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India-U.S. Nuclear Cooperation: Second Meeting of Nuclear Security Roundtable [Rush Transcript]

Speakers: Charles D. Ferguson, Science and Technology Fellow, Council on Foreign Relations, Sharon Squassoni, Specialist in National Defense, Congressional Research Service, and Ashley J. Tellis, Senior Associate, Carnegie Endowment for International Peace
October 3, 2005
Council on Foreign Relations Washington, DC


Council on Foreign Relations
Washington, DC

Charles D. Ferguson:  Good morning.  Thank you all for being here on a Monday morning, the first Monday in October. This is the second meeting of the Council's Nuclear Security Roundtable Forum.  The first meeting was in June, and there we focused on security of spent nuclear fuel at US nuclear power plants, and now today we're going to talk about the US-India nuclear cooperation deal.  So, you may be thinking: why are these things related other than nuclear?  Well, in this Nuclear Security Roundtable series we want to cover a broad range of nuclear issues, not just traditional nuclear nonproliferation issues, but issues of nuclear energy, in the developing world and the developed world, looking at nuclear terrorism and dirty bombs and radiological issues.  And so, if you have any ideas about how to enrich this forum, please contact me through email or phone.  I appreciate the feedback.

And I'm Charles Ferguson.  I'm the Science and Technology Fellow here at the Council.  I've been here for about one year and one month, and prior to that I had worked for the Monterey Institute Center for Nonproliferation Studies and worked a little while in the State Department on nonproliferation issues.  And it's my pleasure to have two distinguished speakers here this morning. On my right I have Dr. Ashley Tellis, Senior Associate at the Carnegie Endowment for International Peace.  He has a very distinguished career.  I don't want to waste a lot of time reading his biography.  You can read that on the back of the announcement. 

To my left I have Sharon Squassoni, a colleague of mine.  We had overlapped at the State Department for a couple years, and Sharon now is working for the Congressional Research Service, and she's worked on these issues for many years.  I should mention that, unlike many Council meetings, this is actually an on-the-record meeting because there is interest in putting a transcript of this meeting on our website.  We're trying to enrich our website,, trying to make it truly a nonpartisan resource for foreign policy.  And so, be forewarned this is going to be on the website.

UNKNOWN:  That's twice you've used the word enrich.

FERGUSON:  Well, we'll also have meetings on enriched uranium, both low and highly enriched.  [laughter]  So with that, let me turn to Ashley Tellis and just set the scene for about 10 minutes or so, and then we'll turn to Sharon and open it up for questions.

ASHLEY TELLIS:  Thank you, Charles.  It's a pleasure to be here this morning to talk about the US-India civil nuclear agreement.  What I will do is just give you a very thin sort of an outline of what has been agreed to, the rationale for doing this and some of the advantages, and then I'll give it to Sharon and open it up for questions. 

Clearly, for those of you who followed the vicissitudes of US-India relations over the last 30 years, this is a landmark agreement. It's a landmark agreement because both countries finally decided to come to grips with an issue that has proved to be enormously important in the bilateral relationship and which we just could not engage on, even in the last decade of enhanced partnership.  And the Bush Administration and the Singh government finally decided to bite deep and to come up with an agreement that obviously is very controversial, but I think has distinctive benefits clearly to India and to the United States.

What the agreement is, in substance, is essentially a grand bargain.  It's a bargain that assures India access to field technology and knowledge in exchange for institutionalizing  very strong export controls, essentially export controls that match up to the standards of the United States and those in the West, that India will continue to separate – in fact, actually begin to separate – its nuclear establishment into military and civilian components, and place the civilian components progressively under international safeguards and will join the United States in retarding before the spread of nuclear technologies worldwide. 

So this is the essence of the bargain.  India gets access in exchange for which it joins the United States in working to construct a more robust global proliferation.  Obviously, the US government struggled with a deal of this kind for at least five years, and this was a subject of great conversation in both governments.  And both sides found it extremely difficult actually to muster the political will to pull together an agreement of this kind.

At the Indian end, there was great reluctance to do the two things that obviously we wanted them most to do, which is to develop a set of export controls that would be extremely tough and extremely rigorous, that would be also very intrusive.  The Indians spent the entire first half of the nuclear era targeted by various regimes.  Although they have a very good proliferation record themselves, they just didn't have the institutional and the legal capacity to make proliferation or preventing more nuclear proliferation, a first order priority.  And there were a lot of legal issues.  There were a lot of military issues that they had to engage in.  They found that very difficult to do.  They started doing that in the last five years.

At the US end, what was very difficult was to construct a bargain of this kind that would, in a sense, at least engage in a detour from standing US policy, which was to treat India as a non-nuclear weapon state which had not signed the NPT, and, therefore, not able to enjoy the benefits that were enjoyed by other NPT signatories.  The reason why I think at this point both sides decided to bite the bullet and do this was a growing recognition, at least in the US, that India has developed remarkably sophisticated end-to-end set of capacities with respect to civilian nuclear power.  And that, especially after 9/11, there is a growing recognition that a country that has such capacities and continue to lie outside the global nuclear regime, in a sense unrestrained by a set of formal obligations, would become increasingly problematic for all of us.

The mistake [indiscernible] in Pakistan, Pakistan enjoying a comparable situation as that of India lying outside the regime.  I think it reminded US policy makers that it was about time that we find ways of getting outlier states with such capacities formally into the regime.  And so, the only question then became, if that was the objective, what kind of a bargain could one construct that would bring India into the regime in a way that would be satisfying for us. 

And so, I think the first driver behind an agreement of this kind was really to tie India permanently into the network of international non-proliferations norms and practices.  As I said before, the Indians have had a remarkably good record with respect to [indiscernible] proliferation.  But there's an important point to keep in mind is that this record has been fundamentally a product of national decisions that have been made by India unilaterally.

