INDO-US Civil Nuclear Deal


From the Perspective of International Nuclear Law


The civil nuclear deal between the US and India is being treated as a waterline of a ship by media in Pakistan. The framework of most analyses hovers around the military and security aspects of the deal but the legal, commercial and technological dimensions have not received much attention. The instant write-up is a vignette study of the legal side of the matter, in which, besides examining the very nature of the deal, an effort has been made to appraise it in the context of the evolving International Nuclear Law.


Arguably, there are two opinions about the very existence of an independent International Nuclear Law. Those who don’t acknowledge this as a full-fledged discipline may like to argue that the International Atomic Energy Agency (IAEA) had published a Handbook of Nuclear Law in 2003 without styling it as ‘International Nuclear Law’. On the other hand, the existence of plethora of international legal instruments dealing with nuclear energy matters does make out a strong case to treat the subject as an independent discipline. Whatever may be one’s preference, the fact is that the international law dimension of nuclear energy is more than established, and any nuclear energy agreement — whether military or civil — cannot escape the realm of international nuclear law as evolved in the later part of the twentieth century. For a holistic conspectus, it may be useful to briefly introduce the overall disarmament regime of the United Nations, in which, nuclear energy law is but one component. The United Nations Office of Disarmament Affairs (UNODA) is pivot in the whole scheme, which has categorized the disarmament efforts into (a) Weapons of Mass Destruction and (b) Conventional Arms. The Weapons of Mass Destruction are further subdivided into (i) Nuclear, (ii) Biological, (iii) Chemical, and (iv) Missiles; likewise, the Conventional Arms are divided into (i) Small Arms, (ii) Landmines, (iii) Cluster Munition, and (iv) Ammunition. Efforts have been made to adopt international treaties on each of the armaments separately. In connection with the nuclear weapons, the United Nations General Assembly passed a Resolution in 1946 and established a Commission to: (a) control atomic energy to the extent possible and to allow it only for the peaceful purposes, and (b) eliminate national atomic weapons. The efforts, therefore, acknowledged that the ‘atomic energy’ (later called nuclear energy) could be used for both peaceful as well as destructive objectives. Accordingly, two types of regimes evolved within the realm of the International Nuclear Law: the first that focused on regulating the destructive uses of nuclear energy, and the second that oversaw its peaceful usage. Later on, the Treaty on the Non-Proliferation of Nuclear Weapons (NPT) was introduced in 1968, which came into force in 1970. Pakistan and India never signed the treaty. Likewise, the Treaty Banning the Nuclear Weapons Tests in the Atmosphere, Outer Space and Underwater (also known as Partial Test Ban Treaty) of 1963 and the Comprehensive Test Ban Treaty (CTBT) are all international treaties dealing with the nuclear energy. The Statute of the IAEA 1956, which is, in itself, a treaty and the Vienna Convention for Civil Liability on the Nuclear Damage, 1996 form the basis of International Nuclear Law on the peaceful use of nuclear energy.


THE INTERNATIONAL NUCL 1Having thus established the framework of the International Nuclear Law, it is now appropriate to examine the background of the US-India Civil Nuclear Deal, which primarily is pegged in corporate America that shaped the primary legislation on nuclear energy in the US. There was no legislation on nuclear energy (then called atomic energy) by 1946 when competing legislation started in the US. The first attempt was by two Harvard Law School trained lawyers Brigadier General Kenneth and Marbury who prepared a draft in which military usage of nuclear energy occupied the central place and there were restrictive and secretive legal provisions to debar civilian and commercial use of nuclear energy. The draft was championed by May and Johnson and therefore came to be known as May-Johnson Draft. The draft faced stringent opposition by the top scientists and the private companies for its secrecy and control by the military. In reaction, Senator MacMahon introduced a competing draft wherein the civilian control over nuclear energy was recommended and there were provisions to address the concerns of the private companies that were upset by the monopolistic legislation proposed by May-Johnson Draft. The MacMahon Draft ultimately became the Atomic Energy Act, 1946 after fierce debate in the House of Representatives on its objectives. The debate hinged on monopolizing nuclear energy versus its scientific advancement. Ultimately, the argument of scientific advancement gave way to controlling and monopolizing propensities. The pressure persisted, and ultimately, the law was further amended and took the form of the Atomic Energy Act, 1954. Since the Atomic Energy Act, 1954 opened up the commercial and corporate prospects of nuclear energy, it also catered to internationalizing the nuclear energy for peaceful uses. Accordingly, its Section 123 provided for cooperation with other nations for peaceful use of nuclear energy, hence the term ‘123 Agreement’. The US entered into Section 123 Agreement with over twenty-five countries.

