By Air Marshal Dhiraj Kukreja
30 Jun , 2016
The date of 24 June 2016 will remain in one’s memory for quite some time. It was on this day that the results of many a diplomatic campaign were announced, to the disappointment of a few, jubilations of others, and a continued silence or a “I told you so” attitude of some.
24 June 2016 is a date that will be well remembered in the history of Indian foreign relations. Whatever happened on this day, India has not to lose hope…
Indian diplomacy supposedly took a beating when its application for membership for the Nuclear Suppliers Group (NSG) was denied on 24 June at the plenary session of the ‘exclusive club’, held at Seoul. Brexit is the informal name given to the referendum held in Britain for its exit from the European Union (EU). The referendum held on the previous day had the results announced on 24 June that a majority in Britain wished to exit from the EU, to the distress of many, not just in Britain, but in the EU and the world as well. The Shanghai Cooperation Organisation (SCO) a small group of Asian nations held its meeting on 23-24 June at Tashkent, where the membership of India was approved. While the membership is important for India, this particular meeting was important, for it was here, on the sidelines of the Conference, that Prime Minister Modi met President Xi Jinping of China to lobby for its membership of the NSG.
NSG
As is well known, Uranium is the main fuel for nuclear reactors; due to this, trading for Uranium is not free as for other minerals. A voluntary group, called the Nuclear Suppliers Group, follows certain guidelines, not just for sharing the technology of building nuclear reactors, but for the supply of Uranium as well. The policies are determined mainly by the developed countries, leading to a feeling of deprivation amongst the developing nations, of a natural energy source that could help them meet their growing energy requirements. Immediately after WW II, along with the fear of proliferation of nuclear weapons, a commercial interest in nuclear energy was also growing on a parallel path. Reportedly, the US government, under pressure from its industry, started an ‘Atom for Peace’ programme, which then led to the Atomic Energy Act of 1954, providing the US industries greater access to the controlled nuclear technology, available with the government.
The NSG is a group that works on consensus. Even in 2008, China had raised objections against granting any waiver to India, but succumbed to pressure and the fear of being isolated.
Following the promulgation of the Act, a conference under the aegis of the UN and presided over by none other than, Dr Homi Bhabha, the ‘father of the Indian nuclear programme’, discussed the peaceful uses of the atom. Under this programme, the US government acceded to India’s request for heavy water for a reactor, supplied by Canada, with a rider that it would be for peaceful uses only. While other nations too gained access to technology for reactors, under this programme, with similar restrictions, countries like UK, France, and China, continued their tests for nuclear bombs! It was after the French test in 1961, that an Irish resolution for an international agreement to desist from transfer or acquisition of nuclear weapons, was unanimously passed in the UN. The negotiations began in 1965, and a clause was inserted that only those nations that had tested and exploded a nuclear device, prior to 01 January 1967, would be considered as nuclear weapons countries; China was included, but India was not, since its first device was exploded only in 1974. India, and many other nations, was not a signatory to this treaty, which is also known as the Non-Proliferation Treaty (NPT), since signing an agreement against further tests, without the complete disarming of the nuclear states, was considered unfair.
The defeat against China in 1962 was the trigger for India to conduct its nuclear tests as deterrence against any further aggression by China. Dr Bhabha aggressively lobbied with the political leadership of the country for India to conduct a nuclear test; though he died in an air crash in 1966, his successors, Dr Ramanna and Dr Sethna, vigorously continued with the programme leading to India’s first underground nuclear test at Pokharan, in Rajasthan, on 18 May 1974.
This nuclear test raised an international uproar, and initiated prolonged sanctions against India. It also was the trigger for the formation of the NSG, as it was seen as the first instance when material, meant for a civilian nuclear programme, was diverted towards the making of a bomb. What is interesting to know is that this was, however, not the first instance where a nuclear power had with intent or by chance, helped a non-nuclear power to make the bomb; there is reason to believe that UK was assisted by USA, the erstwhile USSR had helped China, and France helped Israel in their quest for a nuclear weapon. India, too, had termed its test, not as one for a weapon, but for peaceful use in mining and earth-moving operations! The Indian programme slowed down due to the sanctions, but continued, with the second test conducted in 1998, and acknowledged as a nuclear weapon test. Pakistan followed suit and a few months later conducted its nuclear test. The UN Security Council (UNSC) offered both nations to become state-parties to the NPT, but as non-nuclear weapons states, a condition unacceptable to India, and continuing to be the sole cause for it being a non-NPT state.
The inability to secure the membership, therefore, should not be taken as a diplomatic failure; instead, it is just a setback, which could be overcome in the next plenary of the NSG.
