U.S. and India Release Text of 123 Agreement

U.S. and India Release Text of 123 Agreement
The following is the text of the Agreement for Cooperation between the Government of the United States of America and the Government of India concerning peaceful uses of nuclear energy (123 Agreement):
BEGIN TEXT:
AGREEMENT FOR COOPERATION BETWEEN
THE GOVERNMENT OF THE UNITED STATES OF AMERICA AND THE
GOVERNMENT OF INDIA
CONCERNING PEACEFUL USES OF NUCLEAR ENERGY (123 AGREEMENT)
The Government of India and the Government of the United States of America, hereinafter referred to as the Parties,
RECOGNIZING the significance of civilian nuclear energy for meeting growing global energy demands in a cleaner and more efficient manner;
DESIRING to cooperate extensively in the full development and use of nuclear energy for peaceful purposes as a means of achieving energy security, on a stable, reliable and predictable basis;
WISHING to develop such cooperation on the basis of mutual respect for sovereignty, non-interference in each other's internal affairs, equality, mutual benefit, reciprocity and with due respect for each other's nuclear programmes;
DESIRING to establish the necessary legal framework and basis for cooperation concerning peaceful uses of nuclear energy;
AFFIRMING that cooperation under this Agreement is between two States possessing advanced nuclear technology, both Parties having the same benefits and advantages, both committed to preventing WMD proliferation;
NOTING the understandings expressed in the India - U.S. Joint Statement of July 18, 2005 to enable full civil nuclear energy cooperation with India covering aspects of the associated nuclear fuel cycle;
AFFIRMING their support for the objectives of the International Atomic Energy Agency (IAEA) and its safeguards system, as applicable to India and the United States of America, and its importance in ensuring that international cooperation in development and use of nuclear energy for peaceful purposes is carried out under arrangements that will not contribute to the proliferation of nuclear weapons or other nuclear explosive devices;
NOTING their respective commitments to safety and security of peaceful uses of nuclear energy, to adequate physical protection of nuclear material and effective national export controls;
MINDFUL that peaceful nuclear activities must be undertaken with a view to protecting the environment;
MINDFUL of their shared commitment to preventing the proliferation of weapons of mass destruction; and
DESIROUS of strengthening the strategic partnership between them;
Have agreed on the following:
ARTICLE 1 - DEFINITIONS
For the purposes of this Agreement:
(A) "By-product material" means any radioactive material (except special fissionable material) yielded in or made radioactive by exposure to the radiation incident to the process of producing or utilizing special fissionable material. By-product material shall not be subject to safeguards or any other form of verification under this Agreement, unless it has been decided otherwise by prior mutual agreement in writing between the two Parties.
(B) "Component" means a component part of equipment, or other item so designated by agreement of the Parties.
(C) "Conversion" means any of the normal operations in the nuclear fuel cycle, preceding fuel fabrication and excluding enrichment, by which uranium is transformed from one chemical form to another - for example, from uranium hexafluoride (UF6) to uranium dioxide (UO2) or from uranium oxide to metal.
(D) "Decommissioning" means the actions taken at the end of a facility's useful life to retire the facility from service in the manner that provides adequate protection for the health and safety of the decommissioning workers and the general public, and for the environment. These actions can range from closing down the facility and a minimal removal of nuclear material coupled with continuing maintenance and surveillance, to a complete removal of residual radioactivity in excess of levels acceptable for unrestricted use of the facility and its site.
(E) "Dual-Use Item" means a nuclear related item which has a technical use in both nuclear and non-nuclear applications.
(F) "Equipment" means any equipment in nuclear operation including reactor, reactor pressure vessel, reactor fuel charging and discharging equipment, reactor control rods, reactor pressure tubes, reactor primary coolant pumps, zirconium tubing, equipment for fuel fabrication and any other item so designated by the Parties.
(G) "High enriched uranium" means uranium enriched to twenty percent or greater in the isotope 235.
(H) "Information" means any information that is not in the public domain and is transferred in any form pursuant to this Agreement and so designated and documented in hard copy or digital form by mutual agreement by the Parties that it shall be subject to this Agreement, but will cease to be information whenever the Party transferring the information or any third party legitimately releases it into the public domain.
(I) "Low enriched uranium" means uranium enriched to less than twenty percent in the isotope 235.
(J) "Major critical component" means any part or group of parts essential to the operation of a sensitive nuclear facility or heavy water production facility.
(K) "Non-nuclear material" means heavy water, or any other material suitable for use in a reactor to slow down high velocity neutrons and increase the likelihood of further fission, as may be jointly designated by the appropriate authorities of the Parties.
(L) "Nuclear material" means (1) source material and (2) special fissionable material. "Source material" means uranium containing the mixture of isotopes occurring in nature; uranium depleted in the isotope 235; thorium; any of the foregoing in the form of metal, alloy, chemical compound, or concentrate; any other material containing one or more of the foregoing in such concentration as the Board of Governors of the IAEA shall from time to time determine; and such other materials as the Board of Governors of the IAEA may determine or as may be agreed by the appropriate authorities of both Parties. "Special fissionable material" means plutonium, uranium-233, uranium enriched in the isotope 233 or 235, any substance containing one or more of the foregoing, and such other substances as the Board of Governors of the IAEA may determine or as may be agreed by the appropriate authorities of both Parties. "Special fissionable material" does not include "source material". Any determination by the Board of Governors of the IAEA under Article XX of that Agency's Statute or otherwise that amends the list of materials considered to be "source material" or "special fissionable material" shall only have effect under this Agreement when both Parties to this Agreement have informed each other in writing that they accept such amendment.
(M) "Peaceful purposes" include the use of information, nuclear material, equipment or components in such fields as research, power generation, medicine, agriculture and industry, but do not include use in, research on, or development of any nuclear explosive device or any other military purpose. Provision of power for a military base drawn from any power network, production of radioisotopes to be used for medical purposes in military environment for diagnostics, therapy and sterility assurance, and other similar purposes as may be mutually agreed by the Parties shall not be regarded as military purpose.
(N) "Person" means any individual or any entity subject to the territorial jurisdiction of either Party but does not include the Parties.
(O) "Reactor" means any apparatus, other than a nuclear weapon or other nuclear explosive device, in which a self-sustaining fission chain reaction is maintained by utilizing uranium, plutonium, or thorium or any combination thereof.
(P) "Sensitive nuclear facility" means any facility designed or used primarily for uranium enrichment, reprocessing of nuclear fuel, or fabrication of nuclear fuel containing plutonium.
(Q) "Sensitive nuclear technology" means any information that is not in the public domain and that is important to the design, construction, fabrication, operation, or maintenance of any sensitive nuclear facility, or other such information that may be so designated by agreement of the Parties.
ARTICLE 2 - SCOPE OF COOPERATION
