Unfinished Business for the NSG

Daryl G. Kimball

In an unprecedented move that will undermine the value of the Nuclear Suppliers Group (NSG) and the already beleaguered nuclear Nonproliferation Treaty (NPT), the NSG reluctantly agreed Sept. 6 to exempt NPT holdout India from its guidelines that require comprehensive international safeguards as a condition of nuclear trade.

The decision is a nonproliferation disaster of historic proportions that will produce harm for decades to come. It severely erodes the credibility of global efforts to ensure that access to nuclear trade and technology is available only to those states that meet global nuclear nonproliferation and disarmament standards. India does not.

Furthermore, foreign supplies of nuclear fuel to India's civil nuclear sector will reduce or eliminate India's need to sacrifice electricity production to produce weapons-grade plutonium. This would enable India to increase the rate of fissile material production for bombs and worsen nuclear arms competition in Asia.

Compounding the error, the Bush administration rebuffed efforts by a group of responsible NSG states to incorporate into their decision provisions in U.S. law that severely restrict transfers of sensitive nuclear fuel-cycle technologies to India and mandate a cutoff of nuclear trade if India resumes nuclear testing.

When the NSG meets again in November, the United States and other participating governments will have an opportunity to close one of the loopholes of their India-specific exemption: barring the transfer of uranium-enrichment and spent fuel reprocessing technologies to states that have not joined the NPT or agreed to an additional protocol to their safeguards agreement, which gives international inspectors broader authority.

Tougher NSG standards on sensitive fuel cycle technologies are long overdue. In India's case, enrichment and reprocessing cooperation could actually help its nuclear bomb production program because international safeguards cannot prevent the replication or use of such technologies for weapons purposes.

In practice, it is unlikely that suppliers will transfer enrichment or reprocessing technology to India anytime soon. The NSG waiver for India maintains that NSG states must continue to "exercise restraint" with respect to transfers of sensitive dual-use technologies and enrichment and reprocessing technologies to India or any other state. And, according to the Bush administration, no NSG participating government intends to transfer enrichment or reprocessing technology to India. Yet, India continues to demand "full" access to the nuclear fuel and technology market, and supplier states intentions could change, especially if they smell a profit.

Before agreeing to consider the U.S.-Indian nuclear cooperation agreement last month, the House and Senate should have demanded that the United States win support for tougher NSG guidelines on enrichment and reprocessing transfers. Under heavy political pressure to rush the flawed deal through, they failed to do so.

In exchange for quick House approval of the India agreement, however, Secretary of
State Condoleezza Rice acknowledged the NSG loophole in a personal commitment to Howard Berman (D-Calif.), chair of the House Committee on Foreign Affairs. Rice promised that the United States will make its "highest priority" to achieve a decision at the next NSG meeting to prohibit the export of enrichment and reprocessing equipment and technology to states that are not party to the NPT.

NSG discussions on the matter predate the proposal for opening nuclear trade with India and are ripe for a decision. In 2004 the United States proposed a complete ban on sensitive fuel-cycle technology transfers to states without such capabilities. Many NSG states objected and suggested a criteria-based approach, but the United States said no.

Just ahead of the May 2008 NSG meeting, the United States adjusted its position and threw its support behind a proposal that would bar enrichment and reprocessing technologies to states that:

• have not signed the NPT;

• have not agreed to an additional protocol to their International Atomic Energy Agency safeguards agreement;

• are not in compliance with their NPT or safeguards obligations; or

• are located in regions in which such transfers might promote proliferation or undermine security.

However, Washington also demanded that if enrichment or reprocessing transfers do occur, they should be executed only via "black box" technologies, wherein only the supplier can access and own the technology. Canada opposed this provision, thereby blocking consensus on the package.

If Washington and Ottawa can resolve their differences and if Brazil can be prevailed on to drop its misguided opposition to the additional protocol criterion, the NSG can adapt tougher enrichment and reprocessing transfer guidelines. This would plug one of the gaping holes in the September NSG waiver for India and ensure that other suppliers are more in line with U.S. policy.

The Bush administration must now follow through and rally NSG support for tougher NSG guidelines that would help mitigate some of the damage caused by the waiver for India.