I don't understand the part where India can get all the fuel needed, just by importing it from Nigeria etc. If this is true, what stops Nigeria from selling to TSP and Al Zuwahiri? Or KSA?
Assuming that there is some very good reason why you can't just import from such places, the NSG still controls the technologies, so India should either invest massively in R&D and manufacturing infrastructure for these purposes (and wait 15 years for any results), or sign up and get on board. The latter option is more cost-effective, and cuts the time delay, once foreign exchange is not such a choking problem as it used to be.
As for fears of the FMCT, I read the deal as Unkil saying, "Yes, v will sign off on this, and v know that u will then b able to direct much more of your own fuel to weapons building, but then u should COOPERATE in getting to a FMCT at some point". The logic here is that today India has to say

to FMCT because it would freeze India into a very bad situation. But once
enough fuel is available to generate a lot of enriched Yoo and Pu, then why not get on board the FMCT? Point is that now we get to define "ENOUGH" without being under siege.
Without such an "INTENT", the NSG cannot save their H&D in agreeing to sell to India. They have all adopted some such "fissile material cutoff" simply because they have more than enough already siphoned off into the Classified world. Like a Mantri going on hunger strike.
Without a short-term infusion of Yoo, India has no real hope of breaking through to eventually get to the happy state of "3rd stage thorium-based" etc. as discussed exhaustively here.
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As I c it, here's the situation:
1. Jingostan was 500% pushing for the Deal with Unkil until, say, circa May 2004.
2. Then Jingostan was still 400% pushing for it, citing poor progress / personality skills of Pee Em and chamchas.
3. GOI amazingly broke through to a deal.
4. Jingostan micro-analyzed the deal, and pushed 425% for getting COTUS approval, fighting off the NPA propagandoos.
5. But when COTUS passed a law (of course with all sorts of COTUS silliness attached) it was like a tug of war where the other side suddenly starts pushing instead of pulling: the prospect of an actual deal before the next election, became real. Situation deteriorated.
6. Jingostan joined Commiestan in OPPOSING the deal and demanding honesty from GOI (hah!)
7. Again, against all odds, the GOI showed some sense and spine in negotiating the 123.
8. PeeAref debated the 123 ad nauseum. Jingostan was essentially getting to the situation of a treed cat. Fortunately, Commiestan was up another tree, and seemed to guard access to the NSG.
9. The GOI circumvented that too, and seems to have been doing quite well in negotiating with the NSG.
10. Jingostan is like a watered flower as far as prospects for 2009 go. So now there is a severe time problem. If the NSG negotiations were dragged out enough, there is a good chance that Jingostan can once again swing around to become 600% behind the deal. BUT... if the NSG talks break through and a deal is signed, and COTUS rushes to endorse.. then there is a huuuuuuge problem.
11. Suddenly the Itch To Test (I2T) becomes unbearable.
12. In the process, Jingostan seems perfectly willing to come out with "True Confessions". I predict that if there is no relief (i.e., no breakdown in talks with NSG) we will hear stories along the lines of "I Ate My Baby!" That the POK-II tests were actually just a Holi preparation, all entirely conventional bums, but there was an earthquake because Jayalalithaaa visited Rajasthan, so GOI decided to declare that there had been new clear tests.
You see why I view this whole "N2TN" as a blatant politically-motivated sell-out of India? It violates Fundamental Principles #1 and #2 deeply. No insults intended against anyone, unless someone is insulted by revelation of the clear evidence of their own deeply-held beliefs, which in this case cloud objectivity. Sure there are technical reasons to test. But technical reasons are always subject to consideration of alternatives where the whole problem can be avoided. When we suggest those, we are told that the solutions there are not ready yet, so we should not consider them. Until testing is banned in those areas???