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India-US Nuclear Deal: Only Half Realised After a Decade

A. Vinod Kumar was Associate Fellow at Manohar Parrikar Institute for Defence Studies and Analyses, New Delhi. Click here for detailed profile.
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  • July 21, 2015

    A decade has gone by since President George W. Bush and Prime Minister Manmohan Singh issued the 18 July 2005 joint statement announcing an extraordinary deal – that the United States will facilitate India’s access to global nuclear commerce, in return for India’s commitment to play a major role in global non-proliferation efforts as well as harmonize its civilian nuclear programme with the norms of the nuclear non-proliferation regime. The deal was a defining moment for the non-proliferation regime, embodying its structural realignment wherein a perceived ‘outlier’ was being assimilated into the system through a process that was seen by different sections as having the prospect of strengthening as well as unravelling it.

    Accordingly, India, which is not a party to the Treaty on the Non-Proliferation of Nuclear Weapons (NPT), was to be allowed to participate in nuclear trade despite not subscribing to the International Atomic Energy Agency’s (IAEA) full-scope or comprehensive safeguards as required by the 1992 (Warsaw) guidelines of the Nuclear Suppliers Group (NSG). Many Indian observers termed the deal as marking the country’s return to the non-proliferation mainstream, even as some sections alleged a compromise of national interests by submitting a ‘self-reliant’ programme to international scrutiny. On the other hand, critics across the globe questioned the privileged treatment to one country by transcending the NPT framework, which, they felt, could weaken the Treaty. A decade later, the jury is still out on whether the intended objectives of the India-US nuclear deal have been fulfilled, the projected gains accrued and apprehensions validated.

    The promise of participation in global nuclear trade, facilitated by the September 2008 India-specific waiver from the guidelines of the Nuclear Suppliers Group (NSG), entailed three major outcomes for India: (a) uninterrupted flow of uranium for its reactors, (b) introduction of advanced reactor technologies to expand its nuclear energy programme, and (c) the strategic spin-off of gaining a seat at the high-tables of the non-proliferation regime.

    An uneasy start

    That the NSG passed by consensus the India-specific waiver, despite initial reservations of many supplier nations, could be testament to the fact that the fledging Indian nuclear energy market was a clear allurement for many countries to support the deal. This was evident from the avidness of early birds like France, Russia and Kazakhstan in signing nuclear cooperation agreements with India as well as in the belated policy shifts effected by Canada and Australia, which discarded their initial reservations to tap this vibrant market. This surge had largely translated into a steady stream of uranium flow into Indian reactors,1 which, in fact, is the most significant gain attained so far. This trend is likely to continue going by the renewal of contract with Kazakhstan early this month, and the supplies expected from Canada and Australia in coming months. However, the failure to proceed towards contracts for nuclear power projects designated to be constructed with foreign assistance – Jaitapur (Areva), Mithi Virdi (Westinghouse), Kovvada (General Electric) and Haripur (Rosatom) – underlines the struggle in opening up a hitherto autarkic programme to external engagement.

    India’s attempt to synchronise with international liability covenants through the Civil Liability for Nuclear Damage Act (CLNDA) of 2010 was met with stiff resistance, primarily for its stringent supplier liabilities. Disagreements on administrative arrangements2 pertaining to tracking and accounting of imported material (and demands for additional bilateral safeguards) further delayed the implementation of some of these nuclear agreements even as suppliers like Japan continued to weigh on greater non-proliferation obligations as a condition for nuclear partnership. On the other hand, the feasibility of the colossal nuclear parks to be constructed with foreign technological support is facing increasing resistance from local populaces and anti-nuclear groups, riding on the paranoia caused by the Fukushima incident. Like in the case of the Kudankulam Nuclear Power Project (KKNPP), organised local protests, if they intensify at other project sites, could further delay or even force a change of plans for some of these projects.3

    A still-born renaissance?

    While the first watt of power from foreign-aided projects may take many years to come, the 10th anniversary coincides with major transformations in India’s indigenous programme. The grand promise that the Indian leadership provided to the polity to justify the nuclear deal was that it will lead to a massive expansion of the nuclear energy infrastructure. Though at no point was this projected as an alternative to the snail-paced indigenous programme, many Indian critics of the deal sought to highlight it as a contest of two parallel routes seeking to fulfil India’s initial nuclear energy target of 20,000 MW (revised to 10,000 MW). This debate now attains relevance, with both the routes, howsoever complementary or competing, being impeded by various reasons.

    Since the 1960s, India has striven to set up an indigenous nuclear energy infrastructure driven by Homi Bhabha’s vision of a three-stage programme.4 According to this plan, the first stage was to be populated by a Pressurized Heavy Water Reactor (PHWR) ecosystem running on natural uranium. The plutonium reprocessed from the spent fuel was to feed the Fast Breeder Reactors (FBRs) for a closed fuel-cycle of the second stage. The FBRs were to produce more plutonium through transmutation of uranium (U238) thus giving more fuel than consumed along with power generation. The FBRs were also to convert fertile thorium to fissile U-233, which could power the Advanced Heavy Water Reactor (AHWR) in the third-stage.5 While the PHWR-driven first stage has managed to set up a capacity of over 5780 MW as of today,6 efforts to progress to the second-stage have overshot the initially envisaged timeline many times over. Though a 500-MW Prototype Fast Breeder Reactor (PFBR) at Kalpakkam is expected to go critical by September,7 actual transition to a FBR-driven ecosystem might take many more years. Similarly, the ambitious plan to exploit abundant thorium resources heavily hinges upon the successful development of the AHWR for the third stage.

