India-Australia Civilian Nuclear Deal: A Match Made in Heaven?

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On September 5, 2014, the Australian government signed a civilian nuclear deal with India – to encourage bilateral relations between the two countries through an ‘Agreement on Cooperation in the Peaceful Uses of Nuclear Energy’. A year later (November 15, 2015), at the G20 summit held in Antalya, Turkey, the deal, which will see Australia supply large amounts of uranium to India for purely civilian purposes, has finally been concluded. As India has very limited reserves of uranium, it has primarily relied on indigenous thorium reserves for its civilian and military nuclear purposes, and depended on countries such as Russia, Kazakhstan and Mongolia for the import of uranium. Low economic feasibility has led to the discontinuation of exploration of uranium reserves within the country.

Being one of the four UN members that haven’t signed the Non-Proliferation Treaty till date, India is known to the world as a country that possesses nuclear weapons and has, in fact, tested them in the past; however, in 1998, after conducting a test at Pokhran, Rajasthan, India voluntarily imposed a moratorium on itself, banning the testing of nuclear weapons. Refusal to sign the NPT had resulted in automatic exclusion from global nuclear commerce (one of the stated benefits of being a member), but in 2008 the Nuclear Suppliers’ Group decided to allow India to take part in this global trade and enter into deals with NPT members, due to its ‘good behavior’ with regard to nuclear weapons as well as its growing influence in the world (a move apparently spear-headed by the USA). This acquiescence did come with a few riders – India was to conform to IAEA (International Atomic Energy Association) safeguards as well as ensure any trade would cater strictly to civilian purposes.

Ever since India refused to sign the NPT, it has been taught a lesson in self-reliance, as other countries are often apprehensive of deals with non-signatories. Of late however, India has started entering into more deals, as NPT members have become receptive to engaging with India. Though this will increase recognition and acceptance of India as a growing global power, it will also increase its dependency as well as heighten international scrutiny of nuclear standards within, much to the irritation of Indian officials. India has entered into civilian nuclear deals with countries such as Canada and USA, the most recent being Australia.

Australia, a country extremely rich in uranium reserves, has always strongly advocated non-proliferation of nuclear weapons and chosen to trade only with NPT members in the past. Though this deal with India isn’t in consonance with Australia’s age-old stand against encouraging non-signatories, it has been signed after the ruling party changed its policy regarding civilian nuclear deals with India. This has paved the way to solving India’s acute power shortages to some extent. Australia’s position as a global supplier will only improve through this deal, especially since it has not indulged in trade with countries in this region (China, Pakistan, etc.). It can gain a strong foothold here with the help of a country that is considered a growing global power.

Given Modi’s advocacy of civilian nuclear technology and his desire to further nuclear power generation in the coming years, it is no wonder that India has joined hands with Australia. India’s need for external help has only been compounded by hindrances such as the sudden spate of deaths of nuclear scientists in the past few years, and the danger of exhausting resources. The only way forward for India seems to be to grab opportunities to cement its position as a reckonable nuclear power that dictates its own terms, but at the same time one that isn’t seen as a threat to the world. India has tried to show that it is in control of the deals it enters into by wriggling out of certain demands imposed on it by the other countries. For example, in deals entered into with Canada and the USA, India has succeeded in dismissing demands to track the nuclear fuel supplied at all stages, and thus monitor every single use it is put to. It has stated that conforming to IAEA safeguards and standards is more than sufficient, and that as a sovereign country it must be trusted and some things must be left up to its own discretion.

A case in point is Australia’s domestic policy of mandatorily monitoring the movement of nuclear fuel within the other party’s territory, so as to ensure there is no crossover of civilian fuel to military purposes. It has in fact managed to enforce this in 23 of its 41 agreements with different countries. India – with its history of clamping up when it comes to revealing how many warheads it has, the extent of fuel as well as number and purpose of reactors it has – will have a problem with this monitoring, and will surely opt for primacy of IAEA standards over Australia’s internal policy. Australia on the other hand might just push its luck and try to map the moving fuel as well as put in place stricter conditions for its usage, citing superiority of domestic policies (directly concerning the issue) in bilateral treaties. However, with many of the clauses within the Agreement laying emphasis on conforming to IAEA standards, this seems a relatively shaky demand for Australia to put forth.

