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India

Nonproliferation Experts Analyze State Department Responses to Congressional Questions Concerning U.S.-Indian Nuclear Deal

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Note for Reporters by Sharon Squassoni (202-939-2297), Fred McGoldrick (617-298-2024), and Daryl G. Kimball (202-463-8270 x107)*
September 4, 2008

(Washington, D.C.) As U.S. and Indian officials race against the clock to win domestic and international approval for a controversial proposal to relax rules governing nuclear trade with India, the House Committee on Foreign Affairs (HCFA) has made public the Department of State’s January 2008 responses to more than 40 questions sent by the committee in October 2007 that were aimed at sorting out ambiguous and contradictory statements about the August 2007 U.S.-Indian nuclear cooperation agreement.

Background

Under a 2006 law known as the Hyde Act, Congress granted the U.S. president limited and conditional authority to waive the longstanding U.S. legal restrictions on nuclear trade with countries, such as India, that have tested nuclear weapons, have not joined the nuclear Nonproliferation Treaty (NPT), and do not allow comprehensive international nuclear safeguards.

In 2007, Washington and New Delhi negotiated a bilateral nuclear trade agreement, known as a 123 agreement, which President George W. Bush may only submit to Congress for its possible approval if the 45-member Nuclear Suppliers Group (NSG) agrees by consensus to an India-specific exemption from group guidelines, which currently restrict nuclear trade with India. The NSG is meeting Sept. 4 and 5 in Vienna to consider a revised U.S. proposal to exempt India.

Given India’s demands for a “clean” and “unconditional” exemption and proposed amendments from approximately 15 NSG countries for conditions and restriction on trade with India (barring enrichment or reprocessing technology transfers and terminating trade if India resumes nuclear testing), it is highly unlikely the NSG will reach a decision anytime soon.

Congressional Questions and the State Department’s Responses

The HCFA in October 2007 submitted 45 questions to the State Department and its responses were delivered in February 2008. But they were put under a virtual “gag order” by the Bush administration until now.

The good news is that the Bush administration interpretation of the U.S.-Indian 123 agreement reflects the right of the United States and requirement (per Sections 123 a (4) and 129 of Atomic Energy Act) to cut off nuclear trade if India tests. However, it is doubtful that the Indian government agrees.

Consequently it is essential that the NSG write this “post-condition” into any decision it might make to grant an exemption for India if the United States expects other nations to follow suit.

The following is a preliminary analysis of the responses to questions on several key issues:

“Full” nuclear cooperation: Indian officials insist this means enrichment and reprocessing cooperation. In response to the HCFA questions, the State Department wrote:

1. “As a matter of policy, the United States does not transfer dual-use items for use in sensitive nuclear facilities.” (Q. 4)

2. “Consistent with standing U.S. policy, the USG will not assist India in the design, construction, or operation of SNT [sensitive nuclear technologies] through the transfer of dual-use items.” (Q. 5)

3. “The Administration does not plan to negotiate an amendment to the proposed U.S.-Indian Agreement to transfer to India sensitive nuclear facilities or critical components of such facilities.” (Q. 6)

Bottom line: The United States does not plan to transfer enrichment and reprocessing technology, which could be used to assist India's weapons program. If the NSG decides to grant India an exemption from its guidelines, it should establish an unambiguous policy barring the transfer of enrichment, reprocessing, or heavy water production technology to India.

Termination for nuclear testing: Indian officials have stressed that the 123 agreement does not constrain India’s ability to test a nuclear device. However, the State Department told the HCFA:

1. “Article 14 of the…agreement…provides for a clear right for the United States to terminate nuclear cooperation and a right to require the return of equipment and materials subject to the agreement in all of the circumstances required under the AEA, including if India detonated a nuclear explosive device.” (Q. 35)

2. “…both of the actions that must be taken to exercise the right of return [giving written notice of termination and ceasing cooperation] would be within the discretion of the USG, and both actions could be taken at once.” (Q. 36)

3. “…Should India detonate a nuclear explosive device, the United States has the right to cease all nuclear cooperation with India immediately, including the supply of fuel, as well as to request the return of any items transferred from the United States, including fresh fuel.” (Q. 16)

Bottom line: These answers tie an Indian nuclear test definitively to termination of nuclear cooperation—something that Indian officials have suggested is not the case. The U.S.-Indian draft cooperation agreement doesn’t mention testing at all as a reason for termination and tries to soften the impact of a potential nuclear test on the agreement by referring to whether a trigger for termination resulted from a changed security environment or the actions of another state (for example, Pakistan). Indian officials also have interpreted the agreement as having a “cooling off” period of a year before termination would actually happen. The State Department answers suggest that action after a nuclear test would be swift, unambiguous, and unilateral. So too should the actions of other NSG members. If the NSG grants India an exemption, it should specify that NSG nuclear trade shall be terminated and unused fuel supplies returned if India conducts another nuclear test explosion for any reason.

Fuel supply assurances: Article 5 of the 123 agreement, as well as the Indian-specific safeguards agreement approved Aug. 1, refer to a range of fuel supply assurances. Indian officials have insisted on their ability to take corrective measures in the event that fuel supplies are disrupted. This implies that their legal obligation to keep indigenous reactors is tied to assured supply. Yet U.S. responses indicate that the fuel assurances are not legally binding and they are not meant to insulate India against the consequences of a nuclear test:

1. “The fuel supply assurances…from the March 2006 separation plan…are important Presidential commitments that the United States intends to uphold, consistent with U.S. law.” (Q. 14)

2. “Like all other U.S. agreements for nuclear cooperation, the proposed U.S.-Indian agreement is a framework agreement and does not compel any specific cooperation.” (Q. 37)

3. “The use of the phrase ‘disruption of fuel supplies’…is meant to refer to disruptions in supply to India that may result through no fault of its own.” Examples include a trade war resulting in the cutoff of supply, market disruptions in the global supply of fuel, and the potential failure of an American company to fulfill fuel supply contracts. We believe the Indian government shares our understanding of this provision. (Q. 15)

4. “The fuel supply assurances are not, however, meant to insulate India against the consequences of a nuclear explosive test.” (Q. 18)

Bottom line: Even though the Indian government has argued that it has negotiated long-term fuel supply assurances in its bilateral nuclear cooperation agreement, it is clear that U.S. commitments in this regard are political and not legally-binding in nature and would not apply if India resumed nuclear testing. NSG states should not undermine this policy by allowing India to accumulate strategic or lifetime reserves of fuel that would enable India to overcome a supply cutoff in the event it resumes testing.

Strategic reserve: India has insisted on a lifetime reserve of fuel for its reactors. However, the State Department’s responses to the HCFA paint a different picture:

1. “The parameters of the proposed ‘strategic reserve’ and India’s capacity to acquire nuclear fuel for its reactors will be developed over time.” (Q. 19)

2. “The U.S.-Indian Agreement does not define ‘reasonable operating requirements’ and the two governments have not discussed a definition….We would expect that the actual amount of fuel put in the reserve would depend…on such factors as the availability of fuel in the market, price, Indian storage capacity, costs of storage, and similar practical considerations.” (Q. 20)

Bottom line: The United States has not made a specific commitment to help India amass a strategic fuel reserve. Nevertheless, it is important that the NSG clarifies that such a reserve shall not be created, individually or collectively, and that any fuel supplies provided are “commensurate with reasonable reactor operating requirements,” as specified in the Hyde Act.

Corrective measures: This has never been defined by either side or the International Atomic Energy Agency (IAEA). In response to the HCFA questions, the State Department wrote:

“Until a safeguards agreement is completed between India and the IAEA and the issue of ‘corrective measures’ is clarified, we cannot comment on the appropriateness of the agreement.” (Q. 25)

Bottom line: This response, along with the Indian government’s failure to acknowledge that it may not unilaterally withdraw facilities or material from safeguards, would suggest the Bush administration is still not in a position to determine whether the IAEA-Indian safeguards agreement is consistent with the Hyde Act requirement that the safeguards are permanent and consistent with IAEA standards and practices.

Consent to reprocessing: In its October 2007 questions, the HCFA asked whether safeguards on a reprocessing plant would differ for a non-NPT state. The State Department told the HCFA that:

“…there would be little, if any, difference in the technical challenge of applying safeguards to such a facility [a new reprocessing plant in India] as opposed to a comparable facility in a state with a comprehensive safeguards agreement….In the case of India, the Agency’s safeguards conclusions would have to be limited to the civil facilities and materials under safeguards, and could not be extrapolated to apply to the nuclear program as a whole” (Q. 27)

Yet, U.S. officials commented to earlier congressional questions contained in S. Report 109-288 on the problem of personnel rotations between safeguarded and unsafeguarded Indian nuclear facilities. See below and page 160 of Senate Report 109-288, dated July 2006.

Question (2). The Separation Plan tabled by the Indian Government with its Parliament states nothing about the future bureaucratic structure of its Department of Atomic Energy (DAE) in respect of removing from that organization any personnel involved in any military activities. To what extent will DAE personnel working at any declared sites, facilities and locations continue to have access to military programs in India?

The State Department responded: “In the July 18, 2005 Joint Statement and under India’s March 2, 2006 separation plan, the Government of India committed to separate its civil and military facilities and programs. While the specific issue of DAE personnel has not yet been discussed in detail, we would consider routine, frequent rotation of personnel between civil and military programs as being inconsistent with Indian commitments on separation. In our view, such a rotation would be inconsistent with India’s commitment to identify and separate its civil and military nuclear facilities and programs. We have made this position clear to the Indian government.”

Bottom line: NSG participant countries should agree not to grant India consent to reprocess nuclear fuel supplied by an NSG member in a facility that is not under permanent and unconditional IAEA safeguards.

Furthermore, it is important for NSG states to obtain further details regarding India’s proposed “separation plan” and to understand how the still-to-be-negotiated Additional Protocol between India and the IAEA regarding safeguards can improve confidence that civilian technology transfers do not leak into India’s military nuclear sector.

Click here for the full set of questions and responses.

* Daryl G. Kimball is the Executive Director of the Arms Control Association, Sharon Squassoni is a Senior Associate of the Nonproliferation Program at the Carnegie Endowment for International Peace, and Fred McGoldrick is an independent consultant who previously served as a former Director of Nonproliferation and Export Policy at the Department of State.

Description: 

As U.S. and Indian officials race against the clock to win domestic and international approval for a controversial proposal to relax rules governing nuclear trade with India, the House Committee on Foreign Affairs (HCFA) has made public the Department of State’s January 2008 responses to more than 40 questions sent by the committee in October 2007 that were aimed at sorting out ambiguous and contradictory statements about the August 2007 U.S.-Indian nuclear cooperation agreement. (Continue)

Country Resources:

Revised U.S. Proposal for India-Specific Exemption from Nuclear Suppliers Group Is Inadequate and Irresponsible

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Note for Reporters by Daryl G. Kimball (202-463-8270 x107)
September 3, 2008

Today, the Arms Control Association (ACA) obtained a copy of the revised U.S. proposal to exempt India from existing nuclear trade restrictions maintained by the 45-member Nuclear Suppliers Group (NSG). The proposed rule change would allow India to acquire nuclear technology and material previously off limits to it because of India’s misuse of past nuclear imports designated for peaceful purposes to conduct a nuclear explosion in 1974 and refusal to allow full-scope international safeguards on its nuclear complex.

The text of the revised proposal is available here. ACA’s preliminary analysis follows below.

Background

At a special Aug. 21-22 meeting of the NSG, the Bush administration proposed an India-specific exemption from NSG guidelines, which currently require full-scope IAEA safeguards as a condition of nuclear supply. Bowing to Indian demands, the Bush team called for a “clean” and “unconditional” waiver that would have allowed unrestricted nuclear trade with India at the discretion of each NSG member state. See here the text of the earlier proposal .