1. The Parties shall cooperate in the use of nuclear energy for peaceful purposes in accordance with the provisions of this Agreement. Each Party shall implement this Agreement in accordance with its respective applicable treaties, national laws, regulations, and license requirements concerning the use of nuclear energy for peaceful purposes.
2. The purpose of the Agreement being to enable full civil nuclear energy cooperation between the Parties, the Parties may pursue cooperation in all relevant areas to include, but not limited to, the following:
a. Advanced nuclear energy research and development in such areas as may be agreed between the Parties;
b. Nuclear safety matters of mutual interest and competence, as set out in Article 3;
c. Facilitation of exchange of scientists for visits, meetings, symposia and collaborative research;
d. Full civil nuclear cooperation activities covering nuclear reactors and aspects of the associated nuclear fuel cycleincluding technology transfer on an industrial or commercial scale between the Parties or authorized persons;
e. Development of a strategic reserve of nuclear fuel to guard against any disruption of supply over the lifetime of India's reactors;
f. Advanced research and development in nuclear sciences including but not limited to biological research, medicine, agriculture and industry, environment and climate change;
g. Supply between the Parties, whether for use by or for the benefit of the Parties or third countries, of nuclear material;
h. Alteration in form or content of nuclear material as provided for in Article 6;
i. Supply between the Parties of equipment, whether for use by or for the benefit of the Parties or third countries;
j. Controlled thermonuclear fusion including in multilateral projects; and
k. Other areas of mutual interest as may be agreed by the Parties.
3. Transfer of nuclear material, non-nuclear material, equipment, components and information under this Agreement may be undertaken directly between the Parties or through authorized persons. Such transfers shall be subject to this Agreement and to such additional terms and conditions as may be agreed by the Parties. Nuclear material, non-nuclear material, equipment, components and information transferred from the territory of one Party to the territory of the other Party, whether directly or through a third country, will be regarded as having been transferred pursuant to this Agreement only upon confirmation, by the appropriate authority of the recipient Party to the appropriate authority of the supplier Party that such items both will be subject to the Agreement and have been received by the recipient Party.
4. The Parties affirm that the purpose of this Agreement is to provide for peaceful nuclear cooperation and not to affect the unsafeguarded nuclear activities of either Party. Accordingly, nothing in this Agreement shall be interpreted as affecting the rights of the Parties to use for their own purposes nuclear material, non-nuclear material, equipment, components, information or technology produced, acquired or developed by them independent of any nuclear material, non-nuclear material, equipment, components, information or technology transferred to them pursuant to this Agreement. This Agreement shall be implemented in a manner so as not to hinder or otherwise interfere with any other activities involving the use of nuclear material, non-nuclear material, equipment, components, information or technology and military nuclear facilities produced, acquired or developed by them independent of this Agreement for their own purposes.
ARTICLE 3 - TRANSFER OF INFORMATION
1. Information concerning the use of nuclear energy for peaceful purposes may be transferred between the Parties. Transfers of information may be accomplished through reports, data banks and computer programs and any other means mutually agreed to by the Parties. Fields that may be covered include, but shall not be limited to, the following:
a. Research, development, design, construction, operation, maintenance and use of reactors, reactor experiments, and decommissioning;
b. The use of nuclear material in physical, chemical, radiological and biological research, medicine, agriculture and industry;
c. Fuel cycle activities to meet future world-wide civil nuclear energy needs, including multilateral approaches to which they are parties for ensuring nuclear fuel supply and appropriate techniques for management of nuclear wastes;
d. Advanced research and development in nuclear science and technology;
e. Health, safety, and environmental considerations related to the foregoing;
f. Assessments of the role nuclear power may play in national energy plans;
g. Codes, regulations and standards for the nuclear industry;
h. Research on controlled thermonuclear fusion including bilateral activities and contributions toward multilateral projects such as the International Thermonuclear Experimental Reactor (ITER); and
i. Any other field mutually agreed to by the Parties.
2. Cooperation pursuant to this Article may include, but is not limited to, training, exchange of personnel, meetings, exchange of samples, materials and instruments for experimental purposes and a balanced participation in joint studies and projects.
3. This Agreement does not require the transfer of any information regarding matters outside the scope of this Agreement, or information that the Parties are not permitted under their respective treaties, national laws, or regulations to transfer.
4. Restricted Data, as defined by each Party, shall not be transferred under this Agreement.
ARTICLE 4 - NUCLEAR TRADE
1. The Parties shall facilitate nuclear trade between themselves in the mutual interests of their respective industry, utilities and consumers and also, where appropriate, trade between third countries and either Party of items obligated to the other Party. The Parties recognize that reliability of supplies is essential to ensure smooth and uninterrupted operation of nuclear facilities and that industry in both the Parties needs continuing reassurance that deliveries can be made on time in order to plan for the efficient operation of nuclear installations.
2. Authorizations, including export and import licenses as well as authorizations or consents to third parties, relating to trade, industrial operations or nuclear material movement should be consistent with the sound and efficient administration of this Agreement and should not be used to restrict trade. It is further agreed that if the relevant authority of the concerned Party considers that an application cannot be processed within a twomonth period it shall immediately, upon request, provide reasoned information to the submitting Party. In the event of a refusal to authorize an application or a delay exceeding four months from the date of the first application the Party of the submitting persons or undertakings may call for urgent consultations under Article 13 of this Agreement, which shall take place at the earliest opportunity and in any case not later than 30 days after such a request.
ARTICLE 5 - TRANSFER OF NUCLEAR MATERIAL, NON-NUCLEAR MATERIAL, EQUIPMENT, COMPONENTS AND RELATED TECHNOLOGY
1. Nuclear material, non-nuclear material, equipment and components may be transferred for applications consistent with this Agreement. Any special fissionable material transferred under this Agreement shall be low enriched uranium, except as provided in paragraph 5.
2. Sensitive nuclear technology, heavy water production technology, sensitive nuclear facilities, heavy water production facilities and major critical components of such facilities may be transferred under this Agreement pursuant to an amendment to this Agreement. Transfers of dual-use items that could be used in enrichment, reprocessing or heavy water production facilities will be subject to the Parties' respective applicable laws, regulations and license policies.
3. Natural or low enriched uranium may be transferred for use as fuel in reactor experiments and in reactors, for conversion or fabrication, or for such other purposes as may be agreed to by the Parties.
4. The quantity of nuclear material transferred under this Agreement shall be consistent with any of the following purposes: use in reactor experiments or the loading of reactors, the efficient and continuous conduct of such reactor experiments or operation of reactors for their lifetime, use as samples, standards, detectors, and targets, and the accomplishment of other purposes as may be agreed by the Parties.
5. Small quantities of special fissionable material may be transferred for use as samples, standards, detectors, and targets, and for such other purposes as the Parties may agree.
