The text of 102(b)(1) of the Arms Export Control Act under discussion here providesas follows: Except as provided in paragraphs (4), (5), and (6), in the event that the President determines that any country, after the effective date of partB of the Nuclear Proliferation Prevention Act of 1994 -- (B) is a non-nuclear-weapon-state and either -- (i) receives a nuclear explosive device, or (ii) detonates a nuclear explosive device, then the President shall forthwith report in writing his determination to the Congress and shall forthwith impose the sanctions describedin paragraph (2) against that country. The statute defines a "non-nuclear-weapon state" as "any country which is not a nuclear-weapon state, as defined in Article IX(3) of the Treaty on the Non-Proliferation ofNuclear Weapons" (AECA, 102(c)). Under Article IX(3) of the Treaty, a nuclear weaponstate is "one which has manufactured and exploded a nuclear weapon or other nuclear deviceprior to January 1, 1967" (21 U.S.T. 492-93). The term "nuclear explosive device" is to bedefined pursuant to 830(4) of the Nuclear Proliferation Prevention Act, 22 U.S.C. 3201note, and thus includes "any device, whether assembled or disassembled, that is designed toproduce an instantaneous release of an amount of nuclear energy from special nuclearmaterial that is greater than the amount of energy that would be released from the detonationof one pound of trinitrotoluene (TNT)." (2) Section 102(b)(2) of the AECA sets forth the sanctions to be imposed after a presidential determination. As they existed in May 1998, these sanctions were as follows: (A) The United States Government shall terminate assistance to that country under the Foreign Assistance Act of 1961, except forhumanitarian assistance or food or other agriculturalcommodities. (B) The United States Government shall terminate -- (i) sales to that country under this Act [ i.e. theAECA] of any defense articles, defense services, or design and construction services,and (ii) licenses for the export to that country of anyitem on the United States Munitions List. (C) The United States Government shallterminate all foreign military financing for that country under this Act [ i.e. theAECA]. (D) The United States Government shall deny to that country any credit, credit guarantees, or other financial assistance by any department,agency, or instrumentality of the United States Government, except that the sanction of thissubparagraph shall not apply -- (i) to anytransaction subject to the reporting requirements of title V of the National Security Act of1947 (relating to congressional oversight of intelligence activities), or (ii) tohumanitarian assistance. (3) (E) The United States Government shall oppose, in accordance with section 701 of the International Financial Institutions Act (22 U.S.C.262d), the extension of any loan or financial or technical assistance by any internationalfinancial institution. (4) (F) The United States Government shall prohibit any United States bank from making any loan or providing any credit to the government ofthat country, except for loans or credits for the purpose of purchasing food or otheragricultural commodities. (G) The authorities of section 6 of the Export Administration Act of 1979 (5) shall be used to prohibitexports to that country of specificgoods and technology (excluding food and other agricultural commodities), except that suchprohibition shall not apply to any transaction subject to the reporting requirements of title Vof the National Security Act of 1947 (relating to congressional oversight of intelligenceactivities). While the statute requires that the President impose the sanctions "forthwith," it does not specify a date by which they must be imposed. The President may delay their impositionfor a maximum of 30 days of continuous session of Congress, however, if he first transmitsto the Speaker of the House of Representatives and the Chairman of the Senate ForeignRelations Committee "a certification that he has determined that an immediate impositionof sanctions on that country would be detrimental to the national security of the UnitedStates" ( 102(b)(4)(B)). This section permits only one certification to be transmitted to theCongress for a country regarding the same detonation, transfer, or receipt of a nuclearexplosive device. Section 102(b) does not allow the President unilaterally to waive one or more of the sanctions when they are originally imposed, but does provide for the enactment of legislationon an expedited basis that would permit such a waiver. (6) The statute does not provide for thepossible removal or suspension of one or more of the sanctions once certain conditions aremet, (7) nor does it provide for their termination. Thus,in the absence of other provisions oflaw that may be invoked, legislation must