What happened at Seoul during the plenary session of the 48-member NSG has its beginnings in 2008, may be even earlier. India’s travels in the ‘nuclear group’, from being an untouchable to garnering a majority support for its membership drive, is the sustained quiet, and at times not so quiet, diplomacy from the times of Vajpayee, to Manmohan Singh. In 2008, India was granted a waiver by the NSG to partake in nuclear commerce, despite being a non-NPT nation. This led to the Civil Nuclear Agreement with USA and was followed by the many arrangements with other nations for the supply of fuel for its reactors. After the waiver, the next step was to gain entry into four exclusive high-technology-export groups: the NSG, the Missile Technology Control Regime (MTCR), the Wassenaar Arrangement (not to be confused for ‘Agreement’) covering the export of conventional arms and dual-use technology, and the Australia Group that aims to curb the spread of chemical and biological weapons. Of these, membership to the NSG was a priority.
The NSG is a group that works on consensus. Even in 2008, China had raised objections against granting any waiver to India, but succumbed to pressure and the fear of being isolated. The waiver, in theory, can be revoked in totality, or terms changed. If India is a part of the NSG, even as it stands as a non-NPT nation, the membership would give it the powers to veto any change that could harm it; hence, the urgency. Another cause for submitting its application for the membership in May 2016, is that the presidency of USA will soon change and the new president may not be as sympathetic towards India, as the present incumbent. Further delays would also push India too close to its own election year of 2019!
China’s persistence in objecting to even discuss India at the plenary, is primarily procedural, since India is not a signatory to the NPT. The inability to secure the membership, therefore, should not be taken as a diplomatic failure; instead, it is just a setback, which could be overcome in the next plenary of the NSG. At Seoul, China raised process concerns, but the fact that India’s membership was not even on the agenda finalised in Vienna in April, and yet was discussed in Seoul, is in itself a diplomatic gain. India should continue, with quiet diplomacy, on its efforts to highlight its demonstrated commitment to non-proliferation, which makes it stand out from other non-NPT states, as Pakistan. China’s doggedness to follow international rules, gives India and other nations to pin it down on issues like China’s reluctance to follow the UN Convention on the Law of the Sea (UNCLOS) in its regional disputes in the South China Sea. China’s unstated worry could be that with the membership, India will have access to high-end technology; it is also envious that India has gained membership to the MTCR, of which China is not (announced on 27 June 2016).
If the Brexit triggers a recession in EU, in all probability the price of oil would fall, as the demand in the second largest oil market would reduce.
Brexit
The European Coal and Steel Community (ECSC) started out in 1952 with the signing of a treaty in Paris, with six members – Belgium, France, Italy, Luxembourg, Netherlands, West Germany – four languages, 177m people, and $1.6 trillion in output (2014 estimates from The Economist 18 June 2016). The EU traces its origins from the ECSC and the European Economic Community (EEC), the latter having been formed in 1958. Today the EU has 28 members – with some potential candidates, which could take the number higher – 24 languages, 505m people, and a GDP of $19 trillion.
The EU project had been steadily moving into a state of disrepair for years with discontent brewing, not just in Britain, but in some other nations too, giving rise to extreme-right wing politics and xenophobia. A long period of economic stagnation, coupled with the failure to address the issues of Spanish and Greek debt crisis, with the present influx of Arab refugees, has rattled all member states, especially Britain. The result of Brexit, however, has shocked many of the ardent supporters of EU to face the harsh reality that the Union, which once heralded a post-war healing process and new dawn of progress in Europe, is now gasping for survival.
Great Britain joined the EU in 1973, along with Denmark and Ireland. Not all nations are members of all EU associations; Britain has opted out of the maximum than any other country – from the Schengan passport-free zone, the common currency, and the most of EU justice and home affairs policies – to retain its identity and ‘independence’ (there are nine nations that do not have Euro as currency). It has been continuously resisting attempts to set up new euro-zone institutions or to give legal status to meetings of euro finance ministers or heads of government. However, in February this year, David Cameron, the British PM, agreed not to block future treaty changes that the euro-zone nations may wish to make for a single currency; in return, Britain demanded two concessions.
…if Britain would no longer be a part of EU, then companies may have to rethink their business strategies.
The first, a formal recognition that the goal of an ever-closer union would not apply to every country; the second, a legal mechanism to allow nations that are out of the euro-zone to challenge decisions of the euro group that may be contrary to their interests. Charles Grant of the Centre for European Reform, a think-tank in London, considers these concessions as crucial, for they now permit the member states to economically progress at their own speeds and towards different destinations, from those conceived in the original charter. The original charter of the EU was that all members should move at the same speed towards the goal of “an ever-closer union”; this, however, was not happening as the EU took in new members and the reality set in that not all can move as swiftly as others can, and were being held back by the laggards.
