Importantly, a key criterion for membership in the NSG is that the country is a party to and complying with the NPT or a nuclear-weapon-free-zone treaty. A decision to allow India to join would mark the first exception to that policy. But Indian’s attempt to become a member of NSG was frustrated by the NSG rules—the group follows the principle of consensus.
The Indians frustration was multiplied when the 46-NSG agreed on a clearer, tougher set of guidelines designed to prevent the spread of ‘uranium-enrichment’ and ‘spent fuel reprocessing equipment and technology’ on June 23-24, 2011 in its meeting in the Netherlands. According to the new guidelines, the enrichment and reprocessing equipment and technology (ENR) should not be transferred to those states that have not signed or are not in compliance with the nuclear Nonproliferation Treaty (NPT); do not allow comprehensive International Atomic Energy Agency (IAEA) safeguards; and do not allow more extensive monitoring under the terms of the IAEA Additional Protocol.
Though the Additional protocol is not a legal requirement under the NPT or the IAEA, the new guidelines of the NSG made an Additional Protocol as a condition of supply. The nuclear non-proliferationists seem convinced that the new set of the NSG guidelines would prevent the transfer of sensitive technology, which could be misused by the recipient state to develop fissile material for nuclear weapons.
The United States was in a position to block the amendment in the NSG guidelines. But it refrained due to a few recent Indians nuclear reactor and armament deals. First, Washington was not comfortable with the Indian decision to purchase nuclear reactors from the European or Russian companies. Secondly, U.S. aerospace companies Boeing and Lockheed Martin lost an estimated $10 billion tender competition for a medium multi-role combat aircraft. The Boeing offered the Indian air force the F/A-18E/F Super Hornet, while Lockheed Martin offered the F-16IN Super Viper. The beneficiaries were the French Dassault Rafale and the multinational Eurofighter consortium’s Typhoon.
The new guidelines of the NSG have created a great of anxiety in New Delhi. The Indian media and opposition parties termed these rules ‘as a reversal of the NSG's 2008 waiver allowing the transfer to India of sensitive ENR technology, which can be used for the production of both nuclear energy and nuclear weapons.’ Importantly, since 2008, the Indian officials and observers often used the term “clean waiver” to suggest that the 2008 NSG decision lifted all the restrictions that previously had been in place on nuclear exports to India. Obviously, the June 23, 2011, US State Department press release disappointed the Indians. It stated: “Efforts in the NSG to strengthen controls on the transfers of ENR are consistent with long-standing U.S. policy that pre-dates the Civil Nuclear Agreement and have been reaffirmed on an annual basis by the [Group of Eight industrialized countries] for years.”
The preceding controversy between the NSG and New Delhi underlines two issues, i.e. either the Indian leadership misguided the people of India by concealing the actual facts of the Indo-US nuclear deal or the Americans kept a legal loophole in the agreed document to change its position whenever it needs to teach a lesson to India.
To conclude, NSGs’ new guidelines did expose the limits of Indo-US nuclear deal and also underscored that if New Delhi acted shrewdly after securing the NSG waiver in 2008 and ignored the American companies, Washington has a leverage to keep a check on it.