Now it is time for USA to worry as NSG waiver is given to India. Rice has asked Indian Govt not to disadvantage American Companies as other countries may not have any compulsions while rushing to sign deals with India. Foremost in this rush will be Russia and France which have long standing support and appreciation of Indian position.
Of course USA has played a leading role in the Nuclear Deal . The Hyde Act was first step which enabled USA to engage Indians on Nuclear issue after Tarapur fiasco( Tarapur fuel supply agreement was also under clause 123 of the USA Atomic Energy Act and was later repudiated unilaterally by USA after Pk-1).Hyde Act sought to amend this Act but with certain conditions. No doubt these are stringent conditions in the Act, but American business may not be allowed to suffer when India is now explicitly acknowledged as having Civilian and Military Nuclear complexes.American Presidents always lied to their public and Congress in the past as their practices show, especially in the context of Pakistan, that includes Democrat Clinton and Republican Reagan.India will certainly oblige Rice in not rushing to deal with other nations till USA position is crystalised. Though USA has tough task on their hand and India after sufficient wait period , may sign agreement with other friendly nations with whom our ties have stood test of the time.
Now , if India is acknowledged as Nuclear Military Power and America constructs say about five nuclear reactors, then naturally they will be inclined to continue their assistance rather than choosing path of confrontation, more so if other countries also build their reactors in India.
Indian Scientists should now demonstrate and develop owr own technology based on Thorium cycle and make us a partner in NSG with equal status.That will be our assurance against future supply disruptions in the remote possibility of all NSG members agreeing to take tough line against India.
Secondly India should continue to develop Military technology and doctrines which envisages use of Nuclear weapons under certain situations.
China has shown time and again , that it can not be trusted , so all our focus must be bench marked against Chinese containment policy rather than Pakistan.Diplomatic efforts should be to resolve Border issues on equal footing rather than from a subservient position.
It is encouraging that Rice has indicated that USA and India could sign 123 deal by end of this month , that means when Indian Parliament convenes deal will be clinched and left will be in the lurch. I feel happy about it though unhappy about the episodes witnessed earlier in the Parliament.
Indians are not white angels so issues of corruption and like things will be there and we may have to guard against it as best as possible.
Nuclear energy may not be able to contribute more than 20 % of the requirement. But the main purpose of the deal would be served if India could engage in trade and commerce in high end technological items which will give needed push to further development and growth.
The key to understanding Nuclear Deal is to view it in its totality. Sovereignty of any country depends on the degree of freedom it has in taking decisions and enforcing it. That depends on factors like economic, technological military, scientific development and with how many nations we have convergence of Ideas and enjoy friendship.
Manmohan Singh, for all his simplicity and seemingly helplessness, will go down in the History as one who achieved this remarkable integration with other countries that matter in the comity of nations.
BJP would have the benefit of initiating the dialogue, but it was ManMohan Singh who achieved this, hence the credit.
Nuclear deal will have positive impact on Indian Economy.
1. It is assumed that India may construct 20-40 reactors in next 40 years. Investment will be in order of many billions. This will have its impact on downstream economy.
2. Employment generation will be huge. It is expected that just as with the introduction of Computers and IT related technology there was huge employment generation in IT sector and spawning of engineering colleges , so will be with this deal.
3. Scientist and engineers in many fields such as Civil, mechanical, Metallurgy, electrical, production etc besides specialized training in Nuclear related technology will have tremendous job opportunities.
4. Companies in Infrastructure, constructions,steel , electrical, real estate cement, power equipment etc will have good opportunities. Such as L&T, BHEl, BEL, TATASTEEL , kalptaru, ptc, Reliance Infra etc. These are only indicative.
5. Deal , by itself , may keep the market from sinking as FDI and FIIS might increase their investment. Inflow of FIIs have certainly picked up.But uncertainty will be there largely due to elections and USA slowdown. The year 2009 will see some of these uncertainties going away and may have positive impact on market.
6. Whosoever will come to Power, will have to carry on with this deal, so impact on it due to election will be minimal.hence market may not be affected due to change in Govt.
These are issues on fundamentals of Economy and market. It will not have bearing on Technical analysis, which is based on price-volume action.Time will only tell how we are able to leverage this deal to our advantage.
pk