6.
(a) The United States has conveyed its commitment to the reliable supply of fuel to India. Consistent with the July 18, 2005, Joint Statement, the United States has also reaffirmed its assurance to create the necessary conditions for India to have assured and full access to fuel for its reactors. As part of its implementation of the July 18, 2005, Joint Statement the United States is committed to seeking agreement from the U.S. Congress to amend its domestic laws and to work with friends and allies to adjust the practices of the Nuclear Suppliers Group to create the necessary conditions for India to obtain full access to the international fuel market, including reliable, uninterrupted and continual access to fuel supplies from firms in several nations.
(b) To further guard against any disruption of fuel supplies, the United States is prepared to take the following additional steps:
i) The United States is willing to incorporate assurances regarding fuel supply in the bilateral U.S.-India agreement on peaceful uses of nuclear energy under Section 123 of the U.S. Atomic Energy Act, which would be submitted to the U.S. Congress.
ii) The United States will join India in seeking to negotiate with the IAEA an India-specific fuel supply agreement.
iii) The United States will support an Indian effort to develop a strategic reserve of nuclear fuel to guard against any disruption of supply over the lifetime of India's reactors.
iv) If despite these arrangements, a disruption of fuel supplies to India occurs, the United States and India would jointly convene a group of friendly supplier countries to include countries such as Russia, France and the United Kingdom to pursue such measures as would restore fuel supply to India.
(c) In light of the above understandings with the United States, an India-specific safeguards agreement will be negotiated between India and the IAEA providing for safeguards to guard against withdrawal of safeguarded nuclear material from civilian use at any time as well as providing for corrective measures that India may take to ensure uninterrupted operation of its civilian nuclear reactors in the event of disruption of foreign fuel supplies. Taking this into account, India will place its civilian nuclear facilities under India-specific safeguards in perpetuity and negotiate an appropriate safeguards agreement to this end with the IAEA.
ARTICLE 6 - NUCLEAR FUEL CYCLE ACTIVITIES
In keeping with their commitment to full civil nuclear cooperation, both Parties, as they do with other states with advanced nuclear technology, may carry out the following nuclear fuel cycle activities:
i) Within the territorial jurisdiction of either Party, enrichment up to twenty percent in the isotope 235 of uranium transferred pursuant to this Agreement, as well as of uranium used in or produced through the use of equipment so transferred, may be carried out.
ii) Irradiation within the territorial jurisdiction of either Party of plutonium, uranium-233, high enriched uranium and irradiated nuclear material transferred pursuant to this Agreement or used in or produced through the use of non-nuclear material, nuclear material or equipment so transferred may be carried out.
iii) With a view to implementing full civil nuclear cooperation as envisioned in the Joint Statement of the Parties of July 18, 2005, the Parties grant each other consent to reprocess or otherwise alter in form or content nuclear material transferred pursuant to this Agreement and nuclear material and by-product material used in or produced through the use of nuclear material, non-nuclear material, or equipment so transferred. To bring these rights into effect, India will establish a new national reprocessing facility dedicated to reprocessing safeguarded nuclear material under IAEA safeguards and the Parties will agree on arrangements and procedures under which such reprocessing or other alteration in form or content will take place in this new facility. Consultations on arrangements and procedures will begin within six months of a request by either Party and will be concluded within one year. The Parties agree on the application of IAEA safeguards to all facilities concerned with the above activities. These arrangements and procedures shall include provisions with respect to physical protection standards set out in Article 8, storage standards set out in Article 7, and environmental protections set forth in Article 11 of this Agreement, and such other provisions as may be agreed by the Parties. Any special fissionable material that may be separated may only be utilized in national facilities under IAEA safeguards.
iv) Post-irradiation examination involving chemical dissolution or separation of irradiated nuclear material transferred pursuant to this Agreement or irradiated nuclear material used in or produced through the use of non-nuclear material, nuclear material or equipment so transferred may be carried out.
ARTICLE 7 - STORAGE AND RETRANSFERS
1. Plutonium and uranium 233 (except as either may be contained in irradiated fuel elements), and high enriched uranium, transferred pursuant to this Agreement or used in or produced through the use of material or equipment so transferred, may be stored in facilities that are at all times subject, as a minimum, to the levels of physical protection that are set out in IAEA document INFCIRC 225/REV 4 as it may be revised and accepted by the Parties. Each Party shall record such facilities on a list, made available to the other Party. A Party's list shall be held confidential if that Party so requests. Either Party may make changes to its list by notifying the other Party in writing and receiving a written acknowledgement. Such acknowledgement shall be given no later than thirty days after the receipt of the notification and shall be limited to a statement that the notification has been received. If there are grounds to believe that the provisions of this sub-Article are not being fully complied with, immediate consultations may be called for. Following upon such consultations, each Party shall ensure by means of such consultations that necessary remedial measures are taken immediately. Such measures shall be sufficient to restore the levels of physical protection referred to above at the facility in question. However, if the Party on whose territory the nuclear material in question is stored determines that such measures are not feasible, it will shift the nuclear material to another appropriate, listed facility it identifies.
2. Nuclear material, non-nuclear material, equipment, components, and information transferred pursuant to this Agreement and any special fissionable material produced through the use of nuclear material, non-nuclear material or equipment so transferred shall not be transferred or re-transferred to unauthorized persons or, unless the Parties agree, beyond the recipient Party's territorial jurisdiction.
ARTICLE 8 - PHYSICAL PROTECTION
1. Adequate physical protection shall be maintained with respect to nuclear material and equipment transferred pursuant to this Agreement and nuclear material used in or produced through the use of nuclear material, non-nuclear material or equipment so transferred.
2. To fulfill the requirement in paragraph 1, each Party shall apply measures in accordance with (i) levels of physical protection at least equivalent to the recommendations published in IAEA document INFCIRC/225/Rev.4 entitled "The Physical Protection of Nuclear Material and Nuclear Facilities," and in any subsequent revisions of that document agreed to by the Parties, and (ii) the provisions of the 1980 Convention on the Physical Protection of Nuclear Material and any amendments to the Convention that enter into force for both Parties.
3. The Parties will keep each other informed through diplomatic channels of those agencies or authorities having responsibility for ensuring that levels of physical protection for nuclear material in their territory or under their jurisdiction or control are adequately met and having responsibility for coordinating response and recovery operations in the event of unauthorized use or handling of material subject to this Article. The Parties will also keep each other informed through diplomatic channels of the designated points of contact within their national authorities to cooperate on matters of out-of-country transportation and other matters of mutual concern.
