New Delhi
July 27, 2007

MEA Official Spokesperson: Good evening everybody and welcome to this Joint Press Conference by National Security Advisor, Foreign Secretary and Chairman, Atomic Energy Commission. We will first have opening remarks by the National Security Advisor and thereafter remarks by the Foreign Secretary and then we will open the Press Conference to questions.

National Security Advisor: Ladies and gentlemen of the press:
We are happy to inform you that the governments of India and the United States of America have finalized the text of the bilateral agreement for cooperation in peaceful uses of nuclear energy. India and the United States are today issuing a Joint Statement on the conclusion of negotiations on this agreement.

The finalization of the text of this Agreement after five rounds of discussion is a significant milestone in the implementation of Prime Minister Manmohan Singh and President Bush’s vision to transform the relationship between India and the United States, which was expressed in the Joint Statements of 18th July 2005 and 2nd March 2006. The commitments expressed in the Joint Statements of 18th July 2005 and 2nd March 2006 have been fully reflected in the final text of the bilateral cooperation agreement.

The purpose of the Agreement is to enable full civil nuclear energy cooperation between India and the United States covering nuclear reactors and aspects of the associated nuclear fuel cycle. The Agreement is between two States possessing advanced nuclear technologies, both parties having the same benefits and advantages. We are confident that the Agreement fulfills the terms outlined by the Prime Minister to Parliament on the 17th of August 2006.

The significance of the Agreement, which has become a touchstone of the transformed bilateral relationship between India and the United States, is that when brought into effect, it will open the way to bilateral cooperation between India and the United States in the area of civil nuclear energy.

The Agreement is also significant in opening the possibility of India cooperating with other countries in the world in civil nuclear energy. We look forward to this prospect. India regards international civil nuclear cooperation as potentially most important for energy security and for an environmentally sustainable pattern of development. India is ready to work with like-minded countries to fashion a new consensus on non-proliferation and realize the goal of a nuclear weapon-free world through universal nuclear disarmament.

In order to make cooperation in civil nuclear energy a reality, India will now negotiate an India-specific Safeguards Agreement with the IAEA. The India-US bilateral agreement also opens up the possibility of an unconditional exemption for India from the Nuclear Suppliers Group (NSG) Guidelines, as foreseen in the July 18, 2005 Joint Statement.

The text of the Agreement will be made available to the public soon, at a time to be agreed by the two governments.

Foreign Secretary: I will now read to you the Joint Statement by Shri Pranab Mukherjee, Minister for External Affairs; and Dr. Condoleezza Rice, US Secretary of State on India and United States Complete Civil Nuclear Negotiations, July 27, 2007.

“The United States and India have reached a historic milestone in their strategic partnership by completing negotiations on bilateral agreement for peaceful nuclear cooperation, also known as the ‘123 agreement.’ This agreement will govern civil nuclear trade between our two countries and open the door for American and Indian firms to participate in each other’s civil nuclear energy sector.

The conclusion of negotiations on this agreement marks a major step forward in fulfilling the promise of full civil nuclear cooperation as envisioned by President Bush and Prime Minister Manmohan Singh.

The successful completion of the text permits us to move forward on the U.S.-India Civil Nuclear Cooperation Initiative, first announced by the two leaders on July 18, 2005, and reaffirmed on March 2, 2006. The next steps include India negotiating a safeguards agreement with the IAEA and support for nuclear trade with India from the forty-five member Nuclear Suppliers Group. Once these additional actions have been completed, President Bush will submit the text of the agreement to the U.S. Congress for final approval.

Civil nuclear cooperation between the United States and India will offer enormous strategic and economic benefits to both countries, including enhanced energy security, a more environmentally-friendly energy source, greater economic opportunities, and more robust nonproliferation efforts.

This achievement reinforces the growing bilateral relationship between two vibrant democracies. We are committed to the strategic partnership outlined by President Bush and Prime Minister Manmohan Singh, and look forward to working together to implement this historic initiative.

Question (Parul Malhotra, CNN-IBN): This is a question for the National Security Advisor. Sir, you have been quoted as saying that the agreement is good but it is not the best that we could have got. What did you mean by that?