To their credit, many NSG states essentially said “no thanks” and proposed more than 50 amendments and modifications to the U.S. proposal. Those recommendations aimed to establish some basic but vitally important restrictions and conditions on nuclear trade with India. Many of those amendments track with the restrictions and conditions established in 2006 U.S. legislation regulating U.S. nuclear trade with India, including the termination of nuclear trade if India resumes testing. That U.S. law also significantly restricts transfers of uranium-enrichment and spent fuel reprocessing technologies, which can be used to produce both nuclear fuel for reactors and nuclear material for bombs.

U.S. and Indian officials responded Aug. 31 with a new draft waiver. The NSG is due to reconvene Sept. 4-5 in Vienna to discuss the revised U.S. proposal. Traditionally, the group makes decisions by consensus. See here the NSG’s existing guidelines for the export of nuclear material, equipment, and technology.

The Revised Proposal Is Irresponsible and Should Be Rejected

The revised U.S. proposal does not incorporate any meaningful adjustments or concessions and is essentially the same as the earlier draft proposal.

Apparently, New Delhi and Washington expect that the 15 plus states who are seeking meaningful restrictions and conditions and a regular review mechanism on nuclear trade with India to be satisfied with a “statement from the chair” to substitute for a rationale NSG policy on key issues. The revised proposal also contains the following two cosmetic adjustments:

  • a new paragraph that says all governments participating in the NSG shall inform each other on what bilateral cooperation they are pursuing with India after the exemption is approved. This is being presented as an alternative to several proposals from NSG states for a regular review mechanism for nuclear trade with India. This would be mildly useful ahead of an NSG decision, but adds nothing to what the NSG is already authorized to do and would do nothing to help hold India accountable to nonproliferation and disarmament commitments.
  • a paragraph that says participating governments can call an extraordinary consultation within the NSG “if circumstances have arisen which require consultations.” This is being pitched as a response to a possible Indian nuclear test. But in reality, this doesn’t do anything more than what is already in the NSG guidelines (paragraph 16) that allow for a special meeting of NSG states in the event of extraordinary events, including a nuclear test.


Given that the Indian government has shown so little flexibility and given that the revised proposal was distributed only days before the next NSG meeting, it is highly unlikely the NSG will reach a decision this week.

Although acknowledging India’s legitimate interest in diversifying its energy options, responsible, like-minded countries, including Austria, Ireland, Japan, the Netherlands, New Zealand, Norway, and Switzerland, correctly recognize that the Bush approach is deeply flawed and would effectively end the NSG as a meaningful entity. It is vital that these and other states stand their ground.

Why? Any India-specific exemption from NSG guidelines would erode the credibility of NSG efforts to ensure that access to peaceful nuclear trade and technology is available only to those states that meet global nuclear nonproliferation and disarmament standards.

Contrary to the Orwellian claims of its proponents, the deal would not bring India into the nonproliferation mainstream. Unlike 179 other countries, India has not signed the Comprehensive Test Ban Treaty. It also continues to produce fissile material and expand its nuclear arsenal. As one of only three states never to have signed the nuclear Nonproliferation Treaty (NPT), it has not made a legally binding commitment to pursue nuclear disarmament.

The most recent U.S. proposal should be flatly rejected as unsound and irresponsible. To be effective, NSG guidelines must establish clear and unambiguous terms and conditions for the initiation and possible termination of nuclear trade.

At a minimum, NSG states should:

  • establish a policy that if India resumes nuclear testing or violates its safeguards agreements, trade involving nuclear items with India shall be terminated and unused fuel supplies returned;
  • expressly prohibit any transfer of reprocessing, enrichment, or heavy-water production items or technology;
  • regularly review India’s compliance with its nonproliferation obligations and commitments; and
  • require as a condition for nuclear trade that India join with four of the five original nuclear-weapon states in declaring that it has stopped fissile material production and require that India to transform its nuclear test moratorium pledge into a legally binding commitment. Unfortunately, India has rejected previous calls to take these important nuclear restraint measures.

Some Indian officials have threatened they may walk away from the deal if the NSG establishes even these most basic requirements. If that occurs, so be it.

The Indian nuclear deal would be a nonproliferation disaster, especially now. The current U.S. proposal threatens to further undermine the NPT, the nuclear safeguards system, and efforts to prevent the proliferation of sensitive fuel-cycle technologies. Absent curbs on Indian nuclear testing and fissile material production, it would also indirectly contribute to the expansion of India’s nuclear arsenal with adverse consequences for the nuclear arms race in Asia.

For those world leaders who are serious about advancing nuclear disarmament, holding all states to their international commitments, and strengthening the NPT, it is time to stand up and be counted.

Congress, the NSG, and the U.S.-Indian Nuclear Cooperation Agreement

Several Democratic and Republican members of Congress have urged the Bush administration not to support any NSG exemption for India that does not conform to the restrictions and conditions on nuclear trade established by the 2006 legislation, known as the Hyde Act. Even if the NSG allows civil nuclear trade with India, Congress must still approve the proposed U.S.-Indian nuclear cooperation agreement and it may seek to amend or attach conditions on its implementation.

On August 5, the Chair of the House Committee on Foreign Affairs, Rep. Howard Berman (D-Calif.) wrote U.S. Secretary of State Condoleezza Rice urging “the President should withhold support from any proposed exemption from India in the NSG guidelines that is not fully consistent with the Hyde Act and that does not incorporate a number of other key provisions, including: the immediate termination of all nuclear commerce by NSG states if India detonates a nuclear explosive device or if the IAEA determines that India has violated its safeguards commitments …” (The full text of the Berman letter is available from here. )

Berman goes on to warn Rice that “any effort to consider the [U.S.-Indian nuclear cooperation] agreement outside of the requirements of current law will be impossible if the Administration accepts an NSG exemption that fails to include the Hyde Act conditions.”

It is clear that the current U.S. proposal to exempt India from NSG guidelines fails to include the Hyde Act conditions and restrictions.

Description: 

Today, the Arms Control Association (ACA) obtained a copy of the revised U.S. proposal to exempt India from existing nuclear trade restrictions maintained by the 45-member Nuclear Suppliers Group (NSG). The proposed rule change would allow India to acquire nuclear technology and material previously off limits to it because of India’s misuse of past nuclear imports designated for peaceful purposes to conduct a nuclear explosion in 1974 and refusal to allow full-scope international safeguards on its nuclear complex. (Continue)

Country Resources:

Averting a Nuclear Nonproliferation Disaster: Where States Should Draw the Line in the U.S.-Indian Nuclear Deal Endgame

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WELCOME AND MODERATOR:
DARYL KIMBALL,
EXECUTIVE DIRECTOR,
ARMS CONTROL ASSOCIATION

SPEAKERS:
HENRY SOKOLSKI,
EXECUTIVE DIRECTOR,
NONPROLIFERATION POLICY EDUCATION CENTER

SHARON SQUASSONI,
SENIOR ASSOCIATE, NONPROLIFERATION PROGRAM,
CARNEGIE ENDOWMENT FOR INTERNATIONAL PEACE

TUESDAY, SEPTEMBER 2, 2008

Transcript by
Federal News Service
Washington, D.C.

Edited by the Arms Control Association

DARYL KIMBALL: All right. If everybody could take their seats, turn off their cell phones and other electronic devices. Good afternoon. My name is Daryl Kimball. I’m the executive director of the Arms Control Association and I want to welcome you to our briefing this afternoon about the Nuclear Suppliers Group (NSG) discussion and debate regarding the proposal to exempt India from long-standing NSG guidelines that restrict nuclear trade with states that don’t agree to full-scope IAEA safeguards. This has blocked nuclear cooperation with India since its 1974 nuclear test explosion. [Editor’s note: The NSG did not adopt the full-scope safeguards requirement until 1992, although it had been previously instituted in 1978 in U.S. law.]

We, the Arms Control Association and my two colleagues here, are part of a loose, but diverse coalition around the world here in the United States and in over 24 countries that have been working for months now to try to adjust the terms of the proposed arrangement to exempt India from these international nuclear trade guidelines and, as we see it, to minimize the adverse impacts of this arrangement on the global nuclear nonproliferation system.

Now, in a mere two-and-a-half days, the 45-member Nuclear Suppliers Group will reconvene to consider a revised draft proposal from the United States to the NSG. This is a revised proposal because, on August 21 and 22, the group met to consider the Bush administration’s earlier proposal, which I think can be characterized as a clean and unconditional exemption for India. That proposal was rejected by NSG member states.  Approximately 20 countries put forward some 50 [amendments] and suggestions regarding that proposal. Those suggestions and proposals numbered some 50 in number. So in the last few days, India and the United States have been negotiating a revision to that proposal that was transmitted to NSG member states some time this past weekend. As I understand it, countries are evaluating that new proposal.

But it is unlikely, in my view, that this new, revised version is going to be accepted by the Nuclear Suppliers Group at their meeting on the 4th and the 5th. I’ll be talking about that later in my presentation, which will come up last. Now, why is there an impasse?

Well, there are a number of states, not just the six, so-called likeminded states that have put forward proposed restrictions and conditions, but several other states that are concerned about giving India a clean and unconditional exemption from NSG guidelines. In our view, our basic message today is that it’s extraordinarily important for these states to stand their ground to protect the tattered nuclear nonproliferation system.

What we’re going to be doing today is to highlight what we see as the key problems with the overall arrangement. We’re going to be identifying steps, many of which have been put forward by these likeminded states and their allies, that could restrict and condition future nuclear trade with India to minimize the impact on the nonproliferation system. Then, we’re also going to be providing a summary analysis of responses that have come from the State Department to a set of questions that the House Committee on Foreign Affairs asked in October of 2007, which are just being released this afternoon by the House Committee on Foreign Affairs. These questions relate to the U.S.-Indian 123 Agreement, the agreement for nuclear cooperation between the United States and India.

Sharon Squassoni, who is a senior analyst here at the Carnegie Endowment for International Peace and a former Congressional Research Service analyst, is going to be describing her perspective on the State Department’s responses to the Congress’ questions. Henry Sokolski, who is the executive director of the Nonproliferation Policy Education Center, is going to review what is at stake and what might happen if the NSG grants India a so-called clean and unconditional waiver. I should also add that Henry is a member of the Congressional Commission on Preventing WMD Proliferation and Terrorism. So I’m going to conclude after they speak to review the status of the NSG debate and the rationale behind the proposed conditions and restrictions that a number of responsible NSG members are putting forward.

So, to begin, Henry, if you could come up here to the podium so the camera can catch your visage, Henry is going to talk about why this deal is not a good idea.

HENRY SOKOLSKI: Well, it might be a good idea, but there’s a lot at stake. I think what I would like to focus on is what’s at stake.

You know, former Secretary of Defense Harold Brown was once told that there was a problem with a sale that he was thinking of making on nonproliferation grounds and that, in fact, there needed to be much more staff work done on the nonproliferation issues. He said, staff work? Well, actually, you only need two people to do all of the work related to nonproliferation: one to count the number of countries and another person to wring their hands.

Now, I think that comment is a little inaccurate now because we have countless hundreds if not thousands of people in our government and in other governments counting the numbers and wringing their hands. So the numbers are bigger. But it does highlight why it would be useful to recap why anyone should care about this deal. I think it’s somehow taken for granted that either you don’t care or you do care; you don’t have to explain yourself.

First, roughly, is it September 4th and 5th that this meeting [will occur]? Remember those dates. They have the potential to be the 9/11 of nonproliferation, if you will. Georgia now has a date where we rediscovered history; 9/11 is very important for the war on terrorism.  September 4th and 5th, potentially, could be a turning point dealing with nonproliferation, and I mean a negative one.

