US President George W. Bush has recently signed a key nuclear energy deal with the Indian government. US Representative Edward Mackey (D-Massachusetts) has stated that this deal had "blown a hole in the nuclear rules that the entire world has been playing by." What effect will the Indian exception have on the Iranian nuclear program, and, more generally, what are the international consequences of the US-India deal?

The basic spirit of the international non-proliferation treaty regime is that the great powers keep their nuclear weapons to themselves and provide other states’ civilians with nuclear technology in exchange for their refusal to produce nuclear weapons. The recent deal between the United States and India provides US nuclear technology to India to meet its energy needs, but does not subject India to the requirements of disarmament that the nuclear Non-Proliferation Treaty (NPT) imposes upon other states. India, along with fellow nuclear state Pakistan and presumed nuclear power Israel, is not a signatory to the NPT. It will be able to continue enriching nuclear fuel for military purposes. Representative Mackey is correct: the deal undermines the world’s present set of nuclear rules. But does it matter?

Opponents of the India deal, including an indignant New York Times editorial page (see here and here), have argued that the agreement undermines the world’s ability to curb Iranian and North Korean nuclear ambitions. In the Times’ language, excepting India from non-proliferation rules "undercuts some of the most powerful arguments Washington can make to try to galvanize international opposition to Iran’s nuclear adventurism."

This claim is dubious. It seems difficult to believe that such opposition stems from opposition to nuclear proliferation per se rather than from specific concerns about Iran and its intentions—would Australia be referred to the UN Security Council if it started to enrich uranium? Iran is a unique case because its regime is both repressive and highly ideological, controls vast energy resources, and outwardly espouses the complete destruction of Israel. Moreover, the issue is not that the NPT needs to be bolstered because Iran is nakedly defying its treaty obligations. Iran purports to comply with the NPT by enriching uranium for ostensibly peaceful purposes. Doctrinaire adherence to the specifics of the NPT might actually help Iran; censuring the Islamic Republic might be more difficult if it could hide behind the NPT’s permission of peaceful nuclear activity. The core of the Western objection to Iranian nuclear ambition seems to be that regardless of what the NPT says, and regardless of what Iran says about the NPT, an Iranian nuclear program is still an unacceptable risk.

More broadly, critics of the US-India deal may generally overstate the importance of principle in the NPT. Germany, the Netherlands, and other potentially powerful signatories forego the development of nuclear weapons and speak in the language of moral commitment to non-proliferation. But these countries are also protected by the umbrella of nominally US-controlled nuclear weapons in NATO’s European stockpiles. A nuclear deterrent—whether homegrown or provided by an ally—may be a state’s best guarantor of security. Treaty obligations would probably be insufficient to convince a country not to arm itself if it thought nuclear weapons truly served its strategic aims. What can compel a country not to arm itself are the incentives and threats inscribed in the treaty but that are actually enforced by states.

Those who lament the NPT’s lost legitimacy in the wake of the India deal may therefore miss the point. The Times editorial page, for instance, asserts that “the nonproliferation treaty's carrot-and-stick approach … has dissuaded countries that are capable of building or buying nuclear arms from doing so, from South Korea to Turkey to Saudi Arabia.” But the treaty does not provide the carrot or wield the stick; powerful countries do. The institution of the NPT formalizes rewards and punishments, but responsibility ultimately rests with the great powers to mete them out. In this respect, the US-India agreement is perhaps an ideal case study for international relations realists. It demonstrates the often illusory force of institutions like the NPT, which codify rather than constrain the dominance of the most powerful states. The United States can sidestep the NPT framework when it wishes because the NPT has little force without US backing.

One might claim that the United States should not evade the NPT even though it can. The NPT exists largely to advance the interests of the United States and relatively like-minded countries, however, and the terms of the treaty would probably look very different if these countries intended to adhere to them all the time. An international system that manages nuclear technology through codified rules and consensus seems preferable to an unregulated nuclear “state of nature.” But the skewed playing field and exceptionally high stakes of the nuclear game suggest that the most powerful countries would take charge—whether through institutional rules or case-by-case action—in either framework.

If the nuclear pact with India does not significantly undermine efforts to contain Iranian nuclearization, its biggest drawback may be its potential to complicate further the unsteady US relationship with Pakistan. His dictatorial power and his foot-dragging in arresting terrorists are irksome, but Pakistani President Pervez Musharraf—a survivor of repeated assassination attempts—assumes great risk to his own physical safety simply by receiving Bush in Islamabad. Pakistan’s horrendous security record with its own nuclear technology automatically forecloses any deal similar to the US-India arrangement. Nonetheless, Musharraf cannot be pleased that his cooperation in US anti-terrorism efforts is rewarded with a nuclear carte blanche for rival India. One need only observe the strained postures of Bush and Musharraf in their joint appearances to understand that the US-Pakistan strategic relationship is fraught with tension. The nuclear deal with India trades off the possibility of closer cooperation with Pakistan in the pursuit of other aims.

One of those aims is to solidify India as a US-friendly counterweight to China in Asia. India’s desire to compete with China is partly geostrategic. Many Westerners are probably unaware that India and China fought a border war in 1962—or perhaps even that India and China share a border. China’s military victory in that confrontation gave it control over a critical artery to Tibet. The border between India and China, while presently stable and tacitly acknowledged by both parties, remains a technically disputed line of military control. Additionally, Sino-Indian competition is, of course, economic. India lacks substantial energy resources, and its continuing development will require massive energy use: power for new infrastructure, rural electrification for the poor, and automotive fuel and air conditioning for the burgeoning middle class. The United States sees its transfer of uranium fuel and nuclear technology to India as, in part, an investment in a democratic alternative to Chinese economic hegemony in Asia.