Maverick's World

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.

posted by maverick @ 8:44 AM