Depart Mr Jekyll, Enter Mr Hyde

AFTER the Nuclear Suppliers Group (NSG) meeting last September, the government of India had mounted a high voltage campaign how it had secured a “clean and unconditional” waiver. Prime minister Manmohan Singh had hailed the NSG’s waiver as enabling “full civil nuclear cooperation” with India,  and said, “It marks the end of India’s decades long isolation from the nuclear mainstream and of technology denial regime.” What the government had hid from the people is that the NSG at that time was also considering a ban on all fuel Enrichment and Reprocessing (ENR) technologies for countries that did not have the fuel cycle or had not signed the NPT. The US and some other countries wanted this ban to cover all countries that currently do not possess the full fuel cycle, but it ran into some resistance from countries such as Brazil and Canada. However, there was unanimity inside NSG on banning transfer of such technologies to non-signatories to NPT. The recent G8 ban on transfer of ENR technologies to non-NPT signatories is nothing but this consensus within NSG –  non bracketed text of the NSG resolution – and this is what G8 countries have now adopted.

Why did the Indian government hide what it knew was on the NSG anvil? Was it to pretend before the people that the technology denial regime was ending and India henceforth would get access to all technologies including that for the fuel cycle? Since the PM had stated in parliament that the 123 agreement guaranteed “full civil nuclear cooperation”, anything short of a clean and unconditional waiver would have been politically damaging, therefore the charade. First, the NSG gives a “clean” waiver and in turn, India accepts that it will abide by any future decision of the NSG. Then the NSG imposes a ban on all ENR technologies to countries such as India, on which India would make some noise but not go further.


However, the present G8 ban is even worse: it singles out only India for the ban. Since Israel,  Pakistan and North Korea, the three other nuclear states that have not signed the NPT do not have an NSG waiver, the only country on which the G8 ban is applicable is India. So we are back to the 123 agreement, the Hyde Act and the NSG waiver being limited to reactors and nuclear fuel. The technology denial regime, reiterated a number of times by Kakodkar, the AEC chairman, as thwarting India’s progress in nuclear and other fields, remains very much in place. The India-US nuclear deal, as was stated by the Left all along, was a deal for nuclear reactors and allowing India access to nuclear fuel.

A number of commentators had at the time of the nuclear negotiations had claimed that India had the option of not buying US reactors and could work out more favourable terms with Russia and China, thereby beating the Hyde Act provisions of technology denial. The recent G8 ban on ENR technology makes clear that this route was really never open. The Hyde Act had made clear that the US administration would need to see that the nuclear industry in the US did not have a handicap due to the Hyde Act provisions and must secure a commitment from other countries before the NSG waiver that they would all act in concert. This is what has appeared now as the G8 ban.

Despite the G8 ban being orchestrated by the US, India is bending over backwards to offer its companies two sites for locating nuclear plants. This is the gift that India has made publicly during Hilary Clinton’s visit. Presumably, the 10,000 MW reactor sales that India has promised the US government is still on course, despite the ENR ban. Further, the India government is now working on limiting liability of the private companies running nuclear plants or supplying nuclear equipment. In simple terms, it means that if there is a Bhopal type disaster, the private companies concerned would not pay damages – the burden of damages, relief and rehabilitation would all be carried by the government. The US suppliers of nuclear reactors want complete protection if their equipment fail and cause a Chernobyl or Bhopal type disaster. What they want is that the risk of nuclear plants be carried entirely by the Indian tax payers while they enjoy the benefits. New age capitalism, where the people pay for all the risks and capital enjoys the entire profits!


The question is what are the implications of the G8 ENR ban? Or is it of little consequence to our nuclear program?

The answer to this question would depend on what kind of nuclear program we are looking for. The US and other nuclear powers have been arguing that India should not develop any nuclear fuel facilities, should not try and reprocess the spent fuel and not take the fast breeder reactor route. In essence, they want a nuclear power sector in India which would be entirely dependent on the suppliers. They would then control the pipeline that supplies India with nuclear fuel and thereby ensure that India toes the US line. In such a scenario, the denial of ENR technologies would have little impact – India would have already accepted the US yoke.

The problem comes up if India wants to protect its energy security and continue with its three phase program — fast breeder reactors for the second phase and thorium in the third phase. In this scheme, India would have to put its breeder reactors under IAEA safeguards, while at the time, it would be denied any technology for breeder reactors. Breeder reactors would be regarded as part of the fuel cycle and therefore any technology for such plants would come under the recent G8 ban.