National Security Advisor: I said that the agreement is good but there is always something that you can always get better I can see that. I do not know from where you have got the quote unless it is this morning. We negotiated a text and I think the text is an excellent one. I did not want to be too presumptuous enough to say ‘the best possible’ because in a negotiation there is a certain amount of give and take on both sides. But what we have managed is that we have got all the commitments which our Prime Minister made to Parliament, they are fully safeguarded as far as this text is concerned.

Question (Mathew Rosenberg, Associated Press): How do you think is this agreement going to alter the balance of power in the region?

Foreign Secretary: This is an agreement for cooperation in civil nuclear energy. It is not about the balance of power in the region.

Question (Manish Chand, IANS): Talking of full civilian nuclear cooperation, would it also entail the transfer of technology related to reprocessing, heavy water reduction and enrichment? Also, some scientists have articulated apprehensions that the reprocessing formula that has been worked, that is setting a safeguarded facility, will expose the three-stage programme to international surveillance? What do you make out of that? The first question can be answered by Dr. Kakodkar.

Chairman, Atomic Energy Commission: The objective of setting out this civil nuclear cooperation is to make sure that we benefit not only from the reactor and the fuel supplies that we get from outside, but also continue to benefit in terms of the enormous additional energy potential that would be there in the spent fuel. For that purpose this agreement gives advance consent rights for us to reprocess the spent fuel and reuse the material so recovered in national safeguarded facilities. So, as you can see, it allows us to derive the full benefit out of the cooperation. With regard to the domestic three-stage nuclear power programme, I think that is independent. That will be pursued in accordance with our own national programme and there is no interference of one into another.

National Security Advisor: I might just add, I presume that the question was whether the fast breeder programme would be interfered with. As the Chairman of the Atomic Energy Commission has just stated very explicitly, the fast breeder programme at the moment is not under any kind of international obligations.

Question: This is a question for either FS or NSA. Looking forward to the process of getting NSG exemption, what kind of assurances does India have so far and particularly what do you expect China’s position to be on this?

Foreign Secretary: I think it is a little premature because we have not actually asked the question of individual countries. So far we have briefed them about what we were hoping to do but without a finalized 123 agreement. We had not actually gone to any of these countries and asked, “What will you do if we ask that question?” Now that we have a finalized text, I think we and the US will be briefing the members of the NSG and then I think we will be in a position to give you a response about individual countries, where they might stand, what they do, etc.

Question (Rajeev Sharma, The Tribune): My question is to NSA. I believe that in the text there is no reference to India conducting future tests. If that were to happen whenever it happens, will there be a Presidential waiver? Is the Indian scientific community on board? The second question may probably be answered by Dr. Kakodkar.

National Security Advisor: This deal deals primarily with the civil nuclear cooperation. There is no reference here to detonation or to any test. So, what happens in the event of a test, we will come to that position later on. This one is with regard to civil nuclear cooperation. Both sides are agreed on what they need to do in terms of policy guidelines. If India decides that it has to test, I think Article 14 carries a whole multilayered thing on what we need to do. But as of now there is no particular reference to testing or non-testing as far as this.

Chairman, Atomic Energy Commission: The point is, this finalized draft of this agreement allows us to carry on with the domestic programme that includes both domestic three-stage programme, domestic R&D and of course the strategic programme. It allows us to also carry on the civil nuclear programme which is eligible for international cooperation. I think the rest is too speculative in the sense that would be decided at different points of time.

Question (Seema Sirohi, Outlook): Dr. Kakodkar, Sir, are you satisfied with the text of the 123 agreement?

Chairman, Atomic Energy Commission: Yes

Question (Jyoti Malhotra, The Telegraph): Dr. Kakodkar, you were quite unhappy and you made it very clear in the public eye, in the media that you were very unhappy in the past by the way negotiations were going. So, specifically on the issues that you have discussed in the last week in Washington, - whether to do with reprocessing fuel, supply assurances, testing - are you satisfied with the deal that you have got with the Americans today?

Chairman, Atomic Energy Commission: The point is simple. Whatever I had said earlier was a part of the national position; whatever I am saying now is also a part of the national position; and whatever this agreement has achieved is also consistent with the national position. So, I have no reason to be unhappy.

Question (Jyoti Malhotra, The Telegraph): You have not answered the question about testing and reprocessing. Can you explain to us what India has got on these issues?