seemingly be enacted to achieve these ends. (8) On May 11, 1998, India stated publicly that it had conducted three underground nucleartests that day; on May 13, it announced that it had conducted two additional tests. Pakistanannounced May 28 that it had conducted five underground nuclear tests; it reported a sixthtest May 30. Because neither India nor Pakistan had detonated a nuclear device beforeJanuary 1, 1967, each is considered to be a "non-nuclear-weapon state" for purposes of 102(b)(2). On May 13, 1998, President Clinton signed Presidential Determination No. 98-22, a memorandum for the Secretary of State, in which he determined "in accordance with section102(b)(1) of the Arms Export Control Act ... that India, a non-nuclear-weapon state,detonated a nuclear explosive device on May 11, 1998," and directed "the relevant agenciesand instrumentalities of the United States Government ... to take the necessary actions toimpose the sanctions described in section 102(b)(2) of the Act." (9) On May 30, the Presidentmade an identical determination (No. 98-25) with respect to Pakistan's May 28 tests. (10) Ineach case, the President decided not to invoke that part of 102(b) allowing a 30-day delayof sanctions. By doing so, the President appeared to forego the possible expedited enactmentof a joint resolution authorizing him to waive any sanction with respect to India or Pakistan,as provided in 102(b)(4)(B). Congress could choose to enact separate legislation, however, authorizing such a waiver or a version thereof. The President's determination regarding India was the first invocation of 102(b). At the time, no regulations had been issued governing its implementation. While the ExecutiveBranch has implemented many forms of sanctions legislation in the past and could draw onthis experience in implementing 102(b), it had no prior regulatory precedents foradministering this specific statute. The absence of certain definitions in 102(b) couldpresent problems for agencies, but could also afford them flexibility in implementing thesemeasures. (11) Agencies involved in administeringthe sanctions include the Department ofState, the Department of Defense, the Agency for International Development (AID), theOverseas Private Investment Corporation (OPIC), the Department of Commerce, the Officeof Foreign Assets Control of the Department of the Treasury (OFAC), the U.S.Export-Import Bank, and the Commodity Credit Corporation (CCC). As noted earlier,absent other provisions of law that may apply, authority for the modification, suspension, ortermination of these sanctions would appear to depend on a future congressional enactment. (12) After conducting an inter-agency review to develop a comprehensive sanctions policywith respect to India and Pakistan, the Administration announced its original implementation scheme for the two countries June 18, 1998. (13) Highlights of the sanctions,as modified by the Agriculture Export Relief Act of 1998 and the India-Pakistan Relief Actof 1998, are described immediately below. The 1998 enactments are discussed in greaterdetail in the following section of this report. Provisions of P.L. 106-79 , enacted October 25,1999, granting the President broad waiver authority and repealing the India-Pakistan ReliefAct of 1998, along with the President's actions under the new statute, are discussed in thelast section of this report. Foreign assistance: The United States terminated or suspended foreign assistance under the Foreign Assistance Act, with those exceptions provided by law. (14) On December1, 1998, the President exercised his authority under the India-Pakistan Relief Act of 1998(enacted October 21, 1998) to waive until October 21, 1999, the 102(b) prohibition as itapplied to Trade and Development Agency (TDA) activities involving both India andPakistan. The President also exercised his waiver authority to allow assistance to bothcountries under the International Military Education and Training (IMET) program. (15) Priorto the waiver, TDA would not consider new projects in the sanctioned countries, (16) butcommitments made by the TDA before May 13, 1998, for India and before May 30, 1998,for Pakistan were honored "in accordance with applicable law." (17) Policy regarding OverseasPrivate Development Corporation (OPIC) programs, which are authorized in 231 et seq. of the Foreign Assistance Act, is discussed under "Government credits, credit guarantees,and other financial assistance," below. Military sales, exports, and financing: The United States has terminated foreign military sales under the AECA, revoked licenses for the commercial sale of any item on theUnited States Munitions List, and suspended delivery of previously approved defense articlesand services to India. (18) Pakistan is prohibitedfrom receiving certain U.S. military assistance,as