BASIC Getting to Zero Papers, No. 7
India and the Nuclear Deal
18 August 2008
Siddharth Ramana, BASIC
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Introduction
The Indo-US civilian nuclear agreement (hereafter referred
to the deal) has been heavily criticized by non-proliferation
advocates in the United States and around the world as creating
a gaping hole in the Non-Proliferation Treaty (NPT), and complicating
punishment against potential NPT violators such as Iran. It
has also had to contend with considerable domestic opposition
in India. Supporters have claimed it to be a historic agreement
which transforms the Indo-US relationship and brings India
into the broader non-proliferation regime. The first step
towards the final approval of the deal was made earlier in
August when the International Atomic Energy Agency (IAEA)
Board agreed India-specific safeguards.
The deal envisions the extensive sale of nuclear fuel and
technical cooperation under safeguards involving several selected
Indian nuclear reactors. It transforms India from a nuclear
pariah state to a unique member within the mainstream nuclear
community. India is often described as a 'de-facto' nuclear
state and has come under criticism for remaining outside the
NPT (it was never allowed to join as a nuclear weapon state),
and considerable pressure from the international community
to sign the Comprehensive Test Ban Treaty (CTBT). Indeed,
the Nuclear Suppliers Group was formed in response to India's
nuclear test in 1974 to deny it, and other states access to
dual-use nuclear technologies, that could assist them in the
their military programs. India has abstained from signing
both NPT and CTBT, but under the deal would have the NSG restriction
relaxed and derive fuel and technical know-how which hitherto
had been reserved for the signatories of the NPT.
The deal is exclusive to India, and so was originally opposed
by its nuclear arch-rival Pakistan. But the principal blockage
up to this point has been domestic opposition in India, where
the government has been accused of selling its nuclear sovereignty
to American interests. Opposition to the deal had so polarized
the Indian parliament, that important leftist allies withdrew
support to the government threatening its viability and forcing
it to seek new allies to save the deal and itself. In an acrimonious
trust vote to decide its fate, the government managed to win
by a narrow majority and authorized its interlocutors to proceed
to the IAEA.
Following the IAEA agreement, the next hurdle is for the
Nuclear Suppliers Group (NSG) to agree to exceptions to their
multilateral controls on nuclear fuel and technology for India.
The NSG consists of major nuclear powers and primary exporters
of nuclear fuel and technology and operates by consensus.
The final hurdle is the US Senate. Senators opposed to the
deal appear to be in a minority, but the timetable is tight
in advance of the dissolution of Congress before the US Presidential
and Congressional elections in November.
IAEA negotiations
IAEA Director General Mohamed El Baradei strongly supported
the deal. He concluded
his intervention at the Board by saying:
"As Director General and as a lawyer, I consider
that that the agreement is solid, in full conformity with
our rules and standards; it makes no exception from the basic
rules in terms of duration, in terms of conditions. And, as
a person concerned with nuclear disarmament and non-proliferation
- I believe this is a step in the right direction."
One delegate was reported
to have said that the DG's intervention swung the opinion
of the Board in India's favor even though many countries had
reservations.
While the primary state antagonists have been Iran, China
and Pakistan, China rarely opposes a consensus, and appears
to be holding fire in advance of the NSG meeting. Iran was
vociferously against the exemption granted to India, and accused
the United States of indulging in 'double standards', but
is obviously not a member of the NSG.
Pakistan adopted a U-turn at the IAEA and expressed support,
recognizing the potential for its own rehabilitation into
the international community as a de facto nuclear state. Mr.
Shahbaz, its ambassador to Vienna, hailed it as a precedent,
"which constitutes an acknowledgement of 'new realities'".
This view could
have gained some comfort from El Baradei's statement that
the deal could be considered a precedent. However, calls from
Pakistan's Nuclear Command Authority for a 'criteria based'
exemption rather than an exclusively Indian deal were never
seen as realistic at this point. Pakistan's demands for a
similar deal were explicitly rejected
by President Bush citing the different histories of India
and Pakistan.
One Indian supporter responded to accusations of double-standards
by stating that the "Safeguards agreement is to ensure that
India shall not divert nuclear fuel to any other use. India
is a highly responsible country and not a rogue State. India
has never diverted any imported material to any other use
and has never exported fuel or technology to a third country."
Indian proponents like
to contrast this record with that of its neighbor, Pakistan,
which has been embroiled in a proliferation scandal involving
its leading nuclear scientist Dr. A.Q Khan.