A friend of mine describes this problem with the India deal as roughly [the 1968 nuclear Nonproliferation Treaty] NPT RIP. There certainly are people in India that like to see this deal as just that. They talk about promoting the nonproliferation norms and the mainstream. They do not like the NPT though and they’d rather see that pushed aside. Now, it’s hard to see how going ahead with this deal, unless it’s conditioned more appropriately than it has been, how it can be anything but an engine of destruction of the nuclear rules that are based on the NPT. After all, what it is that the Nuclear Suppliers Group is being asked to do is to supply nuclear fuel and fuel-making to a state that did not have a nuclear weapon in 1967 and therefore is not recognized by the United States, formally, to be a weapons state.

Now, that sounds like a lot of technicalities, but what it means is this; that group was established after the first Indian test in 1974 to make sure that they didn’t get nuclear fuel-making technology. They’re now being asked to approve a deal that roughly would authorize just such transfers, if not from the U.S., and we’ll get into that in a moment, certainly for other countries like Russia and France. Certainly this is how India sees it. If you take a look at the deal, you take a look at the exemption that they’re seeking, it’s hard to see how that wouldn’t in fact be the case.

Essentially, the suppliers that are supposed to show restraint to prevent non-weapons states from getting the means to make weapons are being asked to send fuel, roughly uranium, lightly enriched or otherwise, which India critically needs because, while it has plenty of uranium in the ground, it’s lousy ore; it’s very poor-quality ore. It’s in the ground. They can only produce a certain number of hundreds of tons and it’s less than what they need and want to run all of the reactors they want to run for power and all of the reactors they want to run to make bombs.

This deal is the fix. It supplies everything they need for their power reactors. It therefore leaves all of the other fuel that’s indigenous available to make bombs. Now, roughly then, if you say the NSG should go ahead and supply this reprocessing and enrichment technology needed to make bomb-usable material, you have roughly the mother of all rule-breakers. You eliminate, essentially, the Nuclear Suppliers Group.

Now, why should we care about any of this? You can say, well, so what? Pakistan has been pretty vocal. It claims that this deal will lead to an arms race. They’ve already increased their reprocessing and enrichment and their plans to deploy power reactors. They want China to supply a 20-fold increase in power capacity in their country by 2030. India, meanwhile, has people who are experts in weapons and enthusiasts for weapons saying, well, maybe they need 400 weapons. I’m not saying they’re going to get it, but there are people who are fairly serious who think that’s the number they need. They have less than 100 now.

And then, what is China to make of all of this? One of the free [book] giveaways at the desk [outside the conference room], has a chapter in it describing how Pakistan and India might compete after the deal. It is very detailed. I recommend it. It’s depressing. It’s not something we should be encouraging.

Now, why? Well, as these three countries amble up or, god forbid, race up, what are we trying to do? Climb down. You can go to many of Daryl’s events and they talk about climbing down. Well, if you climb down to let’s say 1,000 weapons in the U.S. stockpile, which is one of the favorite numbers I hear, you’re going to be very close to where people are racing up. That is not a comfortable world to live in. You want everyone to come down, not just us or the Russians or the French and the British. By the way, who knows what the Russians will do now?

So that crowded space also becomes a space in which having civil programs and particularly in places like India, China, and Pakistan start to take on military significance in a way that we have never thought about before. That also isn’t great because there are a lot of people in this city and in Paris and in Moscow that think promoting “Atoms for Peace” and civil and nuclear energy is a great idea. It’s an intensely more complex, competitive, and unstable world without at least some of these fig leaves being preserved.

Finally, I think U.S. credibility is at stake here with this deal. You’re going to hear more from Sharon about these questions for the record, but, roughly, what Daryl and others—I think I signed onto one of the letters—said is, the executive branch, the State Department and the White House, is telling Congress what it wants to hear, that we would never sell them, the Indians, the means to make nuclear fuel because that could help their weapons program. Of course we would suspend assistance if they tested nuclear weapons. By the way, that’s exactly what these questions for the record indicate that we told Congress.

But we tried to keep it quiet, keep it from the public, because we didn’t want the Indians to see this. More important, I think we didn’t want the members of the NSG to know about this because they’d say, well, if America doesn’t want to do these things, maybe we should even insist on it not happening. We’re kind of hoping the release of these questions for the record will prompt that result.

In fact, finally, you’ll see a letter; it’s very obscure: Harmon, Wilmot, and Brown. It’s out there on the table. The idea that we’ve been pushing that this deal is about reactor sales, at least from the U.S., is nonsense. This letter clarifies why it is: liability insurance. The Indians don’t have it. I’m not sure I blame them for not having it after the terrible experience of Bhopal. But because of that, the law firm that represents the U.S. nuclear industries says we can’t do business with India until that changes. It’s not about the change.

So the United States is saying lots of things to different audiences. It needs to get its story together. Daryl will conclude with what we need to do to condition the deal with regard to testing and what sanction or what restraint should be placed on supply after that and about nuclear fuel-making. There are many variants. I mean, I’m sure Daryl has once said, the key thing is to do something in these areas. I think, with that, I’ll hand it over to Sharon.

KIMBALL: Thank you very much, Henry. Sharon Squassoni.

SHARON SQUASSONI: Thank you, all. Daryl’s asked me to talk a little bit about the answers to the questions for the record that are being released even as we speak from the House Foreign Affairs Committee. Chairman Lantos, last year, submitted 45 questions in October of 2007 [to the State Department]. However, the State Department reportedly requested that the answers be held in confidence and I’m not sure whether they gave a reason for why that was. But I think when you take a look at some of the answers to these questions for the record, you’ll see that the likely reason is that some of the answers are very clear-cut in terms of U.S. responses to certain Indian actions. The [State Department’s] response came in February 2008. So it took them several months for them to put this together.

I think that part of the negotiation all along has been this dance of different perspectives or different interpretations. We saw that in the negotiation of the Peaceful Nuclear Cooperation Agreement [the 123 agreement]. We’ve even seen that a little bit in the negotiation of India’s safeguards agreement.

One thing that I would say as a former diplomat that you need to do is make sure that everyone’s expectations are the same going in. I think that these answers to the questions for the record will help that. Many of the questions are very technical in nature. I’m going to highlight just a few of what I thought were some of the interesting answers. The good news is that the administration’s interpretation of what we call the 123 agreement, the Peaceful Nuclear Cooperation Agreement, does reflect the requirement in U.S. law under the Atomic Energy Act to cut off supplies if India tests.

The agreement itself doesn’t say that very specifically. But in these answers to the questions for the record, the administration says unequivocally, yes, you know, we will cut off [supplies]. The bad news is that it’s doubtful that the Indian government agrees with that interpretation, and I’ll provide a few details there.

The implication of this is that it’s very important that the Nuclear Suppliers Group write this restriction—by restriction, I mean, if India tests again, nuclear supply should be cut off—into any decision that it takes in the coming weeks or months if the U.S. expects other nations to follow suit. The U.S. is bound by law to stop supply. There is a presidential wavier, but my guess is that’d be tough to implement. If the U.S. wants other nations to follow suit, it’s got to do this through the NSG.

Okay, so I’m just going to touch on a few issues. One is full cooperation. Indian officials have stated time and time again that full nuclear cooperation means cooperation in enrichment and reprocessing. This is uranium enrichment to make fuel for reactors. It can also be used to make bomb-grade material and reprocessing of spent fuel, which can also be used to recycle fuel and make more fuel or for plutonium bombs.

The U.S. answers in this area, and I quote, “As a matter of policy, the U.S. does not transfer dual-use items for use in sensitive nuclear facilities. The U.S. will not assist India in the design, construction, or operation of sensitive nuclear technology through the transfer of dual-use items, and the administration does not plan to negotiate an amendment to the proposed agreement.” An amendment would be required if we were actually to engage in this cooperation. So at least in three different areas, the U.S. said, we’re not going to do this. That may be news to the Indians.

On termination for nuclear testing, Indian officials have stressed that the U.S. nuclear cooperation agreement does not, and I quote Prime Minister Singh from last year, “does not in any way affect India’s right to undertake future nuclear tests, if that’s necessary.” The foreign minister also told the parliament last year, there’s nothing in the bilateral agreement that would tie the hands of the future government or legally constrain its options.

In these answers to the questions for the record, the U.S. government stated quite clearly, we have a clear right for the U.S. to terminate nuclear cooperation and a right to require the return of our stuff—it didn’t say that [exactly] but I’m shortening it for you—in all circumstances required under the Atomic Energy Act, including if India detonates a nuclear explosive device. It talks about ceasing cooperation immediately and it also mentions that, in addition to ceasing cooperation immediately, it would also affect the supply of fuel and the right of return.

A related issue is fuel-supply assurances. Both in the nuclear cooperation agreement and in India’s safeguards agreement, there are several places, I guess in the preamble, where it mentions that India wants assured fuel supply, including what they call a strategic reserve of fuel for the lifetime of their reactors. Indian officials have stated, in many ways, their interpretation is that if that fuel supply is cut off, they have the right to take corrective measures. These corrective measures have never been defined and it’s funny, in the answers to the questions for the record, because these were done last year, the U.S. says, well, once these corrective measures, once that’s clarified, you know, we’ll be able to comment on this. Well, a year later, it’s still not clarified.

But the U.S. responses clearly indicate that the fuel assurances that the U.S. is undertaking are not legally binding and they are not meant to insulate India against the consequences of a nuclear test. So, number one, the U.S. says, well, these are important presidential commitments that we intend to uphold. Number two, the agreement itself doesn’t compel any specific cooperation. In other words, we wouldn’t have to make these fuel assurances or assured fuel supply.

Third, and probably the most important thing here, the question was asked to [the State Department], well, what is disruption of fuel supplies? The answer was, well, by that, we mean a trade war resulting in the cut off of supply, market disruptions, or potentially a failure of an American company to fulfill its contracts, not a nuclear test. In other words, the fuel supply is only good for those other kinds of disturbances in supply. If India tested, fuel supply would be cut off.

There are several other items, but I’m going to leave them for the Q’s and A’s once you have a chance to look at the actual questions. But I think the bottom line here is that there still exists a gap in the expectations or the interpretations of this deal, both from the Indian side and the U.S. side. One of the useful activities that the NSG can take up is to clarify what the Indians really do expect and nail down some of these things so that nuclear cooperation, if it does happen, can go forward in a stable and reasonable way.  Thank you.

KIMBALL: Thank you very much, Sharon. We’ll be able to go back through some of those issues in the Q’s and A’s. I know that’s pretty complicated, but I think Sharon did a good job of summarizing. For those reporters out there, we can make some copies of these responses to the questions available to you.

Let me describe a little bit of our understanding, our analysis, of what is likely to happen later this week at the Nuclear Suppliers Group meeting and outline what we hope and think several responsible Nuclear Supplier Group countries are going to do. As I mentioned in the opening, on the 4th and the 5th, the Nuclear Suppliers Group is going to reconvene in Vienna, Austria, at the Japanese mission where they traditionally meet. They are going to be asked to approve a revised proposal from the United States that was negotiated last week with India.

According to my sources and a few press reports that are out there, it remains essentially unchanged from the clean and unconditional version that was presented and discussed at the August 21 and 22 meeting of the Nuclear Suppliers Group. It appears as though the Indian government and the United States government are hoping what will happen is that the Nuclear Suppliers Group countries will be satisfied with cosmetic changes and a statement from the chair that would substitute for a rational policy from the Nuclear Suppliers Group on future possible trade with India.

In addition, there seem to be two cosmetic adjustments that have been put into this revised proposal which, by the way, I have not seen, nor am I aware of anyone outside of the NSG government’s seeing this revised proposal. The first is a paragraph that states to the effect that all governments participating in the NSG shall inform one another on what kind of bilateral nuclear cooperation they are pursuing with India after the exemption is granted.