well as U.S. military equipment and technology, pursuant to 620E(e) of the ForeignAssistance Act of 1961 (Pressler Amendment), a restriction which may now be waived under 9001 of P.L. 106-79 . (19) Government credits, credit guarantees, and other financial assistance: The Export-Import Bank (Eximbank) had issued notices terminating new business in India andPakistan prior to the Administration's June 18 announcement. (20) This policy was lateradopted by the Overseas Private Investment Corporation (OPIC) and the Commodity CreditCorporation (CCC). (21) Transactions approved byEximbank as well as legally bindingcommitments made by OPIC and the CCC did, however, go forward. (22) The AgricultureExport Relief Act, enacted July 14, 1998, amended the AECA to provide an exemptionthrough FY1999 for U.S. Department of Agriculture financing covered by 102(b)(2)(D). This enactment permitted U.S. wheat farmers to participate in a 365,000 metric ton wheattender by Pakistan that closed the following day. (23) The new statute also permanentlyexempted from the AECA prohibition federal government financing for medicine andmedical supplies. On December 1, 1998, the President used his authority under theIndia-Pakistan Relief Act of 1998 to waive until October 21, 1999, the AECA prohibitionon Eximbank and OPIC activities with regard to both India and Pakistan, as well asnuclear-related restrictions on Eximbank activities contained in 2(b)(4) of theExport-Import Bank Act. (24) Support for international financial assistance: This sanction affects U.S. support for the programs of such international financial institutions (IFIs) as International Bank forReconstruction and Development (World Bank), the International Development Association,the International Finance Corporation, the Asian Development Bank, and the InternationalMonetary Fund (IMF). (25) In the Administration'sJune 19 press briefing, the TreasuryDepartment spokesman stated that "[t]here is now a G-8 consensus ... on two key points:first, that loans to India and Pakistan in the category of basic human needs will go forward;and second, that loans that are outside of that category -- non-basic human needs -- will bepostponed. With the voting share that the G-8 have at the IFIs, we expect that consensus tobe sustained." (26) In a written summary, the StateDepartment noted that the United States has"gained G-8 support to postpone consideration of non-basic human needs (BHN) loans forIndia and Pakistan by the International Financial Institutions (IFI) to bolster the effect of theGlenn Amendment requirement that the U.S. oppose non-BHN loans." (27) In July 1998, U.S.officials announced that the United States would not oppose the negotiation of IMF loans toPakistan, although it would abstain from an IMF board vote to approve any resulting loanagreement, an action the Administration viewed to be in compliance with its statutoryobligation under 102(b). (28) On December 1,1998, the President invoked the India-PakistanRelief Act to waive this provision until October 21, 1999, as it applies to "the extension ofany loan or financial or technical assistance to Pakistan by any international financialinstitution in support of the assistance program that Pakistan is negotiating with theInternational Monetary Fund." Private bank loans: The Administration stated that it planned to implement the 102(b)(2)(F) prohibition on certain private lending in a future Executive Order. (29) Thisprohibition appeared to have posed considerable difficulty for regulators, in part because ofthe level and nature of governmental involvement in the Indian banking system. (30) As notedearlier, the prohibition's exemption for agricultural commodities was legislatively expandedin July 1998 to include fertilizer. On December 1, the President used his authority under theIndia-Pakistan Relief Act of 1998 to waive 102(b) until October 21, 1999, as it applies to"the extension of any loan or the providing of any credit to the Government of India or theGovernment of Pakistan by any U.S. bank." Exports: The Commerce Department's Bureau of Export Administration (BXA) issued interim guidance for exporters May 28 and June 3, 1998, but a number of questions as towhich dual-use items were to be covered and which recipients were to be embargoedremained unresolved. (31) Following theAdministration's June 18 statement, the Bureau issuedits updated export policy June 22, stating that it would apply this policy to new and pendinglicense applications. As announced, the controls were grouped into three categoriesaddressing items to be exported and end-users, the first category representing the most severelevel of controls. These categories are: (1) nuclear and missile-related items and entities ofconcern; (2) exports of national security-related items (including certain