Changing the Rules of Nuclear Commerce: Will More Commerce Equal More Proliferation?

July 14, 2005

Indian Prime Minister Manmohan Singh meets with President Bush on July 18 to demonstrate and accelerate the new strategic partnership between New Delhi and Washington. High on the Prime Minister’s agenda is breaking through the barriers on nuclear export controls that previous US administrations have spent decades erecting.

One of the cardinal rules of nuclear non-proliferation has been an agreement among supplier nations not to engage in nuclear commerce with states that have not been granted the International Atomic Energy Agency’s seal of approval by accepting “full scope safeguards” on all of their nuclear facilities. Because India is not a party to the Nuclear Non-Proliferation Treaty and has not signed the Comprehensive Test Ban Treaty, New Delhi has no constraints on testing nuclear weapons and is free to pursue the production of fissile material for its nuclear stockpile. Eleven of India’s fifteen nuclear reactors are not safeguarded.

The Nuclear Suppliers Group was established in 1974 after New Delhi conducted a “peaceful nuclear explosion.” It now consists of 45 nations that are committed not to contribute to proliferation by means of nuclear exports. The United States was the first nation to subscribe to the full-scope safeguards rule in 1978, and has worked tirelessly to convince other members of this club to accept it.

Some NSG members have helped construct civilian nuclear power plants in states that have troubling proliferation records, on the basis that NSG provisions allow for the completion of agreements and contracts entered into before these suppliers joined the club. On this basis, China is helping Pakistan, and Russia is helping India to construct nuclear power plants. Russia is also helping Iran to complete the Bushehr nuclear complex on the grounds that Tehran has accepted full-scope safeguards and because special precautions will be taken to prevent Iran from using this complex to produce nuclear weapons. When completed, all of these nuclear power plants are to be under IAEA safeguards.

The nuclear power industries in the United States, France, Russia, China, and other supplier states would welcome the relaxation of export controls. India can make a far stronger case than Pakistan and Iran for becoming an exception to the existing rules of nuclear commerce, but exceptions can quickly become the new rule. Deciding on a case-by-case basis is a tricky business because potential suppliers are likely to reach self-interested judgments on future cases, and because relaxing the rules in one case could set an unwelcome precedent for others.

US and Indian national security interests now overlap in many key areas, and there is widespread support in the United States to broaden and deepen US ties with India. A strong, economically vibrant India is good for both countries, and India’s growth requires new sources of energy. Moreover, global warming is a significant problem that warrants far more serious remedies than have been contemplated to date. Properly safeguarded nuclear power has clear advantages over other means of producing electricity that foul the atmosphere.

At the same time, more nuclear commerce would also increase the stocks of materials that could be used for nuclear proliferation and nuclear terrorism. The relaxation of existing international regulations for nuclear commerce would also come at a time when the Non-Proliferation Treaty and the norms, institutions, and agreements that back it up are under heavy strain. The latest five-year review of the NPT was a complete bust: every strengthening measure that one nation proposed was blocked by another.

India and Pakistan have recently enacted national legislation codifying proliferation-related export controls. This demonstration of responsible nuclear stewardship is clearly a positive development. But is it sufficient to change the existing rules of nuclear commerce?

The two most widely valued barriers against proliferation are a complete end to nuclear testing and a verified cessation of fissile material production for nuclear weapons. At present, the United States and India are unenthusiastic about both of these steps to combat proliferation.

At issue here is not whether, but how the United States and India ought to broaden and deepen their strategic partnership. A relaxation of the international rules for nuclear commerce could do more harm than good unless President Bush and Prime Minister Manmohan Singh can implement good ideas to strengthen global norms against proliferation. So what do they have in mind to prevent a bad situation from becoming worse?