U.S. attempts to construct and consolidate an alliance to contain China’s seemingly inexorable rise registered another milestone in November when the U.S. Senate passed a bill to allow the government to transfer nuclear fuel and technology to India. The nuclear deal with India flies in the face of long-standing U.S. rhetoric about nuclear proliferation and is yet another blow to the Nuclear Non-Proliferation Treaty (NPT).

There has been a degree of opposition in the United States to the agreements with the India deal. For example, in an op-ed in the Washington Post, former President Jimmy Carter was scathing about the “dangerous deal with India.” Many predicted a difficult time for the administration in pushing through a bill so flagrantly in conflict with its posturing on proliferation. “In concluding its nuclear deal with India, the Bush administration faces significant opposition in Congress and tough questions from its allies on whether the arrangement could set a precedent encouraging the spread of nuclear weapons to Iran and other potential foes of the United States,” opined Steven Weisman in The New York Times.

But when it came to it, this “significant opposition” faded away like the morning mist. On November 17, the Senate decided by 85 votes to 12 that, in the words of The New York Times correspondent, the “goal of nurturing India as an ally outweighed concerns over the risks of spreading nuclear skills and bomb-making materials.”

The U.S. decision to tie the nuclear knot with India is in part about money—the size of the growing Indian economy and the profits to be made in the new nuclear-military relationship. More importantly, however, India figures prominently in general U.S. geostrategic aims in Asia and toward China in particular.

The Economics of the Deal

India is the second fastest growing major economy in the world. According to the CIA its real GDP grew 7.6% in 2005, not far behind China’s 9.3% and over twice America’s 3.5%. It is also, again according to the CIA, the fourth largest economy in the world on a purchasing power parity basis (China comes in at number two) and accounts for 1.1% of world imports. In general, India is a large and increasingly attractive market and economic partner.

The nuclear deal links this rapidly growing economy more closely to the United States and also boosts trade in a particularly profitable sector. The nuclear industry is big business, and “nuclear transfer” translates into significant sales for U.S. nuclear technology firms.

Then there are conventional armaments. India is a major military power with an appetite to match. In 2005 it was the largest buyer of arms in the developing world with purchases of US$5.4 billion. Russia, to America’s chagrin, was the largest seller to the developing world, and India is its principal market. The administration hopes that the nuclear deal will change all that by paving the way for a huge $6 billion contract to buy 124 U.S. fighter aircraft.

Such arms deals, of course, will have no relationship with proliferation, because that is what countries like Russia, China, and North Korea do, not the United States. Bill Clinton, in his State of the Union speech in 1999, proclaimed, “We must increase our efforts to restrain the spread of nuclear weapons and missiles, from [North] Korea to India and Pakistan.” In the world of geopolitics, however, seven years is a very long time. And the past is very much a different country.

Strategic Partnership

Although important, money is only part of the reason behind the nuclear deal. The U.S.-India strategic relationship—and that’s what they are calling it—gives the United States leverage over India in many ways, or so it is hoped in Washington and feared in Delhi. The Communist Party of India, a junior partner in Singh’s coalition government, has warned that “the strategic relationship only means that India will be part of the U.S. strategies of global policing and undermine its role in international politics and its resolve to promote multilateralism in international relations.” United Progressive Alliance Chairperson Sonia Gandhi said that the UPA, and the Congress party, would not accept anything outside the original agreement of July 18, 2005.

One huge danger, which for obvious reasons is seldom articulated in public, is that India will become embroiled in America’s anti-Islamic crusade. India has, in the past, refused to send troops to Iraq. That particular request is unlikely to surface again, given likely U.S. plans for disengagement. But as the relationship deepens, similar requests might be more difficult for India to reject. Nearly one-seventh of India’s population is Muslim, and inter-communal violence, and terrorism, is a constant concern.

While deployment of Indian troops to Iraq is unlikely, the United States may well call on India for other forms of assistance, such as support against Iran. India has traditionally maintained good relations with Iran, in part to counterbalance Pakistan. Also, for a number of years, India has talked with Iran about a pipeline that would supply natural gas from Iran via Pakistan. This energy deal must produce palpitations in certain Washington hearts. Not merely would it provide revenue for Iran (and Pakistan), and give India (and Pakistan) a degree of energy security, away from the immediate attention of the U.S. navy. It would also tie the three countries together in mutual benefit.

Containing China

For America, however, the real strategic target of the U.S.-India relationship is China. How the United States implements its China containment strategy, and how successful such a strategy will be, is another matter. China has military, economic, and diplomatic cards to play. India came off badly when it picked a fight with China in 1962 and is not looking to revive any conflict. China overtook the United States a couple of years ago as the major supplier to the Indian market. President Hu Jintao has just concluded a visit to South Asia where he appears to have pulled off quite an achievement in developing a better relationship with India without annoying Pakistan, something that Bush has not been able to do.

In addition, China (presumably with Russian approval) implemented a significant strategic counter-offensive in June 2006 by inviting India (along with Iran, Pakistan, and Mongolia) to become full members of the Shanghai Cooperation Organisation (SCO). This invitation reversed China’s position, stated as recently as January, that India and the other countries would have to be content with observer status. The SCO, formed in 2001 to check U.S. influence in Central Asia, may well expand to counterbalance a similarly expanding NATO. So the contest for India’s favor is by no means a forgone conclusion.

Moreover, India has its own games to play and is no mere cat’s paw of other powers. Apart from its perennial contest with Pakistan, it seeks a dominant position in South Asia with its interventions in East Pakistan/Bangladesh and Sri Lanka, and expansion of influence in the Himalayan states. It has also sought a degree of primacy in the Indian Ocean and adjacent Southeast Asia. In short, India is looking to establish a role commensurate with its importance on the world stage.

Nevertheless, the strategic interests of India and America with respect of China have a natural overlap. Washington would probably view favorably any increase in India’s ability to project military power in Asia. The U.S.-India agreements allow for closer cooperation in defense and in areas such as satellites and space exploration. It is not clear to what degree the United States will help India develop its nuclear missile capability, and such protocols will certainly not be made public. The New Framework for the U.S.-India Defense Relationship of June 2005 certainly does not clarify this matter.

India’s missile program is a key determining factor shaping the U.S.-India-China triangle. India’s Agni III missile, which has a design range of 3,500 km, had an unsuccessful test in July when it only reached 1000 km. India claims that a special steel to be used in its scheduled 2007 test will increase the design range between 15 and 30%. The distance between Delhi and Beijing is 3,800 km, so the improved Agni III, if successful, will bring all of China within range. How much help are Indian scientists getting from their new friends in Washington? It is not yet known but one area of missile cooperation the New Framework did specifically mention was “missile defense.” On November 27, India claimed to have successfully conducted an anti-missile test, intercepting one (nuclear-capable) Prithvi with another.

This developing friendship between the United States and India has all sorts of ramifications. It influences, for instance, America’s relationship with Pakistan, and the United States needs Pakistan in its increasingly difficult struggle to control Afghanistan. However, Washington’s willingness to jeopardize other important relationships indicates just how central the containment of China is to U.S. strategic policy.

Tim Beal teaches at Victoria University of Wellington. He is the author of North Korea: The Struggle Against American Power (Pluto Press, London and Ann Arbor) and is currently working on a study of the impact of China and India on international political economy. His personal site is at www.vuw.ac.nz/~caplabtb/beal.html.

Get more news like this, directly in your inbox.

Subscribe to our newsletter.