computers) andmilitary entities; and (3) other dual-use items. (32) Controls range, for example, from anabsolute prohibition on exports of any dual-use item controlled for nuclear or missileproliferation reasons to all end users (category 1) to end-user based controls on computersof over 2000 MTOPS (category 2) to favorable case-by-case consideration of licenseapplications for dual-use items to Indian and Pakistani entities where neither the item nor theentity is covered by either of the first two categories. In codifying its regulations November 19, 1998, BXA, among other things, added to its general Entity List at 15 C.F.R. Part 744, Supp. 4, the names of Indian and Pakistanigovernment, parastatal, and private entities determined to be involved in nuclear or missileactivities, as well as the names of Indian and Pakistani military entities. (33) The agency statedthat, with limited exceptions, it would require a license for the export of any item overwhich BXA exercises regulatory jurisdiction to the entities cited for nuclear and missileactivities, and presume denial with regard to items specifically listed on the CommerceControl List for export to the named military entities. (34) In March 2000, BXA removed 51Indian entities from the Entity List, changed its licensing policy for exports of items notlisted on the Commodity Control List ( i.e. , those classified as EAR99) to Indian andPakistani government, private and parastatal entities from a presumption of denial to apresumption of approval, and made other changes regarding the treatment of specific entitiesin both countries. (35) Concern over the lack of an exemption for food and agricultural products in the 102(b)(2)(D) prohibition on government credits, guarantees, and financing led to the July 14,1998, enactment of the Agriculture Export Relief Act (AERA), P.L. 105-194 , whichamended this AECA section to exempt credits, credit guarantees, and financial assistanceprograms provided by the U.S. Department of Agriculture (USDA) to support the purchaseof food or other agricultural commodities, and makes this amendment applicable to USDAcredits, guarantees, and assistance made before, on, or after the date of enactment, throughSeptember 30, 1999. (36) The Act also lifted,through September 30, 1999, any sanctions thathad already been imposed under 102(b) involving these USDA programs. (37) Additionally,the AERA made the general prohibition on U.S. credits, credit guarantees, and financialassistance inapplicable to medicine and medical supplies and permanently lifted anysanctions imposed on such items before the date of enactment. (38) Finally, the Act amendedthe private loan exemption for agricultural commodities to specifically include fertilizer andpermanently lifted any sanctions imposed on such items before the date of enactment. (39) The India-Pakistan Relief Act of 1998 (IPRA), enacted October 21, 1998, authorized the President to waive "for a period not to exceed one year upon enactment" all or part of the 102(b) sanctions imposed on India or Pakistan related to FAA and governmental financialassistance, international financial assistance, and private bank loans, as well as all or part ofthe following: 620E(e) of the Foreign Assistance Act, prohibiting military assistance toPakistan based on its nuclear activities (Pressler Amendment); 2(b)(4) of the Export-ImportBank Act, generally restricting financing based on the detonation of a nuclear device; and 101 of the AECA, which prohibits certain FAA and AECA assistance to countries engagedin nuclear enrichment transfers. (40) The Actmaintained 102(b) prohibitions on sales ofdefense articles and services, export licenses for U.S. Munitions List items, foreign militaryfinancing under the AECA, and export controls under 6 of the Export Administration Act(EAA). (41) Before exercising his waiver authority,the President was required to consult withthe Senate Foreign Relations Committee, the House International Relations Committee, andthe Senate and House Appropriations Committees. In addition, the Secretary of State wasrequired to submit a report to these committees, at least 30 days before a one-year waiverperiod expired, on economic and national security developments in India and Pakistan. On November 7, 1998, the President announced that he would waive some of the existing nuclear sanctions because of Indian and Pakistani commitments regarding furthernuclear testing. (42) As noted earlier, the Presidentformally exercised his IPRA authorityDecember 1, 1998, waiving until October 21, 1999, the statutory provisions covered by thenew law, with regard to specific programs and activities. (43) A number of bills were introduced in 1999 to narrow the application of 102(b) of theAECA and other provisions of law as they pertain to India and Pakistan. (44) Three billscontaining