Bush Wins Congressional Approval for India Atomic Energy Accord

By Viola Gienger

Oct. 2 (Bloomberg) -- President George W. Bush won final congressional approval for U.S. companies such as General Electric Co. to sell nuclear fuel and technology to India for its energy needs, achieving one of his top foreign policy priorities.

The Senate voted 86-13 late yesterday in favor of a resolution to support the U.S.-India Civil Nuclear Cooperation Agreement. The House approved the measure, sponsored by California Democrat Howard Berman, by a vote of 298-117 on Sept. 27. The legislation now goes to Bush for his signature.

``I look forward to signing this bill into law and continuing to strengthen the U.S.-India strategic partnership,'' Bush said in a statement after the vote.

The agreement allows U.S. companies to provide reactor technology, fuel and other services to help India produce energy in plants outside its atomic-weapons program. The U.S.-India Business Council estimates India will spend at least $175 billion during the next 30 years to expand nuclear-energy supplies and power economic growth of more than 8 percent annually.

``This is something we as a company have been advocating for,'' said Peter O'Toole, a spokesman for Fairfield, Connecticut- based GE, which already supplies non-nuclear technology and services to India. ``We have a long relationship with the Indian government, so we're very pleased with the passage.''

Supporters of the agreement said it creates potential political and economic links with the world's biggest democracy far beyond the nuclear-energy industry.

`Decades of Mistrust'

The agreement will erase decades of mistrust since India's 1974 atomic test prompted other countries to block nuclear exports to the nation, said Ron Somers, president of the Washington-based U.S.-India Business Council, which includes companies such as GE and PepsiCo Inc.

``We're now engaging India in a partnership based on trust and mutual respect,'' Somers said. ``This will affect positively all sectors of our two economies.''

Indian Prime Minister Manmohan Singh told the United Nations General Assembly in New York that his nation is committed to nuclear disarmament and has an ``impeccable record of non-proliferation.''

``India is a very important country for us, and this relationship is sealed in a very significant way by this agreement,'' said Indiana Senator Richard Lugar, the top Republican on the Foreign Relations Committee, who advocated for the approval with acting Chairman Christopher Dodd, a Connecticut Democrat.

Weapons Program

Opponents decried the agreement, saying it doesn't provide enough safeguards to prevent India from diverting domestic fuel and technology to its weapons program after gaining imported supplies.

That might allow India, which has never signed the nuclear Non-Proliferation Treaty, to increase its bomb production rate and spur neighboring Pakistan to accelerate its own, said the Washington-based Arms Control Association.

Dodd rejected such arguments, saying the resolution of approval and other U.S. laws such as the Atomic Energy Act cover potential violations by India.

``No one anywhere wants to see a further proliferation of nuclear weapons,'' Dodd said.

A group of 45 nuclear-supplier nations including the U.S. waived international restrictions on exports to India last month. The Nuclear Suppliers Group was founded in 1974 to prevent countries from copying India's use of imported technology to make its first atomic bomb.

Still, American companies needed the U.S. Congress to ratify the direct agreement with India to join the competition with potential suppliers in France, Russia and elsewhere.

India plans to acquire nuclear equipment worth $14 billion next year, Shreyans Kumar Jain, chairman of state-run monopoly Nuclear Power Corp., said Sept. 8.

Singh and French President Nicolas Sarkozy signed an agreement to cooperate on civil nuclear technology this week.

To contact the reporter on this story: Viola Gienger in Washington at vgienger@bloomberg.net.