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RHMFIUU/DEPT OF ENERGY WASHINGTON DC
RHEHAAA/NATIONAL SECURITY COUNCIL WASHINGTON DC
RUEHGV/USMISSION GENEVA 0101
RUCNDT/USMISSION USUN NEW YORK 0089
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC

UNCLAS SECTION 01 OF 03 MUMBAI 000111 
 
SIPDIS 
 
SENSITIVE 
 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: PGOV PARM TSPL KNNP ETTC ENRG TRGY IN
SUBJECT: STAFFDEL FITE GIVES DAE OPTMISTIC OUTLOOK FOR 123 AGREEMENT 
IN CONGRESS 
 
MUMBAI 00000111  001.2 OF 003 
 
 
Summary 
------- 
 
¶1. (SBU) Congress will support any 123 Agreement that complies 
with U.S. law, House Foreign Affairs Committee staffers David 
Fite and Douglas Seay told Dr. Ravi Grover of the Department of 
Atomic Energy (DAE) on February 23.  Grover asked several 
questions about the 123 Agreement's prospects in Congress, and 
he made no reference to the substance of the ongoing 
negotiations.  Fite cautioned Grover against expecting a rapid 
conclusion to the negotiations, and criticized the 
Administration for publicly announcing what Fite felt were 
unrealistic timelines.  Such statements created expectations 
that, if unfulfilled, caused commentators to cast doubt on the 
deal when in fact slow negotiations were normal.  Congress 
carefully respected the red lines set out by both the 
Administration and India when drafting the Hyde Act.  The law 
reflected Congress' lack of trust in the Administration.  Many 
of the law's provisions, such as the reporting requirements, 
were not aimed at India, but reinforced Congressional oversight 
over the Administration and bound it to the commitments it made 
to Congress, Fite said.  Seay said Congress was led to believe 
that civil nuclear cooperation was necessary for India to meet 
its energy needs, and hence many were surprised to learn that 
nuclear power will still play only a small role in India long 
after the agreement became reality.  Grover said India would 
diversify its sources of power for energy security reasons; 
nuclear power might meet 25 percent of the country's power needs 
in the longer term.  India remained committed to its vision of a 
closed fuel cycle, he said.  Fast breeder technology was still 
unstable, but would become viable in the coming years.  India 
would not contemplate placing its fast breeders, or the reactors 
that fueled them, under safeguards as long as the breeders 
remained in the developmental stage, he said.  End summary. 
 
Congressional Views on Civil Nuclear Cooperation 
--------------------------------------------- --- 
 
¶2. (SBU) In a February 23 meeting in Mumbai, David Fite and 
Douglas Seay of the House Foreign Affairs Committee briefed Dr. 
Ravi Grover, Director of the Department of Atomic Energy's 
Strategic Planning Group, on Congressional views of the planned 
civil nuclear cooperation.  The July 18 Joint Statement was only 
a lofty declaration of general guidelines that left many details 
undefined or unexplained, Fite told Grover.  The Administration 
did not consult Congress before announcing the Joint Statement, 
or before it reached agreement with India on the separation plan 
announced in March of 2006, although Congress was an equal power 
in the formulation of foreign policy.  In the ensuing discussion 
with Congress, when the vision of cooperation had to be anchored 
into law, the Administration often failed to specify what it 
meant, was unsure of many details or did not give Congress 
answers to its questions, he said. 
 
¶3. (SBU) The resulting legislation was Congress' attempt to 
clarify what the Administration often failed to state 
explicitly, Fite continued.  The legislation also reflected the 
lack of trust that Congress had in the Administration.  The 
reporting requirements often criticized in the Indian media, for 
example, were not aimed at India, but at the Administration. 
Many of the provisions were meant to ensure Congressional 
oversight of the Administration and bind it to the commitments 
it had made to Congress.  At the same time, Congress understood 
and respected the red lines and deal breakers set out by both 
the Administration and India.  The law was also drafted to 
ensure that it received maximum support in a minimum amount of 
time.  The speed with which the legislation passed Congress was 
a testimony to the strength of the underlying argument for 
making an exception for India.  It might have been passed even 
sooner had the Administration been more inclusive with Congress 
from the beginning. 
 
¶4. (SBU) Grover said the GOI would continue to assess the 
legislation in light of its adherence to the July 18 Joint 
Statement.  He asked Fite and Seay whether further U.S. laws 
would have to be changed to make civil nuclear cooperation 
reality.  Both responded by saying that the Administration had 
 
MUMBAI 00000111  002.2 OF 003 
 
 
not approached Congress about doing so, and that to their 
knowledge no further statutory changes were needed. 
 