sanctions relief legislation for India and Pakistan were acted upon: H.R. 973 passed the House June 15, 1999; H.R. 2415 passedthe House July 21, but passed the Senate August 3 in a form that did not contain sanctionsrelief provisions; S. 1122 passed the Senate June 8, and was later inserted into H.R. 2561 , the Department of Defense Appropriations Act, 2000. H.R. 2561 passed the Senate as amended July 28, and was enacted into lawOctober 25 with sanctions relief language. The new law, P.L. 106-79 , 9001, authorizes the President to waive, without time limitation, all of the sanctions contained in 101 or 102 of the AECA, the nuclear-relatedrestriction in 2(b)(4) of the Export-Import Bank Act, and 620E(e) of the ForeignAssistance Act (Pressler Amendment), as these apply to India or Pakistan. The Presidentmay waive military and export control sanctions in 102(b)(2), however, only if he certifiesto Congress that a particular restriction would not be in U.S. national security interests. Further, the issuance of a license for defense exports is subject to the same requirements asthose contained in 36(c) of the AECA, 22 U.S.C. 2776(c), which requires the Presidentto certify to Congress specified information on a proposed defense export before an exportlicense is issued. (45) The statute also contains "sense of Congress" language that (1) the "broad application of export controls to nearly 300 Indian and Pakistani entities is inconsistent with the specificnational security interests of the United States and that this control list requires refinement"and (2) "export controls should be applied only to those Indian and Pakistani entities thatmake direct and material contributions to weapons of mass destruction and missile programsand only to those items that can contribute to such programs." Waivers issued under the law will cease to apply to India or Pakistan if the respective country detonates a nuclear explosive device or takes one of the nuclear-related actions thatwould require the President to report to Congress under 102(b)(1) of the AECA. Thestatute also repeals the India-Pakistan Relief Act of 1998. On October 27, the President waived the statutory restrictions covered by the new law as applicable to specific U.S. government programs and commercial transactions. (46) Thewaiver for India covers the following: Export-Import Bank programs; OPIC programs; Trade and Development Agency programs; assistance under the International Military Education and Training(IMET) program; private U.S. bank loans and credits to the Government ofIndia; assistance to the Asian Elephant Conservation Fund, the Rhinocerosand Tiger Conservation Fund, and the Indo-American Environmental Leadership program;and USDA credits, credit guarantees, and other financial assistance tosupport the purchase of food or other agricultural commodities. The waiver for Pakistan is more limited, covering private U.S. bank loans and credits to the Government of Pakistan, and USDA credits, credit guarantees, and other financialassistance to support the purchase of food or other agricultural commodities. The UnitedStates had earlier terminated aid to Pakistan under an annual foreign operationsappropriations act provision cutting off all assistance financed by funds appropriated underthe statute to any country whose duly elected head of government is deposed by military coupor decree, a provision that was triggered by the October 12, 1999 military coup in Pakistan. (47) The 2001 Foreign Operations Appropriations Act, however, allows appropriated funds forcertain Foreign Assistance Act programs to be made available for basic education programsfor Pakistan, "notwithstanding any provision of law that restricts assistance to foreigncountries." (48) As noted earlier, the Commerce Department in March 2001 removed 51 Indian entities from the Entity List, made other revisions regarding the treatment of specific entities of bothcountries, and instituted a presumption of approval for applications to export goods to certaingovernment, parastatal, and private entities in India or Pakistan where the goods are subjectto DOC jurisdiction but not listed on the Commodity Control List. The Department referredto the "sense of Congress" language in the 1999 statute as supporting its regulatoryrevisions. (49) On August 9, 2001, the President waived the application of restrictions in 101 and102 of the AECA with regard to Pakistan relating to exports of defense articles and servicesto the extent that the restrictions applied to "the sale of certain specified U.S.