The United States, for instance, has made its nuclear cooperation agreement public. That came out in August 2007. Those are the issues that Sharon was just discussing. We’ve not seen any details about proposed Russian-Indian nuclear cooperation or French-Indian nuclear cooperation. So to some extent, this would be mildly useful, especially ahead of an NSG decision. But it does nothing to hold India accountable to any nonproliferation or disarmament commitments that it’s making.

The second cosmetic adjustment that I understand is in the revised proposal is a paragraph that states that governments participating at the NSG can call for an extraordinary consultation within the NSG on India “should circumstances require it.” Now, this is being characterized by the proponents of the revised proposal as a response to the call from several NSG states for a regular review mechanism of India’s nonproliferation record to assess to what extent it is meeting its safeguards requirements and other commitments that it has made.

However, this doesn’t do anything more than what’s already in the Nuclear Suppliers Group guidelines. There’s something called Paragraph 16 in the NSG guidelines that already allows for a special meeting of NSG states in the event that extraordinary events warrant. So this is not a concession of any kind; this is simply a restatement of something that’s already in the NSG guidelines.

In my view, given that the government of India has shown so little flexibility and given that the revised proposal was distributed only a couple of days before this next NSG meeting, it is highly unlikely that the NSG will reach a decision at this week’s meeting.

Now, let me just explain a little bit my understanding of the perspective of the several NSG states that have raised objections and put forward counterproposals on this exemption. Many states acknowledge India’s legitimate interest in diversifying its energy options, but several likeminded states, which is what they call themselves, including Austria, Ireland, the Netherlands, New Zealand, Norway, and Switzerland, as well as countries including Japan and possibly others—or I know others; I’m just not sure who—correctly recognize that the Bush approach is deeply flawed and, as Henry said earlier, would effectively end the NSG as a meaningful entity.

What’s behind their rationale? I think many of them understand correctly that any India-specific exemption from NSG guidelines would erode the credibility of NSG efforts to ensure that access to peaceful nuclear trade and technology is available only to those states that meet global nuclear nonproliferation and disarmament standards. So let’s look at India. Contrary to what I think can only be called the Orwellian claims of proponents, this deal would not bring India into the nuclear nonproliferation mainstream. A couple points: unlike 179 other countries, including the United States, who have signed the Comprehensive Test Ban Treaty, India refuses to sign the Comprehensive Nuclear Test Ban Treaty or enter into any other parallel, legally binding test moratorium.

India also continues to produce fissile material, unlike at least four of the five original nuclear weapons states, and probably also China. India continues to expand its nuclear arsenal. As Henry said, India continues to go up while most other nuclear-weapon states are going down or are maintaining their current status.

In order to maintain its option to resume nuclear testing, as Sharon was describing, India is seeking bilateral nuclear cooperation agreements to help provide it with strategic fuel reserves and lifetime fuel guarantees. Now, this is not only a problem as far as the NSG is concerned. But I should point out, it flatly contradicts a provision in the Henry Hyde Act, the U.S. legislation of 2006 that regulates U.S. trade with India, that was included in that bill by none other than Senator Barack Obama. That provision stipulates that U.S fuel supplies to India should be limited to “reasonable reactor operating requirements.” The idea there is not to provide India with a multi-year fuel supply that could be used to overcome a cutoff in nuclear trade that might result from renewed nuclear testing.

In our view, the current proposal is still unsound.  It’s still irresponsible and should be rejected. To summarize what some of the things are that could be done to minimize the adverse implications and that are being apparently advanced by several of these likeminded and other countries, the NSG states should, at a minimum, establish a policy that if India resumes nuclear testing or violates its safeguards agreements, trade involving nuclear items with India shall be terminated and unused fuel supplies returned.

Another one should expressly prohibit any transfer of reprocessing, enrichment, or heavy-water-related items or technology, which can be used to make bomb material. Third, regularly review India’s compliance with its nonproliferation obligations and commitments. Call on India to join with four of the five original nuclear-weapon states in declaring that it has stopped fissile material production and to call on India to transform its test moratorium pledge into a legally binding commitment.

These are the very conditions and restrictions that are in one form or another embedded in the Henry Hyde Act. From our perspective, if U.S. nuclear trade is going to be limited by these kinds of conditions and restrictions, it only makes common sense for the Nuclear Suppliers Group to adopt the same or very similar conditions and restrictions so that U.S. nonproliferation policies are not undercut by the Russians or the French or Malta or Japan or whomever. In addition, if the U.S. nuclear trading rules are significantly different from that of AREVA or some nuclear vendor in Russia, U.S. companies are going to be at a distinct disadvantage in addition to the fact that, as Henry pointed out, India has not yet agreed to this international nuclear liability convention.

Now, some Indian officials have said that they may walk away from the deal if the NSG establishes even these most basic requirements. From my perspective, if that’s what they want to do, so be it. This would still be a very generous proposal, given India’s nuclear history and its current policies.

We are urging and calling upon those NSG countries that I mentioned and others to stand their ground and to make sure that the NSG does not capitulate at this very sensitive time in the struggle against the spread of nuclear weapons. We’ll take your questions on any of these subjects that we’ve just discussed. If you’d just wait for the microphone to come to you and announce your name before you ask your question.

QUESTION: Thank you. Paul Eckert of Reuters News Agency. Primarily to Sharon Squassoni, not having seen the State Department responses yet, but in and of themselves, do these State Department answers pass muster with you in the sense that they clear up concerns you have about how the agreement was going to be implemented? You seemed to say at the outset that they were very frank in the sense that they were held back to avoid offense to India during their delicate negotiations there. But how about from the point of view of disarmament experts? Are they complete and compliant with U.S. law?  Thanks.

SQUASSONI: Great question. In some areas, yes; in some areas, no. I think that this issue of corrective measures, which they could not resolve a year ago is still unresolved. And the IAEA safeguards agreement that India just negotiated doesn’t clarify matters at all.  In general, however, though, I mean, the U.S. administration, has to follow the U.S. law. So it’s very important. I think it’s very good that they put these answers down on paper to clarify. I think it’s likely that the Indians will not be very happy with such frank answers.

There are a few areas, one on a strategic reserve of supply, that I think they kind of were a little circuitous in their answer. Basically, they said, well, I guess the Hyde act language was “reasonable operating requirements.” Their response was, well, nobody discussed what “reasonable operating requirements” were and, you know, this might change. And, you know, a strategic reserve will depend on all kinds of commercial issues and, for example, how much storage capacity does India have to put this fuel. You need a lot of storage capacity. So it’s a mixed bag, I think. But at least on the testing issue, I find myself satisfied.

KIMBALL: Yeah, I think Henry has a response. Let me just also remind everybody that these questions were sent, as I understand it, to the State Department in October 2007. That was three months after the U.S.-India nuclear cooperation agreement was concluded in [late July]. They were delivered in February so I think there are going to be many more questions that Congress is going to ask. These were questions that were written basically a year ago. I think it’s not unexpected that they don’t, as Sharon said, fully answer all the questions that are still out there. Henry?

SOKOLSKI: I have a slightly different take. I did have a chance to look at these things over the weekend as well. I think the operative phrase that rings loudest in what Sharon shared with us is, “as a matter of policy.” [I’ve] spent a fair amount of time with the history of the previous deals that we’ve cut, which were very instructive. And Robert Zarate has worked with me and is taking a lead in writing a history of some of the Wohlstetter’s work. One of them is called “Buddha Smiles.” I recommend it. It’s on our website. It is a history of the prevarications, vagueness, and confusion associated with the first set of nuclear deals. It’s not a pretty picture. Some of the arguments will rhyme with the kinds of debates we’re having now. So from an experience standpoint from history, I think we need to be worried about what any administration thinks, since it goes away and there are other administrations after it.

Second of all, as someone who has worked in the government, I have to tell you, I don’t think that any of the answers suggest they would like to be held to what they are saying in print. In other words, they don’t want a law that tells them that they have to see things a certain way. It’s the reason they’re fighting these rules in the NSG. That suggests that things could be subject to change.

I leave you only with this other additional thought: there is no way that this deal could be approved by Congress in its current form without violating the Hyde Act. Once you violate a law, you’re on your way to interpreting and reinterpreting all sorts of things willy-nilly. It’s the desire for Congress to uphold the law that it passed that animates a good deal of the effort on this panel and many other people. I’m pretty sure that Mr. Berman sent his note to Secretary Rice precisely because he took his pledge to uphold the laws of the land and the Constitution seriously. But you cannot go ahead with this deal unless it is conditioned more without it violating the Hyde Act. So I wouldn’t take the say-so of these Q’s and A’s even when they’re good until you have something in print that is binding.

KIMBALL: All right, any other questions? Yes, sir?

QUESTION: Thank you. Mike Miyazawa. What is the real objective of the administration? Is it nuclear business or to bring India into the U.S camp as a counterweight against China? What is the single biggest, most important objective of the administration?

KIMBALL: That’s a very good question. I’ve been asked that question for about three years. I still don’t really know the full answer. There are a lot of, I think, theories about why. I think there are different reasons, depending on which part of the administration you’re talking about. I mean, Sharon and Henry could talk about this as knowledgeably as I can. I think there are multiple things going on here. One is simply that the Bush administration is looking for a foreign policy “victory.” Another is that the Bush administration wants to establish stronger strategic ties with India. But the U.S. already has very good strategic ties with India, even without this deal. Maybe they would be even better without the deal.

There is also a strong interest in increasing U.S. defense sales to India. One of the unspoken reasons is that it might help counter Chinese influence in Asia. But personally, I think that that is an extremely flawed theory, given that India is a very independent country that is not going to compromise its foreign policy in order to help Washington on some particular issue vis-à-vis China.

Those are all some of the reasons that have been put forward. Some of the other reasons, such as hoping to reduce the amount of carbon emissions in the atmosphere, I think, have been wildly inflated given that India’s nuclear industry has barely performed in the last four decades. I don’t think it’s going to meet its projections to build all the reactors it is projecting. India’s carbon emissions could be reduced much more significantly through other means other than building a large number of nuclear reactors.

But that’s just a quick review. Do you all have anything else? Henry?

SOKOLSKI: The answer is they asked for it. Clearly, the answer is the Indians asked for it. They like reactors and they like rockets. They like reactors and rockets. I used to work for an assistant secretary that had to travel to India occasionally. He said, whenever I get on these topics with Indians, I try to change the subject to computers or something else because it’s neuralgic. I mean, they just simply love talking about getting more of these things.

We actually bargained to try to get the Indians to send troops to Iraq and then reconstruction funds. They said reactors, rockets. They didn’t send anyone to Iraq and they didn’t give any money for reconstruction. But they kept asking for reactors and rockets. It was thought that if we gave them reactors and rockets, somehow things would improve and that indeed there would be a strategic partnership that would be built on—if not American sales of these things, at least Russian and French sales. And that would be good enough to promote better commercial, military ties with India and the U.S.

I think it was a mistake. The reason it’s a mistake is I remember when they did this, the administration really did not want to hear what the staff had to say. The people, you know, at the director level who actually knew something about nuclear and space cooperation. They would have said, hey, don’t go in here. The reason why is there is so much history of misunderstanding that relations have gotten worse when you focus on these topics. Roughly, I think that’s where we’re headed here.

Make no mistake, there are better ways to cooperate. I would suggest without getting into anything at length, the place I would start is perhaps an ironic place. If you go to the law that the United States passed in reaction literally to the first Indian test, it’s called the Nuclear Nonproliferation Act of 1978. There is a Title V in there. It says we should promote and work with other countries to develop non-fossil fuel, non-nuclear fueled energy sources. It has never been enforced, not by Democrats, not by Republicans; even though I think there are quite a number of programs that we have with other countries in these areas.

