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US-India Deal

A condensed version of this backgrounder is also available in PDF format.

Read WILPF's Statement on the Nuclear Suppliers Group's exemption for India

Recent developments

22 August 2008: First NSG meeting

2 September 2008: Letter from US Congress

4-6 September 2008: Second NSG meeting and approval of waiver

Reactions from disarmament and arms control experts

The 45-member Nuclear Suppliers Group met on 22 August 2008 to discuss the US-India Deal - specifically, whether or not the Group would lift a ban on nuclear trade with India. The Group must agree to allow nuclear fuel and technology exports to India for its civilian atomic energy programme to help seal the US-India Deal. However, the meeting ended inconclusively after several delegations, including Austria, Ireland, the Netherlands, New Zealand, Norway, and Switzerland raised concerns about the deal undermining the nuclear Non-Proliferation Treaty (NPT), which India has not joined.

Almost half the suppliers' group membership proposed about 50 amendments to the US draft for a waiver that would allow India to do business with the cartel. Phil Goff, New Zealand's Disarmament and Arms Control Minister, said, "Around 50 amendments have been proposed to the original text, with many countries speaking in favour of amendments. The key function of the NSG is to formulate guidelines for managing exports of nuclear material, equipment and technology to ensure that this trade does not contribute to nuclear weapons proliferation. Discussions in Vienna focused on how to ensure compatibility of these objectives with the exemptions, sought for the US-India Civil Nuclear Co-operation Agreement." The amendments reportedly seek to impose three main conditions on the exemption for India: period review of India's compliance with non-proliferation commitments; explicit exclusion of uranium enrichment and reprocessing of spent-fuel technologies from what can be exported to India; and no more nuclear trade with India if it conducts another nuclear weapon test.

On 27 August, the US-India Deal Working Group of Abolition 2000 sent letters to 13 governments. An example of these letters can be found here.

On 2 September, the Chairman of the US House Foreign Affairs Committee, Howard L. Berman, made public correspondence between the US State Department and members of the US Congress on the US-India deal. The US Congressmen had asked 45 questions to the Bush Administration seeking clarifications on various aspects of the agreement. The 26-page letter reveals:

  1. The US has given no binding fuel-supply assurance to India.
  2. There is no US consent to India's stockpiling of lifetime fuel reserves for safeguarded power reactors.
  3. Civil nuclear cooperation is explicitly conditioned to India not testing ever again.
  4. The US has retained the right to suspend or terminate supplies at its own discretion.
  5. The letter makes clear that the 123 Agreement has granted India no right to take corrective measures in case of any fuel-supply disruption.
  6. The Bush administration's letter states that the 123 Agreement fully conforms to the Hyde Act provisions.
  7. The letter assures Congress that the US government will not assist India in the design, construction or operation of sensitive nuclear technologies, including enrichment and reprocessing.

These conditions undermine the supposed agreement developed between the Indian and US governments.

On 3 September, groups representing survivors of the atomic bombing of Hiroshima and Nagasaki (Hibakusha) sent letters of support to the six governments that have been blocking the US-India deal at the Nuclear Suppliers Group. They called on the six governments to continue to defend the NPT, saying, "Hibakusha have poured their hearts and souls into the movement for the elimination of nuclear weapons, that never again may the human race be forced to endure the type of tragic suffering that they experienced. And one of the main foundations has been the conviction that only by strengthening the NPT system will a path be opened up for the elimination of nuclear weapons."

The Group met again on 4–6 September to discuss the matter further. After intense pressure from the United States, the six hold-out governments capitulated and approved the waiver. New Zealand Prime Minister Helen Clark confirmed that she had spoken to US President George W. Bush about the matter on 4 September. Phil Goff, New Zealand's Disarmament and Arms Control Minister, said New Zealand's concerns were dealt with to a "significant degree". He explained

New Zealand had particular concerns it wanted to be addressed. This included action to be taken in the event of the resumption of nuclear testing and the question of the transfer of sensitive technologies related to enrichment and reprocessing. New Zealand also wanted India to sign up to the IAEA’s Additional Protocol, which extends that body’s powers of monitoring and inspection. It also sought review provisions for the exemption.

The concerns were addressed to a significant degree by India in a formal statement. India has reiterated its commitment to a voluntary unilateral moratorium on nuclear testing. It has indicated support for international efforts to limit the spread of enrichment and reprocessing and pledged it will not be the source of such proliferation. It has committed itself to sign and adhere to the Additional Protocol with respect to India’s civil nuclear facilities. These undertakings are referenced in the NSG statement on Civil Nuclear Cooperation with India, which also notes constraints on transfer of sensitive exports. It makes provision for reviewing the exemption and for countries to raise any concerns about how the exemption is operating.