-originhelicopter and armored personnel carrier spare parts and ammunition to Pakistan for use inits deployment in Sierra Leone in support of UN peacekeeping operations." (50) Later in the month, the Bush Administration indicated that it was reviewing its sanctions policy with the primary aim of easing sanctions currently imposed on India. (51) Sen. JosephBiden, Chairman of the Senate Foreign Relations Committee, wrote to the President August24 urging him to use his waiver authority to lift economic sanctions (mainly export controls)imposed on India, and stating that "a case can be made for the use of waiver authority to liftsanctions on Pakistan as well," but that concerns over missile technology from China toPakistan should first be resolved. (52) RankingMember of the House International RelationsCommittee Tom Lantos sent a letter to the President August 28 also stating his support forlifting the nuclear sanctions imposed on India. On September 5, Rep. Jim McDermott andRep. Ed Royce (co-chairmen of the Congressional Caucus on India), along with 48 otherHouse Members, wrote to the President in support of Administration statements regardingremoval of sanctions and asking that he "strongly consider re-evaluation and substantiallychanging" the Entity List. Following the September 11 terrorist attacks on the World Trade Center and the Pentagon, the President, on September 22, waived 101(b)(2) sanctions and prohibitions onexports of defense items and sensitive technology and military financing with respect to bothIndia and Pakistan, having determined that continuation of the measures would not be in U.S.national security interests. (53) He also waived anyremaining sanctions in 101 or 102 of theAECA, the Export-Import Bank Act, and the Pressler Amendment. As noted above,however, foreign assistance to Pakistan is currently restricted because of the anti-coupprovision in the FY2001 foreign operations appropriations act. (54) In addition, the PakistaniMinistry of Defense and its sub-units and successors, as well as two other Pakistani entities(the Space and Upper Atmosphere Research Commission (SUPARCO) and the NationalDevelopment Complex) are currently subject to two-year AECA missile proliferationsanctions. These consist of prohibitions on granting export licenses under the EAA and theAECA and on entering into U.S. government contracts involving the sanctioned entities. (55) H.R. 1358 (McDermott), introduced April 3, 2001, would remove all nuclear sanctions imposed on India and Pakistan. The bill has been referred to the HouseInternational Relations Committee and the House Financial Services Committee. H.R. 2889 (Lantos), introduced September 14, 2001, would permanently remove nuclear sanctions as they apply to India. The bill has been referred to the HouseInternational Relations Committee. H.R. 2506 , the foreign operations appropriations bill for FY2002, as passed the House, provides that assistance may be resumed to countries subject to theanti-coup amendment not only if the President certifies that a democratically electedgovernment has taken office, but also if he certifies that "substantial progress has been madetowards the holding of democratic elections" ( 508). The bill, as reported by the SenateAppropriations Committee, does not contain this additional language. Both bills, however,would provide for basic education assistance for Pakistan ( H.R. 2506 , 577,as passed by the House; 572, as reported in the Senate). S. 1465 (Brownback), as reported by the Senate Foreign Relations Committee October 4, 2001, would make a number of statutory aid-related restrictionsinapplicable to Pakistan and allow flexibility in the use of other related authorities untilOctober 1, 2003, unless otherwise provided in the bill. Regarding the anti-coup restriction,it would make inapplicable to Pakistan any such provision in the foreign operationsappropriations act for FY2002 (or for any earlier fiscal year) ( 1(a)). It would also authorizethe President to waive, with respect to Pakistan, any anti-coup provision in the foreignoperations act for FY2003 if the President determines and certifies to Congress that thewaiver would facilitate the transition to democratic rule in Pakistan and is important toUnited States efforts to respond to, deter, or prevent acts of international terrorism ( 1(b)). Congressional consultation requirements would be required before either or these authoritieswere invoked. Regarding EAA and AECA missile proliferation sanctions, it would allowthe President, with respect to a sanction imposed on a foreign person in Pakistan prior toJanuary 1, 2001, to exercise the waiver contained in the underlying authorities afterconsultation with appropriate congressional committees and without regard to thenotification period set forth in the waiver provisions ( 2). Regarding other foreignassistance restrictions, it would make 620(q) of the Foreign Assistance Act, prohibitingassistance to countries in default on certain debt owed the United States, and any similarprovision in the foreign operations appropriations act for