And so, in principle, there is nothing that would prevent the Indians from changing their minds and changing their policies at some future point in time with respect to what they wanted to do with their nuclear assets.  The idea encoded in this agreement was that we would now help what were previously national decisions become essentially binding commitments, and these binding commitments would essentially come about because of an international agreement between India and the United States.  And as the agreement, in a sense, evolves and India becomes part of the international nonproliferation community, then these binding agreements would go beyond the bilateral to the truly multilateral.  And I think this was clearly one of the most important drivers in the Administration's calculation, as I said, strengthened by the experience, on one hand, of [indiscernible] Khan and his activities on one hand, and the terrible events from 9/11.

The second element was simply a straightforward realist calculation that, if we want India to accept the burdens of enforcing the global nonproliferation regime, then we cannot expect it to do so if it continues to be denied the benefits of latitude.  This is a simple axiom of international politics: that countries don't take on obligations as a matter of altruism, no matter how beneficial that altruism may appear in theory.  They will take on these obligations only if there are direct benefits that accrue to them directly.  And so, what this deal was, in a sense, intended to do was give India an opportunity to join the regime and provide benefits for the cost that it would bear in joining us in enforcing it.

There are two other elements that I also wish to highlight.  The first was India's own energy needs, which given its growth profile of the [indiscernible] and its desires to maintain upwards of eight percent growth rates for at least another two decades, it became increasingly obvious, both to the individual and of course to the United States, that this kind of economic growth could not be sustained without real investments in nuclear energy as part of the energy mix. 

Now, nuclear energy is not going to become the most important form of energy for India, even if it sustains its economic growth.  That is still going to be coal.  But it is going to make a major difference in terms of the mix because the Indians will have to look beyond coal to other forms of energy, and these will be both hydro renewables, as well as [indiscernible].

And so, there are a whole range of issues implicated here in terms of economic growth, in terms of safety, in terms of assisting in the managing questions of climate management and global warming, what have you.  And so, there's a whole cluster of economic and ecological issues that were implicated in this desire to assist in this direction.

The fourth and the final element which the Administration obviously has highlighted in a particular way is helping India become a full partner of the United States geo-politically.  And the Clinton Administration, in a sense, tried to do this actually going back to the 1990s when it tried to develop a relationship with India, but in a way that said we want a relationship with you, but we cannot assist you on the one issue that appears to matter most to you. 

That was a difficult kind of policy to execute because every time we tried to talk to India about partnership, the Indians would come back to us and ask us about what we would do in the arena of giving them access to high technology, giving them access to civilian nuclear power, et cetera, et cetera, et cetera.  And we responded by essentially saying we'd like to have a great relationship with you, and there are many ways that we can cooperate.  But we can't cooperate on the one area that matters to you.

Needless to say, that conversation would not have an extended shelf life because, at some point, we couldn't kind of engage the most difficult issue between us.  And what this Administration made the decision to do is that they would engage, even on this issue.  And they have, in a sense, split the difference by saying that whatever you do with your weapons program is, in a sense, your business.  The United States will not assist you in that regard.  But we can carve out, we can create a distinction, between your weapons program, which is your business, and civil nuclear energy where we have a creative and a constructive role to play.  And so, the idea was to engage India and develop a partnership in a whole range of issue areas, including the most difficult of civil nuclear [indiscernible].

And I would argue that the first fruits of this relationship have already been seen, for example, in the critical role that India played at the IAEA, first in working with a range of non-aligned states who were represented on the Board of Governors to try and create a consensus in favor of the resolution of [indiscernible].  And then finally, India's own public vote to refer the matter to the UN Security Council at some point in time, a decision that clearly marks a real turning point in the way India sees its own role in international institutions, its own perception of the global nonproliferation order, and the value of its relationship with the United States.

Let me end by just saying a couple of things.  This is obviously a very controversial agreement, and I can understand why that would be because it really represents a detour from universalism, from the universalism of our policies.  I would argue, however, that on balance, this agreement does not represent a turning away from universalism, but rather an effort to develop a more sophisticated and a nested strategy.  The universalism, in a sense, remains the [indiscernible] nonproliferation policy.  We are not about to renegotiate the NPT or change our obligations, but we are looking for alternative, supplementary ways to deal with those problem cases which cannot be resolved purely within the universal restraint of the NPT regime.  So I think of this policy essentially as universalism plus, rather than as a repudiation [indiscernible].

And I think the questions will be asked and ought to be asked about what the price of the plus is, and that's really what the debate is about.  That is when you have these add-ons to what is essentially a universalist policy, is it worth the cost?  And I think this is where, you know, people of good will, as it were, would have differing evaluations based on what their judgments about the equities are. 

My own reasoning is very straightforward.  I think India's capacities are sophisticated, and India is an independent enough player that I would be unwilling to take the risk of an India, no matter how well mannered in the past, would continue to remain well mannered in perpetuity if it were not anchored to some set of global nonproliferation obligations.  And for me, this is the principle driver, besides all the other, [indiscernible] as the justification for pursuing this agreement.

FERGUSON:  Thank you very much, Ashley.  That's an excellent scene setter, and I'm sure you've sparked a lot of questions.  Now, let me quickly turn to Sharon and find out what's going on in Congress and other views.

SHARON SQUASSONI:  A few disclaimers, I'm speaking for myself here today, not for CRS or, God forbid, the entire Congress.  If I mention some congressional views, it's from public sources.  CRS is prohibited from divulging any kind of confidential information from Congress.  I signed up to talk this morning about procedure, rather than substance, but let me just make a few forays and talk a little bit about why this agreement is controversial, as Ashley said.  I think there's a sense from the nonproliferation community – I'm not talking about Congress here – that the costs may outweigh the benefits, the costs in terms of impact on US nonproliferation policy and, in particular as we saw in the September 8th House International Relations Committee hearing, Iran.  Iran, Iran, Iran, Iran.

I'm not quite as optimistic as Ashley that India's support at the last board meeting necessarily means that it's going to be easy from hereon in.  There's a difference between saying we don't want Iran to acquire nuclear weapons and saying that Iran should restrict its whole nuclear fuel site [indiscernible].  As you know, India has been for 30, 40 years – has staunchly criticized any kind of discrimination.  And in the case of Iran, it is, in the views of some, discrimination.

