The Lasso Loosens

Last week, deputy secretary of state Richard Armitage raised hopes that the US would lift the sanctions it had unilaterally imposed on India following the Pokhran nuclear tests of May 1998. Armitage declared that the Bush administration would move "at a speed visible to the naked eye" in easing whatever restrictions are still in place once Congress reconvenes in September.

Though Armitage hasn't set any timeframe, several reports say this is imminent. The sanctions, mandatory under the Nuclear Proliferation Prevention Act of 1994, were imposed under section 102 of the US Arms Export Control Act, also called the Glenn Amendment. When these were imposed, Ted Galen Carpenter of the Cato Institute commented on the US' non-proliferation hysteria thus: "The misguided 1994 Nuclear Proliferation Prevention Act requires the imposition of sanction against any nation that has the temerity to pursue a nuclear weapons programme—much less test such weapons. Some of the sanctions may inadvertently benefit India by weaning that country from the narcotic of foreign aid.... A more intelligent and constructive approach is needed. India's acquisition of a nuclear weapons capability—or even the deployment of a small arsenal—doesn't threaten America's security."

It is precisely this kind of thinking that has nudged the Bush administration to rationalise its approach to sanctions on India. The Bush administration is taking New Delhi into confidence on its National Missile Defence (nmd) plans. The US probably also wants to develop, over time, security linkages with India as a hedge against a resurgent China. All this can't be realised while the remaining sanctions are still in place (see chart). (Most of the sanctions have been lifted.)

What has been the cost of the US sanctions on India? According to one study made by the US International Trade Commission, at the behest of the House of Representatives, restrictions had a "relatively minimal impact on India's overall economy". Other estimates say that the restrictions directly affected $120 million under the US financial assistance programme. Washington's opposition to lending by international financial institutions led to the blocking of about US $1.2 billion from the World Bank. Since last July, however, the World Bank has approved 12 loans amounting to about $2.5 billion—the US abstained from voting whenever a loan came up for discussion.

Considering the symbolic value of post-'98 sanctions, Delhi is consequently more keen to have Washington ease technology restrictions imposed in the '70s, governing export of dual-use materials, or items which have scientific as well as potential military, especially nuclear-related, applications.

Indeed, on February 10, 1998, three months before the May nuclear tests, then undersecretary for commerce William Reinsch had announced in Los Angeles a major evaluation of the US export control systems conducted by the Bureau of Export Administration (bxa). He said the US had already developed a five-year strategic plan for enforcement strategies in which a determination had been made to pare down the export control lists, limiting it to items that are "truly critical", a recognition that the maintenance of long lists in no meaningful way advanced American interests, given the widespread technological availability.

Reinsch also said the US would evolve "a healthier sanctions policy". It was precisely this Armitage reiterated in June, hinting that the Bush administration was committed to "get beyond the post-'98 sanctions, I think we will, with the support of the US Congress.We want to do that and we will do that. And then there are other sanctions which we will have to work with Congress over time to remove as well...". This is music to New Delhi's ears.

Although President Bush has to work with Congress, which is Democrat-heavy, in October 1999, the US Congress passed the Defence Appropriations Act, 2000, which gave the president the leeway to waive all restrictions, including defence cooperation and sale of dual-use items and technology without putting any time restrictions as is usually the case. Clinton hadn't exercised the waiver authority.

Yet, in the past few months, there has been a spurt in defence cooperation with the Pentagon. For instance, it accorded foreign minister Jaswant Singh full military honours during his April visit to Washington, which included an unscheduled 45-minute audience with President Bush as well. This was followed by the visit to Delhi by Gen Henry H. Shelton, chairman of the joint chiefs of staff. With the Pentagon having shed its inhibitions, there is evident earnestness to move military-to-military relations to an unprecedented level. The sanctions are thus perceived as being out of tune with the current political bonhomie in the Indo-US relationship.

The US has traditionally been sanctions-happy. It's the favoured tool of foreign policy, although of very dubious efficacy. In the last decade alone, the US has imposed or threatened sanctions against approximately 75 of the world's nearly 200 nations. Ironical for a country that advocates free trade in a globalised economy. usa Engage, a coalition of more than 670 US companies committed to easing embargoes, estimates that the sanctions cost the US as much as $19 billion annually in lost exports and deprived the economy of more than 200,000 high-wage jobs.

During secretary of state Colin Powell's Senate confirmation hearings this January, he proclaimed himself against the sanctions-first policy. Powell said: "I've got battalions of lawyers and experts and analysts who should be worrying about a regional strategy for the Andes, who are instead writing long reports about who should be certified or not certified. That is not the best use of our talent." He added: "They (the sanctions) just keep coming, and I think that I have seen about half a dozen new ones even before I took office in the last couple of weeks. I would encourage self-discipline on the part of Congress so that when you are mad about something or when there is a particular constituent interest, please stop, count to 10, call me up, come up and let's talk about it."

Delhi, meanwhile, expects that the Entities List (published on November 13, '98)—a list of about 200 (decreased to 150 in December '99) Indian government organisations, psus, private companies, which are subject to stringent export restrictions with the presumption of denial—will be pruned further or dropped altogether, leading to a case-by-case review of export requests for technology which may have dual applications. When this happens, it'll be the clearest acknowledgement that the 1994 Nuclear Non-Proliferation Act may be entering a phase beyond its political usefulness.