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India, US unveil text of 123 agreement

india Updated: Jul 10, 2008 15:26 IST

The Indo-US civil nuclear deal provides for a consultative mechanism if termination of the pact is warranted due to any reason, including "changed security environment", apparently a fallback arrangement if New Delhi were to conduct an atomic test.

The 123 agreement, whose text was unveiled on Friday, is silent on nuclear testing by India but makes it clear that the pact will not hinder or hamper New Delhi's military nuclear programme.

The 40-year agreement, extendable by 10 years, commits the US to ensure uninterrupted fuel supplies to Indian reactors even if it terminates its cooperation and to help create strategic fuel reserve for Indian safeguarded nuclear reactors.

It makes it incumbent upon the US to work with other Nuclear Suppliers Group (NSG) to ensure that India can have nuclear cooperation with the international community.

"Either party (country) shall have the right to terminate this agreement prior to its expiration on one year's written notice to the other party," says the 22-page text of the pact reached last month.

"A party giving notice of termination shall provide the reasons for seeking such termination," it says, adding the termination can be cancelled if the notice is withdrawn before the end of one-year notice period.

Before the agreement is terminated, the two countries "shall consider the relevant circumstances and promptly hold consultations" to "address the reasons cited by the party (country) seeking termination", it says.

Under the pact, the two countries "agree to consider carefully the circumstances that may lead to termination or cessation of cooperation.

"They further agree to take into account whether the circumstances that may lead to termination or cessation resulted from a party's (country's) serious concern about a changed security environment or as a response to similar actions by other States which could impact national security."

This apparently refers to a possible situation wherein India might be compelled to conduct a nuclear test if it is convinced that its security interests are threatened.

"The party (country) seeking termination (of agreement) has the right to cease further cooperation under this agreement if it determines that a mutually-acceptable resolution of outstanding issues has not been possible or cannot be achieved through consultations," the pact says.

"If a party seeking termination cites a violation of this agreement as the reason for notice for seeking termination, the parties (India and the US) shall consider whether the action was caused inadvertantly or otherwise and whether the violation could be considered as material," the agreement says.

"If a party, seeking termination cites a violation of an IAEA safeguards agreement as the reason for notice for seeking termination, a crucial factor will be whether the IAEA Board of Governors has made a finding of non-compliance," it says.

If the agreement is terminated, the US will have the right to require the return of "any nuclear material, equipment, non-nuclear material or components transfered" under the agreement as also any special fissionable material produced through their use.

A notice by the country that is invoking the right of return shall be delivered to the other on or before the date of termination of the agreement.

But recognising that exercising of the right of return would have "profound implications" on their relations, the two countries would undertake consultations prior to such a step.

"Such consultations shall give special consideration to the importance of uninterrupted operation of nuclear reactors of the party (country) concerned with respect to the availability of nuclear energy for peaceful purposes as a means of achieving energy security," the agreement says.

Both countries shall "take into account the potential negative consequences of such termination on the ongoing contracts and projects initiated under the agreement of significance for respective nuclear programmes of either party."

However, if the US exercises its right of return, it shall "compensate promptly" India for the "fair market value thereof and for the costs incurred as a consequence of such removal".