The other part is the nonproliferation regime.  Some folks view this reversal of 30 years of US nonproliferation policy as basically calling India a de facto nuclear weapons state.  And also, some suggest that this throws the entire bargain of the NPT into question.  There are a lot of states who have advanced nuclear fuel [indiscernible] and Germany and who've made that bargain.  They've said, no, we're not going to develop nuclear weapons in exchange for that nuclear cooperation.

On the benefits side, I think so far there's – I haven't seen anyone who has said that we shouldn't develop a stronger relationship with India.  I think there is a broad consensus for that.  However, some, including Congressman Leech in the September 8th hearing, said we should have come up with some other ideas, perhaps supporting a permanent seat for India on the UN Security Council. 

Also on the benefits, the Administration has repeatedly said that we're going to bring India into the mainstream of nonproliferation.  India has agreed to take certain steps.  Some of them are, I think, clearly benefits.  Others they've already agreed to do, and in terms of – I think everybody welcomes a separation of the civilian and the military facilities, but that's not a done deal.  For one, that is a negotiation between India and the IAEA, and it's not clear to me how much influence the US is going to be able to exert over that.

The other thing is because India is keeping its nuclear weapons program, some observers have questioned what the value - the nonproliferation value – of safeguards even on the civilian facilities are. 

When you look at the voluntary safeguards agreements with the nuclear weapons states, we don't do that because there's a nonproliferation benefit.  We do that as a gesture in many ways towards the entire regime and because during the negotiation of the NPT many states said, hey, if we're going to put all our facilities under safeguards, we're going to be at a commercial disadvantage.  And so, the five nuclear weapons states in varying stages decided to do that.

In a general sense from the nonproliferation community, there's a sense that we didn't get enough.  People are scratching their heads: did we really get enough from India?  We didn't get a commitment on their part to stop fissile material production for nuclear weapons.  There are some observers, I guess Henry Sokolski is one of them, who said if you want to be an advanced nuclear technology state, read that as nuclear weapons states, you should do what we've done, which is we've stopped fissile material production for weapons. 

Another thing is the proliferation security initiative.  It seems as though we might – I don't have any inside information, but it seems like we might have asked the Indians to pony up on PSI, and maybe we haven't gotten a response yet, but that's not part of this agreement.  That would be helpful.

All right, let me talk a little bit about the procedure, what happens in Congress, and I wanted just to make three points.  The first is that this agreement will go nowhere without positive congressional action.  No matter what strategy – legislative strategy – the Administration pursues, there has to be positive congressional action.  And the reason why I stress that is because usually an agreement for nuclear cooperation sits before Congress.  Even if Congress doesn't act on it, it goes through. 

It's a pretty easy thing.  In this case, because India is a non-nuclear weapons state, not just under the NPT, but under US law, the President, if he wants to comply with current law, must exempt that peaceful nuclear cooperation agreement from certain nonproliferation criteria, that is Section 123 of the Atomic Energy Act.  I could bore you with 1,000 details.  I won't.  A lot of it is outlined in my paper, and there's also an excellent feature on arms control today in October by Larry Scheinman, Fred McGoldrick and Hal Bengelsdorf, all experts on this, and they lay out some of the requirements.

All right, so that's the first thing.  If Congress goes ahead with a joint approval – joint resolution approves this exempted cooperation agreement – the Administration has a year to export before – and that's because of the exemption.  They have a year to export before Congress has to look at those exports.  This is in Section 128.  However, because India has tested a nuclear device after 1978 and because they have an active nuclear weapons program, under Section 129 the exports have to be terminated. 

The President can waive that.  So what you do is you start an export, and then you waive the Section 129.  Okay, this does not make nuclear exporters happy.  It's a complicated process.  It can be turned off after a year, presuming that the President is able to waive, Congress doesn't disapprove this waiver on cessation of exports.

So it's a little complicated to comply with existing law, but it can be done.  The second option that the Administration can choose is to amend the Atomic Energy Act.  There are pros and cons.  The two most problematic sections are Section 128 and 129.  The third option is stand-alone legislation.  They can propose legislation or it can come within Congress, like the Brownback Amendment, which waives sanctions after testing for India and Pakistan.  I would just call your attention to the fact that Brownback had a time limit on it.  It said five years, a five-year waiver, then the President can re-up that.  We might see something like that. 

There also might be interest in Congress depending on what the actual text of that agreement for cooperation says in attaching some conditions.  And those similar to the conditions – not similar to, but an analogous case was the cooperation agreement we had with China.  Congress attached – as you know, China had a lot of export activities that we were not happy about from a nonproliferation perspective, and so it took many, many years before that agreement went into effect.

I don't have a crystal ball.  I don't know what those kinds of conditions might be.  We'll see as we proceed if there's any interest in that.  So the second point I wanted to make, opposition and support for this agreement comes from both sides of the aisle, both sides of Congress.  I mentioned also the opposition kind of key to Iran.  We'll see how strongly India supports us there.  The sense of costs outweighing the benefits, but remember there's a strong US-India caucus, and there's strong support, I think, for stronger ties with India.

And the third point I wanted to make was timing is all.  I overheard [indiscernible] talking about the lack thereof of consultation with Congress.  And as you can see from the transcript of that September 8th hearing, Congress pays attention when it gets a sense that its prerogatives are being stepped on.  And there were some very pointed questions in that hearing, and I'm sure consultation is going on now, and it will continue. 

One of the pointed questions that the Chairman of the House International Relations Committee asked was are you going to work with this committee and the Senate Foreign Relations Committee?  You're not going to attach a rider to an appropriations bill, are you?  And the response was a little fuzzy from Undersecretary of State Nick Burns.  He stressed, once again, that he would consult with Congress.

And the other key thing is the Nuclear Suppliers Group and how the Administration – the timing of when we're going to the Nuclear Suppliers Group, whether we get agreement from the Nuclear Suppliers Group before an actual nuclear cooperation agreement is laid before Congress.  I've heard that there have been consultations.  There's an October meeting of the NSG.  There's some talk of perhaps an extra meeting. 

Some states seem to welcome this move.  France and Russia seem quite ready to move in and supply India with the cooperation that they had halted in the past.  Others, like Sweden and Australia, may not be quite as ready to do that.  The key question is, is the Administration going to introduce a legislative proposal this year or is it going to wait until after January?