It might be time to start thinking about implementing that law, because I can assure you there are many, many more cost-beneficial ways of promoting energy development than nuclear power in India. That’s for sure.

SQUASSONI: I would just add one brief point that there are two questions in these answers that relate to what are the economic benefits that the U.S. expects to get from this deal. The answer is very little. Both because of the issue of liability and, when asked, India has made no commitment to buy reactors from the U.S. They are very interested in uranium to fuel their heavy water reactors. They’re interested in French and Russian reactors.

I know your question wasn’t, you know, was it U.S. nuclear business? I’m sure the global nuclear industry is looking at India and China and salivating for all the reactors they might be able to sell, but not for the U.S. As a matter of fact, in India, at one point, this agreement was called the 126 agreement not the 123 agreement. That was for the 126 fighter aircraft that India would at some point purchase from some lucky defense contractor.

KIMBALL: Any other questions? Yes, we’ve got a couple here. Why don’t we go to the person in the middle?

QUESTION: Thank you. Joanne Thornton with the Stanford Group Company. And I wondered what happens on Capitol Hill in the unlikely event that the Nuclear Suppliers Group can come to a consensus this week. I’ve seen so many different renditions of how many legislative days are required for the package to lay over before the Congress. Can you clarify that? Thanks.

KIMBALL: Yeah, before Sharon clarifies that, let me just also just put one other important piece of information on the table, which is that we mentioned Howard Berman, who is the chairman of the House Committee on Foreign Affairs, wrote an Aug. 5 letter to Secretary of State Condoleezza Rice about his interest in seeing the Hyde act restrictions and conditions written into the NSG guidelines. He also said that even if the NSG makes its waiver and the U.S.-Indian 123 agreement is sent to Congress, immediately after we reconvene on September 8th, it is not likely that Congress will have sufficient time to fully consider all the issues and details surrounding the agreement.

He goes on to say that any effort to consider the agreement outside the requirements of current law—as Henry said the current proposal at the NSG is not consistent with the requirements of U.S. law in that it does not contain the same restrictions and conditions—will be “impossible” if the administration’s NSG exemption fails to include the Hyde act conditions. So we have at least one key member of the Congress saying that. It will be impossible. You can interpret what that means if the NSG decision does not meet or is not parallel with the Hyde act.

In addition to that, the clock is ticking. And for that, Sharon?

SQUASSONI: The clock is ticking. The most optimistic counting of the days if this agreement were to be presented to Congress on Monday the 8th, that would only give 19 days until September 26th. It’s not out of the question that we’ll have a lame-duck session, probably unlikely; 19 days is not enough time because the agreement must, by law—no way around it unless they pass another law—must sit before the committees for 30 days, no less than 30 days. So what happens then is if there aren’t 30 days in the session, next year, we have a new Congress. The agreement has to be resubmitted.

But that assumes that all the ducks are in a row. Quite frankly, they’re not, because there are, I think, seven requirements that the Hyde act says the whole package has to meet. One of them is that India has made substantial progress toward negotiating an additional protocol with the IAEA. Now, this is a safeguard agreement strengthening—the U.S. has one, although I don’t think it’s in force yet—additional [IAEA] access and information; all the things that the IAEA inspectors now get in this new agreement. [Indian and IAEA negotiators] met maybe once. They’re not going to make that by next Monday. I don’t even think that particular one can be finessed. Some of the other requirements can be finessed a little bit.

Really, this is not going to be taken up by this Congress. It will have to wait until the next Congress.

SOKOLSKI: Looking forward, a lot of people in the United States like to think about, well, what happens if Mr. Obama becomes president or Mr. McCain becomes president?  We can talk about that. What Americans don’t like to think about is what happens in India? They’re going to get a new government.

Now, the people that are opposing the current government say they want to renegotiate the agreement. I have to tell you, my hunch is it isn’t to include all these conditions. I think this thing is very much in play. It suggests to me that when the Indians say, well, we can’t possibly do this and we can’t possibly do that, it kind of suggests either they’re not that interested in getting this deal or they’re still bargaining. If there are any Indians that are out there that are in favor of this deal, I would urge them to actually think long and hard about maybe agreeing to some conditions because these are not that onerous. They really aren’t. If they don’t, well, the new administration they have to worry about probably isn’t Obama or McCain, it’s a non-Congress-led government in India. My hunch is that that’s the reason why these dates, 4th and 5th of September, are going to be remembered at least by people who write histories of nonproliferation.

KIMBALL: I agree with Henry. One other point that I think is important to emphasize that I’ve been talking about for several days is that the conditions and restrictions that the like-minded responsible NSG countries are talking about, I don’t think they can be addressed through creative language, through wordsmithing. These have to be clear, meaningful guidelines in the NSG policies that apply to all of the NSG states. They can’t be interpreted differently by one state or another. They have to clearly apply to all these states. Otherwise, these like-minded states, I don’t believe, are going to be satisfied and are going to continue to block agreement on anything less than what they’re looking for.

Are there any other final questions before we adjourn this afternoon? Yes?

QUESTION: (Inaudible), Voice of America. You just said that there will be a new government in America and there will be one in India as well very soon. So what do you say to the fact that if at all, India just goes ahead and tries a deal with Russia or France and they have been really positive about that? So what do you say to that?

KIMBALL: Well, the rules are quite clear. The Russians and the French have said publicly that they’re not going to enter into bilateral agreements with India on nuclear cooperation until and unless the NSG approves a waiver that allows them to do so.

In addition, India still has to sign the safeguards agreement that was approved on August 1st. Russia has, in the past, violated NSG rules by supplying India with nuclear fuel even though the NSG guidelines have up to this point barred that. So theoretically, it’s possible that Russia may simply chuck the NSG rules and go ahead. But I don’t believe that will be the case. In fact, I think Russia may in fact be supportive of some of these restrictions and conditions that are proposed by Ireland, New Zealand, and others. So I don’t really think that’s a realistic possibility. I think the Indian government fully understands that.  Henry?

SOKOLSKI: I don’t know. I’m not as sure. I do know this. The French are not quite as keen to put their nuclear thumbs in America’s eye. The Russians? That’s a special case, always a special case. The Indians, however, and the Russians, need to be careful. You can do this a little. But you have relations not just with America but you have relations with Pakistan.  You have relations with China. And what these countries do matters a lot to a sensible peaceful prosperous Southwest Asia as well. They will game it. You can count on that. They will game it.

So, one of the reasons these rules are helpful—I know many Indians find them nothing but meddlesome—is it reduces the need to keep looking over your shoulder and people gaming all these things for possible military purposes.

Finally, I can only urge one other thing. America’s relations with India depend primarily on the movement of people, money, and trade. There is so much that can and needs to be done in this area. Yes, energy technology as well, but probably not nuclear; I can’t imagine making a dime investing in that.

But it seems to me that there is plenty of work and plenty in the original agreement that does not pertain to rockets and reactors that is pretty important to pursue. I would think it would be a big mistake if we forgot what else we agreed to.

KIMBALL: All right, yes, sir? Microphone, please, so we can record this for all time. This better be good, Eric. (Laughter.)

QUESTION: Today, in the People’s Daily in China, the Chinese government is coming out against the India NSG exemption. What do you make of that? Several of you mentioned the role of China in all this. Is this really a doorstop for this?

SOKOLSKI: This gets to the point of gaming. I don’t think the Chinese want to be the primary spoilers for this deal. On the other hand, if they see others that are willing to at least condition it, I don’t think they want to hold back. I mean, they would prefer a world in which the rules make it easier for them to know what to do with regard to nuclear trade for India and Pakistan, which is a real nasty brew of trouble for them. Oddly enough, I’m not sure the Chinese are totally against these rules. They could see how they might help them.

But I would say that they are at least cheering for one side right now, which is interesting. Don’t expect that to stop if people come to the conclusion to push the rules aside and start doing deals with this country or that country. China will continue to try to maneuver.  That China agreed to sell nuclear items not just to Pakistan but India tells you just how playful they can be. They’re easy to underestimate. That’s a mistake to do.

KIMBALL: I’m not quite sure what it means. But I think it’s possibly a sign that the deal is in deeper trouble than the government in New Delhi thinks it is. Any other questions?

Well, I want to thank everyone for attending. I want to just underscore our basic message today, which is that, as Henry said, [this deal is] a potential nuclear nonproliferation 9/11.  It’s very important for world leaders who are serious about the nuclear Nonproliferation Treaty and the rules and standards that govern nuclear trade and commerce to stand up and stick to some core principles to make sure that this is not a further dent in the already damaged nuclear nonproliferation system. Thank you very much. (Applause.)

END

Description: 
Event transcript of a discussion between Henry Sokolski and Sharon Squassoni moderated by Daryl G. Kimball.

Country Resources:

U.S.-Indian Nuclear Deal Reaches NSG Brink

Wade Boese

After piloting a controversial nuclear trade initiative for more than three years through sometimes stormy domestic political processes that threatened to sink it, the United States and India in August brought the proposal before other governments for their approval. Several demurred, compelling New Delhi and Washington to work again to salvage it.

John Rood, acting U.S. undersecretary of state for arms control and international security, told reporters Aug. 22 that he was "optimistic" about the pact's prospects despite the failed initial attempt to move it through the 45-member Nuclear Suppliers Group (NSG). Rood led the U.S. delegation to the Aug. 21-22 Vienna meeting of the voluntary group, which was convened specifically to review the U.S.-Indian measure. The group operates by consensus to try and coordinate all members' nuclear trade policies, and it tentatively plans to meet again Sept. 4-5 to attempt to reach a common position on the U.S.-Indian initiative.

India has called for the group to allow it to trade with NSG members without any conditions. That now appears unlikely, raising questions about whether India ultimately might abandon the effort. Pranab Mukherjee, India's external affairs minister, was quoted in the Aug. 23 Hindustan Times as declaring, "[W]e cannot accept prescriptive conditionalities." Indian officials have most vehemently argued against measures that would end nuclear trade if India conducts another nuclear test. India last tested nuclear weapons in May 1998, leading rival Pakistan to carry out its first nuclear blasts. Neither state has forsworn additional tests although they have declared voluntary moratoriums.

Two days before the NSG meeting, Phil Goff, New Zealand's disarmament and arms control minister, told The Times of India that his country was exploring conditions that would terminate trade in the event of a future Indian test. Similarly, Rep. Howard Berman (D-Calif.) wrote an Aug. 5 letter to Secretary of State Condoleezza Rice urging that an NSG decision link trade and testing, as Congress did in its December 2006 legislation stipulating the circumstances under which the United States can engage in nuclear trade with India. (See ACT, January/February 2007. )

In general, Berman, chairman of the House Committee on Foreign Affairs, has pressed the administration to ensure that an NSG outcome be consistent with the U.S. law, known as the Hyde Act in honor of a former panel chairman. Berman warned in his letter that discrepancies between the NSG result and the Hyde Act would "jeopardize congressional support for nuclear cooperation with India." If the NSG clears India for nuclear trade, Congress would still need to approve a July 2007 bilateral U.S.-Indian nuclear cooperation agreement before any U.S. nuclear items could legally flow to India. (See ACT, September 2007. )

Some U.S. lawmakers have expressed concern that, under such a scenario, entities in other states such as France and Russia might get a jump start on cutting deals with India. Because of the abbreviated congressional schedule due to the November general elections, Congress is only expected to be in session Sept. 8-26 before ending this year's work. However, the Hyde Act calls for the bilateral agreement to sit for 30 continuous days before Congress can take a vote.

