The new nuclear future
A new world has opened for India with the deal done. It's up to us to go out and make the best use of the opportunity, writes Raj Chengappa.
As George W. Bush stepped briskly into the White House for the signing ceremony in the afternoon of October 8, the gathering that included Ronen Sen, India's ambassador to the US, was aware that they were witnessing a rare and historic moment.
Bush looked much the cat that got the cream as he signed the hard-fought US Congress legislation enabling civilian nuclear trade with India after a hiatus of 34 long years. He had plenty of reason to look pleased.
Even as the walls of the US economy seemed to be crumbling around him, he was ending his two-term tenure as President with a signal foreign policy success-a bright ray of sunshine amid the gathering gloom.
In India it was just past the midnight hour and as the country slept, its giant nuclear establishment, to paraphrase Jawaharlal Nehru, was stepping out from the old to the new and waking up to new life and freedom. As a senior Indian diplomat observed, "We're out of the doghouse and on the high road again."
For years after India's 1974 nuclear test, the country was treated like a pariah, especially by the US. America had erected an entire architecture of laws and multinational groupings meant to isolate and punish India for being a rogue nuclear power.
Sanctions were heaped on India and US firms were prevented from selling hi-tech that was even remotedly connected to the word nuclear. America put pressure on the world to ostracise India and formed the 45-member Nuclear Suppliers Group (NSG) to prevent other countries from conducting nuclear trade with India. Indian nuclear scientists were made unwelcome at international seminars in their field.
Now with the Indo-US nuclear deal, the huge boulder that was blocking India's nuclear path had been lifted. For excited Indian nuclear scientists, Prime Minister Manmohan Singh and Bush had made the impossible happen.
Not only had India ended the apartheid it faced with regard to civilian nuclear trade, but the country was also incredibly allowed to carry on with its nuclear weapons programme unhindered. It was a privilege only the so-called P5 nations-the US, Russia, France, UK and China-enjoyed.
India has now joined the exclusive club of the nuclear haves. As M.R. Srinivasan, a former chairman of the Atomic Energy Commission, put it: "For all practical purposes we are now recognised by the world as a nuclear weapons state."
To achieve that, the US had to expend voluminous political capital that began on July 18, 2005 with Bush and Manmohan signing a landmark agreement to remove the nuclear obstacle from bilateral relations.
The Bush administration got the US Congress to pass the Hyde Act, amending the Atomic Energy Act that had prohibited American entities from trading with countries that didn't sign the NPT or had done a nuclear test-India fitted into both categories.
Meanwhile, the US negotiated a bilateral 123 Agreement with India that laid the framework for their civilian trade. It was agreed that India would place in phases 14 of its 22 power reactors under International Atomic Energy Agency (IAEA) safeguards. Delhi then negotiated an India-specific safeguards agreement with the IAEA, after Manmohan won a trust vote in July this year.
The biggest breakthrough came last month when the US got the NSG countries to make an exception to trade with India. It meant that India could conduct civilian trade with not just the US but with the entire world.
Last month's battle in the US Congress to get the 123 ratified was Bush's final salvo to push the deal through that culminated with him signing it into law. It was to be followed by External Affairs Minister Pranab Mukherjee and US Secretary of State Condoleezza Rice inking the 123 Agreement in Washington DC.
Typically, the opposition to the deal from the BJP and the Left came thick and fast. Both parties had bitterly opposed it and denounced the signing as a sellout of India's nuclear sovereignty. In Parliament later this month they would once again haul Manmohan over the coals by going over the fine print of the deal.
But nothing they would say or do would rob Manmohan of his moment of glory. Like Bush, he too is credited with pulling off a foreign policy coup that has not only defined his prime ministerial tenure but has also set the agenda for the nation and possibly for the next election.
So why is it such a big deal for India and for its nuclear establishment? Few know that India's nuclear power reactors are running at 50 per cent of their capacity because of a crippling shortage of uranium fuel. Four of its new reactors cannot be commissioned because there is no fuel available to start them up.
