Andrew Lichterman

With the collapse of the Nehruvian paradigm, consisting of democracy, secularism, non-alignment and “socialism,” the top ten to fifteen percent of Indians, the upper-crust of society, have set their face against the rest, especially the poor. Culturally, economically, and politically, they are closer to Northern elites and their own kin in North America and Europe. Strongly influenced by social-Darwinist ideas, they see the poor as a drag on “their” India. They want a shortcut to high global stature. What better route than the military one? Greatness here is defined purely in terms of power untempered by civilized conduct or compassion. Praful Bidwai and Achin Vanaik, New Nukes: India, Pakistan, and Global Nuclear Disarmament (New York: Interlink Books, 2000), p.136.

Last summer, the Bush Administration completed an agreement with India, initially negotiated in 2005, that would allow expanded trade in nuclear fuel and technology. It is now before Congress. If approved, the deal could allow India to expand its nuclear arsenal more easily by using scarce domestic uranium for weapons production while buying fuel for its power reactors on the international market. It will also undermine an already shaky Nuclear Nonproliferation Treaty(NPT) regime by giving a country that developed nuclear weapons outside the Treaty the benefits of international nuclear trade. In general, the deal reinforces the legitimacy of nuclear weapons and weakens global rule of law, as the United States, the world’s leading military power and a country that ignores its own NPT obligations to negotiate for the elimination of its nuclear arsenal, also claims the right to choose which countries are sufficiently “responsible” to have both nuclear power and nuclear weapons.

In addition, the U.S.-India nuclear deal is an effort by elites in both countries to bolster nuclear energy programs that long have been unable to fulfill the promises made by their advocates of cheap, reliable nuclear-generated electricity. The risks posed by nuclear accidents and long-term storage of highly radioactive spent fuel remain unsolved. Expanded energy production and reduction in greenhouse gas emissions can be accomplished more flexibly and in a way that serves a broader spectrum of India’s population via the development of a variety of decentralized renewable energy technologies. Trade and investment in such technologies also would benefit the United States, helping to accelerate the development and use of renewable energy here as well.

Neither the press nor most U.S. arms control analysts have paid much attention to the broader changes in the U.S.-India relationship that elites in both countries are seeking, each with an eye to maximizing their own wealth and power. The 2006 U.S. Quadrennial Defense Review declared that “India is emerging as a great power and a key strategic partner.” U.S. Military planners envision India as a possible forward base for operations from South Asia to the Middle East, and perhaps as a junior partner in those operations as well. Arms makers see huge potential profit from increased arms sales, with India being one of the world’s largest importers of high-tech weapons. U.S.-based multinationals are gearing up for expansion into India, hoping to use the enhanced “security” partnership as a wedge to further open India to foreign investment and sales, not only in nuclear technology and services but in everything from banking to food and agriculture to big box retail stores.

The ambitions of elites in the two countries to strengthen an array of military and economic ties is reflected in the set of initiatives announced by U.S. President Bush And India’s Prime Minister Singh in July 2005 together with the agreement in principle on nuclear trade and cooperation. A few weeks earlier, the two countries had agreed to a “New Framework for the U.S.–India Defense Relationship.” The “New Framework” called for increased military cooperation across a wide range of activities, from joint exercises and intelligence exchanges to increased weapons trade to collaboration in missile defense development. The July 2005 agreements also established a “CEO Forum” to “harness private sector energy and ideas to deepen the bilateral economic relationship,” an agreement for closer cooperation in space technology and commercial space activities and a “Knowledge Initiative on Agriculture.” The U.S. private sector members of the Agricultural Knowledge Initiative governing board are Archer Daniels Midland, a diversified giant that takes agricultural products from the world over and turns them into commodities ranging from processed foods to biofuels and industrial chemicals, Biotech giant Monsanto, and Walmart, the world’s biggest retailer.

A significant part of the CEO Forum’s agenda is to greatly expand the degree to which foreign banking and financial services companies can do business in India. This position was duly echoed by the U.S. government, with a Treasury Department fact sheet stating that

the development of the financial sector and trade in financial services will play a key role in promoting private-sector led growth and economic stability in India. Opening the financial sector to foreign participation would make additional long-term financing available for infrastructure development.

In light of the spiraling collapse of the U.S. financial sector, the notion that opening India to its particular brand of radically deregulated, short-term profit-driven “financial services” will promote “economic stability” is dubious at best.

The socioeconomic impact of these proposed new arrangements–how they will affect the mass of the populations in India, the United States, and world-wide–remain almost entirely outside the ambit of U.S. discussion of the nuclear deal, although they have not escaped the notice of commentators in South Asia. The effect of the U.S.-India deal–or deals–will be to bind India to a development path favorable to particular elements in the U.S. political and economic elite, and to their Indian counterparts. In this future, India’s development will center on production of goods and services that serve global supply chains controlled by multi-national corporations. In addition to consumer goods and export crops that are mass commodities available to many in a few wealthy countries, but are luxury items available only to a fraction of the world’s population as a whole, there will be further expansion of “service industries” such as back-office corporate operations ranging from call centers to billing and information technology support. Also part of this global circuit of trade and investment are armaments and the capital goods, and engineering and construction services necessary to build new infrastructure to sustain components of these global production chains in “underdeveloped” regions. Increased U.S.-India trade and cooperation in high tech weapons, space, and nuclear technology will reinforce this pattern, producing few jobs for those below the top 20% of either country in income and little development that benefits the majority of the population in either country, further increasing wealth disparities, and consolidating the power of narrow elites in both states.

Nuclear technology is a prototypic element of this global system–and in the future envisioned by the elites of many countries is poised to become more important as supplies of fossil fuels are depleted. Producing energy in large, expensive centralized facilities, nuclear power is most useful for serving the emerging production and service centers of the global corporate capitalist metropole. It has far less promise, however, for improving living conditions among the many hundreds of millions of rural poor in India and world wide who neither can afford to buy much that global corporations have to offer nor are likely to be served by centrally-generated electricity anytime soon.

Only the nuclear cooperation deal itself is before Congress this week. But its purpose and likely effects need to be reevaluated in light of the mounting evidence that the dominant neoliberal global development model–which the set of U.S. India deals reached in recent years largely are designed to promote and enforce–is a disaster, leading to a global economic typhoon that capsizes all but the sturdiest boats rather than raising them.

The Bush administration is trying to push approval of this complex and important matter through Congress in the few days left before its session ends on September 26 (although the Congressional session could be extended). Unfortunately, the Democratic Party congressional leadership seems inclined to rubber stamp the deal, despite the lack of time for study or debate in the closing days of a session dominated by a financial crisis of historic proportions. This is a bad deal for most people in the U.S. and India, and likely for the rest of the world as well. At the very least, it deserves extensive, well publicized discussion before going forward.

For more information on the U.S.-India nuclear deal and the broader energy and security context, see

Rushing into the Wrong Future: The U.S.-India Nuclear Deal, Energy and Security, by Andrew Lichterman of the Western States Legal Foundation, Oakland, California, and M.V. Ramana of the Center for Interdisciplinary Studies in Environment and Development, Bangalore, India.

For more detail on the nuclear weapons proliferation impacts of the agreement, see the commentary and resources provided by the Arms Control Association.

And for more in-depth background:

Zia Mian and M. V. Ramana, “Wrong Ends, Means, and Needs: Behind the U.S. Nuclear Deal With India,” Arms Control Today, January/February 2006

Aspects of India’s Economy No.41, ‘Global Power’, Client State: India’s Place in the US Strategic Order

Achin Vanaik, “Post cold war Indian foreign policy,” Seminar web edition #581 January 2008