FY2002, inapplicable to Pakistan( 3). The reported bill also contains provisions modifying FAA notification deadlines fordrawdowns and transfers of excess defense articles carried out to respond to, deter, or preventacts of international terrorism ( 4). As introduced September 25, 2001, the bill would have authorized the President through September 30, 2003, and notwithstanding any other provision of law, to provide assistance,authorize the export of defense articles or defense services, authorize the export of dual-useitems, or extend other financial assistance to India or Pakistan, under the Foreign AssistanceAct, the Arms Export Control Act, the Export-Import Bank Act, or any other provision oflaw, if the President determined that to do so was in the national interest of the United Statesand important to U.S. efforts to respond to, deter, or prevent acts of international terrorism. The President would have been required to notify Congress before using this authority; thestatute could not have been construed to authorize the President to provide for nuclearcooperation with either country.

Summary:
Section 102(b) of the Arms Export Control Act (AECA) requires the President to impose sanctions on any country that he has determined is a "non-nuclear-weapon state" andhas received or detonated a "nuclear explosive device." Sanctions include prohibitions onforeign assistance; munitions sales and licenses; foreign military financing; governmentcredits, guarantees, and financial assistance; U.S. support for multilateral financialassistance; private bank lending to the affected government; and exports of certain specificcontrolled goods and technology. Specific exceptions exist for humanitarian aid; food andagricultural exports; food assistance; private bank loans and credits for purchases of food andagricultural commodities; and certain transactions involving intelligence activities. Thestatute does not provide for terminating or suspending sanctions once imposed. ThePresident placed 102(b) sanctions on India and Pakistan in May 1998 following nucleartests by those countries earlier that month. The statute had never before been invoked andits full implementation give rise to various legal and policy issues. After an inter-agencyreview, the Administration announced its overall implementation plan for both countriesJune 18, 1998. Concerns over the lack of an exemption for agricultural goods in 102(b)(2)'s prohibition on government credits and guarantees led to enactment of theAgriculture Export Relief Act ( P.L. 105-194 ), which exempted Department of Agricultureprograms through FY99; it also permanently exempted government financing for medicineand medical goods and allowed private loans for fertilizer exports. In October 1998,Congress authorized the President to waive for one year certain 102(b)(2) prohibitionsapplicable to the two countries, as well as other related statutory restrictions (India-PakistanRelief Act, P.L. 105-277 ). The President exercised this authority December 1, 1998. Congress has since authorized the President to waive indefinitely, as they apply to India and Pakistan, all sanctions imposed under 101 or 102 of the AECA; a nuclear-relatedrestriction in the Export-Import Bank Act; and 620E(e) of the Foreign Assistance Act(FAA)(Pressler Amendment), which restricts military aid and exports to Pakistan (DODAppropriations Act, 2000, P.L. 106-79 , 9001). The President may waive military andexport control sanctions only if he certifies to Congress that applying a restriction would notbe in U.S. national security interests; any licenses for defense exports must be notified toCongress and are subject to congressional review. In October 1999, President Clintonwaived sanctions with regard to certain programs and commercial transactions specific toeach country. In August and early September 2001, both the Bush Administration andMembers of Congress began to call for removal of the sanctions, mainly as applicable toIndia; legislation to lift the measures has also been introduced. Following the September 11attacks on the World Trade Center and the Pentagon, the President waived for both India andPakistan prohibitions on exports of defense items and sensitive technology and militaryfinancing, citing U.S. national security interests; also waived were any remaining sanctionsin 101 or 102 of the AECA, the Export-Import Bank Act, and the Pressler Amendment. Foreign assistance to Pakistan continues to be restricted because of an anti-coup provisionin appropriations legislation and other debt-related restrictions; also, three Pakistani entitiesare subject to two-year AECA missile proliferation sanctions. Legislation allowing removalof restrictions on Pakistan ( S. 1465 ) was reported by the Senate ForeignRelations Committee October 4. This report will be updated.