Chairman, Atomic Energy Commission: I explained that in detail earlier I thought. The benefit of the civil nuclear cooperation starting from the first reactor, which would come all the way into making use of the spent fuel arising out of such imported fuel and reactors through reprocessing into reuse in other safeguarded reactors. All that is provided for in this agreement. This is what exactly we are looking for as far as the full civilian nuclear cooperation. So, it is there. I was very unhappy when I thought it will not be there but it is there.

Question (Sidharth Varadarajan, The Hindu): I understand that the 123 agreement does not commit the United States to selling India technology and components for reprocessing, enrichment, heavy water. Is it our understanding that the United States will not block the Nuclear Suppliers Group from authorizing the export of such components as figured in the trigger list of the NSG? Secondly, my understanding of the manner in which the fuel supplies and the continuation operation of reactors have been immunized in the event of a test is that there is a mechanism for replacing any fuel supplies that the US may want return with fuel supplies from friendly countries. Would such a mechanism be possible if the NSG adopts as part of its rule change, the cessation of cooperation in the event of another Indian nuclear test because the first American draft of the NSG rule change last March has one of the conditions that this entire exemption for India is dependent on the six commitments India have made, one of which is continuing the moratorium.

Foreign Secretary: I think it is our expectation and we will work towards an unconditional NSG exemption from the guidelines for India. As far as we are concerned, we think that fuel supply assurances that we have got, many of which were expressed in public in March 2, 2006 in the Joint Statement, stand and will be carried out in practice. That is our expectation. So, to the extent that you are asking what if the NSG does something or the other, frankly that is hypothetical. What we are looking at is an unconditional, clean NSG exemption. That is what we will work for. On the transfer of technology, maybe I should hand you over to the Chairman.

Chairman, Atomic Energy Commission: As I mentioned, any civil nuclear programme has the reactor activity and the fuel cycle activity. Now, this agreement would, as I said, allow us to derive full benefit out of the reactor and associated fuel cycle activities as a kind of uninterrupted chain. You also know that India has its own full capability in all areas. So, what is important is that we are able to derive full benefit out of whatever cooperation we get from outside and we do not have any issues left in terms of not knowing what will happen to spent fuel and things like that. So, it is fully provided for.

National Security Advisor: If I might just amplify what the Foreign Secretary was saying, I think this agreement contains a full reflection of the March 2, 2006 supply assurances. I think there has been no derogation of those rights. If companies are going to come up with something new, as the Foreign Secretary said, we will deal with it at that time. As of now, the text contains, as I said, the assurances that are contained with regard to fuel supplies in the March 2006 are repeated in full in this agreement.

Question (Jo Johnson, Financial Times):By allowing India to import fuel, does this agreement not free up indigenous nuclear fuel supplies for use in India’s strategic weapons programme and thereby contribute to the nuclear arms race in South Asia and therefore affect the balance of power in the region?

National Security Advisor: I think it is time that certain countries overcame the belief that we are interested in proliferation. I would make use of this opportunity to drive home this point. If we need additionalities as far as our strategic stockpile is concerned, we know how to do it. We did not need to use this route for that purpose. I think it is important to understand that. We do not wish to enter into a debate on this issue. This agreement was intended primarily to drive the civil nuclear cooperation programme. I believe that the text that has been finalized opens that possibility. We are not using it as an excuse to enhance our strategic capabilities. The earlier countries forget that, I think the better.

Question (Rakesh Kapur, Punjab Kesari): The question is for Mr. Narayanan. The whole deal has been done under the ambit of the Hyde Act which empowers the President of the US to snap the deal the day India conducts the nuclear explosion? Have we mortgaged our right to conduct nuclear explosion in Washington?

National Security Advisor: We have not mortgaged any right. If anything, we have enhanced our rights. I do not think I need to say anything further on the subject.
Question: The question is to the National Security Advisor. You have said that all concerns have been reflected in the deal. Now recently, very recently about 23 US Congressmen led by Democrat Edward Burke have written a letter to President Bush saying that if the 123 agreement has been intensely negotiated it seems to be bypassing the US law and the will of the Congress. In that case, the deal maybe heading to be in jeopardy. Do not you see this to be heading for yet another stumbling block?