Fewer know that the main reason for India's nuclear power sector stagnating at 4,100 MW-when it should have been 10,000 MW eight years ago-was because of the ring of sanctions against the industry. And that India has only fuel enough to support 10,000 MW of nuclear generated power when it has plans for over 60,000 MW.
There were far more important reasons than just bailing out India's flailing nuclear industry. India had become chronically short of energy-the power cuts that most cities experience is testimony to that. With an energy shortage of 10 per cent, India needs to add 10 power plants of 1,000 MW capacity this year alone to meet its current demand.
What the deal means to India
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It is still heavily dependent on thermal power fired mainly by coal to help ease the energy shortage. Thermal power now accounts for 51 per cent of the electricity generating capacity of 1,45,000 MW.
But apart from dwindling coal reserves it comes with the disadvantage of high carbon emissions that will put India on the mat for global warming.
Hydro-electric generation is credited with another 25 per cent but with environmental activism and the damage to forest resources being enormous, they are not seen as the best alternative.
In renewable energy, like solar and winds, efforts haven't met with the kind of success they should have and they now contribute barely 8 per cent of the share. Enter nuclear power.
Nuclear power is enjoying a remarkable comeback across the world-after major improvements in safety of reactors following Chernobyl and Three Mile Island-and is once again being touted as the clean fuel of the future.
France is the leader with nuclear power accounting for 75 per cent of its electricity generation. Japan is at around 30 per cent. Even European countries like Germany, who are rethinking their opposition to nuclear plants, have begun making enquiries.
In the US, there has been a surge of interest-John McCain promised that if he became President he would sanction a hundred new nuclear plants. Nuclear energy now accounts for 23 per cent of the total world electricity production while in India it contributes only a paltry 3 per cent.
The deal is certain to change that. Soon after his New York and Washington visit, Manmohan flew into Paris for a bilateral summit with French President Nicolas Sarkozy. As they looked on, Anil Kakodkar, Atomic Energy Commission chairman and Bernard Kouchner, the French foreign minister, signed an umbrella Indo-French nuclear cooperation agreement.
Details of it have still not been made public but from the look on Kakodkar's face it was apparent that India had got what it wanted from France-nuclear fuel, reactors, reprocessing rights for spent fuel and possibly enrichment technology as well. Later he told India Today, "It's a perfect agreement."
Meanwhile, the French nuclear power giant, Areva, has already been having meetings with the Nuclear Power Corporation of India Limited (NPCIL). The two have homed in on a site in Jaitapur in Maharashtra to set up a nuclear park that would have possibly six top-of-the-line French reactors of 1,600 MW each in the first phase.
Costing close to $2 billion each, it could add 9,600 MW of power in the next five years alone and bring into India some of the latest nuclear technology. For the French, the business would be worth close to $12 billion. But Indian firms would benefit too.
S.K. Jain, NPCIL chairman and managing director, points out that there is a huge capacity constraint across the globe for nuclear power. That would mean that companies like Areva would outsource manufacturing of equipment to Indian companies like Larsen & Toubro and Bharat Forge. Jain says India is pushing for a steady indigenisation of imported plants with the vendors and it could go up to as much as 80 per cent for future plants.
By December, when the new Russian President Dmitry Medvedev makes his maiden visit to India, the NPCIL would be signing a similar agreement with its counterpart Rosatom for the supply of four reactors of 1,000 MW each to be set up in Kudankulam in Tamil Nadu.
Under an earlier agreement, the Russians are building two giant 1,000 MW reactors at a cost of Rs 14,000 crore, expected to be commissioned by 2010. An agreement with Russia will bring in fuel as well as reactor and reprocessing technology.
American companies who believe they have first right over India's imported nuclear pie are already champing at the bit. Both GE and Westinghouse, the big two of the US nuclear industry, are making major bids for nuclear reactors and could win as many as four reactors in the next couple of years.
GE is promising an astonishing 40-month completion if India chooses its 1,500 MW plants. Says Ron Somers, president of the US India Business Council, "We are looking at $150 billion of business in the nuclear industry alone."