In case India abandons the fast breeder and the thorium route, and goes in for Light Water Reactors and enriched fuel, it faces a different problem. It would have to import enriched fuel. Unlike Heavy Water Pressurised Reactors that use natural uranium, the Light Water Reactors need enriched uranium. If India wants to reduce its dependence on imported fuel, it has to either enrich fuel itself or reprocess the spent fuel. Since India has limited sources of natural uranium, reprocessing would be important to reduce dependence on imported fuel. This immediately brings up the same problem as with breeder reactors, such reprocessing plants would be under complete IAEA safeguards and yet would be denied technology.

This state – to have fully safeguarded facilities and yet be denied technology — means that every bit of equipment that goes into it would need to be indigenously produced. The IAEA safeguards can not only check for whether we are beating the ban through grey market but could also go further and check plants that produce such equipment and whether they are in turn using “banned” equipment. This is indeed the worst of both worlds.

India is soon to negotiate the consent for reprocessing with the US. This consent, according to the Atomic Energy Commission, is crucial to India’s future nuclear program. The US carried out similar negotiations with the Japanese for its reprocessing facility. What the US imposed on the Japanese is very expensive monitoring equipment. In this case, the issue is not only its cost. What it could easily impose on India is monitoring equipment, which India cannot buy and will find prohibitively expensive to produce — India would be between the proverbial rock and a very hard place.

The question then arises: why should India buy nuclear plants from countries that are a party to a continuing technology denial regime? If – as the government claims – these countries have broken the compact and gone back on their pledge in the NSG for a clean waiver, why should we then still buy their reactors? These reactors would not only be prohibitively expensive, they would come with fuel supplies tied to the parent countries. At any point of time, they could turn off the tap and our fuel supply would come to a standstill. This is what happened in Tarapur. Why are we then endangering our fuel security for buying reactors at huge costs,  that too at 2-4 times the prices of Indian reactors?


The other question that we need to address is that if we buy reactors at such high costs, will we have money left to continue with our indigenous development including the breeder-thorium route? Or are we hiding that we intend to give up this route any way and fall back on the easier one of importing reactors? Even if it is a far more expensive option and means loss of energy security for the future?

We had indicated earlier that as a consequence of the India US nuclear deal, it is clear that India is going to slow up the Fast Breeder and thorium route. We cannot put in the kind of investments in imported nuclear reactors and also continue investing in FBR technology. This government is abandoning its earlier goal of technology self reliance and energy security by stealth.

The technology denial regime is not limited to just explicit items required for ENR. It covers also various dual use technologies. Therefore, the ban on ENR technologies would affect not only nuclear but also other sectors.  The government needs to come clean on the implications of the G8 ban instead of hiding behind the statement that it goes by the NSG waiver statement. India going by the earlier NSG waiver is of no use, if the countries that have ENR technologies do not abide by this waiver any more. It is either hiding its head in the sand or continuing to deceive the people knowing full well what the ban implies. What is clear is what the Left had said all along – this deal is flawed from the beginning. In making the US its interlocutor to the NSG, it has accepted that the US will shape the nature of its future nuclear energy program.

Instead, India should have looked for a nuclear fuel deal and engaged with the broader NSG community. It would perhaps have taken longer but at the end of this process, India would have had a deal which would have respected its goal of self reliance and energy security. If all India is getting out of this deal is nuclear fuel and reactors, then this agreement is a bad one. It ties India down in various ways and has already extracted a heavy price in terms of foreign policy, foregoing
the cheaper energy option of imports of gas and LNG from Iran. In the long run, a broader engagement with a number of member states of the NSG would have been much better for India than a deal secured with US “mentoring” India through the NSG process and thereby imposing its conditions on us.

For many of the nuclear disarmament proponents in the West, the path to disarmament has been through nuclear non proliferation.  Unfortunately, it was the unwillingness of the nuclear weapon states to move meaningfully towards disarmament that endangered the NPT compact. The US strategic doctrine that envisages use of nuclear weapons even against non-nuclear weapons states, its aggressive policy of regime change, its war and occupation of Iraq has changed the international landscape completely and it is time that the disarmament movement in the West comes to terms with this.

If we are serious about disarmament, we cannot think now only of how to strengthen the NPT regime by creating barriers to ENR technologies. We have to look for multilateral fuel facilities which are jointly owned by the international community, cast iron guarantees for fuel supplies before asking countries to give up self reliance in fuel production. The world will not accept a new NPT like compact, where only a few countries have complete control of all nuclear fuel, and others will be only meek recipients.