One last point about timing, the issue of what India does in relation to what we do.  On July 19, Nick Burns said, well, India is going to implement some of these things, and then we'll go to Congress and the NSG at the same time.  On September 8th in the HIRC hearing, we heard a reciprocal basis. Bob Joseph said, well, reciprocal and phased.  India should put forth a credible defense plan to separate its facilities.  That's going to be a key step for us.  It could be that one option that Congress considers is, gee, let's see the whole safeguards.  Let's see the whole separation.  We'll see the whole safeguards agreement before we act on this.  A possibility, I have no idea about the [indiscernible].  I'm going to stop there.

FERGUSON:  Thank you very much, Sharon.  That was great.  And I should have mentioned at the beginning, both Sharon and Ashley have written extensively on this subject.  I highly recommend both of their major papers.  Go to the Carnegie Endowment website and download Ashley's many papers on this issue.  And Sharon has written an excellent Congressional Research Service report on this issue, even though I guess they're not allowed to give it out directly.  You can go on Google, search for her name.

SQUASSONI:  It'll tell you where to get it.

FERGUSON:  [indiscernible] nuclear deal and you can find it.  It's easy to find.  Let me just start off with one question and open it up to the floor because I know we have plenty of people in this audience who have thought deeply about this issue and other people that have actually written on this issue.  So we definitely want to hear from them. 

But the first question to Ashley.  Maybe I wasn't listening carefully enough, but the issue of China really didn't come up in your talking points, and I know from reading your papers and I know one of the major points [indiscernible] this deal was that perhaps trying to counterbalance China.  Because there's this view among many that China might become an enemy of the United States sometime in the future, indeed the world's largest democracy, India, [indiscernible] sort of a counterbalance.  But some would argue India is already counterbalancing China in many respects, and does the United States really need to join forces in that way.  Could you kind of elaborate on the India-China-US trilateral issue?

TELLIS:  I have to – I'll answer the question, but I have to distinguish between the Administration's position and my own views.


TELLIS:  These are my views.  The Administration has correctly, in my judgment, studiously avoided saying anything about China, and I think that is appropriate.  My own view is that it is in our long-term interest to have a strong India [indiscernible].  It's also in our long-term interest to have a strong Japan, to have a strong set of Southeast Asian states.  When I think of the US-India relationship, vis-à-vis China, I am not imagining a tight alliance which has as its objective the goal of any kind of [indiscernible]. 

I think US interests are served by having a set of powerful, independent centers of power on China's periphery.  Even if these countries choose their own policies, which may be at some [indiscernible] of our own, it still serves our interest to have them strong and independent.  And so, when I think of the nuclear agreement, I think there are two entailments that come out of this principle. 

The first is you don't put constraints on India's ability to develop its nuclear weapons.  And so, I've been strongly of the view that we ought not to artificially constrain India's ability to manage its [indiscernible].  These are choices that the Indians, of course, will make about size and quality and all that, but I don't think we should be in the business of constraining this. 

The second is there are issues in which we can make a difference, and for me that is civilian nuclear energy as a way of enhancing India's economic growth because that advances the goal of having a [indiscernible].  So I see this agreement as a most unsatisfying goal for both those interests.

FERGUSON:  Good, thank you.  Let's open it up for questions.  Lee Feinstein has put his hand up.

LEE FEINSTEIN:  Thank you, Charles for arranging this and actually starting really fabulous discussions.  Just one quick comment and then two factual questions.  Ashley, I was interested in the way you describe this as universalism plus, and I guess I would describe it in a similar way, but I use the words sort of a maturation of their regime, which is that the problem with the regime is that its starting point is to treat North Korea as if it were Norway.  And so, how do you make those distinctions, and how do you do it within a rules-based system?  And this is a difficult problem which one finds particularly in the nonproliferation regime, but elsewhere.

I would say that what is developing, in a way, is a distinction between open societies and closed societies, and that in the case of open societies – you talked about [indiscernible] things.  In an open society, it's not that you let India off the hook for developing its own nuclear weapons program, but you apply different tools to pressure.  And ideally you would treat Pakistan differently, but that's for a variety of reasons. 

That's not happening.  And certainly you would treat Iran and North Korea and other places differently, and that's, I think, what is developing.  And that started, frankly, in the first Bush Administration when it was a rogue-based approach.  And this is just sort of the natural evolution from that.  And I would also just say I think that the geo-political dimension, as Charles was saying, is the critical dimension here and much less about constraining India's nuclear exports.

I suspect that India's nuclear controls are not as good as you've been saying, and they haven't been as good in the past.  And I bet that they won't be so good in the future.  But I don't think that that was the main motivation.  I think the main motivation is this geo-political stuff. 

So two questions, one for Ashley and one for Sharon, very quick, factual ones.  Ashley, I was very intrigued by the continuity of the BJP in the Congress in terms of these questions, and so if you could say a little bit more about that and what specifically, if any, has the blowback been on the vote to support the United States on Iran. 

And, Sharon, if you can remind me of this because I realize I forgot, but sort of the Venn diagram world you've got what the NPT bars and the kind of cooperation that it says cannot engage in legally and what is permitted if you waive and get a 123 Agreement.  So can you remind me what that delta is.

TELLIS:  First, just briefly on that.  India has had export control problems in the past, but to the best of my knowledge they've not been in the near-term.

But let me go back to my original point, which is the record, if you look at export control issues that have occupied us for about 10 years, nuclear has not been front and center.  Most of the export control issues have been with precursor materials that are being used, and there is a fundamental difference.  The second point is the question of GOI [Government of India] complicity has never been proven in any of those issues, and we've gone actually after [indiscernible] both the US and India that have been involved in these issues.  But for Americans, the strategic objective now of the agreement is to tighten this so that these things never occur again.

