(md Rahmath khan)

123 AGREEMENT:

Section 123 of the United States Atomic Energy Act of 1954, titled "Cooperation With Other Nations",
establishes an agreement for cooperation as a prerequisite for nuclear deals between the US and any
other nation.Such an agreement is called a 123 Agreement. To date, the U.S. has entered into roughly
twenty-five 123 Agreements with various countriesCountries with which the U.S. has or had or is
working towards having a 123 Agreement include

WHAT IS 123 AGREEMENT:

The 123 agreement between India and USA refers to Sec. 123 of the U.S. Atomic Energy Act. There is a
ban on transfer of nuclear technology to other countries under this Act. The Hyde Act was passed by
U.S.A to make an exception for India, to enable transfer of technology for civil nuclear energy. The 123
Agreement is the terms of engagement which operationalizes the treaty agreement between india and
u.s.a for transfer of civil nuclear technology. The next step is to enter into agreement with the IAEA
( international atomic energy agency) for safegaurds of the civil nuclear reactors to be set up under the
123 agreement and to enter into an agreement with the NSG ( nuclear suppliers group) for supply of
nuclear fuel i.e uranium for the civil nuclear reactors. Once India completes the agreements with IAEA
and NSG, then the U.S. Congress will vote on the 123 agreement. Once it is approved by the U.S.
Congress, then the deal is complete and India and U.S.A can enter into nuclear commerce i.e supply of
nuclear reactors, transfer of technology, supply of nuclear fuel

What is the total opportunity in Nuclear Power?

The share of nuclear power installations is 3% in total power capacity of India. This
translates into an installed capacity base of 3000-4000 MW in FY2008. India is eyeing
to increase the share from 3% of current power capacity to 6% of expanded power
capacity. This translates into additional installations of 8000-9000 MW in next 5-7years.
Whereas the ‘Blue Sky Estimate’ is 20000 MW in next 5-7 years targeted by
Government of India. This translates into total opportunity of US$ 50 bn (Blue Sky
Estimate) in coming years.

Terms and Conditions of 123 agreement

The 123 agreement between India and USA refers to Section 123 of the U.S. Atomic Energy Act
for the transfer of civil nuclear technology. Under the agreement, India will be permitted to
reprocess US-origin nuclear fuel at a special facility under the International Atomic Energy
Agency (IAEA). With this India can enter into a trade with the US i.e. supply of nuclear reactors,
transfer of technology, supply of nuclear fuel etc. Terms and conditions of 123 agreements
between U.S and INDIA

The proposed bilateral agreement has eight important terms and condition:

1. It gives the U.S. absolute right to terminate cooperation with India .The termination can
come into effect at the end of one-year notice period although the agreement empowers
the U.S. to suspend all cooperation without such a notice.
2. This accord does not uphold a core principle of international law and is linked with the
national lines and regulations
3. The provision of the nuclear testing has not been explicitly referred in the agreement
although a test prohibition against India is clear through the incorporation of the U.S.
right to demand the return of all supplied materials and items.
4. The U.S. under the 123 agreement has not only the right to terminate cooperation in
response to an Indian test but also can terminate that if according to Washington, India
did not comply with the given conditions in the Hyde Act with regard to the prescribed
non -proliferation condition.
5. The agreement gives the exclusive right to the U.S. to unilaterally terminate, cooperate
and demand the return of all equipment and fuel supplied in the past.
6. While the U.S. has the right to terminate cooperation at will and withdraw from all
obligations, India has been denied the right to withdraw from all its obligations, even if
the agreement was terminate at America instance.
The agreement also includes India`s obligation to accept international
inspection on its entire civil nuclear program including the indigenously built facilities it
is voluntarily opening to external scrutiny.
7. The U.S. also maintains the right in the 123 agreement to unilaterally suspend the
reprocessing-related "arrangements and procedures" which it intends to work out with
New Delhi in the years ahead once India has built a new reprocessing facility under
IAEA (International Atomic Energy Agency) safeguards.
8. The agreement relating to `consultation` and uninterrupted fuel supply appear more to be
accord with the provisions of the national laws. The agreement as mentioned in Art5 (4)
does not allow India to build up lifetime reserves but only permits continuous fuel supply
for the continuous operations of the reactors for their lifetime.

Submitted to: Submitted By:

Mr.Anand Reddy sir B .Rajitha Reddy

(H425)
Vinesh & subash

Benefits of 123 Agreement for India and US

 RECOGNIZING the significance of civilian nuclear energy for meeting growing global
energy demands in a cleaner and more efficient manner

 DESIRING to cooperate extensively in the full development and use of nuclear energy
for peaceful purposes as a means of achieving energy security, on a stable, reliable and
predictable basis

 WISHING to develop such cooperation on the basis of mutual respect for sovereignty,
non-interference in each other's internal affairs, equality, mutual benefit, reciprocity and
with due respect for each other's nuclear program

 DESIRING to establish the necessary legal framework and basis for cooperation
concerning peaceful uses of nuclear energy

 AFFIRMING that cooperation under this Agreement is between two States possessing
advanced nuclear technology, both Parties having the same benefits and advantages, both
committed to preventing WMD proliferation

 NOTING the understandings expressed in the India - U.S. Joint Statement of July 18,
2005 to enable full civil nuclear energy cooperation with India covering aspects of the
associated nuclear fuel cycle

 AFFIRMING their support for the objectives of the International Atomic Energy Agency
(IAEA) and its safeguards system, as applicable to India and the United States of
America, and its importance in ensuring that international cooperation in development
and use of nuclear energy for peaceful purposes is carried out under arrangements that
will not contribute to the proliferation of nuclear weapons or other nuclear explosive
devices

 NOTING their respective commitments to safety and security of peaceful uses of nuclear
energy, to adequate physical protection of nuclear material and effective national export
controls

 MINDFUL that peaceful nuclear activities must be undertaken with a view to protecting
the environment
  MINDFUL of their shared commitment to preventing the proliferation of weapons of
mass destruction and

 DESIROUS of strengthening the strategic partnership between India and US

Negotiation process:

As far as the terms and conditions are concern, all the rights are in favor of U.S.A and against INDIA, so it
is win-lose situation. So it seems to be distributive negotiation.

And according to benefits, as both INDIA and U.S.A are mutually benefited, so there is win-win situation
arise, so it might be integrative negotiation.

But as in the INDIA is changing its mind setting so it is transmission negotiation in the end.

Conclusion:

As the case goes through some ups and down of mind setting it is a transmission negotiation tha took
place in the case.