Round The World

New Delhi, 25 August 2010

India-Japan Talks

STRIVING FOR COMMON N- PACT

By Monish Tourangbam,

Research Scholar, School of International Studies (JNU)

The fourth round of India-Japan Strategic Dialogue recently concluded in New Delhi comes at a crucial time. Japanese politics has witnessed another change of leadership with Nato Kan becoming the Prime Minister following the resignation of Hatoyama. Although the strategy between the two nations is not expected to be much different as most of the ministers have been retained in the new government, the visit of the Japanese Foreign Minister Katsusya Okada does assume importance. It dispels apprehension, if any, in New Delhi of the baton being passed to yet another PM in the recent frequent leadership changes that Japan has seen.  

The visit and the dialogue acquire great importance as it comes at a time when reports pouring in suggest that China is overtaking Japan as the world’s second largest economy. Consequently, countries such as India and Japan have a common interest in furthering their economic ties, bilateral engagements and striving for more joint endeavors around the world. Other than the vital area of economic engagement and permanent fixtures such as the stake in the oft-discussed UN reform and climate change, the highlight of the visit was clearly processing and taking forward the talks on civilian nuclear agreement.

As New Delhi forges ahead in securing its nuclear energy commerce with most of the major suppliers, including erstwhile skeptics like Canada, Tokyo would very much want to increase its hold in this area. However, keeping in mind the fact that Japan is the only country in world history which has actually borne the brunt of a nuclear bomb, it would be a hard nut to crack. Undoubtedly, there will be domestic pressure on Japan to include clauses and conditions that would preserve its reputation as one of the strictest followers of the non-proliferation regime.

The N-agreement when operationalized will allow Tokyo to export nuclear power generation technology and related equipment to India given that its demand for energy is on the rise. Remember, nuclear energy is regarded as the best possible clean alternative to carbon-emitting fossil fuels and therefore makes it more attractive to a rapidly developing economy like India, which needs to balance the demands of its growth as well as mitigate climate change.

Clearly, India’s clean non-proliferation record has tilted the scales in its favour, making it possible for other nations to start negotiations for nuclear energy ties. However, in Tokyo there continues to be lingering concern that the nuclear accord between the two could run into rough weather thanks to a strong anti-nuclear domestic constituency in Japan. This is accentuated by the fact that India, a nuclear power, still refuses to sign the Nuclear Non-Proliferation Treaty (NPT).

Mercifully, the Japanese government has not put the signing of either the NPT or the Comprehensive Test Ban Treaty (CTBT) by India as a pre-condition for the nuclear agreement even though it would have made things much easier. Okada applauded India’s non-proliferation track record but at the same time insisted on the need to include conditions that would preserve Japan’s adherence to the basic tenets of non-proliferation and disarmament.

On its part, New Delhi is unlikely to go beyond saying that it is completely committed to a “nuclear free world”. Foreign Minister S M Krishna has said that New Delhi shared Japan's goal of a nuclear weapon-free world and was ready to work with it in achieving the objective in a “comprehensive, non-discriminatory and verifiable framework”. The reference is apparently to the NPT and CTBT, which India has maintained is discriminatory in nature.

Given the situation, the visiting Japanese Minister has maintained that Tokyo will have no option but to terminate the deal if India goes for another nuclear test. However, India has stood by its voluntary moratorium on further nuclear testing and that is the most it can offer to Japan as of now. How these commitments will be included into the text of the agreement and what sort of terminology will convey the message without hurting the sentiments of both the sides is a matter of debate and discussion.

Krishna has conveyed India's appreciation of Tokyo’s decision to begin talks on a civil nuclear pact. Both sides have agreed that the negotiations should continue quickly with no timelines resulting in a “win-win” situation. He also thanked Japan for removing 11 Indian entities from its End User List, which would provide a big boost to high technology trade between the two nations.  

Besides giving an edge in terms of taking India-Japan ties to the strategic level, the nuclear deal will provide Japanese companies such as Hitachi, Mitsubishi, Toshiba and Marubeni an enviable opportunity to secure a foothold in the rapidly growing Indian nuclear energy market. According to sources, India wants to partner Japan in mastering and marketing closed fuel cycle reactors -- fast-breeder reactors (FBRs) -- as the second generation nuclear power plants, which are touted as "proliferation free."

It is worthwhile remembering that India is one of the most lucrative markets for nuclear commerce and that its source for nuclear energy neither ends nor starts with Japan. There are enough countries in the field to give competition. So, the onus is not entirely on India’s shoulders and the continuity of the negotiations will be maintained in the days ahead so as to amend the terminology and other nuances of the agreement that would satisfy both the sides. Importantly, it is not in the interest of both the countries to let differences of perceptions and strategies inflict damages on the long-term partnership that can further be taken to a higher platform.

Other than the nuclear cooperation talks, the two sides also discussed the Comprehensive Economic Partnership Agreement (CEPA) and decided to embark on a new dialogue on Africa. Speaking to journalists at the end of the Strategic Dialogue, Krishna and Okada expressed hope that the CEPA would be finalised before Prime Minister Manmohan Singh's visit to Tokyo towards the year-end.

Both the ministers are expected to meet on the sidelines of the UN General Assembly in New York along with the foreign ministers of Brazil and Germany to carry forward their joint effort as part of G4 for reform of the Security Council. As such, the two countries also have decided to reach out to the 53 nation African continent whose support is vital.

Commenting that India and Japan need to redouble efforts, Okada felt that finalisation of the CEPA would help raise the economic ties by a couple of notches. He called for a 10-fold increase in bilateral trade at present estimated to be around $12 billion. As of now, Japan is the sixth-largest foreign investor in India. The two had signed a peace treaty in 1952 and the yen loans to India started as early as 1958. Over the years, India has become one of the most important destinations of Japanese aid. Now all eyes will be on the negotiations for a civil nuclear pact. --INFA

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