On the question of the continuity between the [indiscernible] and the Congress, I think that is actually quite remarkable, but in some sense also not surprising because India nuclear decision making, by and large, has been characterized by consensus.  The only issue on which I think there might have been a difference was the 1998 tests, where the Congress [Party] would probably not have tested then, but would have tested eventually.  Because if you'll remember, for example, between '91 and '95, when you had Congress governments in power, there were repeated efforts at testing.  In fact, they got very close to testing in '95 and [indiscernible] because two national, technical [indiscernible] identified, et cetera, et cetera, et cetera, something every day.  So there's been a great deal of continuity.  And on this issue, I think for all the carping, they recognize that this is a step for the countries [indiscernible].

On the Iran issue, I think it's become fascinating because now you have a marriage of the right and the left.  The left to basically see India as having sold out and become a junior partner with the United States, a UK in motion, as it were.  [laughter]  And you have the right who are extremely opposed because they see India is cutting off its ties with Iran as fundamentally handicapping New Delhi in the geo-political race, vis-à-vis Pakistan and Central Asia.  And this is an issue that we have not seen the final act of, so stay tuned.  [indiscernible]

SQUASSONI:  On the questions about what the NPT bars, what's permitted under US law – the NPT doesn't say very much except in Article I.  A nuclear weapons state is not allowed to aid, assist, encourage a – I think it says non-nuclear weapon state or any state, I think – any state – exactly, no, yeah, that's right, because there is cooperation between nuclear weapons states which shouldn't be happening and which – okay – in the manufacture, acquisition, development of nuclear. 

Okay, so that leaves a lot out there, and the Nuclear Suppliers Group, which was created in response to India's first nuclear weapons test, was kind of a realization that, oh, by the way, we have to restrict a lot of other things since in that test many people maintain that some peaceful nuclear cooperation is used, specifically the US having [heavy] water in the [Indian plutonium production] reactor.  It was used to produce plutonium for that first test.

Full scope safeguards, we can engage in anything that's not nuclear weapons related to a country that has full scope safeguards including enrichment and reprocessing.  But I would maintain that it would be an odd development if we were to decide to engage in enrichment and reprocessing-related cooperation with India because we've been trotting around the globe saying this is directly related to nuclear weapons.  We have to be careful, and I think one point that the Administration has raised is none of our cooperation can contribute to India's nuclear weapons program, and that's why there has to be this separation of civil and military facilities.  Now, whether you believe that IAEA safeguards is sufficient to insure that is a matter of your own personal convictions, I think, although certainly in US law [indiscernible].  Is that correct?

UNKNOWN:  And regarding IAEA, it's very hard to come up with a case of diversion from a safeguarded facility to a nuclear weapons program.  There have been whole programs hidden from the IAEA, but that's different.


UNKNOWN:  Right.

UNKNOWN:  So is the US in violation of Article I because of its relationship with the UK?

SQUASSONI:  I cannot answer that.

UNKNOWN:  We amended the Atomic Energy Act, didn't we, in 1954 to have access?

UNKNOWN:  But that was – the question was law versus NPT and NPT Article I.

UNKNOWN:  Oh, right, that was a part of NPT, yeah.

UNKNOWN:  I don't remember my MPT negotiating history, but I think that the United States, when it negotiated the NPT, was very careful to do it in a way from its lawyers' perspectives to permit friendly nuclear cooperation.

UNKNOWN:  I think that under the treaty we're not allowed to give nuclear weapons.  I'm pausing on delivery systems because we've sold tomahawks.  But I don't think that there is a bar on cooperation in the R&D field.

UNKNOWN:  It's much bigger than that with the UK, of course.

TELLIS:  Absolutely.  Part of it is the grandfathering because a lot of the work that we did with the UK and France actually predated – France is a trickier question, but the UK –

UNKNOWN:  The UK has certainly continued and continues.

UNKNOWN:  By the way, there is just a comment on no violations of the safeguarded facilities.  There is at least one example, and that's the Indian violation of the Canadian safeguards.

UNKNOWN:  [indiscernible], right, yes.

UNKNOWN:  And the Canadians were very aware of that, by the way in '67 and '68.  I was involved –

SQUASSONI:  And the US did not have safeguards on that heavy water.

UNKNOWN:  That's right.

SQUASSONI:  So it wasn't a violation of our –

UNKNOWN:  No, but it was a violation of Canadian [indiscernible].


FERGUSON:  So we have a list of questions. 

QUESTIONER:  Ashley and Sharon, thanks for very able presentations.  One of the arguments against this agreement is the argument that if we, the United States, unilaterally carves out an exception for a “good citizen” what's the argument or the rationale to keep other good citizens, as opposed to the Irans and the North Koreas from going down this route?  Can either one of you speak to how this agreement has been received in Japan, in Germany and in South Korea and Taiwan, as well?  And they're obvious danger countries, as well.

TELLIS:  It doesn't cause too much of a problem for me because the way I think about it is that this is a question of national politics.  The more important country in the world has to take the lead in [indiscernible], and when it modifies the ritual has to make a special effort to protect the benefits of that.  And so it's not surprising to me that the US would do this. 

The question is how it's done.  And one of the things that I think the Administration has emphasized, that it's willing to do this cooperatively.  That is, it's not going to do this in a way that essentially provides a license for anybody going out and doing anything they want.  Now, this is not a question of is there an exceptionalism here.  The answer is yes.  Of course there is an exceptionalism, and you can't deny that.  The question is can the exceptionalism be modulated in a way that still maintains the rules of the game.

And so, there's a great deal of consultation that's going on with the industry partners, including many of the countries that you highlighted, to do this in an orderly fashion.  Because everyone recognizes the downside of a pure laissez-faire kind of system where everyone goes out and does their own thing.  And so, I think part of the consultation can be agreed that they're going to do this in an orderly fashion. 

Now, it's aided by one fact, that most of the countries in question recognize India and two others as the exception to the NPT ritual.  They see these as being outlier, so it's not as if the Administration has to construct a zero-base case to prove that India is the exception.  They also recognize – and this is of importance to them – that their own interests are served by bringing and getting to the [indiscernible].

That is, an India that chose to behave very egregiously down the line would be an India that would affect not only US interests, but their own.  And so the question here at some point becomes collective sacrifice.  What is it that the entire community together is willing to put on the table in order to bring this large concentration of capabilities now outside the [indiscernible]?  And there are going to be difficult and delicate negotiations, but this is a collective benefit.  It's not just a benefit for India.  And everyone recognizes that.  This is a difficult negotiating process, but I think everyone understands this.