4. The provisions of this Article shall be implemented in such a manner as to avoid undue interference in the Parties' peaceful nuclear activities and so as to be consistent with prudent management practices required for the safe and economic conduct of their peaceful nuclear programs.
ARTICLE 9 - PEACEFUL USE
Nuclear material, equipment and components transferred pursuant to this Agreement and nuclear material and by-product materialused in or produced through the use of any nuclear material, equipment, and components so transferred shall not be used by the recipient Party for any nuclear explosive device, for research on or development of any nuclear explosive device or for any military purpose.
ARTICLE 10 - IAEA SAFEGUARDS
1. Safeguards will be maintained with respect to all nuclear materials and equipment transferred pursuant to this Agreement, and with respect to all special fissionable material used in or produced through the use of such nuclear materials and equipment, so long as the material or equipment remains under the jurisdiction or control of the cooperating Party.
2. Taking into account Article 5.6 of this Agreement, India agrees that nuclear material and equipment transferred to India by the United States of America pursuant to this Agreement and any nuclear material used in or produced through the use of nuclear material, non-nuclear material, equipment or components so transferred shall be subject to safeguards in perpetuity in accordance with the India-specific Safeguards Agreement between India and the IAEA [identifying data] and an Additional Protocol, when in force.
3. Nuclear material and equipment transferred to the United States of America pursuant to this Agreement and any nuclear material used in or produced through the use of any nuclear material, non-nuclear material, equipment, or components so transferred shall be subject to the Agreement between the United States of America and the IAEA for the application of safeguards in the United States of America, done at Vienna November 18, 1977, which entered into force on December 9, 1980, and an Additional Protocol, when in force.
4. If the IAEA decides that the application of IAEA safeguards is no longer possible, the supplier and recipient should consult and agree on appropriate verification measures.
5. Each Party shall take such measures as are necessary to maintain and facilitate the application of IAEA safeguards in its respective territory provided for under this Article.
6. Each Party shall establish and maintain a system of accounting for and control of nuclear material transferred pursuant to this Agreement and nuclear material used in or produced through the use of any material, equipment, or components so transferred. The procedures applicable to India shall be those set forth in the India-specific Safeguards Agreement referred to in Paragraph 2 of this Article.
7. Upon the request of either Party, the other Party shall report or permit the IAEA to report to the requesting Party on the status of all inventories of material subject to this Agreement.
8. The provisions of this Article shall be implemented in such a manner as to avoid hampering, delay, or undue interference in the Parties' peaceful nuclear activities and so as to be consistent with prudent management practices required for the safe and economic conduct of their peaceful nuclear programs.
ARTICLE 11 - ENVIRONMENTAL PROTECTION
The Parties shall cooperate in following the best practices for minimizing the impact on the environment from any radioactive, chemical or thermal contamination arising from peaceful nuclear activities under this Agreement and in related matters of health and safety.
ARTICLE 12 - IMPLEMENTATION OF THE AGREEMENT
1. This Agreement shall be implemented in a manner designed:
a) to avoid hampering or delaying the nuclear activities in the territory of either Party;
b) to avoid interference in such activities;
c) to be consistent with prudent management practices required for the safe conduct of such activities; and
d) to take full account of the long term requirements of the nuclear energy programs of the Parties.
2. The provisions of this Agreement shall not be used to:
a) secure unfair commercial or industrial advantages or to restrict trade to the disadvantage of persons and undertakings of either Party or hamper their commercial or industrial interests, whether international or domestic;
b) interfere with the nuclear policy or programs for the promotion of the peaceful uses of nuclear energy including research and development; or
c) impede the free movement of nuclear material, non nuclear material and equipment supplied under this Agreement within the territory of the Parties.
3. When execution of an agreement or contract pursuant to this Agreement between Indian and United States organizations requires exchanges of experts, the Parties shall facilitate entry of the experts to their territories and their stay therein consistent with national laws, regulations and practices. When other cooperation pursuant to this Agreement requires visits of experts, the Parties shall facilitate entry of the experts to their territory and their stay therein consistent with national laws, regulations and practices.
ARTICLE 13 - CONSULTATIONS
1. The Parties undertake to consult at the request of either Party regarding the implementation of this Agreement and the development of further cooperation in the field of peaceful uses of nuclear energy on a stable, reliable and predictable basis. The Parties recognize that such consultations are between two States with advanced nuclear technology, which have agreed to assume the same responsibilities and practices and acquire the same benefits and advantages as other leading countries with advanced nuclear technology.
2. Each Party shall endeavor to avoid taking any action that adversely affects cooperation envisaged under Article 2 of this Agreement. If either Party at any time following the entry into force of this Agreement does not comply with the provisions of this Agreement, the Parties shall promptly hold consultations with a view to resolving the matter in a way that protects the legitimate interests of both Parties, it being understood that rights of either Party under Article 16.2 remain unaffected.
3. Consultations under this Article may be carried out by a Joint Committee specifically established for this purpose. A Joint Technical Working Group reporting to the Joint Committee will be set up to ensure the fulfillment of the requirements of the Administrative Arrangements referred to in Article 17.
ARTICLE 14 - TERMINATION AND CESSATION OF COOPERATION
1. Either Party shall have the right to terminate this Agreement prior to its expiration on one year's written notice to the other Party. A Party giving notice of termination shall provide the reasons for seeking such termination. The Agreement shall terminate one year from the date of the written notice, unless the notice has been withdrawn by the providing Party in writing prior to the date of termination.
2. Before this Agreement is terminated pursuant to paragraph 1 of this Article, the Parties shall consider the relevant circumstances and promptly hold consultations, as provided in Article 13, to address the reasons cited by the Party seeking termination. The Party seeking termination has the right to cease further cooperation under this Agreement if it determines that a mutually acceptable resolution of outstanding issues has not been possible or cannot be achieved through consultations. The Parties agree to consider carefully the circumstances that may lead to termination or cessation of cooperation. They further agree to take into account whether the circumstances that may lead to termination or cessation resulted from a Party's serious concern about a changed security environment or as a response to similar actions by other States which could impact national security.
3. If a Party seeking termination cites a violation of this Agreement as the reason for notice for seeking termination, the Parties shall consider whether the action was caused inadvertently or otherwise and whether the violation could be considered as material. No violation may be considered as being material unless corresponding to the definition of material violation or breach in the Vienna Convention on the Law of Treaties. If a Party seeking termination cites a violation of an IAEA safeguards agreement as the reason for notice for seeking termination, a crucial factor will be whether the IAEA Board of Governors has made a finding of non-compliance.