New Zealand, along with others at the NSG, pressed for the strongest possible safeguards to be written into the exemption. In the end we accepted the consensus reached. In doing so, New Zealand noted that the NSG would need to be vigilant in implementing the exemption in order to realise the Non-Proliferation benefits and indicated that it would be monitoring that process closely.

However, most experts believe the waiver is a "massive setback" to non-proliferation and disarmament.

Praful Bidwai of the Inter Press Service and co-founder of the Movement in India for Nuclear Disarmament argues, "The NSG's waiver will allow India to resume nuclear commerce with the rest of the world with very few restrictions although India is not a signatory to the Nuclear Non-Proliferation Treaty (NPT) and has refused to accede to any other agreement for preventing the spread of, reducing the numbers of, or abolishing nuclear weapons."

Bidwai notes, "Contrary to the claim that the waiver, and more generally, the U.S.-India nuclear deal, will bring India into the global 'non-proliferation mainstream' or promote nuclear restraint on India's part, it will allow India to expand its nuclear weapons arsenal and encourage a nuclear arms race in Asia, particularly in the volatile South Asian subcontinent, where Pakistan emerged as India's nuclear rival 10 years ago."

The US-India Deal Working Group of Abolition 2000 says the deal "creates a dangerous distinction between 'good' proliferators and 'bad' proliferators and sends out misleading signals to the international community with regard to NPT norms. Furthermore, it was inappropriate for the member states of the NSG to take it upon themselves to make a decision on this matter for the 140-plus other members of the NPT."

Australian Senator Scott Ludlam, Australian Greens spokesperson on nuclear issues, argued, "The decision is dangerous and it is also invalid. Forty-five countries have made a decision on behalf of the 189-strong membership of the NPT. This minority has never been given the authority to reinterpret the NPT, overturn NPT decisions or violate existing international standards."

Many experts complained about the process as well. M.V. Ramana from the Centre for Interdisciplinary Studies in the Environment and Development, Banagalore, described Indian Foreign Minister Mukherjee's statement on 5 September as "inane and dishonest," lamenting, "It is really a sad commentary on the state of debate at the NSG if such statements actually create what was described by the U.S. delegate as a 'positive momentum'." Daryl Kimball of the Arms Control Association said, "it appears as if George Bush and his team engaged in some nasty threats, misinformation about positions, and intimidation, to wear down the core six members … and their allies. You have to assume the conversations among foreign ministers, presidents, and prime ministers didn't focus on the policy and non-proliferation issues, but raw politics."

Kimball also noted that the German chair "let the Americans run the show and keep asking for more consultations despite the remaining differences. A more competent and less biased chair would have provided more balance and would have adjourned the meeting Friday night when it was clear there was still disagreement on some fundamental issues." Achin Vanaik, head of the department of political science at Delhi University and a national coordination committee member of the Coalition for Nuclear Disarmament and Peace (India), argued, "This was a triumph of crass power politics. It is sad and profoundly disturbing that nobody resisted U.S. or Indian pressure and stood up for elementary principles in a group where even a single member could have blocked the waiver. India's 'victory' is founded on crude muscle power and cynicism, and negates rational, democratic decision-making based on a commitment to making the world a safer place."

Even though the NSG approved a waiver on 5 September, the deal might not make it through US Congress by the end of its session on 26 September. However, the waiver approved on 6 September allows any NSG member to trade with India, which means counties other than the United States can engage in nuclear trade with India even if Congress does not approve the US to.

Read WILPF's Statement on the NSG's exemption for India.


Introduction

On 18 July 2005, US President Bush and Indian Prime Minister Manmohan Singh reached agreement on a plan for civilian nuclear energy and outer space cooperation. The deal, if approved by the US Congress, Indian Parliament, and the Nuclear Suppliers Group, would lift the US moratorium on nuclear trade with India, provide US assistance to India's civilian nuclear energy program, and facilitate opportunities for bilateral space activities.

Nuclear cooperation: Under the proposed deal, India would separate its military and civilian nuclear reactors, and place many—but not all—of its civilian nuclear reactors under International Atomic Energy Agency (IAEA) safeguards. Military facilities, and stockpiles of nuclear fuel that India has produced up to now, will not be subject to inspections or safeguards. Meanwhile, the US will be allowed to build nuclear reactors in India, and provide India with nuclear fuel for its civilian reactors.

