Now, activate the India-Australia nuclear deal
The India-Australia nuclear deal, signed this past weekend during Prime Minister Tony Abbott's two-day tour, is a game-changer in the emerging bilateral. Given that India is not a signatory to the nuclear non-proliferation treaty, Australian lawmakers have had to overcome much domestic opposition to finalise this deal. To understand the kind of resistance that India's non-NPT status evokes abroad, look at Japan: Despite wide-ranging support for India, Tokyo is still struggling to build political consensus on doing nuclear trade with Delhi. Australia had also gone back and forth on the issue, but the situation turned definitively for the better in 2012 when the Government of Julia Gillard lifted the ban on the sale of uranium to India. From India's point of view, the deal is yet another affirmation of India's impeccable non-proliferation credentials. As Prime Minister Abbott said in New Delhi, Australia now “trusts” India with its uranium. This best captures the essence of the reinvigorated India-Australia relationship.
Given the convergence of interests and values between the two countries, both pluralistic democracies seeking a peaceful and prosperous Indo-Pacific, close ties between the two may seem natural today. But this has not always been the case. For decades, India and Australia kept each other at an arm’s length for a variety of reasons that go back to the frosty relationship between Jawaharlal Nehru and Robert Menzies, Australia's ‘white policy', and its strident criticism of India's nuclear tests. When the two countries sought to improve ties at the turn of the century, they faced many setbacks. The 2009 attacks on Indian students in Australian cities vitiated the atmosphere, and the decelerating pace of economic growth in a policy-paralysed India meant that neither party had the incentive to push for more. The India-Australia bilateral remained below potential. It is against this backdrop that the nuclear deal must be seen, first and foremost, as a sign of trust and friendship.
At an operational level, it will possibly take a few years before Australia can actually begin selling uranium to India. The two nations have to first hammer out an administrative agreement, which is easier said than done. Two issues are expected to be contentious: First, satisfying Australia that its nuclear fuel is being used for civilian energy purposes only and not being diverted to the nuclear weapons programme. Already, India believes that it has put itself up for enough scrutiny, but Australia is reportedly pushing for more verifications. Second, India's tough liability laws, which expect foreign suppliers and manufacturers to take responsibility of any nuclear accident, could be problematic for the Australians, much like they have proved to be for the Americans. In 2008, India signed a similar nuclear deal with the US, but it did not kick off nuclear trade, as the two countries have yet to find common ground on the issue. Hopefully, these problems will be resolved sooner than later. An energy-starved India desperately needs nuclear fuel to power its growth. As the Government plans to increase its nuclear capacity from 4,780 MW to 63,000 MW by 2032 by adding nearly 30 reactors at an estimated cost of $85 billion, Australia, with the world's third largest uranium deposits, will be a natural partner.