The 123 Agreement 
----------------- 
 
¶5. (SBU) Grover asked whether Congress might amend the final 123 
Agreement that resulted from the current negotiations between 
the two governments.  Fite emphasized that Congress would not, 
but only subject the agreement to an up-or-down vote.  Seay 
added that Congress assumed that the Administration would 
consult with it before the two governments agreed on a final 
version of the agreement.  It would be in both the 
Administration's and in India's interest to do so, he said. 
Fite emphasized that the Hyde bill envisioned that Congress 
would also need the final text of India's safeguards agreement 
with the IAEA, and NSG consensus on India, before voting on the 
123 Agreement.  Congress understood that India did not want to 
sign a binding safeguards agreement with the IAEA until Congress 
approved the 123 Agreement.  Hence Congress would only expect 
the final text, and not a signed document. 
 
¶6. (SBU) Grover asked about the chances of Congress defeating 
the 123 Agreement.  Fite said he expected Congress would support 
any agreement that complied with U.S. law and did not contain 
unexpected or unusual provisions.  Grover immediately asked what 
provisions might make Congress question an agreement.  Both Fite 
and Seay replied that U.S. law already specified what any 123 
Agreement must contain.  The Hyde Act made one specific 
exception for India, but otherwise the requirements were in 
preexisting law.  As long as the agreement with India adhered to 
the law they could not foresee challenges in Congress, they told 
Grover.  S.K. Agrawal, the Nuclear Power Corporation's Project 
Director who also attended the meeting, asked whether Congress 
might question the Administration's interpretations of the 
statutory provisions that the agreement must contain as stated 
in the President's signing statement.  That was highly unlikely, 
Fite replied.  The Administration knew what Congress expected, 
and there was no desire in Congress to torpedo the agreement. 
Fite said that, while Congress still had questions about the 
signing statement and its effect on other existing statutes, he 
expected the President would observe all provisions of the Hyde 
bill as enacted.  To do otherwise might affect approval of the 
123 Agreement. 
 
Politicization of 123 Agreement Surprises Congress 
--------------------------------------------- ----- 
 
¶7. (SBU) From the U.S. standpoint, the 123 Agreement was largely 
technical, Seay said.  It therefore came as a surprise to many 
in Congress that the agreement had become so politicized in 
India.  Since it was a sensitive issue in India, the Indian 
government would set the pace of negotiations.  Fite cautioned 
that India should not be surprised if negotiations lasted longer 
than many had originally expected.  Fite criticized unnamed 
Administration officials who, in his opinion, announced 
unrealistic timeframes in their public comments about the 123 
Agreement.  Such statements generated expectations that, if 
unfulfilled, caused many people to fear that negotiations were 
in trouble, when in fact such delays were a normal part of such 
complicated technical discussions, Fite said.  He also cautioned 
Grover against expected rapid results from any negotiations over 
a safeguard agreement with the IAEA. 
 
Small Role of Nuclear Power Surprises Many in Congress 
--------------------------------------------- --------- 
 
¶8. (SBU) Seay told Grover that the Administration had cited 
India's pressing energy needs as a major reason for pursing 
civil nuclear cooperation.  It hence came as a surprise to many 
in Congress that, according to India's own forecasts, nuclear 
power would still play only a small role in fulfilling India's 
power needs even long after the initiative became reality. 
Grover replied that, for purposes of energy security, India 
wanted to diversify its sources of electrical power.  Hence 
nuclear power should play an important, but not dominant role in 
the country's power mix in the coming decades.  In addition, 
 
MUMBAI 00000111  003.2 OF 003 
 
 
demand for power would grow at a rapid pace, in line with the 
growth of the economy.  India could simply not establish enough 
nuclear capacity, even with imported reactors, to increase the 
role of nuclear power to, say, half of the country's power 
needs.  Over the long term, nuclear power could cover up to 25 
percent of India's power market, he said. 
 
India's Three Stage Program 
--------------------------- 
 
¶9. (SBU) Seay also asked Grover whether the planned three stage 
program was economically viable.  Grover replied that India 
remained determined to build a network of fast breeders, and 
later thorium reactors, to meet the country's energy needs and 
to guarantee energy security.  According to some forecasts, the 
world's uranium reserves could begin to dwindle by mid-century. 
Demand for world uranium would increase rapidly.  India must 
have an alternative, and hence the DAE remained committed to the 
vision.  In general, the thorium plan was widely misunderstood. 
The DAE was approaching the three stage plan sequentially. 
Currently the DAE was focused on making fast breeder reactors 
viable.  Only when that technology was mature would the DAE 
begin to develop thorium reactors, Grover said. 
 
¶10. (SBU) India's fast breeder technology was "still not 
stabilized," Grover added.  Additional investment and research 
were needed.  The DAE also needed power plants to provide 
plutonium for the fast breeders, he said.  India would not 
contemplate placing those plants, or the fast breeders, under 
safeguards as long as the fast breeders were in the development 
phase.  He did not specify, however, whether India would be 
prepared to do so once the fast breeders became commercially 
viable. 
 
¶11. (U) Staffdel Fite cleared this cable. 
KAUFFMAN