In December 2006, US Congress approved legislation changing US law to allow US exports of civilian nuclear fuel and technology to India for the first time in 30 years. The approval was granted, however, with the conditions that the US and India conclude a formal nuclear cooperation agreement, that India and the IAEA conclude a nuclear safeguards agreement, and that the deal is approved by the Nuclear Suppliers Group. In July 2007, an operating agreement adopted by Bush and Singh, known as the 123 agreement, sought allowances for India to reprocess spent nuclear fuel under IAEA safeguards. Under this agreement, the US would also support the creation of an “Indian strategic fuel reserve” and allow India access to the international fuel market. These measures still have to be approved by Congress.

Space cooperation: The deal would create closer ties between the US and India in space exploration, satellite navigation and launch, and in the commercial space arena through mechanisms such as the US-India Working Group on Civil Space Cooperation. For example, in May 2006, the US and India signed an agreement to fly two US instruments on India's unmanned mission to orbit the moon, scheduled for 2008.

Problems

Problem #1: The deal increases India's ability to produce nuclear weapons
The supply of US nuclear fuel to India, under the deal as it is currently structured, would allow India to divert more of its own uranium resources to significantly expand production of plutonium for nuclear weapons. The agreement does not call for any additional measures that would constrain India's fissile material1 or nuclear weapon production, and does not call upon India to sign or ratify the Comprehensive Test Ban Treaty, which would prohibit India from resuming nuclear weapon testing.

Under the current proposal, India has pledged only to accept safeguards over civilian nuclear facilities of its choosing. This could allow India to exclude nuclear facilities and fuel for nuclear weapons from international safeguards. In addition, the safeguards would only apply to facilities and material manufactured once the deal is accepted—they will not cover the fissile material produced by India since its nuclear programme began in 1948. Furthermore, if India has access to the international fuel market (as it would through the 123 agreement), it would be protected against the US revoking its supply of nuclear fuel if India resumes nuclear weapon testing.

India already has about 500 kilograms of weapons grade plutonium, sufficient for roughly 100 nuclear warheads. It also has a stock of about 11.5 tons of reactor grade plutonium produced in the spent fuel of its power reactors. Under the terms of the deal, this stock of plutonium, too, would be kept out of safeguards. India would also keep out of safeguards its Prototype Fast Breeder Reactor, which is scheduled to start in 2010. It is to be fueled with reactor-grade plutonium and will produce weapons grade plutonium. This would result in a roughly four-fold increase in India's current weapons plutonium production rate. By substituting imports for domestic uranium and expanding existing uranium recycling efforts, India also might be able to produce up to 200 kg a year of weapon grade plutonium in its unsafeguarded power reactors.

Problem #2: The deal could lead to missile proliferation
The space cooperation aspect of the deal could result in transfers of technology and expertise relevant to nuclear missile development. For example, India will use its rocket Chandrayaan-1, which has previously been used to launch satellites into orbit, for its unmanned mission to the moon. Experts have long warned that the same rocket could also be armed with a nuclear warhead and turned into an intercontinental ballistic missile (ICBM). The methods for integrating payloads into space vehicles, which US engineers will assist Indian engineers in doing for the joint lunar mission, are also relevant to integrating multiple nuclear warheads into ICBMs. US assistance on Indian civilian space exploration ventures could help India develop the know-how for further developing its ballistic missile capabilities.

Problem #3: The deal could spark an arms race in South Asia
In response to the proposed US-India deal, Pakistan's National Command Authority stated that its “credible minimum deterrence requirements” will continue to be met, indicating the possibility of an expansion of fissile materials stockpiles in Pakistan. Both India and Pakistan's stocks, however, already far exceed the fissile material requirements for a “minimal” nuclear arsenal. China's response will likely be similar if the deal goes through.

The space cooperation element of the deal provides India with the opportunity to increase its missile technology expertise. This in turn could lead to an increase in quantity and quality of its delivery systems, to which its neighbours would surely respond.

US involvement in East and South Asia features policies of selectively favouring or opposing nuclear activities that strongly affects the regions' strategic balances. For example, the geostrategic benefits of using India to assert its interests in Asia is likely one of the primary rationales behind this deal for the US. Former RAND Corporation analyst Ashley Tellis says, "accommodating India on the issue of nuclear cooperation" would "buttress its potential utility as a hedge against a rising China" and "encourage it to pursue economic and strategic policies aligned with US interests," helping to "shape the Asian environment in a way that suits our interests."

Problem #4: The deal violates international and domestic law
Non-Proliferation Treaty
The deal violates Article I of the nuclear Non-Proliferation Treaty (NPT), which states that “Each nuclear-weapon State Party to the Treaty undertakes not to transfer to any recipient whatsoever nuclear weapons or other nuclear explosive devices or control over such weapons or explosive devices directly, or indirectly; and not in any way to assist, encourage, or induce any non-nuclear-weapon State to manufacture or otherwise acquire nuclear weapons or other nuclear explosive devices, or control over such weapons or explosive devices.”