4. Following the cessation of cooperation under this Agreement, either Party shall have the right to require the return by the other Party of any nuclear material, equipment, non-nuclear material or components transferred under this Agreement and any special fissionable material produced through their use. A notice by a Party that is invoking the right of return shall be delivered to the other Party on or before the date of termination of this Agreement. The notice shall contain a statement of the items subject to this Agreement as to which the Party is requesting return. Except as provided in provisions of Article 16.3, all other legal obligations pertaining to this Agreement shall cease to apply with respect to the nuclear items remaining on the territory of the Party concerned upon termination of this Agreement.
5. The two Parties recognize that exercising the right of return would have profound implications for their relations. If either Party seeks to exercise its right pursuant to paragraph 4 of this Article, it shall, prior to the removal from the territory or from the control of the other Party of any nuclear items mentioned in paragraph 4, undertake consultations with the other Party. Such consultations shall give special consideration to the importance of uninterrupted operation of nuclear reactors of the Party concerned with respect to the availability of nuclear energy for peaceful purposes as a means of achieving energy security. Both Parties shall take into account the potential negative consequences of such termination on the on-going contracts and projects initiated under this Agreement of significance for the respective nuclear programmes of either Party.
6. If either Party exercises its right of return pursuant to paragraph 4 of this Article, it shall, prior to the removal from the territory or from the control of the other Party, compensate promptly that Party for the fair market value thereof and for the costs incurred as a consequence of such removal. If the return of nuclear items is required, the Parties shall agree on methods and arrangements for the return of the items, the relevant quantity of the items to be returned, and the amount of compensation that would have to be paid by the Party exercising the right to the other Party.
7. Prior to return of nuclear items, the Parties shall satisfy themselves that full safety, radiological and physical protection measures have been ensured in accordance with their existing national regulations and that the transfers pose no unreasonable risk to either Party, countries through which the nuclear items may transit and to the global environment and are in accordance with existing international regulations.
8. The Party seeking the return of nuclear items shall ensure that the timing, methods and arrangements for return of nuclear items are in accordance with paragraphs 5, 6 and 7. Accordingly, the consultations between the Parties shall address mutual commitments as contained in Article 5.6. It is not the purpose of the provisions of this Article regarding cessation of cooperation and right of return to derogate from the rights of the Parties under Article 5.6.
9. The arrangements and procedures concluded pursuant to Article 6(iii) shall be subject to suspension by either Party in exceptional circumstances, as defined by the Parties, after consultations have been held between the Parties aimed at reaching mutually acceptable resolution of outstanding issues, while taking into account the effects of such suspension on other aspects of cooperation under this Agreement.
ARTICLE 15 - SETTLEMENT OF DISPUTES
Any dispute concerning the interpretation or implementation of the provisions of this Agreement shall be promptly negotiated by the Parties with a view to resolving that dispute.
ARTICLE 16 - ENTRY INTO FORCE AND DURATION
1. This Agreement shall enter into force on the date on which the Parties exchange diplomatic notes informing each other that they have completed all applicable requirements for its entry into force.
2. This Agreement shall remain in force for a period of40 years. It shall continue in force thereafter for additional periods of 10 years each. Each Party may, by giving 6 months written notice to the other Party, terminate this Agreement at the end of the initial 40 year period or at the end of any subsequent 10 year period.
3. Notwithstanding the termination or expiration of this Agreement or withdrawal of a Party from this Agreement, Articles 5.6(c), 6, 7, 8, 9, 10 and 15 shall continue in effect so long as any nuclear material, non-nuclear material, by-product material, equipment or components subject to these articles remains in the territory of the Party concerned or under its jurisdiction or control anywhere, or until such time as the Parties agree that such nuclear material is no longer usable for any nuclear activity relevant from the point of view of safeguards.
4. This Agreement shall be implemented in good faith and in accordance with the principles of international law.
5. The Parties may consult, at the request of either Party, on possible amendments to this Agreement. This Agreement may be amended if the Parties so agree. Any amendment shall enter into force on the date on which the Parties exchange diplomatic notes informing each other that their respective internal legal procedures necessary for the entry into force have been completed.
ARTICLE 17 - ADMINISTRATIVE ARRANGEMENT
1. The appropriate authorities of the Parties shall establish an Administrative Arrangement in order to provide for the effective implementation of the provisions of this Agreement.
2. The principles of fungibility and equivalence shall apply to nuclear material and non-nuclear material subject to this Agreement. Detailed provisions for applying these principles shall be set forth in the Administrative Arrangement.
3. The Administrative Arrangement established pursuant to this Article may be amended by agreement of the appropriate authorities of the Parties.
IN WITNESS WHEREOF the undersigned, being duly authorized, have signed this Agreement.
DONE at , this day of , 200 , in duplicate.
FOR THE GOVERNMENT OF THE
UNITED STATES OF AMERICA:
FOR THE GOVERNMENT
OF INDIA:
AGREED MINUTE
During the negotiation of the Agreement for Cooperation Between the Government of the United States of America and the Government of India Concerning Peaceful Uses of Nuclear Energy ("the Agreement") signed today, the following understandings, which shall be an integral part of the Agreement, were reached.
Proportionality
For the purposes of implementing the rights specified in Articles 6 and 7 of the Agreement with respect to special fissionable material and by-product material produced through the use of nuclear material and non-nuclear material, respectively, transferred pursuant to the Agreement and not used in or produced through the use of equipment transferred pursuant to the Agreement, such rights shall in practice be applied to that proportion of special fissionable material and by-product material produced that represents the ratio of transferred nuclear material and non-nuclear material, respectively, used in the production of the special fissionable material and by-product material to the total amount of nuclear material and non-nuclear material so used, and similarly for subsequent generations.
By-product material
The Parties agree that reporting and exchanges of information on by-product material subject to the Agreement will be limited to the following:
(1) Both Parties would comply with the provisions as contained in the IAEA document GOV/1999/19/Rev.2, with regard to by-product material subject to the Agreement.
(2) With regard to tritium subject to the Agreement, the Parties will exchange annually information pertaining to its disposition for peaceful purposes consistent with Article 9 of this Agreement.
FOR THE GOVERNMENT OF THE
UNITED STATES OF AMERICA:
FOR THE GOVERNMENT
OF INDIA:
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NEW DELHI: In the midst of the largest financial crisis in recent times, India and the US triumphantly signed the 123 agreement ending India’s nu

