U.S.-India Civil Nuclear Deal
Red Book
Red Book

Mains Guidance Program (MGP) for UPSC CSE 2026, Cohort-1 starts 11th February 2025. Registrations Open Click Here to know more and registration.

Source: This post on U.S.-India Civil Nuclear Deal has been created based on article “Time to seize the promise of the U.S.-India nuclear deal” published in The Hindu on 22nd January 2025.

UPSC Syllabus topic: GS Paper 3- International relations

Context: The article explores the history, potential, and challenges of the U.S.-India civil nuclear deal, which was finalized in 2008 after a lengthy negotiation process.

When was the U.S.-India civil nuclear deal finalized, and why was it significant?

  1. The U.S.-India civil nuclear deal was finalized in late 2008 after years of negotiations beginning in 2005.
  2. It marked a watershed moment in defense and strategic cooperation between the two democracies, building trust to collaborate on advanced and potentially destructive technologies.
  3. The Coalition for Partnership with India, consisting of businesses, Indian-Americans, and academics, advocated for the deal, overcoming opposition that feared it would promote nuclear proliferation.

What were the anticipated benefits of the deal?

  1. The deal was expected to enhance India’s civil nuclear sector with new plants using U.S. technology, creating jobs in both countries.
  2. It aimed to generate more electricity for Indian industries, reduce reliance on fossil fuels, and contribute to climate goals by producing clean energy.
  3. Despite high expectations, the energy and commercial promises have not materialized. For example, plans for six nuclear plants announced by President Obama in 2016 remain unrealized.

What is the U.S. Entity List, and how does it relate to the deal?

  1. The U.S. Entity List identifies entities with which U.S. companies are restricted from conducting business.
  2. After the deal, most Indian entities were removed from the list, except a few involved in sensitive nuclear research.
  3. National Security Adviser Jake Sullivan announced that the U.S. is finalizing measures to remove longstanding regulatory barriers, potentially enabling greater collaboration between U.S. and Indian nuclear entities.

What is the Civil Liability for Nuclear Damage Act, and why is it problematic?

  1. It was enacted in 2010. The Act deviates from international norms by placing major liability obligations on suppliers rather than operators.
  2. This has deterred major U.S. suppliers like GE and Westinghouse from participating in India’s nuclear projects.

How has India tried to address supplier liability concerns?

  1. The Indian government introduced a 20-year insurance scheme through public sector companies to cover supplier liability.
  2. Russian companies accepted this arrangement due to government ownership and geopolitical interests, but U.S. firms have remained reluctant.

How has technology evolution impacted the deal’s implementation?

  1. Rapid advancements in nuclear technology require U.S. companies to offer cutting-edge solutions.
  2. These must also be cost-competitive to avoid burdening Indian consumers with high electricity prices.
  3. Indian officials are cautious of cost overruns that have plagued recent U.S. nuclear projects, leading to increased electricity costs without substantial improvements.

What needs to be done to overcome the remaining challenges?

  1. Resolving liability concerns, regulatory hurdles, and cost barriers will require joint efforts from U.S. companies, the Biden administration, and Indian authorities.
  2. Collaboration on technology and competitive pricing is crucial.
  3. Addressing these challenges could unlock tremendous benefits, including enhanced energy security, economic growth, and deeper U.S.-India strategic ties.
  4. However, time is running out to realize the full promise of the deal.

Discover more from Free UPSC IAS Preparation Syllabus and Materials For Aspirants

Subscribe to get the latest posts sent to your email.

Print Friendly and PDF
Blog
Academy
Community