The deal also violates other positions agreed upon by consensus by NPT members, including a 1995 agreement on principles and objectives for nuclear non-proliferation and disarmament, which states, “New supply arrangements for the transfer of source or special fissionable material or equipment or material especially designed or prepared for the processing, use or production of special fissionable material to non-nuclear-weapon States should require, as a necessary precondition, acceptance of the Agency's full-scope safeguards and internationally legally binding commitments not to acquire nuclear weapons or other nuclear explosive devices.”

The deal flagrantly ignores the thirteen practical steps for nuclear disarmament from the 2000 NPT Review Conference, and the principle of universality agreed to by all NPT member states. The deal provides further examples to non-nuclear weapon states that the US does not intend to honour its 1995 and 2000 commitments, compromising future progress on both non-proliferation and disarmament objectives and threatening the integrity of the core bargain on which the treaty is based.

Security Council
It also contravenes United Nations Security Council Resolution 1172 of 1998, which calls for India and Pakistan to “immediately to stop their nuclear weapon development programs... and any further production of fissile material for nuclear weapons,” and encourages all States to prevent the export of equipment, materials or technology that could in any way assist programmes in India or Pakistan for nuclear weapons or for ballistic missiles capable of delivering such weapons, and welcomes national policies adopted and declared in this respect.”

Intergovernmental organizations
The deal further undermines the Missile Technology Control Regime (MTCR), of which the US is a signatory. The goal of the MTCR is to prevent the proliferation of unmanned delivery systems capable of carrying weapons of mass destruction. It is “not designed to impede national space programs or international cooperation in such programs as long as such programs could not contribute to delivery systems for weapons of mass destruction,” a principle which the US-India deal potentially violates. The proposed arrangement could also trigger a significant erosion of the guidelines of the 45-member Nuclear Suppliers Group, which offer important barriers against the transfer of nuclear material, equipment, and technologies for weapons purposes.

US domestic law
The deal would require significant changes to US non-proliferation laws and long-standing nonproliferation policies, including the Atomic Energy Act of 1954, as amended by the Nonproliferation Act of 1978, which bars civilian nuclear cooperation with non-nuclear-weapon states as defined by the NPT that do not allow full-scope IAEA safeguards (which includes India).

Problem #5: The deal normalizes India's status as a nuclear weapon state
The deal effectively normalizes India's status as a de facto nuclear weapon state outside the NPT, elevating it to the level of a nuclear weapon state under the Treaty but not bound by any of its obligations. It enables India to participate in the international community's system of nuclear activities without conforming to the systems norms, standards, or laws, including those regarding disarmament and non-proliferation.

Conclusion

The deal thus represents a step backwards for non-proliferation and disarmament: it allows for an increase in nuclear weapons, fissile materials, and delivery systems, and the resumption of nuclear testing. It undermines the NPT at a time when the regime is facing other crises and needs support to retain its credibility and functionality. The deal indicates the intention of US and India to develop a stronger strategic relationship, which is detrimental to international security because it is being established in an environment of mistrust and geopolitical tensions, and is in clear violation of the spirit and letter of international law and intergovernmental organizations.

1 While the deal does require India to support a Fissile Material Cut-off Treaty, negotiations at the Conference on Disarmament on such a treaty have been blocked for over a decade.


Resources and documents

Text of NSG statement on India, 6 September 2008
(Arms Control Association critical analysis)

Revised US proposal for the India waiver, 3 September 2008
(Arms Control Association critical analysis)

US Proposal for India-Specific Exemption from Nuclear Suppliers Group Guidelines, August 2008

IAEA-India Nuclear Safeguards Agreement, 1 August 2008
(Arms Control Association critical analysis)

Arms Control Association: In March 2006, the ACA created a US-India Nuclear Cooperation Agreement Resource Page, which provides key documents, analysis, and up-to-date and comprehensive information concerning the proposal.

Abolition 2000: The Abolition 2000 network of organizations established a US-India Working Group in May 2007, which tracks the issue, provides lobbying materials, and issues press releases.

International Panel on Fissile Materials: The IPFM released a research report in September 2006, by Zia Mian, A.H. Nayyar, R. Rajaraman, and M.V. Ramana on Fissile Materials in South Asia: The Implications of the U.S.-India Nuclear Deal.

South Asians Against Nukes: An independent platform to raise awareness about military and civil nuclearization in India and Pakistan, SAAN was established soon after the nuclear tests conducted by India on 11 May 1998 to bring together information resources for peace and anti-nuclear activists from all over South Asia.

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