clear isolation and capping the three-year dramatic journey of the nuclear deal.

With promises of more to come in the bilateral relationship, external affairs minister Pranab Mukherjee and US secretary of state Condoleezza Rice inked the agreement at a ceremony at the Benjamin Franklin Room of the State Department in Washington with a mention of the domestic difficulties faced by both Prime Minister Manmohan Singh and US President George W. Bush in the last three years.

“Prime Minister Singh literally risked his political future for this agreement and then remade his government to gain the support that he needed,” said Ms Rice after the signing.

With an eye on the domestic constituency, Mr Mukherjee also made it a point to clarify that the 123 agreement was “legally binding” on both India and the US and that it “reflects a careful balance of rights and obligations”.

“Its provisions are now legally binding on both sides once the agreement enters into force,” said he said at the signing. He further elaborated on the point. “We intend to implement this agreement in good faith and in accordance with the principles of international law and I am confident that the US will also do the same,” he said, adding that India and the US trusted each other.

His statements were an attempt to clear the confusion created by Mr Bush’s letter to the US Congress that said the provisions in the 123 agreement were “political commitments” and not “legally binding.” However, the US side remained silent on the issue. With the deal now sealed, signed and delivered, the two sides did not hesitate in having the last word. “Many thought this day would never come. But doubts have been silenced now,” said Ms Rice who described the 123 agreement as "unprecedented".

This deal, which is the centrepiece of India-US ties, is also expected to rejuvenate India-US ties in other sectors also. Ms Rice called the deal “a diplomatic triumph for both our nations” and said that the agreement would lead to “a new and far broader world of potential for our strategic partnership in the 21st century, not just on nuclear cooperation but on every area of national endeavour.”

But the journey has been full of twists and turns. Even the last steps of the deal were dogged with drama. Ms Rice was unable to sign the agreement last Saturday as Indian negotiators wanted further assurances from Mr Bush on key provision in the agreement. In the subsequent signing statement Mr Bush reiterated fuel supply assurances and gave India the advance consent to reprocess fuel. Even though this was not enough to silence domestic critics, the Indian establishment was satisfied with the assurances.

The deal will now allow US companies, which have already started negotiations with NPCIl, to sell nuclear technology and fuel to India after a gap of over three decades. “We look forward to working with the US companies on the commercial steps that will follow to implement this landmark agreement,” said Mr Mukherjee.

With the NSG approval already in the bag and now the 123 deal, there is now nothing holding India back from sourcing fuel and technology from the international nuclear market. A few formalities still remain including the formalisation of the IAEA safeguards agreement and the negotiation of the additional protocol with the IAEA.

Mr Mukherjee, who thanked Mr Bush, Ms Rice, the US Congress and the Indian American community for the nuclear deal, said “By reinforcing and including the nuclear element in our country's energy needs, which is so vital to sustain our growth rate, nuclear power will directly boost industrial growth, rural development, and help us to expand every vital sector of our economy.”