The byproducts of uranium include plutonium, which is often used as fuel for the making of nuclear weapons. This Agreement surprisingly doesn’t contain specific references to the tracking of byproducts produced, just saying that the ‘objects of the agreement’ should be used for peaceful purposes. This ambiguity could allow the byproducts to be used in weapon research as well as transferred to third parties, without violating the agreement, as no such conditions are even specified. In other words, India could divert these byproducts to indirect military purposes, which Australia will definitely not keep quiet about.

The ‘right of return’ of the supplier country, in this case Australia, refers to the right to take back the nuclear supplies from the receiving country. Normally, this can occur at any point when the supplier so desires. However, seeing as the receiving country might be left high and dry due to sudden withdrawal of energy resources without any immediate substitute, India has made a smart move by asking for one year’s notice of termination of the contract. This way India can source resources to replace the nuclear power sources, and avoid a sudden vacuum of energy.

Australia has agreed to the use of fuel for powering military bases or producing radioisotopes in military areas for medical purposes, categorising these purposes as civilian. Technically, India could divert civilian fuel to actual military purposes, on the above pretext. However, given India’s apparent craving to be seen as an independent yet accepted nuclear power, it may refrain from doing so. Even Australia, a state that has been so lenient towards India in the deal so far (allowing exemptions from certain conditions that are otherwise strictly enforced), will balk at such a move and terminate the agreement because of its strong anti-proliferation stance (according to the deal, Australia can suspend cooperation if any breach occurs). Even though India has substantial imports of uranium coming in from Kazakhstan and Russia, it will not want to be seen as a violator of deals and scare off other NPT members that may want to sign with it. The future of India’s nuclear progress lies, fortunately or unfortunately, in how it cooperates with other countries, especially since it is a non-NPT state. This is the only way it can retain its independence and at the same time not become an outcast.

The Agreement is governed by the conditions of the Arrangements and Procedures of the Indo-US civilian nuclear deal, and also provides for the reprocessing of Australian Obligated Nuclear Material. This means that India can reprocess or recycle nuclear material from Australia, something that Australia has allowed no other country to do.

The initial time period before renewal being 40 years in the Agreement, one can see the two countries mean business. Tony Abbott, the Australian Prime Minister, said that India has followed international laws and that its model behaviour has impressed Australia. The unexpected leniency on Australia’s part and the enthusiasm and trust shown by both countries speak of a deep friendship. However, this leaves one confused, as apart from being British colonies and recent friction on the issue of attacks on Indian students in Australia, there hasn’t been a prominent link between the two. So, this newfound faith in each other serves to make the deal look a bit too optimistic.

However, even after considering all this, some aspects might just ensure the deal holds out: One, Australia is really looking for an entry into this region, and what better entry than via India? Further, with Adani’s and GVK’s investments back home, generation of job opportunities will increase at a good rate; Two, India desperately wants to be seen as a dependable nuclear power, which still calls the shots. At the same time, with the proposed increase in nuclear reactors in the coming years, and lack of sufficient resources, it will do well to hold up its end of the deal.

If all goes well, in Tony Abbott’s words, ‘India will receive a constant supply of uranium for months, years and decades.’

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One thought on “India-Australia Civilian Nuclear Deal: A Match Made in Heaven?

  1. Have a a few points to make:

    a. You say that the change in the NPT regime, to allow in India, is a move apparently spear headed by the US; why apparently, it was conceived and pushed for primarioly by US, with obvious India participation.

    b. Australia has been supplying uranimum to China for some years now, so seeling to India is not because it seeks entry into the region.

    c. the chances of Australia selling uranium to Pakistan seems very slim, due to obvious reasons.

    d. Australia has in the past sold uranium to China, whose proliferation of military nuclear technology to Pakistan and North Korea is more or less an open secret, therefore this holier than thou attitude that Australia adopted when dealing with Indias legitimate requirements, was just posturing and emblematic of Australias tortured and lost in the sea foreign policy with regard to India, ASEAN and China.

    e. India was not using thorium as a substitute to make up for its low indegenious uranium supply; thorium use requires a higher and seperate order of technology and process, towards which India is working towards; in this context, the whole NPT agreement and uranium supply agreements can be seen as stop gap arrangments while the thorium based reactors become operational. And as India has the one of the largest supply of Thorium, we would be pretty self sufficient.

    Like

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