Consequently, if the NSG cleared India for nuclear trade this September or later this fall, foreign firms would most likely be free to pursue sales while U.S. companies would lack the domestic authority to do the same. Indeed, Russia already has negotiated an agreement to build four more reactors in India in the event that the NSG gives the green light to nuclear exports to India. Berman wrote the administration that it should not rush an NSG decision that "would give other countries an unacceptable head-start."

The sweeping effort to expand nuclear commerce with India by rescinding roughly three decades of U.S. and NSG constraints began with a July 2005 agreement between President George W. Bush and Indian Prime Minister Manmohan Singh. The swath of restrictions were erected incrementally in response to India refusing to join the 1968 nuclear Nonproliferation Treaty (NPT), exploding its first nuclear device in 1974 using Canadian and U.S. imports designated for peaceful purposes, and denying international oversight of its full nuclear complex.

Bush, seeking to bolster U.S. ties to the rising Asian power, pledged that the United States would work to roll back the trade constraints if India took certain steps to align its nuclear behavior more closely with that of other states. Above all, India was supposed to grant the International Atomic Energy Agency (IAEA) greater access to India's nuclear operations.

India and the IAEA

Singh in March 2006 vowed to eventually put 14 Indian thermal power reactors under the IAEA safeguards network, while leaving another eight unsupervised. He also elected to withhold from safeguards two fast breeder reactors, which yield more nuclear material suited for bomb-making than they consume as fuel. (See ACT, April 2006. ) Safeguards measures, such as inspections and remote monitoring, are supposed to deter and detect misuses of civilian nuclear facilities and materials to build nuclear weapons.

Indian negotiators in March 2008 completed talks on a draft IAEA safeguards agreement, but Indian Communist parties and their allies objected to finalizing it because of their general opposition to improving relations with the United States. Singh for months unsuccessfully attempted to win over the leftist parties, who had been crucial in helping his coalition government maintain power against its chief opposition, the Hindu-nationalist Bharatiya Janata Party (BJP). Meanwhile, BJP politicians railed against the U.S.-Indian deal as potentially crippling to India's nuclear weapons program and hindering its freedom to conduct future nuclear tests.

With the Bush administration pressing him to act or risk time running out on it being around to drive the deal through the NSG, Singh ignored leftist parties' protests and sent the draft safeguards agreement to the IAEA for approval by its 35-member Board of Governors. The move triggered a legislative debate and confidence vote on the Singh government that also was seen as a referendum on the U.S.-Indian initiative. Winning over the previously hostile Samajwadi party, Singh prevailed 275-256, with 10 abstentions, in an unruly July 22 vote marred by bribery allegations and the release of six lawmakers from jail to cast their ballots.

Preceding and during the debate, the BJP contended that the Singh government was "purveying untruths" about its draft IAEA safeguards agreement. Government officials described it as "India specific," suggesting that it was distinct from standard agreements. A key aspect touted by government officials included India's right to take "corrective actions" if foreign supplies of fuel ended. Anil Kakodkar, chairman of India's Atomic Energy Commission, and other Indian officials stressed that India had agreed to "permanent safeguards" on the basis of "permanent supplies," suggesting that if supplies stopped, so did safeguards.

The corrective actions referred to by the Singh government, however, were not defined in the agreement and appear only in its preamble and not the operative section. An IAEA source July 14 told Arms Control Today that a preamble contains "no rights or obligations." The source also said India would not be able to terminate safeguards on its own, pointing out that the agreement states that withdrawing a facility from safeguards requires a joint Indian and IAEA determination that it is no longer safeguards "relevant," meaning that nuclear material is no longer there or is unusable.

The IAEA source also said safeguards are "not time bound." Similarly, IAEA Director-General Mohamed ElBaradei said Aug. 1 that the agency safeguards are of "indefinite duration" and can only be terminated in accordance with the specific terms contained in the agreement. Still, the Indian government and the IAEA never publicly stated a common position on the duration of safeguards or their potential termination, leaving open the possibility for future misunderstandings.

The Indian-IAEA safeguards agreement is unique in that it is the first so-called umbrella agreement. When safeguarding facilities in the three non-NPT states-parties (India, Israel, and Pakistan), the IAEA typically negotiates one INFCIRC/66 agreement per facility, but this new arrangement will apply to as many facilities as India chooses to add incrementally over time. In addition, New Delhi can agree to have the terms of the new agreement apply to the six thermal power reactors that are already under safeguards from earlier arrangements. The Pakistani government complained in a July 15 letter to ElBaradei that the Board of Governors was being asked to approve a safeguards agreement unaware of the facilities it covered.

India 10 days later circulated a list of facilities that it claimed would be put under safeguards by 2014. In its safeguards preamble, India indicates it will only subject facilities to safeguards after negotiating agreements for "reliable, uninterrupted and continuous access to fuel supplies from companies in several nations."

Moreover, India reiterated its intent to build up a "strategic reserve of nuclear fuel" to ensure that its reactors could operate for their lifetimes if outside supplies ever ceased. The Bush administration pledged to help India acquire fuel reserves, but U.S. lawmakers through language in the Hyde Act supported only assisting India in procuring sufficient fuel for "reasonable reactor operating requirements." Critics fear a large reserve of fuel might lead India to calculate that it could risk nuclear tests and escape serious penalties.

Despite concerns raised by Pakistan and other states, the IAEA board Aug. 1 approved the Indian safeguards measure by consensus. The safeguards agreement will not enter into force, however, until India specifically notifies the agency that it is ready to bring the agreement into effect. New Delhi is not expected to do so until it secures what it considers to be a satisfactory NSG decision and negotiates contracts to lock in fuel supplies and develop its strategic reserve.

The NSG's Turn

Abiding by India's pleas for a "clean" NSG approval, the United States submitted a proposal Aug. 6 to the group that would not set any conditions for India to engage in nuclear trade. New Zealand's prime minister, Helen Clark, indicated just days before the meeting's Aug. 21 start that such a stripped-down approach was not going to be readily accepted, saying that her country was looking at "conditionalities" and speaking with "like-minded countries."

Meanwhile, some Democratic U.S. lawmakers also weighed in. In his Aug. 5 letter to Rice, Berman noted that an unconditional NSG approval "would be inconsistent with U.S. law, place American firms at a severe competitive disadvantage, and undermine critical U.S. nonproliferation objectives." In an Aug. 20 op-ed in The New York Times, Reps. Edward Markey (D-Mass.) and Ellen Tauscher (D-Calif.), who chairs the strategic forces subcommittee of the House Armed Services Committee, argued that the NSG "would vote itself out of existence if it allowed India to have nuclear technology with no strings attached." Their underlying concern is that India's import of nuclear fuel would enable it to devote more of its own domestic resources to building nuclear arms, spurring Pakistan to ratchet up its weapons programs.

NSG meetings are supposed to be confidential, but reports leaked that more than 50 proposed amendments were offered by several countries on the conclave's first day. Austria, Ireland, Norway, and Switzerland reportedly joined New Zealand in raising the most serious challenges to the proposal; but other countries, such as Canada and Japan, also reportedly supported possible amendments.

Proposals other than those pertaining to nuclear testing reportedly focused on requiring India to negotiate an additional protocol with the IAEA to give the agency greater inspection authority inside India. There also was support for prohibiting exports to India of enrichment and reprocessing technologies, which can be used to produce nuclear fuel as well as nuclear bombs. Another approach called for periodically reviewing India's compliance with certain standards of nonproliferation behavior in order to maintain its eligibility for trade.

At the close of the two-day meeting, the group issued a one-sentence description that participants "exchanged views in a constructive manner." The United States is expected to prepare a revised proposal for the group to consider at its upcoming meeting.

Averting a Nonproliferation Disaster

Daryl G. Kimball

Decision time has arrived on the controversial proposal to roll back three decades of nuclear trade restrictions on India, which violated peaceful nuclear cooperation agreements by detonating its first nuclear bomb in 1974.

As early as Sept. 4-5, the Nuclear Suppliers Group (NSG) will reconvene to consider a revised U.S. proposal to permit nuclear trade with India. At a special meeting of the 45-member group last month, the Bush administration proposed an India-specific exemption from NSG guidelines, which currently require full-scope IAEA safeguards as a condition of supply. Bowing to Indian demands, the Bush team called for a “clean” and “unconditional” waiver that would have allowed unrestricted nuclear trade with India at the discretion of each NSG member state.

To their credit, more than 20 states essentially said “no thanks” and proposed more than 50 amendments and modifications that would establish some basic but vitally important restrictions and conditions on nuclear trade with India. Many of these amendments track with the restrictions and conditions established in 2006 U.S. legislation regulating U.S. nuclear trade with India, which include the termination of nuclear trade if India resumes testing and a ban on the transfer of uranium-enrichment and spent fuel reprocessing technology.

Incredibly, U.S. officials are resisting even these most basic measures. As the Department of State’s Richard Boucher said in an Aug. 19 interview, “[S]ome would like to see all the provisions of the Hyde Act legislated in some international fashion. We don’t think that is the right way.”

Although acknowledging India’s legitimate interest in diversifying its energy options, like-minded countries, including Austria, Ireland, Japan, the Netherlands, New Zealand, Norway, and Switzerland, correctly recognize that the Bush approach is deeply flawed and would effectively end the NSG as a meaningful entity. It is vital that these and other responsible states stand their ground.

Why? Any India-specific exemption from NSG guidelines would erode the credibility of NSG efforts to ensure that access to peaceful nuclear trade and technology is available only to those states that meet global nuclear nonproliferation and disarmament standards.

Contrary to the Orwellian claims of its proponents, the deal would not bring India into the nonproliferation mainstream. Unlike 179 other countries, India has not signed the Comprehensive Test Ban Treaty. It continues to produce fissile material and expand its nuclear arsenal. As one of only three states never to have signed the nuclear Nonproliferation Treaty (NPT), it has not made a legally binding commitment to achieve nuclear disarmament.

In order to maintain its option to resume nuclear testing, India is seeking bilateral nuclear cooperation agreements that help provide it with strategic fuel reserves and lifetime fuel guarantees. This flatly contradicts a provision in U.S. law championed by Sen. Barack Obama (D-Ill.) that stipulates that fuel supplies be limited to reasonable reactor operating requirements.

Given India’s demands, the revised U.S. proposal will likely only pay lip service to the other NSG states’ concerns. Any such proposal should be flatly rejected as unsound and irresponsible. To be effective, NSG guidelines must establish clear and unambiguous terms and conditions for the initiation of nuclear trade and possible termination of nuclear trade.

If NSG states agree under pressure from an outgoing U.S. administration to blow a hole in NSG guidelines in order to allow a few states to profit from nuclear trade with India, they should at a minimum:

  • establish a policy that if India resumes nuclear testing or violates its safeguards agreements, trade involving nuclear items with India shall be terminated and unused fuel supplies returned;
  • expressly prohibit any transfer of reprocessing, enrichment, or heavy-water production items or technology, which can be used to make bomb material;
  • regularly review India’s compliance with its nonproliferation obligations and commitments; and
  • call on India to join with four of the five original nuclear-weapon states in declaring that it has stopped fissile material production and call on India to transform its nuclear test moratorium pledge into a legally binding commitment.

Some Indian officials have threatened they may walk away from the deal if the NSG establishes even these most basic requirements. If that occurs, so be it.

The Indian nuclear deal would be a nonproliferation disaster, especially now. The current U.S. proposal threatens to further undermine the NPT, the nuclear safeguards system, and efforts to prevent the proliferation of sensitive fuel-cycle technologies. Absent curbs on Indian nuclear testing and fissile material production, it would also indirectly contribute to the expansion of India’s nuclear arsenal with adverse consequences for the nuclear arms race in Asia.

For those world leaders who are serious about advancing nuclear disarmament, holding all states to their international commitments, and strengthening the NPT, it is time to stand up and be counted.