    While the general perception is that the second-stage will formally begin with the commissioning of the PFBR, the actual scenario may be different. The PFBR, work on which began after the Fast Breeder Test Reactor went critical in 1985, may undergo the pre-heating and core loading processes in coming weeks after approval from the Atomic Energy Regulatory Board (AERB).8 The progress towards attaining higher power operations, criticality and eventual commissioning may depend on the functioning of the reactor during the pre-heating process and final approval from the AERB. While the PFBR fuel cycle is expected to run till 2021, construction of commercial FBRs (initially 1&2) is slated to start in 2023-24, with an expected completion time of three to five years for each facility, implying that commercial power generation may happen only by 2030. Further, sources in the nuclear establishment also suggest that the prospects of introducing the thorium blanket to generate fissile U233 for the AHWRs will only follow the successful commercialization of the FBRs.

    India, meanwhile, will continue to rely on the PHWR infrastructure, which will gallop to a capacity of 9580 MW in the next few years (nearing the 10,000 MW target) with the addition of 3800 MW from the five ongoing projects (KKNPP-II, Kakrapar 3 & 4 and RAPS 7 & 8).9 Assuming that at least some of the projects earmarked under international cooperation are contracted in the next few years, actual construction may take a subsequent decade to operationalize (going by Areva’s current record). This is based on the assumption that construction of at least some units in Jaitapur, Mithi Virdi and Kudankulam (III&IV) may not be impeded by local protests or other factors. While new projects planned by the Nuclear Power Corporation of India Limited (NPCIL),10 like in Gorakhpur, Haryana and the project planned with the Nuclear Thermal Power Corporation (NTPC) in Madhya Pradesh, may also take off during this period, the fate of the projects in Haripur and Kovvada are still unpredictable. Nonetheless, most of these projects can be expected to produce power only in the latter half of the next decade when construction on the FBRs may be in full swing.

    This being the realistic picture, dependence on a single route may not satiate the goal of massive nuclear expansion or initiating a nuclear energy renaissance. Rather, the leadership has been geared towards a synergy of indigenous development and external technological support to meet the original 20,000 MW target and progress further beyond. A testament to this is the claims from the nuclear establishment that India will build a capacity of around 600 GW by 2050.11 A lot, hence, depends on how both routes could actually progress in material terms amid resistance and impediments from various quarters.

    The integration question

    Notwithstanding these challenges, the nuclear deal was a clear strategic gain for India. With the NSG waiver, India became the only non-NPT state that can maintain its military and civilian nuclear programme even while accessing global nuclear trade, thus giving it near-parity with nuclear-weapon states, and yet not subjected to the obligations of non-weapon state-parties to the NPT. Further, the NSG wavier has opened the possibility of India’s entry as a full member in the NSG as well as other export control sub-regimes like the Wassenaar Arrangement, Australia Group and Missile Technology Control Regime (MTCR). This will essential imply India’s metamorphosis from a recipient state to a supplier, and also marks an ideational departure from the time when India saw these groupings as denial regimes. It may though be premature to infer whether India could use these memberships to gain liberal access to enrichment and recycling technologies or be a supplier in the multilateral fuel-cycle initiatives, as the NPT continues to be a key determinant for these structures.

    The NPT thus remains a key obstacle for India’s complete access to the full range of rights and benefits within the regime, which, in fact, was a prominent topic of debate during the nuclear deal. While the implications of the deal for the Treaty were vigorously highlighted by critics of the deal, some sections also wondered how India could be integrated with the regime while remaining outside the NPT. However, the fact that the Treaty has remained under severe stress since its indefinite extension in 1995 and had little hope or initiative for structural reforms, has only buttressed the ideational logic behind the nuclear deal – of finding solutions to strengthen the regime outside the NPT framework. Though proliferation risks have largely subsided in the last decade thanks to numerous initiatives pursued outside the NPT system, the diplomatic endeavours to deal with the lingering cases of deviance (Iran and North Korea) only embody a continuity of this trend.

    The nuclear deal, therefore, has to be valued within this context of bringing a state with advanced nuclear capability within the regime’s normative framework instead of allowing its autonomous existence with limited adherence to regime norms. Nonetheless, it needs to be seen how long India would be able to maintain this unique identity of an ‘advanced state with nuclear technology’ while maintaining a fine balance between the rights and duties of nuclear weapons states and non-weapon states, in its obligated endeavour of undertaking a “leading role in global non-proliferation efforts”, as enshrined in the joint statement.

    Views expressed are of the author and do not necessarily reflect the views of the IDSA or of the Government of India