Yes, it's a Big Deal

Indo-US civilian nuclear cooperation will immensely help India. By denying itself the opportunity to access international nuclear commerce for its energy security and growth, India would end up undermining its economic strength

Manpreet Sethi Delhi

Ever since the strategic community woke up to the significance of the Indo-US joint statement made on July 18, 2005, and the promise of nuclear cooperation that it held, the relationship between the two 'natural allies' has attracted unprecedented comment. This is not surprising given that the evolving nuclear relationship calls for major changes in long held positions on both sides.

In the last almost two years though, a fair amount of ground has been covered. Contrary to the early predictions of those who did not expect this venture to travel far, the US and India are presently negotiating a bilateral agreement (technically known as the 123 agreement for the section of the US Atomic Energy Act, 1954, that deals with such agreements). Of course, the road has not been without bumps, several of which have threatened to throw the deal off course. But given the support at the highest political level in both countries, the bureaucracies have managed to hang on and move ahead. However, their every move has invited intense media scrutiny. Constantly in the 'breaking news' mood, the media has never hesitated to paint the relationship all white or all black, or to alternately declare the deal euphorically close to the finish line or hopelessly damaged beyond repair.  The truth, meanwhile, lies somewhere in between.

Any analysis of the deal must begin with the basic question of what does this cooperation mean for India. Is it about energy, or is it completely bereft of the energy factor? Do the costs outweigh the benefits? Does it mean making compromises that are completely unacceptable or can India live with some compromises? And, most importantly, have we determined what these should be? These are some questions that need answering in order to understand the true import of the envisaged nuclear cooperation. 

The Indo-US civilian nuclear cooperation agreement is essentially about providing additional nuclear generation capability to India. If economic development and growth are the twin aspirations of an emergent India, then, for a country of India's size, population and economy targeting ambitious growth rates of 10 per cent over the next two decades, safeguarding energy is a strategic priority.

Electricity will have to be made available in increasing quantities and from sources that are stable, dependable and sustainable.

Presently, India imports a bulk of its energy requirements of coal, oil and gas; imports of high quality coal have grown at a rate of 16 per cent a year; by 2030, India's demand for oil will raise import dependence to 90 per cent; Indian demand for natural gas is expected to grow by over five per cent per annum and will be met by 70 per cent imports. This scenario is alarming not only because of the pressure it places on scarce foreign exchange resources, but also because it raises energy vulnerabilities that for a large country like India are neither affordable, nor strategically prudent.

In an attempt at diversifying its energy mix, India has developed renewable and other alternative sources of energy, including nuclear. In fact, the latter offers several unique advantages for the country. With an experience of half-a-decade in the nuclear field, India is currently capable of designing, building, operating and maintaining nuclear power plants of varied types and capacities, besides being able to manufacture all associated equipment and components, and produce the required nuclear fuel and special materials. If anything, the availability of uranium as fuel is a constraint on nuclear power expansion. And hence, the need for access to imported nuclear fuel.

The Indo-US agreement offers this possibility. India has the capacity, technology and the will to expand its nuclear programme, even without international cooperation, including undertaking more rigorous prospecting and mining of uranium, if necessary. However, since this would take longer, resulting in low and costly energy availability, and slow economic growth and human development, the proposed US-India civilian nuclear cooperation offers a viable proposition.

The conclusion of the 123 agreement would not immediately impact the electricity generation graph in India, given that it is yet to make several pit stops. It will take India to the next step for its participation in international nuclear commerce, and then to the IAEA for an additional protocol. At every step, the negotiations will be more technical and difficult. And even after these are over, tenders for nuclear construction will be subjected to competitive bidding in India, and will have to overcome the mandatory licensing and regulatory procedures before the first reactor is even begun to be constructed. These processes will take time, and even the best estimates do not foresee the Indian electricity grid being energised by such power in less than a decade. Does that mean that nuclear cooperation is not worth pursuing? Far from it.

First, it is the duty of every government to undertake long-term perspective planning. Given the energy demand estimates until 2030 and beyond, there is no way India will be able to meet them only with fossil fuels, renewables or even the most stringent energy efficiency and conservation standards. As environmental concerns grow so will the attractiveness of zero carbon sources. At present, India's per capita energy consumption is low and even then, India is the world's sixth largest carbon emitter. This ranking would certainly change as India emerges as the world's most populated and urbanised country by 2030, and even more so if it continues to retain fossil fuels as the predominant fuel in its energy mix.

Nuclear power, in this scenario, could prove helpful since it is a zero carbon source that is also practical, useable and sustainable. So, for India to embark on a path that might see light only after a decade or more is surely not a waste of diplomatic energies and investments.  The Sino-US nuclear cooperation agreement took 25 years before the contract for the first reactor was finally decided last year.  In the Indian case, the agreement holds the relatively immediate promise of making nuclear fuel available to India from the international market, thereby enabling it to expand its nuclear programme based on indigenous reactor construction plans, even as foreign reactors are being negotiated.

