When India tests its nuclear device in Pokharan, in the absence of any such agreement with the US:

N-weapons programme: Not recognized internationally, any efforts to strengthen programme attracts range of countermeasures, across-the-board sanctions.

Fuel supplies: No fuel supplier nation can trade with India. In 1992, Nuclear Suppliers Group (NSG) adopted a rule that no country outside P-5 can have unsafeguarded reactors. And if so, NSG will not do business with such countries. Prime example: India.

Reprocessing: India does reprocess spent fuel but shortage of fuel. India cannot import fuel and even if it does, reprocessing will draw criticism. US-origin fuel still lying idle in Tarapur.

Research and Technology: India nuclear scientists find hard to travel due to visa problems, dual technology not available because India is outside the NPT system

With the 123 agreement in place...

N-Weapons programme: US doesn't recognize but agrees it will not hinder growth of the military programme. India can still test but US can respond by asking for return of all it has supplied under the agreement. However, this time there will be consultations taking into account circumstances (which means if Pak and China test)

Fuel Supplies: US agrees to let India import fuel for civilian programme and is committed to get a similar exemption from NSG. This frees up domestic fuel for weapons programme. Besides, US guarantees India uninterrupted supplies, also agrees to support building a strategic reserve.

Reprocessing: US agrees to grant advance consent to reprocess spent fuel under safeguards. This enlarges base for the second-stage programme and can prove useful to expand the civilian programme.

... contd.