Assistance to India's military program?
The chairman of the House of Representatives Foreign Affairs
Committee Howard Berman, a Democrat, in a letter to Secretary
of State Condoleeza Rice, has attacked
the deal, saying, "Such an exemption would be inconsistent
with US law, place American firms at a severe competitive
disadvantage, and undermine critical US non-proliferation
objectives".
U.S. Congressman Edward Markey, a senior member of the House
of Representatives Energy and Commerce Committee, and co-chair
of the House Bipartisan Task Force on Non-proliferation, has
described
the agreement as "worse than useless" and "a sham". According
to him "This pathetic safeguards agreement not only seriously
undermines the Non-Proliferation Treaty, but it also sends
the exact wrong message to Iran: that international nuclear
safeguards are only for show. With this agreement, the IAEA
has thrown its principles out the window and has abandoned
its most important responsibilities."
Significant criticism of the deal relates to the fear that
the agreement would free up Indian domestic uranium reserves
to cater to the military sector of India's nuclear program.
According
to Sukla Sen of the Coalition for Nuclear Disarmament and
Peace, "The agreement is fatally flawed because it is part
of a larger deal that allows India to keep its nuclear arsenal
and make more fuel for nuclear weapons. It detracts from the
objectives of nuclear non-proliferation and disarmament, and
will have a negative global impact."
Joseph Cirincione of Ploughshares and the Center for American
Progress asserted
that "the deal endorses and assists India's nuclear-weapons
program. U.S.-supplied uranium fuel would free up India's
limited uranium reserves for fuel that otherwise would be
burned in these reactors to make nuclear weapons." It is therefore
feared that the production capacity of the Indian nuclear
arsenal would be considerably increased.
Responding to fears that the deal would further advance the
India's military nuclear program assistant Secretary of State
for South and Central Asian Affairs Richard Boucher said
"you see that in the draft law (introduced in the US Congress)
and elsewhere, the Indian decision to have a moratorium on
nuclear testing is one of the basis on which we can undertake
this civilian nuclear cooperation". Recently, under secretary
of state Nicholas Burns buttressed this statement claiming
that the 123 agreement was "absolutely consistent" with the
Hyde Act, and that US can terminate the pact if India conducted
atomic tests.
Herein lies a significant problem, for as articulated
by Henry Sokolski, executive director of the Non-proliferation
Policy Education Center, "The Bush administration has tried
to convince Congress that the enabling US legislation for
the nuclear deal, the Hyde Act, has mechanisms to check India's
nuclear weapons ambitions. However, the Indian Government
is indicating the opposite."
Dr. Ashley J. Tellis of the Carnegie Endowment for International
Peace points
out that India's uranium reserves are more than sufficient
for its military and civilian programs. "The present shortage
of uranium fuel arises from bottlenecks in mining and milling
capacity... as a result of decisions made under pressures
of fiscal necessity by the government of India in the early
1990s." New facilities, not dependent in any way upon the
deal and already in the pipeline, mean that current shortages
will be transitory. Nuclear material or equipment exported
by the United States (or others) under the deal with India
would not
be directly involved in the manufacture of nuclear weapons.
Trellis argues that imports of any energy source could relieve
India of the uranium limits on its military program just as
effectively as assistance to their civil nuclear program.
Limits to the deal
Under the current terms of the deal if India were to experience
unwarranted disruptions in the supply of fuel to its safeguarded
civil nuclear energy establishments, the IAEA would assist
and take legal recourse and India would have the right to
suspend its safeguards. The preamble to the agreement talks
of India's right under the deal to "reliable, uninterrupted
and continuous access to fuel supplies from companies in several
nations, as well as support for an Indian effort to develop
a strategic reserve of nuclear fuel to guard against any disruption
of supply over the lifetime of India's reactors." Articles
52(c), 29, 30 (f), and 4) provide additional clarification.
India is also reserving
the right to amend or adjust the list of safeguarded facilities,
or to delay the application of safeguards, depending on India's
access to the international fuel market, as outlined in the
preamble.
Any guarantee of assured fuel supplies would nevertheless
be a bilateral matter between India and the supplier. Australia
has stated it would support India at the NSG, but is unlikely
to supply India with uranium because of its de facto nuclear
status and its failure to sign the NPT.