QUESTIONER:  My question though was: is that argument acknowledged in Japan and Taiwan and Germany and South Korea?

TELLIS:  That is a harder question to answer because this is a long process.  What I haven't seen so far is what I would think as strident and outright opposition.  Even China, of the P-5, for example, who I would imagine would have the most anxiety about an agreement like this, has adopted a very natural and a very measured tone.  Part of it is a matter of style, but I think people are groping to find all the ways of making this work because they recognize that there are down sides to both at times. 

There are down sides to keeping India out of the regime.  There are also down sides to this being done in a way that is disorderly.  And so how does one kind of walk that mean between these two hard choices?  And this is not a kind of negotiation that lends itself to rhetorical flourishes because there is pain at both ends.  And so, the question is can we construct a logic that meets certain tests of regularity, that innocence permits the construction of a new set of supplementary rules, what we call the maturation of the regime, to make this work to serve our common purposes.

SQUASSONI:  I don't have anything to add, particularly on the views in those countries.  I will say I was at a UN conference in Japan in August, and there was kind of disbelief that the US was going ahead with this.  But it was a conference on disarmament, so they were preaching to the choir.  There are people who maintain that, no matter what the US does, it's not going to make certain countries develop nuclear weapons.  Even if we do this thing, which is pretty stressful, I would say, for the NPT and for the NSG, will that make Japan develop nuclear weapons?  Pretty unlikely.  However, have North Korea and Iran noticed this?  And what is the impact of that?

QUESTIONER:  Good segue.  The question is how is Pakistan reacting post-agreement, and how is the White House managing that response?

TELLIS:  Pakistan has reacted at one level in the obvious way by basically saying us too, and the Administration has responded in what's also the obvious way just to say it doesn't apply to you because you don't have a record that, in a sense, justifies this.  I've made the argument that we need a three-fold test to [indiscernible].

You start off by basically saying which are the outliers [indiscernible], and you get three candidates, India, Pakistan and Israel, who in principle share the benefits of this country.  Then you apply a second test, which is who is being a responsible custodian of nuclear assets, and you get two, and that's India and Israel.  Then you apply a third test, which is who really requires nuclear energy for civilian nuclear purposes, and you get only one, and that's India.  And when you aggregate the three tests, there is India which is common to all three categories. 

Down the line, is it possible that Pakistan could become a beneficiary of this kind of thinking?  Yes.  But I think that case will have to be argued and demonstrated when we come to that.  At this stage, Bob Joseph has been very clear, if you're going to go to the caucus with a request for a country [indiscernible].

FERGUSON:  [indiscernible] two quick ones?

UNKNOWN:  Well, actually, it concerns Pakistan, so I could wait or whatever you want to do.

FERGUSON:  If you want to [indiscernible] briefly, then we can get back.

UNKNOWN:  Right.  I think there's another Pakistan question.  My sense of how the Administration has reacted matches yours, although I think there's probably another aspect to it.  And if I were the Administration, I would also be using this as an occasion to re-ask a whole lot of questions about Dr. A.Q. Khan. 

But the other question is what about China and Pakistan?  And do you anticipate that at some point in the relatively near future the Chinese might say, well, we might be able to see our way clear to go along with this, but our friends too?  How do we deal with that?

TELLIS:  This, I think, very well explains Chinese silence [indiscernible], that the lack of Chinese opposition to this is because they want to keep the door open to some kind of preferential arrangements of their own with Pakistan.  I suspect that's [indiscernible].

UNKNOWN:  They could, of course, also do it without bothering to go through the NSG.  Stranger things have happened.

TELLIS:  Yes, they could do that, but they would have a hard time.  Like M-11 missiles, which can actually be transported [indiscernible], building another [indiscernible] reactor, trickier.  That would be trickier [indiscernible].

UNKNOWN:  Ashley, I was remarking before that I was hoping that we would be able to make the case better than the Administration does, and you have certainly been more forthcoming than the Administration has on this.  My question/comment falls upon Lee's point about politics versus nonproliferation because, unfortunately, it seems as if the Administration is making the case on the basis of politics, rather than on nonproliferation grounds.  The arguments are always India is a good guy country, which half of or a significant number of people in Congress already believe, and, therefore, don't need to be convinced.  And the others don't care because they're concerned about the very serious nonproliferation aspects of this. 

So my comment is more on the issue of unilateralism, plus getting there by an exceptionalism route.  It's hard to see how that plays in nonproliferation terms.  It seems that there could be a universal path to a universalism plus outcome.  Just sort of almost back of the envelope ways could be one that you've sort of alluded to, to start with the non-NPT signatories, so that already you simply create a framework that isn't “we like India, we don't like other countries.”  Instead, it's a “we're going to fix this sort of quirk in the NPT whereby three countries don't fall in a category.”  And I think you quite rightly point out there are ways of distinguishing India from Pakistan or Israel.  I don't quite buy the sort of “India needs the energy” argument because every country judges for itself what its energy needs are.

More importantly, though, in Congress I think people can quite reasonably say we have declared Pakistan to be a major non-NATO ally. [Indiscernible]  If China says me too for Pakistan, the Administration will have the political will to say no, no, not you too, and perhaps more tellingly in Congress I don't see any chance if Israel decides it wants to get in on the deal that any Congress is ever going to say no, Israel can't get in on this also. 

So already there is a problem because: is this an exceptionalism that can fly?  Another path though might well be also the very bargain of the NPT itself, which India declares to be discriminatory, and they're right.  Perhaps one way might be for us to start living up to our NPT obligations now as a nuclear weapons state and not even putting on the table the prospect of new US nuclear weapons, which, as people point out, because they're in violation of the NPT.

My question is, is it too late to find a universalist path to a universalism plus or are we stuck with this exceptionalist path, which, quite frankly, is not convincing to many people, even who want to support the goals?

