be if the American threaten to cut off their IT juices? Okay if not that then what will the DCH do when the Americans openly attack Indian hawala channels?

I really don't know the answers to those questions, anyway I await the new displays of DCH zeal as the load shedding kick in and growth declines in the next five years.

At 9:12 PM, Anonymous Anonymous said...

Hi M
""issue a carefully worded assurance to the US that India will renegotiate the deal at another time.""

One again.why do we need to assure the Americans for renegotiating at a later date? Hope you get the question this time.

At 5:59 AM, Blogger maverick said...

Hi Anonymous,

It is simple politeness - that is all. When you do "business" you have to be "polite".

This "assurance" is our way of saying that we acknowledge that the delay is on our side and that once the political stuff settles down, whoever remains standing will sign on whatever *new* dotted line the Americans choose to draw up. Whether that signature amounts to anything more than a "thank you" purchase from US sources I cannot say but the next government in power will sign the deal - regardless of who it is.

My guess is that if it is a left front government it will sign the Indo-US nuclear deal after simultaneously signing the NPT and CTBT because lets face it they love Prabir Purkayastha and M V Ramana.

Also if it is a BJP government it will test a big bomb and then sign the NPT and the CTBT and the deal at the same time because lets face it BJP wallahs actually believe M V Ramana and Zia Mian when they say that the last bomb test failed. So after having proved that their last attempt at a political legacy in India was a success, the BJP will quietly ink the deal.

Sure, you can avoid this step of "assuring" them.

But then tomorrow they might do something in Pakistan without "assuring" you.

Or perhaps something in Burma or Sri Lanka or Maldives without taking your sensitivities into consideration.

Or tomorrow they may just turn up Jamnagar and ask to buy about 45% more ATF/Diesel than they normally do.

The rest of the stuff I can ignore because we in India will get wind of it long before the Americans do anything - but the diesel end of things I can't ignore.

At 7:11 AM, Anonymous Alok_N said...

what M is saying is that there are various levels of negotiation ... amreeka bahadur has held India hostage in various forms over the years ... and he has several new methods up his sleeve ...

why not negotiate with hostage takers? ... didn't the mighty Loh-Purush grovel before the Taliban for just one airplane? ... here its not just an airplane but an entire nation's energy security at risk ...

refusal to negotiate with a hostage taker results in him getting mad ... unless there is a plan/ability to corner and apprehend the criminal, does it not make sense to negotiate?


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