Aug 9, 2008

Columnists - Siddharth Varadarajan

Eleventh hour for the Nuclear Suppliers Group

Siddharth Varadarajan
Though the Nuclear Suppliers Group was set up as a response to India’s 1974 nuclear test, its seven founding members today support the idea of allowing nuclear trade with the country. Surely, the time has come for the cartel to stop looking at India as a non-nuclear weapon state.

As international cartels go, the Nuclear Suppliers Group is perhaps unique in having a DNA structure that is schizophrenic. One-part exporters’ club and two-parts recruiting sergeant for the international non-proliferation system, the NSG can certainly take credit for helping some fence-sitters make up their mind over the years about joining the Treaty on the Non-proliferation of Nuclear Weapons (NPT). But with the number of holdouts now down to three — includi ng India — a form of natural selection is leading to the ‘export’ part of the group’s genetic code slowly triumphing over the non-proliferationist part.

By September 8, we shall see whether this process is allowed to reach its logical end — the lifting of the group’s anachronistic ban on nuclear sales to India — or whether a last ditch effort by the non-proliferationists within produces a mutation that will only end up harming the NSG in the long run. That is the date by which the United States hopes to shepherd through an amendment to the NSG’s highly restrictive export guidelines. Will the waiver India is given be clean and unconditional, thereby allowing the country to participate in full civil nuclear cooperation? Or will a partial, conditional waiver force India to walk away from the nuclear deal and free us of our commitment to place a number of indigenous reactors under international safeguards? This is the stark choice the 45-nation nuclear cartel must make in the next four weeks.

Set up in 1975 as an ad hoc body, the purpose behind the ‘London Club’ as it was known then was to tighten export controls to ensure that nuclear facilities and materials sold exclusively for peaceful use were not diverted to military purposes. Though a control regime in the form of the Zangger Committee and its ‘trigger list’ had existed from 1971 and 1974 respectively, its applicability was confined to states that were party to NPT. The London Club — whose seven founding members were the United States, Russia, France, Britain, Germany, Japan and Canada — incorporated the Zangger trigger list of nuclear items and export guidelines, and made them applicable to all ‘non-nuclear weapon states,’ that is, the whole world other than the five countries that had nuclear weapon state status under the NPT.

Despite being provoked by India’s alleged misuse of Canadian equipment in its ‘peaceful nuclear explosion’ of 1974, the NSG’s first guidelines did not prohibit nuclear sales to the country or to others that were not members of the NPT. Of course, individual NSG members like Canada and the U.S. quickly adopted national export rules requiring full-scope safeguards of recipient states. But the group’s guidelines merely demanded an assurance of non-explosive use, the acceptance of International Atomic Energy Agency safeguards on the items to be sold, physical protection and controls on any re-transfer of imported material to a third party. That is why India and Russia could go ahead and sign the Kudankulam agreement of 1988 for the supply of reactors. On the so-called sensitive nuclear technologies such as enrichment and reprocessing equipment, the NSG went beyond Zangger by calling on its members to exercise restraint on sales but did not bar their sale.

By the start of the 1990s, the number of countries that remained outside the NPT was down to under 20, excluding the successor states of the former Soviet Union and Yugoslavia. Apart from several Arab and African nations, the major nuclear-capable countries that had yet to join the treaty as non-nuclear weapon states were Argentina, Brazil, India, Israel, Pakistan and South Africa. Mainly in order to push these states towards explicitly renouncing the weapons option once and for all, the NSG in 1990 began discussing the possibility of requiring the acceptance of comprehensive, or full-scope, safeguards on all nuclear facilities in a country as a condition for making any nuclear sales to it. This suggestion had first been mooted in the 1970s and 1980s but resisted by suppliers for commercial reasons. The end of the Cold War and the discovery that Iraq — an NPT signatory — had developed a clandestine nuclear weapons programme prompted the NSG to adopt two major new guidelines. The first guideline, finalised in May 1992, adopted the full-scope safeguards requirement and was intended as a means of pushing NPT holdouts towards accepting the treaty. The second set of guidelines was aimed at tightening export controls on “dual use” items so that non-nuclear weapon states would not be able to divert them towards a military purpose. Linked to this was the push at the IAEA for a more stringent set of safeguard controls known as the Additional Protocol.

