N-Deal: Looking Ahead Boldly

Much has been said about the Indo-US nuclear deal including our own cacophonic takes here, here and here. At this point, a deal will most likely be signed during President Bush's visit in March. A compromise was apparently reached on the contentious breeder reactor issue - it is now likely to be declared 'civil' in the near future. Meanwhile, the DAE will continue with the construction of additional fast reactors as planned.

Once the agreement goes through the U.S. Congress and the Nuclear Suppliers Group (NSG), India along with Russia, France, Japan and others will be roped in under President Bush's GNEP initiative. India can somewhat benefit from this deal by getting limited Pu supplies to its already well-developed fast reactors. But experts such as Steven Kraft has said that the Pu reprocessing plan is clearly a long term idea with the required technologies expected to mature only 50 to 60 years after. Of course, to satisfy the immediate energy needs for the next two decades, India will import fuel and dozens of traditional Uranium-based reactors from the usual 'heavy-weights' like France, Russia or USA.

Let's be clear on one thing: all this bonhomie heavily depends on the current mood of the Big Boyz at that time. The P-5 (especially the P-1), can at any time threaten to cut-off supplies or inflict intrusive IAEA inspections ( the P-1 funds more than 50% of its budget ) if and when India's foreign policy decisions or military hardware purchase doesn't pleases them. Hence it is important for India to pursue alternative strategies, not only as a Plan-B against possible sanctions but also as an additional energy source to feed its economy.

In this post, we ponder new, far-reaching avenues to secure India's energy supplies and in the process forge new strategic partnerships for the 21st century. With its excellent non-proliferation record, India has no reason to fear from developing a peaceful nuclear energy coalition with friendly developing nations.

Amidst all the world attention towards Iran, Brazil quietly started Uranium enrichment in a brand new plant in Resende near Rio de Janeiro sending out alarm bells among American strategic thinkers. Note that despite being an NPT signatory and having the 6th largest Uranium reserves in the world, Brazil had to lobby hard with the IAEA to do this (yet another instance of the discriminatory NPT regime). India and Brazil have already worked closely in several areas alongside the G-20 nations. They successfully lobbied against rich nations to eliminate their agricultural subsidies during WTO summits in Cancun and Hong Kong. India should go ahead and further this close relationship by signing a bilateral energy partnership, by providing technical assistance to Brazil it its civilian program in exchange for Uranium mining rights.

South Africa is another potential partner with huge Uranium reserves and one of the most advanced pebble-bed reactors. Brazil, India and China have already shown interest in this technology. India can commit itself to purchase a few of these reactors in return for sanction-free Uranium supplies. Further trade agreements can be signed to give preferential treatment to South African goods and services in the huge Indian market. (This blogger prefers a South African Steenberg Shiraz than an over-rated French Bordeaux). Note that till the early 90s under the whites-only government, it had an active weapons program with heavy Israeli assistance (who in return 'clandestinely' (duh!) got the fuel). Surprisingly, just when the apartheid was beginning to be abolished, the whites-only government shut down its weapons program and signed the NPT!

A more daring approach is to target an African country like Niger ( currently the #3 supplier in the world ) aiming for exclusive mining rights of yellow cake. A pro-active measure is to lure this poor country (GDP $3.5 bn) with few other natural resources with massive Indian investments, economic assistance or even military aid. As an ex-French colony, Niger's mining activities are probably under proxy French control. New Delhi can try lobbying with Paris but nevertheless it shouldn't be afraid of dealing directly. After all these years, what good it did to African nations by remaining loyal to their former colonial masters. This idea has its own risk since Niger was also the major embarrassment to President Bush's pre-invasion intelligence 'slam-dunk'. Similar policies should be cooked-up to approach other major Uranium suppliers like Nigeria or Kazakhstan ( similar to what the Chinese are doing).

All these ideas require creative thinking and bold realpolitik on the part of Indian strategic thinkers (not the 'cheerleader' variety). Make no mistake - no one is going to get India's energy supplies on a platter. The NSG cartel will try its best to maintain its stranglehold on global Uranium supplies. It is only with dynamism and a forward-leaning approach that India can break this monopoly and ensure supplies not only for herself but also for friendly neighbors and allies among the developing countries.