Decision time has arrived on the controversial proposal to roll back three decades of nuclear trade restrictions on India, which violated peaceful nuclear cooperation agreements by detonating its first nuclear bomb in 1974.

As early as Sept. 4-5, the Nuclear Suppliers Group (NSG) will reconvene to consider a revised U.S. proposal to permit nuclear trade with India. At a special meeting of the 45-member group last month, the Bush administration proposed an India-specific exemption from NSG guidelines, which currently require full-scope IAEA safeguards as a condition of supply. Bowing to Indian demands, the Bush team called for a “clean” and “unconditional” waiver that would have allowed unrestricted nuclear trade with India at the discretion of each NSG member state. (Continue)

Conflict of Interest Shadows Germany in Upcoming Controversial India Nuclear Trade Decision, Report Shows

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For Immediate Release: August 20, 2008


Contacts: Daryl G. Kimball, Executive Director, 1-202-463-8270 x107 and Oliver Meier, International Representative (Berlin), +49 171 359 2410.

(Washington): A respected nuclear journal this week reported that Germany's position on a controversial proposal to lift global nuclear trade restrictions on India might have been influenced by a private German firm's joint venture with the French nuclear conglomerate Areva. France is supportive of a U.S. drive to exempt India from existing nuclear trade rules, while many other countries have expressed opposition or concerns.

Previously, Germany had been more critical of the proposal, but now, under pressure from the United States and France, Germany has agreed to support the exemption for India, according to an Aug. 19 report in Platts Nuclear News Flash. That report notes that during German government discussions on the proposal to exempt India from the NSG rule in 2007 and 2008, "participants had expressed concern that Germany's reluctance to support granting India the exemption might impact a pending decision by French President Nicolas Sarkozy whether to make changes in the ownership structure of Areva NP that would replace the German Siemens with a French firm. Siemens currently holds a one-third share in Areva NP."

Germany's position on the issue matters greatly because it is currently the chair of the 45-member Nuclear Suppliers Group (NSG). The voluntary group is scheduled to meet Aug. 21-22 to discuss the U.S. proposal to exempt India from an NSG trade rule that nuclear importers must have international safeguards on all of their nuclear facilities and materials, which India does not. In its role as the NSG chair, Germany has a vital role in arbitrating the discussion and helping the NSG reach a decision by consensus.

"The report is deeply troubling because it suggests that Germany's role as the chair of the NSG is compromised given that it clearly has a conflict of interest that has affected its nonproliferation policy at the NSG. It is also clear that France is in a position to exert undue political influence over Germany's behavior," said Daryl G. Kimball, the executive director of the Arms Control Association. "Germany has a special responsibility to consider and take into account the position of NSG states that do not support the proposed exemption for India and to incorporate their proposed restrictions and conditions on trade with India," Kimball suggested.

According to an Aug. 19 report by Platts Nuclear News Flash publication, during German interagency discussions on the proposal to exempt India from the NSG rule in 2007 and 2008, "participants had expressed concern that Germany's reluctance to support granting India the exemption might impact a pending decision by French President Nicolas Sarkozy whether to make changes in the ownership structure of Areva NP that would replace the German Siemens with a French firm. Siemens currently holds a one-third share in Areva NP."

Areva, along with other nuclear vendors in Russia, the United States, and Japan hope to sell nuclear power plants and technology to India if the restrictions on such trade with India are lifted. According to the report in the industry newsletter, "During 2008, German leaders have urged Sarkozy to retain Siemens in Areva NP, in the interest of assuring the German company's future as a global nuclear power vendor."

"It is highly ironic that the German government and its foreign minister, which support a policy to phase out the use of nuclear power in Germany, are now seeking to facilitate a change in NSG policies to help a German company profit from nuclear business in other countries," noted Kimball.

The proposed NSG rule exemption would allow India to acquire nuclear technology and material previously off limits to it because of India's misuse of past nuclear imports for peaceful purposes to conduct a nuclear explosion in 1974 and refusal to allow full-scope international safeguards.

Several NSG members have raised questions about rewarding India with greater opportunities to engage in international nuclear trade while India continues to refuse to constrain its nuclear weapons program.

ACA and a wide-range of other NGOs and experts have called the proposal a "nonproliferation disaster" in an Aug. 15 letter to Germany and other NSG participants. They are recommending that at a minimum, the NSG establish a policy banning the transfer of enrichment and reprocessing technology to India and an immediate suspension of all NSG trade if India resumes nuclear testing. (See http://www.armscontrol.org/node/3287)

A copy of the text of the U.S. proposal to exempt India from NSG rules and ACA's analysis is available online at http://www.armscontrol.org/node/3274

# # #
The Arms Control Association is a private research and policy advocacy organization established in 1971 to promote effective arms control and nonproliferation solutions.

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Experts and Organizations from 24 Countries Call on Nuclear Suppliers Group to “Avoid a Nonproliferation Disaster”

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For Immediate Release: August 15, 2008

Contacts: Daryl G. Kimball, Exec. Director, Arms Control Association 1-202-463-8270 x107; Philip White, Citizens’ Nuclear Information Center, Tokyo, and Coordinator, Abolition 2000 U.S.-India Deal Working Group 81-3-3357-3800

(Washington, D.C.-Tokyo, Japan): In a letter sent this week to the foreign ministers of the participants in the 45-member Nuclear Suppliers Group, a prestigious and broad array of more than 150 experts and nongovernmental organizations from 24 countries urged that they reject a George W. Bush administration proposal to exempt India from longstanding global nuclear trade standards.

The experts and NGOs argue in the August 15 letter that “India's commitments under the current terms of the proposed arrangement do not justify making far-reaching exceptions to international nonproliferation rules and norms.”

The Nuclear Suppliers Group will convene on August 21-22 in Vienna to discuss a U.S. proposal to relax longstanding NSG restrictions on trade with states, such as India, that refuse to allow comprehensive international nuclear safeguards. (For the text and an analysis of the U.S. proposal see < http://www.armscontrol.org/node/3274>.) Opposition from several countries is expected.

The appeal is part of a global NGO campaign to influence governments’ views about the controversial nuclear trade proposal.

“Unlike 178 other countries, India has not signed the Comprehensive Test Ban Treaty. It continues to produce fissile material and expand its nuclear arsenal. As one of only three states never to have signed the nuclear Nonproliferation Treaty (NPT), it has not made a legally-binding commitment to achieve nuclear disarmament,” the letter notes.

“Yet the arrangement would give India rights and privileges of civil nuclear trade that have been reserved only for members in good standing under the NPT. It creates a dangerous distinction between ‘good’ proliferators and ‘bad’ proliferators and sends out misleading signals to the international community with regard to NPT norms,” according to the letter.

“In the absence of a suspension of fissile material production for weapons by India, foreign nuclear fuel supplies would free up India’s relatively limited domestic supplies to be used exclusively in its military nuclear sector, thereby indirectly contributing to the potential expansion of India’s nuclear arsenal,” the signatories warn.

The NGOs and experts call upon NSG participant countries “to support measures that would avert further damage to the already beleaguered global nonproliferation and disarmament regime.”

Among the former government officials and experts endorsing the letter is Amb. Jayantha Dhanapala, the former UN Undersecretary General for Disarmament Affairs and President of the 1995 Nuclear Nonproliferation Treaty Review and Extension Conference. Other notable signatories include the mayors of Hiroshima and Nagasaki, former U.S., Canadian, and Australian ambassadors, and the former U.S. official responsible for civilian nuclear trade negotiations.

NGOs from Australia, Austria, Belgium, Canada, Finland, Germany, India, Italy, Ireland, Japan, Malaysia, Mexico, the Netherlands, New Zealand, Norway, South Korea, South Africa, Sweden, the United Kingdom, the United States, and elsewhere endorsed the letter, which was organized by the Tokyo-based Citizens’ Nuclear Information Center and the Washington-based Arms Control Association.

Given that the IAEA Board and the NSG traditionally operate by consensus, the signatories point out that each member state “has a pivotal role to play.” If the NSG is to allow nuclear trade with India, the experts and NGOs urge NSG participants to establish meaningful and common sense conditions and restrictions on nuclear trade with India, including:

  • Terminating nuclear trade with India if it resumes testing;
  • Prohibiting any transfer of sensitive plutonium reprocessing, uranium enrichment, or heavy water production items to India, which can be used to make bomb material;
  • Before India is granted a waiver from the NSG’s full-scope safeguards standard, it should join the other original nuclear weapon states by declaring it has stopped fissile material production for weapons purposes and transform its nuclear test moratorium into a meaningful, legally-binding commitment.

Unfortunately, Indian officials are demanding a so-called “clean” and “unconditional” exemption from NSG guidelines and are seeking bilateral nuclear cooperation agreements that help provide India with strategic fuel reserves and/or lifetime fuel guarantees in order to allow it to resume nuclear testing in the future without fear of a fuel supply cut off.

The August 15 letter warns the foreign ministers of the NSG countries that “if nuclear testing is to be deterred, meaningful penalties must be available. If NSG states do agree to supply fuel for India’s ‘civilian’ nuclear sector, they must avoid arrangements that would enable or encourage future nuclear testing by India. Otherwise, you and your government may become complicit in the facilitation of a new round of destabilizing nuclear tests.”

For the full list of endorsers and the text of the letter, see < http://www.armscontrol.org/system/files/NSGLetterGermanyAug15.pdf >.

Country Resources:

U.S. Proposal for India-Specific Exemption from Nuclear Suppliers Group Guidelines Circulated August 2008

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Note for Reporters by Daryl G. Kimball (202-463-8270 x107)
August 13, 2008

The Arms Control Association has obtained a copy of the U.S. proposal to exempt India from existing nuclear trade restrictions maintained by the 45-member Nuclear Suppliers Group (NSG). The proposed rule change would allow India to acquire nuclear technology and material previously off limits to it because of India’s misuse of past nuclear imports for peaceful purposes to conduct a nuclear explosion in 1974 and refusal to allow full-scope international safeguards.

Submitted August 6 to Germany, the current chair of the NSG, the proposal is the latest step in President George W. Bush’s effort to seek India-specific exemptions from U.S. and NSG nuclear trade restrictions on states that do not allow full-scope international safeguards.

The NSG is due to meet August 21-22 in Vienna for an extraordinary plenary meeting to discuss the U.S. proposal and may convene again to vote on the initiative as early as September. Traditionally, the group makes decisions by consensus. Several NSG members have raised questions about rewarding India with greater opportunities to engage in international nuclear trade while India continues to refuse to constrain its nuclear weapons program.

The new U.S. proposal is based closely on a March 2006 pre-decisional draft but has been weakened further as a result of U.S. acquiescence to Indian demands to delete or modify certain sections, particularly those that would link nuclear trade with India to its compliance with certain nonproliferation commitments.

The NSG’s existing guidelines for the export of nuclear material, equipment, and technology are also available online.

Brief Analysis

Generally speaking, any India-specific exemption from NSG guidelines would erode the credibility of the NSG's efforts to ensure that access to peaceful nuclear trade and technology is available only to those states that meet global nuclear nonproliferation and disarmament standards. India has not agreed to abide by the standards and commitments expected of other responsible states, including full-scope IAEA safeguards, a meaningful Additional Protocol to its safeguards agreement, a legally-binding ban on nuclear testing, and a halt to the production of fissile material for weapons.

While India has agreed to IAEA safeguards on a few additional reactors by the year 2014, it has not declared which facilities would be safeguarded and it has not acknowledged that such safeguards apply to all civil facilities and materials on a permanent and unconditional basis. India has suggested it could withdraw from the agreement if fuel suppliers are cut off due to its resumption of nuclear testing. (See <http://www.armscontrol.org/node/3205> for an analysis of the agreement.) The IAEA director-general has failed in his basic responsibility to ensure there is a clear understanding between the Indians and the IAEA that the agreement is consistent with IAEA standards and practices for terminating safeguards.