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A brief note on a few concerns with the 123 Agreement Prachi Shrivastava
The Indo-US nuclear agreement announced on July 18, 2005 by President George Bush and Prime Minister Manmohan Singh regarding the establishment of a U.S.-India global partnership could dramatically increase nuclear and nuclear-related commerce with India. In Indias interpretation of the text of the agreement[1], it expects to be treated like a Nuclear Weapons State (NWS) with regard to assuming responsibilities and obligations under international non-proliferation regimes, namely, International Atomic Energy Agency (IAEA) nuclear full-scope safeguards (FSS), and the Guidelines of the 45-member Nuclear Suppliers Group (NSG) for nuclear trade.[2] Thus India will come to enjoy a unique status, shared only by Israel and Pakistan: a nuclear weapons state that is a non-NNPT signatory. Every other non-nuclear weapons state that is a signatory to the Nuclear Non Proliferation Treaty (NNPT), including Iran, must abide strictly by the terms of the document of structure and content of agreements between the agency and states required in connection with the treaty on the non-proliferation of nuclear weapons[3]. The deal treats India for what it is, i.e. a de facto NWS.
But for the agreement to materialize, what is required to be bartered is, an Indian commitment to
1. Separate its civil and military nuclear programs and put declared civil facilities under international safeguards.
2. Enter into an IAEA safeguards agreement in perpetuity and an IAEA Additional Protocol.
3. Never test nuclear weapons again.
The Safeguards System
IAEA board of Governors has proposed to India, a safeguards agreement based on The Agencys Safeguards System (1965, as Provisionally Extended in 1966 and 1968)[4], which is a revised system with further additional provisions for safeguarded nuclear material in conversion plants and fabrication plants.
The principal purpose of this system of controls is to enable the Agency to comply with the statutory obligations under Article 2 of the IAEA statute, with respect to the activities of Member States in the field of the peaceful uses of nuclear energy, as provided in the Statute. The said statutory obligation refers to the task of the Agency of seeking to accelerate and enlarge the contribution of atomic energy to peace, health and prosperity throughout the world. Since the technology of nuclear energy for peaceful purposes is closely linked with that for the production of materials for nuclear weapons, the same article of the Statute provides that the Agency shall ensure, as far as it can, that assistance provided by it or at its request or under its supervision or control is not used in such a way as to further any military purpose. Safeguarded nuclear material should not co-mingle with unsafeguarded nuclear material in any facility, unless this unsafeguarded nuclear material also comes under safeguards. This latter condition is an example of contamination, a key principle of safeguards. Although these conditions do not appear to have been accepted by India, they are necessary to prevent civil nuclear cooperation from benefiting Indias nuclear weapons program[5].
Article 5 of the Statute authorizes the Agency to apply safeguards, at the request of the parties, to any bilateral or multilateral arrangement in the field of atomic energy. Provisions of the statute that are relevant to a particular project, arrangement or activity in the field of nuclear energy will only become legally binding upon the entry into force of a safeguards agreement and to the extent that they are incorporated therein.[6]
While the IAEA applies safeguards to select facilities in the USA, Russia and China, France and the United Kingdom have separated their civilian and military programs, applying Euratom/IAEA safeguards to all civilian programs. This is the precedent that comes closest to the deal with India. Safeguards on all civilian facilities have the additional advantage of facilitating Indian participation in an international cut-off agreement.[7]
In the Indian debate, some participants criticize the deal on national security grounds, arguing that it will constrain the weapons programme and, specifically, that the fast breeder reactor at Kalpakkam must be placed on the military side of the separation line[8]. It is unsafeguarded and lends itself to production of fissile materials, but has hardly been used for weapons purposes so far. Several former heads of Indias nuclear industry have suggested that IAEA safeguards should only be applied to facilities that receive nuclear assistance from abroad.[9] However, India''s nuclear record is far from perfect. Indias history of using a civilian nuclear facility for the 1974 Pokharan test places a question mark over whether India can be trusted with such assistance. The only way this trust can be guaranteed is for the US and the international community to insist on broad and robust IAEA safeguards.
Agreement in-perpetuity
The IAEA policy with regard to perpetuity is that the primary effect of termination of the agreement, either by act of the parties or affluxion of time, would be that no further supplied nuclear material, equipment, facilities or non-nuclear material could be added to the inventory. On the other hand, the rights and obligations of the parties, as provided for in the agreement, would continue to apply in connection with any supplied material or items and with any special fissionable material produced, processed or used in or in connection with any supplied material or items which had been included in the inventory, until such material or items had been removed from the inventory.[10]Safeguards should apply in perpetuity, with minor, standard exceptions that do not include use in nuclear explosives or weapons. India cannot negotiate a provision for removing a facility from safeguards that is, moving from civilian to military category under a national security clause. Under the Regime, withdrawal of safeguarded material to an unsafeguarded or military facility will not be permitted even after a notice period for national security reasons.
However, India has bargained for the freedom of designation of its own nuclear facilities as civilian or military, including the freedom to shift these facilities from one category to another, in line with National security considerations. It will hear of no discrimination between India and other NWSs. Nuclear weapon states, including the US, have the right to shift facilities from civilian category to military and there is no reason why this should not apply to India.
IAEA Additional Protocol
An analysis of Baghdads success in circumventing IAEA safeguards showed that Iraq had exploited the agency''s system of confining its inspection and accounting activities to facilities or materials explicitly declared in a countrys safeguards agreement with the agency. To close the undeclared facilities loophole, the IAEA drafted a safeguards improvement program known as Program 93+2. The program has subsequently been implemented in two parts.
The second part of Program 93+2, which substantially expands the scope of the IAEAs safeguards regime, required a formal expansion of the agencys legal mandate in the form of an additional protocol[11] to be adopted by member states to supplement their existing safeguards agreement with the IAEA.
The essence of the additional protocol is to reshape the IAEAs safeguards regime from a quantitative system focused on accounting for known quantities of materials and monitoring declared activities to a qualitative system gathering a comprehensive picture of a states nuclear and nuclear-related activities, including nuclear-related imports and exports. The additional protocol also substantially expands IAEA''s ability to check for clandestine nuclear facilities by providing the agency with authority to visit any facility -declared or not - to investigate questions or inconsistencies in a states nuclear declarations.
India agreed to apply an additional safeguards protocol (AP) to its civilian facilities. This is welcome from the point of view of making such protocols an integral part of new, enhanced international safeguards standard. However, the Model AP was adopted in order to better detect undeclared activities in NPT member states, so the value of this undertaking is limited. Since India would have undeclared nuclear weapons programmes, and since the AP is meant to uncover undeclared programmes, it would have limited utility in the Indian context, just as it is in the NWSs. So India should, one would imagine, be able to negotiate a reasonably acceptable AP.
Never Testing Nuclear-Weapons Again
It is clear from the sequence of events that the Nuclear Suppliers Group wishes to see India firmly fixed in a system of commitment in perpetuity with IAEA by initialing and then unleash their own conditions for making changes in their guidelines. In all probability, the NSG will prominently demand no testing by India in future as a precondition. There could be other conditions as well. To forestall these dangers, India while finalizing the safeguards agreement with IAEA should proactively avoid getting into a trap by insisting on clear unambiguous language.
Some Indian concerns
Separation seems to be a feasible proposition but Indias strategic needs have to be clear in quantitative terms.
We are looking at a scenario where even those facilities wholly designed and built by India and the R&D institutions as listed in the separation plan which were hitherto outside the scope of safeguards, as well as all the future civil facilities which will grow substantially in numbers, will be included in the safeguards agreement compulsorily with all the implications. The separation plan document, which states that the facilities which are to come under civil list will be decided solely by India, is a paper tiger.
Properly negotiated INFCIRC/66-type safeguards agreements and the AP can be arrived at without compromising on strategic programmes and national security.
The AP is a document, which cannot be taken lightly as it will include all the intrusive provisions of safeguards inspections. There is a possibility this could be under wraps or deferred to avoid immediate stalemate. This needs to be gone into in detail before taking any decision to go forward.
India is more likely to be treated by the IAEA like an NWS
Though technically not an NWS, and a Voluntary Offer Agreement may not be acceptable, but it is likely to be treated so because of the accepted fact of Indias weapons programme and undeclared military facilities. So, the IAEA is likely to apply safeguards selectively so as not to unduly burden its scarce funds and skilled human resource. Even though there is a small budgetary increase, the IAEA expects that individual states would contribute to meeting the expenses towards implementing the respective APs. In Indias case, it would be a major jump the standard safeguards plus the AP on Indias declared civilian facilities. If India has to meet part of this expenditure at least by increasing its contribution to the IAEA, this is also a factor that needs to be taken into account.
Wary of the Hyde Act
The 123 Agreement is bereft of an arbitration clause. This concern is relevant because in the 123 Agreement, India has initialed a blank cheque by agreeing to abide by the US national laws without any qualification by which it gets exposed to any future damaging changes in law. What will hang in air is the fate of safeguards agreement when the cooperation agreement gets abrogated or terminated for any reason enumerated in the Hyde Act or any changes, revisions or new Acts passed by the US in future as it happened in the case of the Tarapur agreement when the 1963 Indo-US bilateral agreement was unilaterally dumped by the US when a new nuclear non-proliferation system (NNPA) was promulgated in 1978 in the aftermath of the 1974 nuclear test by India.
The 123 Agreement provides India with generous opportunities to hold bilateral consultations to resolve disputes with no leverage, leaving the ultimate decision to US to be taken as per their national laws. Unfortunately, India does not have laws to match the one like the Hyde Act, which surely will dominate the operation of the agreement from behind with 123 staying in front.
(The author is a student of Amity Law School, New Delhi.)