Canada, which angrily cut off its nuclear agreement with India after the 1974 test, is talking about restarting trade. "It's a good feeling," says an Indian negotiator.
Meanwhile, with fuel now expected, India is expanding its own indigenous capacity. It has just mastered the 700 MW type of reactors and is building four of them within the next five years. It is also perfecting its Fast Breeder Reactors (FBRS), so called because they generate as much plutonium as they consume.
Pact map
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This, if successful, will give a major boost to power generation plans. Under the deal, India is creating a National Technical Facility to store spent fuel from its reactors it designates as civilian. With permission to reprocess such fuel, the spent plutonium could be used as fuel in FBRS. That would put India streets ahead in the business.
Its also on its way to using abundant thorium reserves as a fuel. Most importantly, India will be allowed to export its own reactors, especially in the market for smaller reactors of 220 MW and 540 MW.
The downsides: Issues like the safety of reactors are a major concern. The world nuclear industry has strived hard to make their plants almost error free and in the event of an accident to ensure that all leaks would be contained and there would be no need for evacuation.
With so many reactors being built and run at a short time, India needs to beef up its regulatory board and safety standards.
On the strategic side, the big question is what happens if India tests a nuclear weapon? Under its deal with India, the US would terminate the agreement and could even demand the return of reactors and fuel supplied by it.
But while negotiating the agreement, the Indian side pushed the Americans to soften the whole breakaway clause by ensuring no sudden deaths or withdrawals. There would be a protracted negotiation and the circumstances that led India to test would become a factor.
This would mean that if say China and Pakistan tested, India would have good enough reasons to test. The US President would then have waiver power to prevent the provisions of the Act from being enforced.
Learning from the Tarapur experience, where the US reneged from the agreement to supply fuel to it after the 1974 tests, India will insist that all the vendors give cast-iron guarantees of fuel supply and the country would maintain a strategic reserve of fuel to meet such exigencies.
So the right to test remains with India but as Mukherjee told India Today, "Other nations have the right to react." Exasperated by the constant nagging over whether we can test or not, a senior official said, "Look, it's like asking a woman to prove her virginity. She can only do it by losing it."
And if Barack Obama comes to power and he gets the US to ratify the CTBT, India could be pressured into signing the document. Right now India and Pakistan are the main holdouts.
So would it crimp India's weapons programme as the Opposition has been charging? Under the deal, India has so far identified eight reactors that it would designate as military-four at Kalpakkam near Chennai, two at Kaiga in Karnataka and two at Tarapur.
It also has two research reactors Dhruva and Cirrus. (Cirrus is to be decommissioned in 2010). These would provide as much fissile material as India needs for its credible minimum deterrent.
Since India would be allowed to import fuel, it can conserve its domestic mines to build bombs. While India has agreed to join negotiations for a Fissile Material Cut Off Treaty, it is unlikely to sign till it is satisfied that it has a large enough stockpile.
India is pressing ahead with its triad of missiles, aircraft and nuclear power submarines to deliver its weapons (see chart). Those programmes are proceeding at full speed. Agni, with its many variants, can now threaten most of China's major cities apart from the whole of Pakistan.
India's top secret nuclear submarine is on its way to completion, giving it the ability to strike from the sea. And it is building a state-of-the-art antiballistic missiles system. On all these programmes, the deal allows India to proceed at a fair trot without hindrance. In some areas like missiles, it could even collaborate and get the much-needed high technology for them.
More importantly is the deal's impact on India's self-confidence and its image abroad. India is clearly recognised as a power that has arrived on the world stage. It can shed its baggage of nonalignment and go for what Lalit Mansingh, former foreign secretary, calls co-alignments with all the major countries whether the US, Russia, France, China, South Africa, Brazil, the UK, Australia.
India has already entered into strategic partnerships with all of them. It can push for a seat in the UN Security Council now with greater vigour. A new world has opened for India. It's up to us to go out and make the best use of the opportunity.
Nuke numbers
Nuclear arsenal India is developing a range of nuke weapons and delivery systems.
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