TELLIS:  And I don't have an a priori answer to that.  If this were done by a think tank, if you went to the Rand Corporation and said how would you do this, I'm sure they would do it exactly as you propose, which is you don't [indiscernible].  It's too complicated.  We need to have a plan, and we would come up with a plan, and we would try and sell the plan.

But I think in the – I shouldn't be preaching to you here because you know this better than I do – but in the real world of politics you respond to opportunities as they present themselves.  And even the Bush Administration with all its revolutionary propensities, I cannot imagine would sit down and say the NPT is in trouble, we need to come up with a new master plan. 

What I see happening, if one pushes this out really over the long term, is that what happens with India provides the impetus to developing, in a sense, these new rules, which then get expanded to dealing with issues that the original NPT didn't deal with.  Like, for example, the whole question of rights to the fuel cycle, questions about the diffusion of enrichment and reprocessing technologies, et cetera, et cetera, et cetera.  There were unresolved issues in the NPT, and I'm just thinking of this politically.

I just find it hard to imagine any Administration sitting down and saying, oh, we need to start with a clean sheet of paper and construct the whole edifice, in a sense, all at once.  I think what you will get are probes that deal with parts of the problem as you're confronted with parts of the problem.  All politicians, I think, naturally would do this until there comes a point where there's a tipping effect, that you say, gee, we've made so many probes dealing with specific problems that at some point we've got to now pull back and say, okay, how do we pile all these things together. 

And I think that is the more likely outcome to your universalizing of the exceptions, than simply someone starting out de novo with a sheet of paper saying we're going to construct a nuclear regime.  I'm not saying it's a better way to do it, but I just think it's the more realistic.

FERGUSON:  Sig Harrison.

QUESTIONER:  This has been really a very helpful discussion.  I really want to thank the speakers.  But I do think we should add one more dimension to this.  We talked about this basically in nonproliferation terms, and I did myself an opinion piece in August in the Washington Post.  We talked about it in geo-political terms.  But I was very surprised to hear John say that he doesn't think it's relevant whether India needs the energy. 

It seems to me that, as someone who has spent many years of his working life having to do with the third world and India, then dealing with the dealings of nonproliferation [indiscernible], you've got to think of this in terms of third world poverty or the coming third world poverty as a goal – as US goal, not just for the good reasons, but because the stability of India, as a balance here, depends upon on whether it can succeed and the assumption that, because India has got such a great growth rate now, got more investment there and so forth and everything is fine in India's business now, it seems to me India has confronted tremendous problems of making this place function, despite the progress it has made.

And the implications of a collapse of the Indian polity and economy resulting from the energy problems that it faces in the context of the population are still very real.  It's not just a question of poverty, but it's a question of: do we like stability, and it seems to me that the energy needs of India are very distinctively important as a part of the capital there, that the degree of nuclear power in this mix can't be [indiscernible].  But this is a very, very critical thing talking about whether India, which we're now very optimistic about in socio-political and economic terms, is really as stable as it looks.  And when you look at this [indiscernible] people tremendous poverty, most [indiscernible].

So anyway, I've made my point.  But we should certainly understand that one of the real things that tips the balance and certainly tipped the balance for me because I'm very concerned about the nuclear nonproliferation arguments is that this is essential in its own terms for dealing with one of the biggest economic challenges in the world today.

UNKNOWN:  Just to clarify, my objection was not to the energy [indiscernible] per se.  I think India's energy needs are tremendously significant.  My point is that this is an exceptionalist argument rather than a universalist one.  So if you're going to make the case on exceptionalist terms, then the argument goes along.  My question is how we can have a universalist path to the goal that I share, as well.  Anyway, I just wanted to clarify.

QUESTIONER:  You have to make the case in both terms, and I completely agree with what you said about Article VI and living up to the NPT.  That's the biggest issue of all.  But in this gathering, I don't want to be [indiscernible].

FERGUSON:  We've got a clarification.  Please.

UNKNOWN:    I don't understand how the Article VI gets you to develop an exception for the NPT holdouts.

UNKNOWN:  Well, my point is that we should be able to come up with, with all the brainpower in the Administration and experts outside, some way of pitching this goal, which I've been pitching ever since the Clinton Administration of how do we get to the goal that we've got here, but in a way that is not pure exceptionalism, that is not just we like India, we don't like Country X, therefore, tough luck.  And one way might be to reexamine the entire bargain of the NPT because, just as we have problems with the bargain allowing countries like Iran or North Korea to do considerable work quite legally that we don't think they should be doing, likewise India and other countries have expressed the view that we, ourselves, are not living up to our obligations under the NPT.  So I think there is an opportunity, if we want to address these in a universalist way, to reexamine the entire bargain of the NPT.  I'm not advocating it necessarily because I think, as Ashley quite rightly points out, it's a very difficult political thing, and I don't see this Administration even countenancing the idea that we might have some obligations to any other country.  I only raise that as one way of us kind of getting a universalist path, rather than an exceptionalist path, which I think really doesn't get us going in a way that is convincing.

UNKNOWN:  If renegotiating the NPT were an option, I think there would be easier ways of renegotiating it than what you're talking about.

UNKNOWN:  Not renegotiating.

UNKNOWN:  But it's not.

UNKNOWN:  Fulfilling it, observing it, honoring it.


UNKNOWN:  I'm with you, but I don't think that's a policy prescription that can work.

UNKNOWN:  If it can't work, nonproliferation can't work.

SQUASSONI:  It seems to me, though, that the Administration has at least a chance in – I see a fissile material production cutoff as a very nice way of getting those three states outside the NPT.  And certainly when I was in the State Department and in the Arms Control and Disarmament Agency, that's how we viewed it.  It's a way of getting those three states outside the NPT to make some commitments that the five nuclear weapons states have already done.  That would be a positive step, not only for nonproliferation.

UNKNOWN:  China hasn't done that.

SQUASSONI:  China has stopped its production, but it has not admitted that, I think.

UNKNOWN:  Admitted it.

TELLIS:  Oh really?  Well, there's some doubt about that because [indiscernible; cross talking].

UNKNOWN:  This has been for some time.

UNKNOWN:  For some time, right?

SQUASSONI:  Yeah, for almost 10 years.  I think back in '95.