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India will be allowed to reprocess US-origin used nuclear fuel under the terms of the 123 Agreement text it has negotiated with the USA, the full text of which has been released.

Under the agreement India will be able to develop a strategic reserve of nuclear fuel to guard against any disruption of supply over the lifetime of its nuclear power reactors. It will also be able to reprocess US-origin nuclear fuel at a special facility under International Atomic Energy Agency (IAEA) safeguards.

This would make India the third region unrestricted in that respect by US lawmakers - after the European Union and Japan - and the first to host such a facility under such international safeguards arrangements.

Indian negotiators had insisted on reprocessing, which had been central in their plans for nuclear energy development until now, albeit with non-US fuel. Reprocessing liberates unused fissile uranium and produced plutonium from used nuclear fuel to be recycled into fresh fuel. This is a sensitive technology because the separated plutonium could be used to fuel nuclear weapons.

Mohamed ElBaradei, director general of the IAEA said: "By bringing multinational control to any operation that enriches uranium or separates plutonium, we can lower the risk of these materials being diverted to weapons."

The other stumbling block in negotiations was language agreed in the US in December 2006 that would see the entire deal scrapped if India tested a new nuclear weapon. Many Indian leaders were unhappy with this and said it infringed on Indian sovereignty. However, the Indian cabinet has approved the renegotiated text and will shortly put it before parliament as a whole. Foreign minister Pranab Makherjee said that "all concerns of India have been reflected and have been adequately addressed," but US politicians have warned that their approval could be difficult to gain if too many concessions have been made to India on this matter.

The text of the agreement was made public on 3 August, but most of the details had already been disclosed by US and Indian officials. The agreement does not specify what would happen should India conduct a new nuclear weapons test. However, its states that should the nuclear fuel supply from the USA be cut for any reason - possibly because of an Indian test - Washington would help find third countries to supply alternative nuclear fuel. The agreement will initially remain in force for 40 years, but can be renewed for subsequent ten-year periods. The agreement also provides for the termination of nuclear cooperation between India and the USA with one-year notice period.

The process to find a way for the two countries to cooperate in nuclear energy has been progressing slowly since a July 2005 meeting between President George Bush and prime minister Manmohan Singh. So far India has split its large nuclear industry into a civil sector and a military one, which includes some power-producing reactors, and agreed to IAEA safeguards and inspections in its civil sector much like those non-nuclear weapons states agree to under the Nuclear non-Proliferation Treaty (NPT). The details of this oversight regime remain to be agreed with the IAEA, but ElBaradei said: the US-India agreement "is a creative break with the past."

The USA sought to bring India into the mainstream of the global nuclear industry, which it has been largely excluded from since refusing to sign the NPT. As a non-signatory, India was subsequently excluded arrangements made by the Nuclear Suppliers Group (NSG) and forced to develop nuclear energy alone.

The objectives of the NPT and NSG were to stop nuclear materials and technology passing between civil and military programs. With respect to those aims, India's behaviour is generally deemed to have been excellent: While generating nuclear electricity it has also developed and maintained its own weapons systems, but, crucially, has not passed on any technologies to other countries. The NSG is expected to rethink its guidelines if US-India nuclear trade becomes a fact.