The supply of foreign nuclear fuel to India’s civil nuclear sector would also free up India’s limited fuel supplies for use in its military production sector and allow India to increase its production of fissile material for nuclear weapons. (For further discussion on this point, see <http://www.armscontrol.org/pressroom/2006/20061115_Indian_Fissile>.) This would be inconsistent with NSG member states’ commitments under Article I of the nuclear Nonproliferation Treaty not to assist in any way the nuclear weapons program of another country.

If, as India is demanding, supplier states agree to help India amass a strategic reserve of nuclear fuel or agree to provide lifetime reactor fuel supplies, the current NSG exemption would allow India to resume nuclear testing without fear of losing access to nuclear fuel supplies. Contrary to the U.S. Henry Hyde Act—the 2006 U.S. law regulating future U.S. nuclear trade with India—the current U.S. proposal to the NSG fails to specify that if India resumes nuclear testing, nuclear trade with India would be terminated.

Trade with India involving sensitive nuclear technologies (uranium enrichment, spent fuel reprocessing, and heavy water production) and certain dual-use items on the NSG trigger list could also be used by India for weapons production purposes. Since IAEA safeguards cannot be relied upon to prevent the diversion or replication of these sensitive technologies for weapons-related purposes, the transfer of these items to India should be explicitly prohibited.

Regarding the current U.S. proposal, one of the most notable and troublesome features is the weak and very ambiguous language in section 2, which is ostensibly meant to outline what India has done that qualifies it for a special exemption from NSG guidelines. The proposal would simply “recognize” India’s commitments and actions that were outlined in the July 2005 joint statement by President George W. Bush and Prime Minister Manmohan Singh.

Section 3 would allow individual NSG members to engage in a full range of nuclear trade with India without any legally or politically meaningful requirement that would link nuclear trade with India to implementation and compliance with the commitments and actions mentioned in section 2.

The proposal would only require that: “Participating Government shall maintain contact and consult through regular channels on matters connected with the implementation of the Guidelines, taking into account relevant international commitments and bilateral agreements with India.”

This is a much weaker formulation than the already weak March 2006 U.S. draft proposal, which stated that: “Participating Governments may transfer trigger list items and/or related technology to the safeguarded civil nuclear facilities in India …as long as the participating Government intending to make the transfer is satisfied that India continues to fully meet all of the aforementioned nonproliferation and safeguards commitments, and all other requirements of the NSG Guidelines.”

Furthermore, the current U.S. proposal would leave it up to each individual NSG participant to decide whether India is or is not meeting these weak standards and loose commitments before they sell nuclear technology and materials (possibly including technologies the United States would not be willing to sell) to India.

To be effective, the NSG’s guidelines must establish clear and unambiguous terms and conditions for the initiation of nuclear trade and possible termination of nuclear trade with recipient states.

In essence, the Bush administration is proposing an NSG rule-change that would not only erode rules-based efforts to curb the spread of nuclear weapons, but it would also allow other states to interpret or ignore the India-specific NSG guideline as they see fit and undermine how U.S. lawmakers would like to see such a rule applied. For instance, Russia has already shown its blatant disregard for existing NSG guidelines by re-supplying India's two Tarapur light-water reactors in 2001 and 2006.

Section 4 of the proposal would effectively give India a veto over future NSG decisions even though it is not a member of the NSG. It states that: “Participation of India in the decisions regarding proposed amendments will facilitate their implementation by India.

The Bush administration’s proposed India-specific exemption is a nonproliferation disaster that could effectively end the NSG as a meaningful entity.

Remedies

The current U.S. proposal should be flatly rejected by other NSG member states as unsound and irresponsible. If NSG states agree under pressure from an outgoing U.S. administration to blow a hole in NSG guidelines in order to allow a few states to profit from reactor and nuclear fuel and technology sales to India, they should at a minimum, support common sense restrictions and conditions on such trade, including but not limited to the following:

  • NSG states should establish a policy that if India resumes nuclear testing, or violates its safeguards agreements, trade involving nuclear items with India should be terminated and unused fuel supplies should be returned;
  • NSG states should expressly prohibit any transfer of sensitive reprocessing, enrichment, or heavy water production items or technology;
  • NSG states should actively oppose any arrangement that would give India any special safeguards exemptions that would in any way be inconsistent with the principle of permanent safeguards over all nuclear materials and facilities. NSG states should not take any decision unless India and the IAEA conclude a meaningful Additional Protocol to supplement its new facility specific safeguards agreement;
  • Before India is granted a waiver from the NSG’s full-scope safeguards standards, NSG states should call upon it to join with four of the five original nuclear-weapon states in declaring that it has stopped fissile material production and call upon India to transform its nuclear test moratorium pledge into a legally binding pledge, perhaps by signing the Comprehensive Test Ban Treaty.

Congress, the NSG, and the U.S.-Indian Nuclear Cooperation Agreement

Several member of Congress have urged the Bush administration not to support any NSG exemption for India that does not conform to the restrictions and conditions on nuclear trade established by the Hyde Act. Even if the NSG allows civil nuclear trade with India, Congress must still approve the proposed U.S.-Indian nuclear cooperation agreement and it may seek to amend or attach conditions on its implementation.

On August 5, the Chair of the House Committee on Foreign Affairs, Rep. Howard Berman (D-Calif.) wrote U.S. Secretary of State Condoleezza Rice that “the President should withhold support from any proposed exemption from India in the NSG guidelines that is not fully consistent with the Hyde Act and that does not incorporate a number of other key provisions, including: the immediate termination of all nuclear commerce by NSG states if India detonates a nuclear explosive device or if the IAEA determines that India has violated its safeguards commitments …” (The full text of the Berman letter is available from <http://www.armscontrol.org/node/3240>.)

Berman goes on to warn Rice that “any effort to consider the [U.S.-Indian nuclear cooperation] agreement outside of the requirements of current law will be impossible if the Administration accepts an NSG exemption that fails to include the Hyde Act conditions.”

It is clear that the current U.S. proposal to exempt India from NSG guidelines fails to include the Hyde Act conditions and restrictions.

 


 

 

Statement on Civil Nuclear Cooperation with India
[Text of Draft U.S. Proposal to NSG, August 2008]

1. At the _____ plenary meeting on ______ the Participating Governments of the Nuclear Suppliers Group agreed that they:

    a. desire to contribute to an effective non-proliferation regime and the widest possible implementation of the objectives of the Treaty on the Non-Proliferation of Nuclear Weapons

    b. seek to limit the further spread of nuclear weapons

    c. wish to pursue mechanisms to affect positively the non-proliferation commitments and actions of those outside the traditional nuclear non-proliferation regime

    d. seek to promote fundamental principles of safeguards and export control for nuclear transfers for peaceful purposes

    e. recognize the world's need for clean and reliable sources of energy for sustained growth and prosperity

2. In this respect, Participating Governments have taken note of steps that India has taken voluntarily as a contributing partner in the non-proliferation regime and they welcome India's efforts with respect to the following non-proliferation commitments and actions:

    a. Deciding to separate its civilian nuclear facilities in a phased manner and file a declaration regarding its civilian nuclear facilities with the International Atomic Energy Agency

    b. Conducting negotiations with the IAEA and obtaining approval of its Board of Governors regarding a Safeguards Agreement for application of safeguards to civilian nuclear facilities that is in accordance with IAEA standards, principles and practices (including Board of Governors document GOV/1621)

    c. Committing to sign and adhere to an Additional Protocol with respect to India's civil nuclear facilities

    d. Refraining from transferring enrichment and reprocessing technology to states that do not already possess these

    e. Having adopted a national export control system capable of effectively controlling transfers of multilaterally controlled nuclear and nuclear related material, equipment, and technology.

    f. Harmonizing its export control lists with those of the Nuclear Suppliers Group and committing to adherence to NSG guidelines

    g. Continuing its unilateral moratorium on nuclear tests and declaring its readiness to work with others towards conclusion of a multilateral Fissile Material Cut-off Treaty.

3. In view of the above, Participating Governments have adopted the following policy on civilian nuclear cooperation with the IAEA-safeguarded Indian civilian nuclear program

    a. Notwithstanding paragraphs 4(a), 4(b) and 4(c) of Infcirc/254 (Rev. 9) Part 1, Participating Governments may transfer trigger list items and/or related technology to India for peaceful purposes and for use in safeguarded civilian nuclear facilities provided that the transfer satisfies all other provisions of Part 1.

    b. Notwithstanding paragraph 4(b) of the Part 2 guidelines, Participating Governments may transfer nuclear-related dual use equipment, etc. for peaceful purposes for use in civilian nuclear facilities under IAEA safeguards, provided that the transfer satisfies all other provisions of Part 2.

    c. Participating Governments shall maintain contact and consult through regular channels on matters connected with the implementation of the Guidelines, taking into account relevant international commitments and bilateral agreements with India.

4. In order to facilitate the efforts of non-member adherents to Infcirc/254 Parts 1 and 2 to remain current in their implementation of the Guidelines, the NSG Chair is requested to review proposed amendments to the Guidelines with all non-member adherents on a non-discriminatory basis and solicit such comments on the amendments as a non-member adherent may wish to make. Participation of India in the decisions regarding proposed amendments will facilitate their implementation by India.

5. The NSG Point of Contact is requested to submit this statement to the IAEA DG with a request that it be circulated to all Member States.

Country Resources:

Letter from Congressman Howard Berman to Secretary of State Condoleezza Rice on the U.S. Indian Nuclear Deal

Body: 

PDF Document of Chairman Howard Berman's letter to Secretary Condoleezza Rice on the U.S.-Indian nuclear deal and exemptions from the Nuclear Suppliers Group dated August 5, 2008.

Description: 
PDF Document of Chairman Howard Berman's Letter to Secretary Condoleezza Rice

Country Resources:

What's Next for India's Nuclear Trade Future: Key Issues before the IAEA, NSG and U.S. Congress

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Body: 

Fresh off the heels of a vote of confidence from parliament, Indian Prime Minister Manmohan Singh has renewed a push for nuclear cooperation between the U.S. and India. Late next week, the International Atomic Energy Agency's Board of Governors will meet to consider an unprecedented safeguards agreement for India. Soon thereafter, the 45 member states of the Nuclear Suppliers Group will consider an India-specific exemption to allow civil nuclear trade for the first time in 30 years. The NSG has restricted trade with India and other states that have not signed the nuclear Nonproliferation Treaty. Only then would the U.S. Congress consider a bilateral nuclear cooperation agreement between the U.S. and India. As these events unfold, a number of experts are raising alarms about the implications of this agreement on global stability.

Click here for a transcript of this event.

WHAT:

Press briefing to address key issues before the international community on the controversial proposal and outline key conditions and restrictions that would reduce the adverse impacts on nonproliferation.

Panelists include:

  • Ambassador Robert T. Grey, Jr., Director, Bipartisan Security Group, former U.S. Ambassador to the Conference on Disarmament
  • Sharon Squassoni, Senior Associate, Nonproliferation Program, Carnegie Endowment for International Peace
  • Daryl G. Kimball, Executive Director, Arms Control Association
WHEN: Wednesday, July 30, 2008, 9:30 - 10:30 a.m.
WHERE:

National Press Club
Murrow Room, 13th Floor
529 14th Street NW
Washington, DC 20045

RSVP Meri Lugo 202-463-8270 x100; [email protected]
Description: 
Press briefing to address key issues before the international community on the controversial proposal and outline key conditions and restrictions that would reduce the adverse impacts on nonproliferation.

Country Resources:

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