Likely Consequences of the Nuclear Suppliers Group Decision

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The Bush administration has once again rubbished its conservative credentials by strong-arming the Nuclear Suppliers Group to waive longstanding rules designed to prevent proliferation in order to promote nuclear commerce with India. True conservatives don’t undermine institutions and norms that serve essential purposes without having something better to take their place. Bringing India into the mainstream of nuclear commerce has always been a commendable goal. The crux of the matter has been how to do so in ways that reinforce, rather than undermine global nonproliferation norms.

The deal struck by the Bush administration is likely to do far more harm than good for two essential institutions designed to prevent proliferation — the NSG and the International Atomic Energy Agency. The IAEA badly weakened international standards to safeguard civil nuclear facilities against the diversion of bomb-making materials to military programs in order to accommodate Indian sensibilities and the Bush administration’s lobbying. New initiatives will be required to prevent the further weakening of the international safeguards system.

The deal struck in the NSG is also likely to have slow motion, far reaching, negative repercussions because the Indian waiver was not accompanied by compensatory steps to shore up international controls against proliferation. The most obvious compensatory step – India’s signature on a treaty banning further nuclear testing – was strenuously resisted by New Delhi, Washington, and other capitals that stood to make financial gains from civil nuclear commerce with India. At the Bush administration’s insistence, the NSG even declined to clarify penalties in the event of a resumption of nuclear testing by India.

The Government of India acknowledges that strong nonproliferation norms and institutions are in its national security interests. It is impossible to conceive of an effective global nonproliferation system without strong protective measures by the IAEA and the Nuclear Suppliers Group. How much damage the Indian deal will do to these two bulwarks against proliferation now depends in large measure on whether India resumes nuclear testing. Opponents of the deal in India assume that a resumption of testing is now less likely because international favors could be withheld. But the NSG agreement makes no such stipulation; it merely calls for discussions in the event that New Delhi decides to test again.

The Nuclear Suppliers Group has been the world’s most unusual cartel because it was set up to prevent profit taking if proliferation would result. A key protection against profit taking has been a consensus rule adopted by the NSG in 1978 at U.S. insistence. All members of the NSG are supposed to sign off on changes to commercial guidelines before they occur.

The consensus rule has now been stood on its head by the Bush administration’s intense lobbying of small nuclear suppliers which were the last holdouts against U.S. efforts to relax the rules for India. Whereas before, nuclear commerce with India would need to proceed by consensus, now it will have to be stopped by consensus. The chances of this – even after India resumes nuclear testing – have been reduced, because the two biggest beneficiaries of new nuclear deals with India, Russia and France, will want to continue business as usual.

It is an unfortunate fact of life that the biggest potential profit takers in nuclear commerce happen to be permanent members of the UN Security Council, which need to serve as the guardians of the global nonproliferation system. When the P-5 works in concert, proliferation is effectively contained and reversed. When the P-5 places other interests, such as profit taking, over proliferation concerns, nuclear dangers will grow. In the past, the United States has taken the lead and worked with non-nuclear weapon states in the NSG to toughen guidelines against dangerous nuclear commerce. Now the Bush administration has lined up with profit takers against non-nuclear weapon states to weaken these guidelines. It is unlikely that the mangling of the consensus rule at the NSG will be limited to India.

This is not what the U.S. Congress had in mind when it passed the Hyde Act endorsing the exception to NSG guidelines for India. The Congress accompanied this endorsement with conditions, including clear penalties in the event of a resumption of Indian nuclear testing, constraints against selling equipment used to make bomb-grade material, and limits on the refueling of Indian nuclear power plants to make the decision to resume testing more difficult for New Delhi. Instead of working to multilateralize these conditions in the NSG, the Bush administration lobbied to nullify them. If and when New Delhi resumes nuclear testing, in all likelihood Washington will impose penalties, while others pursue profits. As a result of the Bush administration’s lobbying, the NSG and the International Atomic Energy Agency will become complicit in undercutting the global nonproliferation system.

It is extremely unwise to rest the wellbeing of key institutions to prevent vertical and horizontal proliferation in the hands of those who are under no formal obligation to refrain from nuclear testing and may have good reason to resume testing. India’s Prime Minister Manmohan Singh has plainly left this option open, and its Chairman of the Atomic Energy Commission, Anil Kakodkar, has indelicately declared that “when” (not “if”) India decides to resume nuclear testing, “we need to factor in possible consequences.” Those consequences have been diminished by the Bush administration’s machinations. India has tested a Hydrogen bomb design only once, and it is very hard for any state to certify this capability after a single test. India’s lone H-bomb test may not have been fully successful.

One likely consequence of the NSG’s waiver will be to extend the time line when New Delhi tests again. In the meanwhile, the triangular nuclear competition among China, India and Pakistan will gain momentum, a few U.S. lobbyists will increase their quality of life, and Russian and French firms will make handsome profits. U.S. firms will likely be confined to subcontracting to foreign firms, unless the Government of India adopts liability waivers in the event of nuclear power plant accidents.

The hard work required to repair and strengthen the global system to prevent further proliferation and to move toward genuine nuclear disarmament will be left to others. This will require a very different kind of U.S.-Indian nuclear partnership than that engineered by the Bush administration.


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