National Security Advisor: We and the US Administration have arrived at an agreement. I think the negotiators on both sides understand the limits of the law, the limits of flexibility and how far we can go. In doing this, and to answer the first question that Parul made, the question is the best deal that we could get could have very well have other problems, but we have got a deal, a very good deal which we believe should meet the legal requirements of both countries. Now I cannot speak on behalf of individual Senators or Congressmen in this matter because we dealt with US Administration and I think they know the limits of where they can go.

Question (Amit Baruah, The Hindustan Times): My question is to Foreign Secretary Menon. External Affairs Minister Pranab Mukherjee goes for the ASEAN Regional Forum meeting in just a few days. Will he take this opportunity to engage a large number of Foreign Ministers including the Minister from China on the civil nuclear deal?

Foreign Secretary: Certainly. This will now be a topic in several of our conversations with those countries which are concerned with this issue. I am not sure as to which of the NSG members he is meeting at the ARF. I know he has a very detailed schedule and they are trying to set up a meeting between the Foreign Minister of China and EAM. Certainly this is one of the issues which we will raise. We will inform our friends of what has occurred, what we just informed you about, and about how we plan to take this forward in the future.

Question (Seema Mustafa, Asian Age): I will go back to an issue that was raised earlier. The Hyde Act very clearly says that if India was to detonate a nuclear device, all nuclear cooperation will cease. Has any corrective measure been brought into the 123 agreement regarding this and also uninterrupted fuel supply?

Foreign Secretary: I think that question has been answered. This is an agreement between two Governments. It means the concerns of the two Governments and those Governments operate within their own laws. It is for them to understand whether this agreement meets their laws or not. It is not for us to interpret their laws, or for them to interpret ours. This agreement as a finalized text meets the concerns of both sides and serves the interests of both sides.

Question (Rahul Bedi, Jane’s Defence Weekly): My question is to the National Security Advisor. We are all familiar with the American adage that there is no free lunch. My question, what are the Americans getting out of this? Is this predicated to a lot of arms contracts that are up for bidding because there have been a series of reports in newspapers that the Americans stand to gain a vast sum of money in contracts not only in the nuclear field but also in the weaponry.

National Security Advisor: I will say this and then I will ask Foreign Secretary to amplify what I have to say. Quite clearly in the course of our negotiations there was no reference to arms deals or any other extraneous considerations. I think the five days that we spent in Washington, we spent primarily on the text of what we need to. As the Foreign Secretary just mentioned, it took us a lot of time to reconcile the requirements on either side in keeping with their national legislations and national requirements. Quite clearly I would presume that the outcome would be a transformed relationship, the transformed relationship would then lead to areas of cooperation. But quite clearly we are not here to indicate that this will lead to A, B and C. I know what you are referring to. If the new contracts for the 126 aircraft is going to come. I suppose they would have been in the race irrespective of whether there was the 123 agreement or not. We have never kept countries captive to deals of this kind. This is an open transparent effort. As far as I am concerned, I have not seen any evidence of a deal that give us the 123 and we will give you something.

Question (Rahul Bedi, Jane’s Defence Weekly): What are the Americans getting out of this deal?

Foreign Secretary: I think (you) should ask the Americans that. Let them speak for themselves. They are quite articulate. But the simple answer to your question is there are no conditionalities. This is an agreement for cooperation in civil nuclear energy. That is what it is. That is all there is. We did not negotiate anything else with it.

Question (R. Ramachandran, Frontline): I would like to know from Dr. Kakodkar as to what is the current status of implementation of safeguards on the safeguarded facilities with the IAEA. What is the status of negotiations on the additional protocol? Is there any move at the NSG contingent upon conclusion of the draft agreement?

Chairman, Atomic Energy Commission: We have had a number of discussions with IAEA on the India-specific Safeguards Agreement. With the finalization of the text we will carry that process forward and sort of try to negotiate this India-specific safeguards agreement further. The question of an additional protocol, we will take up later in sequence. First we have to get the safeguards agreement in place.

Question: Whether US tendency is contingent upon completion of the draft…
Any move at the NSG?

Chairman, Atomic Energy Commission: We have to find out from the NSG.

Question (Srinjoy Choudhary, Times Now): Question for NSA. Sir, how convinced are the Left and the Opposition about the deal? You have met them already. How much in agreement are they with the Government’s position?