What does Brexit mean for the world? This question would require another essay and hence, is not being covered in its entirety; nonetheless, some important nations would be discussed. As can be already seen, Britain is being sucked into a political upheaval. David Cameron announced his resignation to move out by October; would this mean a smooth transition, or a fresh election. The successor would then commence negotiations with the EU to finalise the terms for the exit, but as per the recent statements emanating from France, the EU does not seem to be in a mood to wait that long. In the meanwhile, Scotland has commenced talking for a second referendum for its independence from UK; will Northern Ireland follow?
If the Brexit triggers a recession in EU, in all probability the price of oil would fall, as the demand in the second largest oil market would reduce. The decline in the oil price could lead to a reduction in the oil production by OPEC, to cater for the demand and price; this in turn may have a ripple effect on the growing economies of India and China. A recession in Europe could also have significant effects in the ASEAN, as some of the members have a substantial trade exposure in the EU and British markets.
A nationalistic Britain that would emerge with Brexit could also create issues with stringent visa requirements for Indian IT professionals.
Britain, home to some 1.4 million Indians, is India’s 12th-largest trading partner, and being one of the only seven countries with which India has an export surplus, which totals $3.7 billion. A falling currency, consequently, could hurt that surplus. Brexit would also force India to reassess the not yet implemented, Broad-based Trade and Investment Agreement, a free-trade agreement New Delhi launched in 2007 with the EU. This will probably create the space for India to negotiate a separate trade agreement with Britain.
India is Britain’s third-largest source of foreign direct investment, with approximately 800 Indian firms employing 110,000 people. These include Tata Steel, England’s largest steelmaker, and Tata Motors, which owns England’s largest carmaker, Jaguar Land Rover (JLR). One of the reasons to set up base in Britain was to ensure access to the European Union; if Britain would no longer be a part of EU, then companies may have to rethink their business strategies.
A nationalistic Britain that would emerge with Brexit could also create issues with stringent visa requirements for Indian IT professionals. Racist taunts have begun, though mainly against the Polish immigrants, but the Indians too are feeling insecure. In the end, Britain could become more dependent on India to outsource its IT needs, but the coming months, with the market volatility, would be crucial to assess the effects of Brexit.
Membership in the group potentially offers India greater access to the energy resources of Central Asia. It will also provide an opportunity to intensify anti-terror cooperation with all nations, especially China and Pakistan.
SCO
An important item that did not get much prominence in the media was the Indian membership to the SCO. The SCO is a Eurasian political, economic, and military organisation founded in 2001 in Shanghai, by the leaders of China, Russia, Kazakhstan, Kyrgyzstan, Tajikistan, and Uzbekistan. These countries, except for Uzbekistan had earlier been members of the Shanghai Five, an organisation founded in 1996; after the inclusion of Uzbekistan in 2001, the present name was adopted. In July 2015, the SCO decided to admit India, which had been an observer for 10 years. India signed the memorandum of obligations on 24 June 2016, at Tashkent, along with Pakistan, thereby starting the formal process of joining the SCO as a full member; the process would be complete by the next meeting at Astana in 2017.
Membership in the group potentially offers India greater access to the energy resources of Central Asia. It will also provide an opportunity to intensify anti-terror cooperation with all nations, especially China and Pakistan; anti-terror cooperation is a subject under the SCO that all member countries have to undertake. Western media observers, however, believe that one of the original purposes of the SCO was to serve as a counterbalance to NATO and in particular, to avoid conflicts in areas bordering both Russia and China that would give an excuse for USA to intervene. There have been many discussions and commentaries about the geopolitical nature of the SCO; many analysts believe that the SCO is aiming to gain greater access to the Persian Gulf, once Iran, now an observer, becomes a member. The Western nations, hence, are following the expansion of the SCO with keen interest.
India is not a part of any major military alliance, yet it has close strategic and military relationships with most of the major powers and developing nations.
Concluding Thoughts
India is the world’s second most populous country, the world’s most-populous democracy and one of the fastest growing major economies. As the seventh largest economy by nominal rates and third largest economy in terms of purchasing power parity, India is a regional power, a nascent global power, and a potential superpower. In the last few years, India has emerged as a growing international influence and a prominent voice in global affairs. With such testimonials India has formed groups, and sought membership of other major world groups, for economic and security cooperation; it is not a part of any major military alliance, yet it has close strategic and military relationships with most of the major powers and developing nations, alike.
24 June 2016 is a date that will be well remembered in the history of Indian foreign relations. Whatever happened on this day, India has not to lose hope as far as membership to the NSG is concerned. It should pursue its efforts with renewed vigour as a mature future world power. There are talks of India withdrawing its commitment towards the Paris Climate Agreement; it would be an ill-advised move, and would irreparably harm India’s credibility. Brexit need not worry India too much, though it will have some economic repercussions, which will become clearer as days go by. The membership of SCO must be viewed in totality; what the organisation was in the post-9/11period, and what it is today, must be seen with full consciousness of geo-political realities.
© Copyright 2016 Indian Defence Review
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