UNKNOWN:  Yeah, almost – yeah.

SQUASSONI:  But I wanted to come back to Sig's point.  There are some who say – wearing my CRS hat – there are some who say.  [laughter]  But nuclear energy in India, since it's only 2.7 percent of the installed electrical capacity, is least leveraged to have an impact on the growth of energy for them.  Also, it's remarkably expensive, and I think when Enron put a gas fired plant in there – and maybe somebody knows a little bit more about the Indian energy situation – the Indians couldn't pay for it.  And so one of the questions I have is who is going to pay for this vast buildup of nuclear power. 

One other point, and since I'm not an economist I just throw this out there, it is – nuclear energy projections are based on a growth rate of eight percent, and at least in 2003 the Asian Development Bank said that growth rate is unrealistic.  Now, it may be a question of cart before the horse.  Do you need the energy to get the growth rate and vice versa?  And so, I just throw those points out.

UNKNOWN:  Can I respond to that unless there's somebody else –

UNKNOWN:  Quickly, then [indiscernible].

UNKNOWN:  Historically, projections of energy demands almost always have been high.  If we look back over a few decades, energy production use has grown more or less in line with GDP.  But the question of what is too expensive gets you into the bureaucratic question of what is produced by the national government, which I believe a number of the new facilities are, and what is done through the state electricity boards, which is just about everything [indiscernible].  In other words, there's not a neat answer to that.  The argument that the Indian government is making, energy needs is a big one.  We need lots of energy, and nobody would disagree with that.  It's one of the two fastest growing, or expected to be, energy markets in the world.  My own view, and I'm strongly in favor of this agreement for basically all the reasons that Ashley said, is that the energy needs are one of the weaker arguments simply because of the numbers.  But they're an argument that is very powerful and compelling to the Indian government.

UNKNOWN:  I had two questions.  One has to go to the fissile material cutoff, and posed to both, but to Ashley first.  You made the argument that it's against – the US should not try to constrain India's program, but the lack of any real commitment to a fissile material cutoff needs to be one of the elements of this agreement that's most [indiscernible] and it's drawn the most criticism in Congress and elsewhere.  And at the September 8th hearing Bob Joseph actually indicated they were trying to get something, but it wouldn't be a condition for implementing this agreement. 

So it's just at least rhetorically it's something on the Administration's agenda.  Do you see – how does that play out in conjunction with the point that you made?  Or do you see any movement on this beyond the kind of attenuated commitment that's in the joint statement tied to the fissile material [indiscernible] treaty?  And my second question, maybe a little bit kind of left field is, you talked about the international elements, which are nonproliferation and the international politics. 

Is there at least some sense from the Administration that there is a domestic political benefit to this, that there's an important gesture to a domestic political constituency of rising importance?  Because I haven't really seen much discussion about that, and I wonder if both of you could respond to that.

TELLIS:  Well, on the first I don't know what the Administration is thinking about or what the conversations are in India about fissile material cutoff.  For me, it's a very practical issue.  We can't go to the Indians and ask them to stop fissile material production when the Chinese are sitting on a relatively large fissile material stock.  There is no way the Indians are going to do that because they're thinking of their own security down the line.  And until they reach the point where they think they have enough, and different people in India have different notions of what enough means, you're not going to get – so just as a public policy problem, you don't go shaking and tilting windmills trying to get something that you're not going to get because they have this idea it's not in their security to stop fissile material production.

For the rest of the P-5, fissile material cutoff production may make sense because they're sitting on extremely large fissile material inventories.  And in the Chinese case, it is not clear what they've stopped.  Yes, they've stopped the production of HEU [indiscernible], but there are other materials used in the weapons that they might be producing.  We don't know. 

And in any event, the question really is if the Indians are not willing to do this, I don't see this as being in our strategic interest [indiscernible].  Now, I don't know if the Administration has a different view.  I saw Joseph's testimony, and I suspect there may be pressures from within to try and get this, but as best I can tell the Indians are not going to give up.

UNKNOWN:  But they did commit themselves to go along with the [fissile material cutoff] treaty if one was negotiated.

TELLIS:  Sure.

UNKNOWN:  Is there any priority given to that?

UNKNOWN:  Which is way in the future by everyone's estimation.

FERGUSON:  What about Dan's other question about the –

TELLIS:  My own sense is that this is not being an issue that the Administration has given much thought.  The domestic – I presume you mean the elite Americans and their –

UNKNOWN:  Yes, right.

TELLIS:  They've been kind of not heard from, and I'm sure at this stage there's some mobilization in order to get the agreement to go to Congress.  But I don't think this decision was made in order to kind of assuage the sentiments and to reach out to the constituents.  I think this was done for a larger geo-political and proliferation reasons with the domestic constituencies [indiscernible].

FERGUSON:  How does this affect the votes in Congress?

SQUASSONI:  [indiscernible]  You mean the Indian-American –

FERGUSON:  And the caucus [indiscernible].

SQUASSONI:  All I can say is Dana Rohrabacher, if you were there at the hearings, said he must be the only one on the HIRC who hasn't been co-chairman of the US-India Caucus. 


UNKNOWN:  Actually, I can say on the Senate side this definitely is a factor, and the Administration has been very actively courting the Indian-American community and has been using this as a selling point.  And they may well succeed.  That's why it gets back to my point of: is this a politics or is this a nonproliferation accord?  As politics, they may be able to ram this through Congress, and they may be able to ram it through the Nuclear Suppliers Group because France and the Dutch want to sell their power plants as well.  The question is, is that a firm basis for a lasting solution?

TELLIS:  Well, I want to make the distinction that [indiscernible] example.  Now that you have an agreement, they may well be doing this, but I don't think the agreement was conceivably intended let's get these guys to go to public.

FERGUSON:  Thank you for those comments.  We're right at 10:00, so here at the Council we pride ourselves on ending meetings on time.  Thank you very much for the stimulating discussion, and I look forward to the next round of the Nuclear Security Roundtable. 

Thank you very much.  Please join me in thanking Ashley and Sharon once again for their excellent presentations.

[audience applause]

[end of session]

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