National Security Advisor: Srinjoy, you always try to be smart. We have met the Left and we have met the members of the NDA. We have explained to them in great detail as to where we stood. They have indicated that they would like to see the text before they pass judgment. That is the point. But the impression we got from the discussion was that at least from what we discussed with them they were particularly satisfied. I think they were more than satisfied because I think we left most of the talking to Dr. Kakodkar. That carried credibility which I hope will be carried across board here also because I think if the nuclear community is on board, I think that should make everybody comfortable as to where we are.

Question (Somini Sengupta, New York Times): Can you characterize how good a deal is this for India; and if you did not get everything that you wanted what would that possibly be? This is for the NSA.

National Security Advisor: I think you should address this to Dr. Kakodkar. It was mentioned. I think Siddharth Varadarajan who reads not only between the lines but beyond the lines, also in these matters. Yes, we would have liked some of the technologies which are yet to come - they would require further discussions and what not. So, there are issues which we would have liked but we have settled for what we think is more than adequate from what we wanted. We were very hopeful that in course of time whatever you gain is a very small percentage would be available.

Chairman, Atomic Energy Commission: That should be adequate. I would describe this as a satisfactory thing from the point of view of carrying forward India’s nuclear energy programme.

Question (Sheela Bhatt, Rediff.Com): Dr. Kakodkar, we do not know much about your Department. But we would like to know how jubilant are your scientists or what is the exact reaction of the scientists. Are they celebrating this as an award or not? Secondly, can you explain in layman’s language how radical is this moment for you for the scientists of India. And I would like to know what you have not got what nuclear weapon states have got.

Chairman, Atomic Energy Commission: I think we are all karmayogis. So, we just carry the work on and this will allow us to remain consistent with that philosophy in an expanded manner.

Question (Jyoti Malhotra, The Telegraph): You have not answered that question, “What is it that you could have got?”

Chairman, Atomic Energy Commission: I think NSA responded to that right in the beginning. I can have a huge wish list, but that is not the point. The point is what was the objective with which we set out in July 18, 2005 and whether we are consistent with that. And the answer is yes.

Question (Indrani Bagchi, Times of India): Dr. Kakodkar, could you elaborate a little on the India-specific safeguards agreement that we will be negotiating? Around when do you expect the negotiations to be complete; and could you elaborate a little more on what you mean by India-specific safeguards? Would it be based on the template of current safeguards that we have or do you have a different template?

Chairman, Atomic Energy Commission: The very title ‘India-specific’ means that it has to be different and specific to the Indian conditions in the context of the international civil nuclear cooperation. I think we should wait for the details till the negotiations are complete with IAEA.

Question (Indrani Bagchi, Times of India): When?

Chairman, Atomic Energy Commission: As soon as possible.

Question (Indrani Bagchi, Times of India): Any timeframe?

Chairman, Atomic Energy Commission: I think it is unrealistic to put a timeframe to it. We should do it as soon as possible.

Question (Pranab Dhal Samanta, Indian Express): Dr. Kakodkar, in the March 2 Separation Plan it was agreed that India will put its civilian reactors under permanent safeguards in return for permanent fuel assurances. Are you convinced after the few assurances that are placed in the 123 agreement that you can go and negotiate a safeguards agreement with IAEA and put Indian reactors under permanent safeguards? Or is there more work to be done on the fuel assurances?

Chairman, Atomic Energy Commission: The fuel assurances that were built into the March 2 document and the fuel assurances built into this finalized draft agreement are entirely consistent.

Question: Mr. Menon, how soon can the commerce start once we have in place? The second question is for Dr. Kakodkar. Are you satisfied that India’s security boat for energy and for weapons (is) secure for generations once we have this deal?

National Security Advisor: On Commerce, the NSA and Commerce have nothing in common. I will ask the Foreign Secretary to explain. As far as the second question whether we have adequate supplies of fissile material for our programmes, I think there is no reason for anybody to feel concerned over that irrespective of this agreement which does not touch on the strategic programme.

Foreign Secretary: Your question was, “When can commerce begin?” As soon as we complete the series of steps we have outlined here which bring this agreement into effect.

Question: You do not need to wait for…(inaudible)?

Foreign Secretary: I have just mentioned the whole series of steps that we have outlined in the Joint Statement and what the NSA said at the beginning.
(Concluded)