Some privileges afforded to the nuclear weapon states will
not be granted. Inter-changeability of nuclear establishments
kept under civilian or military designation, available to
recognized NPT nuclear weapon states, is not given to India
- they will not be able to switch reactors. The governing
additional protocol, as and when it is negotiated, may include
safeguards provisions applicable to non-weapon states. The
United States has certain unique rights in the name of its
'national security interest' in the agreement with the IAEA,
while China has the right to decline an additional protocol.
By agreeing to place India's nuclear facilities under the
safeguards, it would be an irreversible process.
Domestic Critics
Domestic critics point
to the failure of the government to achieve recognition of
India's nuclear status. According to Dr A N Prasad, a former
director of the Bhabha Atomic Research Centre and member of
the Atomic Energy Commission, "It would have been better if
India had insisted right at the beginning and managed to get
a safeguards arrangement similar to the one applicable to
the weapons states." This would have expressed formal intent
of treating India on parity with the United States.
He thinks the 'corrective measures' as mentioned in the agreement
fails to address the fear of a repeat of the disruption of
nuclear fuel supplies from the United States, as experienced
after the 1974 test. In that instance, nuclear fuel to the
power plant at Tarapur was withheld when a new nuclear non-proliferation
Act (NNPA) was passed by US Congress.
Previous supply
A number of countries-Canada, China, France, Russia, and
the United States-have
provided fuel to India's safeguarded facilities under facility-specific
(INFCIRC/66) safeguards agreements both before and after the
NPT entered into force and before and after India first detonated
a nuclear explosive device in 1974. The current Indo-Russian
civilian nuclear cooperation program, involving the construction
of two light water reactors at Koodankulam in the south Indian
state of Tamil Nadu, is also operating under the same understanding.
Nuclear cooperation taking place under facility-specific safeguards
agreements-a standard form of collaboration under the auspices
of the International Atomic Energy Agency-was understood
to fully satisfy all the obligations incurred by the state
parties under the NPT.
Who benefits?
So who benefits the most? According
to Dr. George Perkovich, at the Carnegie Endowment for International
Peace, the nuclear deal was India's idea, and can best be
understood as a scientific-commercial understanding, and a
mutual desire to establish a stronger geo-political relationship.
India would not only be supplementing its energy sources,
but would also gain help in modernizing its nuclear facilities.
According
to Indian Prime Minister Manmohan Singh, in a meeting with
the US President he commented that "the people of India, particularly
the thinking part of our population, our scientists, our technologists,
have rightly or wrongly nursed this grievance against the
United States. That the United States has joined with other
countries to erect a system of controls which denies our country
access to dual-use technologies to prevent us from leapfrogging
in the race for social and economic development... I appeal
to you I think to look at India-US nuclear cooperation in
that grand setting. I look upon it as an act of historic reconciliation".
India has the largest reserves of Thorium in the world, and
Thorium provides a high radiation barrier to discourage theft
and proliferation of spent fuel. This source of nuclear fuel
has been supported by the American
Nuclear Society as also in the recommendations of an IAEA
paper. Assistance under the deal could prove critical
in exploiting this fuel, with implications beyond India.
For the United States, the investment opportunities for American
companies such as GE Energy, USEC and Westinghouse Electric
in future Indian nuclear reactors could amount to more than
$100 billion in new reactor construction contracts in just
the next ten years. According to US-India Business Council's
Ron Sumers "India's energy needs are vast -- as its economy
booms, the country plans to quintuple its nuclear energy production
to as much as 40,000 megawatts by 2020. At an estimated $2.5
billion per 1,000 megawatts, the nearly 30 new reactors India
will commission could signal the beginning of a "nuclear renaissance"
that American nuclear companies have been waiting for."
But there is stiff competition. Russia and France are making
the same calculations. Areva NP SAS, Atomenergoproekt, and
ZAO Atomstroyexport are already working in India. According
to Padmanabha Chari of the Institute for Peace and Conflict
Studies, a Delhi-based think tank "I can easily see the Indians
going for French or Russian reactors because they are seen
as more advanced". France has already signed
a nuclear deal with India during the 2006 state visit of President
Jacques Chirac to India.
Conclusion
There is no chance of India signing the NPT as a non-nuclear
weapon state. Some argue that the deal strengthens the non-proliferation
regime by bringing a de facto nuclear state into the
wider non-proliferation regime. Others point to the weakening
of the bargain, and an indefinite acceptance of the status
of India as a nuclear power, that will encourage others within
the NPT to take the option. The decisive decision is likely
to be in the Nuclear Suppliers Group over the coming weeks.
The views expressed in this paper do not necessarily reflect
those of BASIC
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