In case of India, the process officially started in 2005. and later in 2006, the Henry J. Hyde United States-India Peaceful Atomic Energy Cooperation Act of 2006 (known as Hyde Act) was passed. The characteristic features of Hyde Act, as extracted from the text of the legislation, need through understanding for appreciating the India-US civil nuclear deal. Its main points are:

  1. Preventing the proliferation of nuclear weapons;
  2. Sustaining the NPT, hence linking the future legal relationship with the International Nuclear Law;
  3. To encourage commerce in civil nuclear energy with India;
  4. To encourage state parties to NPT to develop, research, produce and use nuclear energy for peaceful purposes;
  5. To prevent transfer of nuclear equipment, materials or technology by Nuclear Suppliers Group (NSG) or by any other state;
  6. To achieve moratorium on the production of fissile material for nuclear explosive purposes by India, Pakistan, and China;
  7. To achieve conclusion and implementation of a treaty banning the production of fissile material for nuclear weapons;
  8. To secure India’s ratification of accession to the Vienna Convention on Supplementary Compensation for Nuclear Damage, 1997;
  9. To halt the increase of nuclear weapon arsenals in South Asia and to promote reduction of such weapons.  With, inter alia, the above-stated characteristics, it is believed that the Hyde Act provided the upper limit for the future agreement between India and the US. Subsequently, in 2008, Section 123 Agreement was finalized between India and the US and was passed into a law styled as the United States-India Nuclear Cooperation Approval and Non-Proliferation Enhancement Act. The Act approved the Section 123 Agreement and provided, in detail, the non-proliferation mechanisms and initiatives. After the 2008 Act, the matter remained dormant as India passed its Civil Liability for Nuclear Damage Act, 2010 in partial fulfilment of its obligations under Section 123 Agreement read with Hyde Act. The corporations in the US, however, took it with a pinch of salt as the liability clauses introduced in the Civil Liability for Nuclear Damage Act, 2010 exposed them directly and indirectly to liability and to punitive clauses of the Indian law. In January 2015, when the US President Obama visited India, the ‘breakthrough’ of ‘diluting’ the liability law by introducing an ‘insurance pool’ and ‘operator-liability’ instead of ‘supplier-liability’ was celebrated.  The afore-stated legal position needs careful appreciation. The analysis will reveal that the US-India Deal is linked to international nuclear law and in asymmetrical power equation between a superpower and a Third World country, the dynamics may turn out in the favour of the dominant. Anyhow, it is too early, at this stage, to pass judgements on this issue.


At the same time, it may be in fitness of this writing to briefly take stock of Pakistan’s nuclear law scene. In 1984, Pakistan saw its first law on the subject titled as the Pakistan Nuclear Safety and Radiation Protection Ordinance, 1984. Later, in 2001, the Pakistan Nuclear Regulatory Authority Ordinance was promulgated. The legal scene on Pakistan side seems barren as the subject has been under control of security establishment and all the efforts made for its legislation are restrictive in nature.


The survey of international nuclear law with reference to India-US Civil Nuclear Deal when placed in juxtaposition with Pakistan presents a very queer picture. The general perception is that Pakistan has been isolated by the deal and that India has gained a lot of legitimacy and prowess with the international community as the US is backing it up. The perception, however, is based on general analysis instead of specialized analysis, which will show that the obligations envisioned by the Hyde Act, and duly incorporated in the 2008 Agreement, are quite weighty for India. On the other hand, Pakistan should try to develop a holistic view of the situation based upon all aspects of the matter.

The author is an independent researcher and has done his BCL from the University of Oxford.


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