After the NSG adopted the full-scope safeguards requirement for nuclear sales, key holdouts like Brazil and Argentina eventually acceded to the NPT. Today, the only countries left outside are India, Pakistan and Israel. All three countries possess nuclear weapons, though Tel Aviv has not officially declared this to be the case. In the case of India, the decision formally to embrace nuclear weapons was prompted in part by the efforts of America and its NSG allies to force the country to give up its nuclear option through a tightening of international restrictions. Once India tested its nuclear weapons in May 1998, Pakistan had no option but to follow. The fact that the two countries became de facto nuclear weapon states, then, is proof of the failure of the NSG’s strategy towards them.

As the NSG reviews its achievements, it is worthwhile asking what possible utility the full-scope safeguards guideline can have in today’s world. India and Pakistan will never accede to the NPT as non-nuclear weapon states and Israel’s status cannot be resolved without the Middle East peace process reaching a definitive stage. Thus, if retention of the guideline is intended as an incentive for accession to the NPT, there is no question of it working in the case of the remaining three holdouts. But what about the guideline’s use as a means of curbing the risk of further proliferation? It is clear that supplying nuclear material to Pakistan, given Islamabad’s abysmal proliferation record, will entail significant proliferation risks. Similarly, allowing Israel to access civil nuclear cooperation will surely place stress on the acceptability of the NPT in West Asia. For these two countries, then, there is considerable merit in retaining the NSG’s guideline for the time being. In the case of India, however, there is no reason to assume that allowing the country to engage in safeguarded nuclear commerce with NSG members will increase the danger of proliferation. Not only has India demonstrated responsibility and restraint in its nuclear and dual-use export policies, but it has also additionally committed itself to placing a number of its indigenous reactors under IAEA safeguards in exchange for imported fuel, thereby reducing the potential size of its military nuclear sector.


The NSG’s guidelines were intended to deal with the problem of proliferation in a world where the potential number of countries that could go down the nuclear weapons route was much larger. Its emphasis on regulating the access of non-nuclear weapon states to supplies had a certain relevance in the 1970s, 1980s and even 1990s. But today, it is meaningless for the cartel to continue to treat India as if it does not possess nuclear weapons. If one reviews the national position of NSG states, it is evident that the seven founding members and all members with a significant nuclear export industry are in favour of recognising the reality of India’s status. Those members most opposed to waiving the NSG’s rules for India are those who either have a theological position against nuclear energy (eg. Austria and New Zealand) or who are not major players in the international nuclear industry. When India has been able to negotiate unconditional supply agreements with large nuclear vendors like Russia and France and also with the U.S. after a fashion, it doesn’t make sense for the NSG as a whole to impose conditions based on the false assumption that the country is somehow a non-nuclear weapon state.

If the U.S. is serious about delivering its side of the July 2005 bargain with India, it must drive home this fundamental point to the NSG members. To the extent to which Russia and France will be major beneficiaries of the proposed exemption for India, they too need to stress the importance of the waiver being clean and unconditional. Adding NSG-wide conditions — such as mandating a supply cut-off in case India tests a nuclear weapon — will only eat into the autonomy of decision-making of individual countries. Every individual member is free to adopt its own export rules but should not seek to impose its national standards on NSG states.

India has come this far despite the serious misgivings that exist within the country about the nuclear deal because it believes the NSG would be prepared to look at the matter coolly and rationally. If, however, the suppliers group insists on living in the past and pursuing extraneous agendas, New Delhi will have no option but to walk away.

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