Some argue that despite all the trouble, nuclear power will never go beyond contributing 11-12 per cent of the total energy generation. This line of thinking overlooks how much even that percentage would be in actual terms given the large energy generation that India would need/have by 2025-30. If the country is to get anywhere near meeting its burgeoning electricity requirements, it will have to make consistent efforts to tap every source of energy and add it to the overall energy mix. Every watt, generated from whichever source, or saved, will count.

Many also fear that by making itself dependent on imported nuclear fuel, India would end up replacing one type of dependency (of fossil  fuels) for another (of nuclear fuel). They opine that India would become hostage to enriched uranium fuel supply, which could be terminated by the supplier nation at will and whim.

Four issues must be kept in mind while addressing this concern. One, while every type of fuel dependency raises vulnerabilities, in the case of nuclear fuel imports, India would be using them to generate additional capacities as it graduates to the second (FBR) and third (AHWR) stage of its nuclear programme that would eventually make it self sufficient in nuclear fuel. Fossil fuels offer no such hope of ever facilitating indigenous resource availability. Rather, increasing dependence on fossil fuel imports would only increase risks as resources dwindle globally and prices rise.

Secondly, the reality of the moment is that the US is the only country that has the power to alter the nuclear commerce network that has been built over the years to keep India out. While other countries such as Russia and France have indicated their willingness to participate in India's nuclear generation programme, they are unable to do so until the US first accommodates India. Therefore, not to  make use of this opportunity when Washington is willing to make the necessary changes would actually be a disservice to the country.

Thirdly, the cooperation will also facilitate Indian participation in global nuclear research and development initiatives, such as the International Thermonuclear Energy Reactor. These multilateral initiatives recognise Indian nuclear expertise and provide an opportunity for Indian scientists to play a major role in them. Therefore, the civilian nuclear cooperation agreement facilitates a wider opening of international research opportunities in pioneering energy fields for India.

Fourthly, the agreement holds the promise of opening up the larger gamut of high technologies which are denied to India. This is to be enabled through a long overdue reorientation of the non-proliferation order to accommodate India's unique status as a State with nuclear weapons but not a member of the NPT. In fact, the deal offers New Delhi the chance to reposition itself in the nuclear order from a longstanding 'target' of the non-proliferation regime to a 'partner' in the establishment of a new global nuclear order.

These opportunities do not come without a cost and the real challenge for Indian diplomacy is to minimise these while maximising the gains. Many in the Indian strategic community fear that the agreement would limit and control India's nuclear weapons capability by restricting the build-up of fissile material, since many reactors would come under IAEA safeguards. Such assumptions are misplaced for the simple reason that they assume that India was using 100 per cent of its nuclear assets for weapons production and is now going to be left with only 35 per cent for this purpose. But there is nothing to indicate that this is the case.

Even in the absence of the deal, India was using only CIRUS and Dhruva for production of weapons grade Plutonium, which it can continue even after the deal is concluded. CIRUS would have to be shut down from 2010 onwards, but if India plans well and so desires, it could build another one by then or even use one or more of its eight 'unsafeguarded' nuclear reactors for fissile material production. The biggest advantage of this agreement is the acceptance of India's strategic programme, a fact that the US and international community were loath to doing in the past.

India's nuclear doctrine was drafted well before such an agreement was anywhere on the horizon and committed India to minimum nuclear deterrence and no first use of nuclear weapons. This obviates the need to stockpile large amounts of fissile material for arsenal building. Indian deterrence presupposes the construction of a robust counter-strike capability that is survivable. It does not require India to indulge in a foolhardy exercise of warhead accumulation. In Indian strategic perception, the nuclear weapon has a clear political, deterrent role and therefore, the numbers required are very different from assessments of states that have a first use doctrine. This essential difference must be kept in mind while assessing the impact of the Indo-US agreement on India's defence.

Rather, by denying itself the opportunity to acc-ess international nuclear commerce for its energy security and economic growth, India would end up undermining its economic strength-—that too is a deterrent of another kind. In an analysis of the pros and cons of the agreement, it is more prudent to place some of the nuclear reactors under safeguards and firewall them from the strategic programme, than to subject the entire country to the risks of en-ergy vulnerability and possible economic stagnation.

India is today an economically resilient, politically mature and diplomatically savvy enough country to understand and handle US agendas, if any, in the deal. But while pushing its self interest resolutely, India should be ready to accept some compromises. The challenge lies in knowing what can be given for that which is more worthwhile.

The writer is a security and strategic affairs analyst