US law affects US stance vis a vis India. Thus the Hyde act can restrict US from supplying nuclear fuel to India. In fact, it may even be used by congress to push US foreign policy in the direction of isolating India interms of nuclear fuel access.
Whats important is the stance taken by other suppliers with a more independent foreign policy. E.g. France, Russia, etc. If they are locked into lucrative supply and nuclear power plant construction projects, they might be inclined to continue providing fuel even if India tests a weapon.
So I don't completely agree with your simplistic view of things.
