Relax. Indian Access to Australian Uranium Is No Threat

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During the recent G20 Summit in Antalya, Turkey, a senior Indian diplomat tweeted, “With the completion of procedures, including administrative arrangements, the #IndiaAustralia Civil Nuclear Agreement will enter into force.” He described the development as a “milestone achievement.” While support for the deal in New Delhi is unequivocal, there are voices in Canberra who are concerned that the agreement undermines traditionally important Australian non-proliferation interests. These fears are misplaced. The risk of India diverting uranium to its weapons program are overstated and ignore the incentives for New Delhi to abide by civil nuclear regulations.

In the face of rising energy demands and international pressure to address its carbon emissions, increasing nuclear energy production continues to be a popular solution for the Indian government. India’s active nuclear weapons program, combined with its non-membership of the Treaty on the Non-proliferation of Nuclear Weapons (NPT), has made the acquisition of nuclear materials difficult over the years. However, the 2008 U.S.-India Civil Nuclear Agreement paved the way for Indian civil nuclear trade. Last week, on the sidelines of the G20 Summit, Indian Prime Minister Narendra Modi met with his new Australian counterpart, Malcolm Turnbull, and both leaders finalized a nuclear deal, which will most likely be ratified by the end of this year and allow Australia to sell uranium to India on a commercial basis.

In 2014, during former Australian Prime Minister Tony Abbott’s visit to New Delhi, when he and Modi settled on uranium trade through a memorandum on “Cooperation in the Peaceful Uses of Nuclear Energy,” Abbott promised Australia as “a long-term reliable supplier of uranium to India.” However, Australia’s Joint Standing Committee on Treaties (JSCOT) recommended earlier this year that uranium sales to India should only commence after concerns about non-proliferation, nuclear regulation, and proper safeguards were addressed. JSCOT also called for India to set up an independent nuclear regulator, dismissing the current one as ineffective and mired in bureaucracy. These parliamentary recommendations were based on Australia’s commitment to the global non-proliferation regime. As the world’s third largest producer of uranium, Australia has never exported uranium to any country outside the NPT, but an exception will be made for India. The original 2014 agreement had been tabled by an Australian Parliament concerned that Australian uranium would end up in India’s nuclear weapons program.

The agreement plugs a critical need for India. Australia at present holds the largest recoverable uranium reserves in the world at roughly 31 percent of the world’s total and can be critical in addressing India’s energy deficiency. India expects to have a 14,600 MWe nuclear capacity in line by 2024 and has set a goal for 25 percent of total energy to be nuclear-generated. According to the Hindustan Times, India has less than 24 small reactors at six sites with a capacity of 4,780 MW, or 2 percent of its total power capacity. It plans to increase its nuclear capacity to 63,000 MW by 2032, adding nearly 30 reactors at an estimated cost of $85 billion.

A long-term civil nuclear trade deal with Australia is an efficient way to sustain these future nuclear projects, especially given Australia’s geostrategic importance for India and broader cooperation between the two states in the Asia-Pacific. To keep up with international demand, Australia plans to open new mines to increase uranium production and might even overtake Kazakhstan and Canada to become the world’s top uranium producer in a few years. Australia produces uranium to export, as it does not operate nuclear power plants, and may become the most important uranium supplier to India, bringing in $1.75 billion in uranium exports annually.

Australian uranium sales to India will not only produce economic dividends for Australia and renewable energy options for India, but can also aid in convincing India of the need to accept better nuclear safeguards and to strengthen its non-proliferation regime. Concerns about Australian uranium being transferred to India’s nuclear weapons program are overstated due to political, economic, and reputational incentives. First, the current the government of India retains stronger political incentives to deliver energy to the Indian people than to build its weapons stockpile. Additionally, India will not jeopardize a larger free trade agreement with Australia currently being negotiated. Third, India will not risk being ostracized for going against international principles as it continues to showcase itself as a global power and request entry into multilateral trade control bodies.

In its recent submission of “Intended Nationally Determined Contribution” to the United Nations regarding climate justice, India stated that it is promoting nuclear power as a safe, environmentally benign, and economically viable source to meet the increasing electricity needs of the country. Providing access to energy hasn’t only been used by the Modi administration, but rather continues to be prominent on the agenda of all major Indian political parties. Intensifying renewable energy production, especially nuclear, is a long-term political demand for India as its population continues to increase.

India’s civil nuclear agreement with Australia is part of a larger overall trade deal, which will provide high returns to India by entering a new export market. Australian High Commissioner to India Patrick Suckling has noted that this deal “strengthens our [Australia’s] bilateral Strategic Partnership with India” and “provides the framework for substantial new trade in an energy commodity over the medium to long term.” India is unlikely to jeopardize this blooming relationship by diverting uranium from Australia to its weapons program, particularly as Australia is showing signs of greater bilateral trade relations with India’s economic rival in the region by passing a recent free trade agreement with China.

While India’s need includes cleaner energy to provide power to over one billion people, its global ambitions are even greater. As such, it will not diverge from international norms to risk subsequent alienation in the international community. Australian support is critical for India’s bid to join the Nuclear Suppliers Group (NSG), which would provide additional opportunities for Indian participation in global nuclear commerce if entry is granted. Additionally, India historically has upheld norms to maintain its positive international reputation.

Currently, India’s nuclear deterrent is sufficient, so it is unlikely to build many more nuclear warheads to compete in the region. Although it is a nuclear power, India does not operate or plan to develop tactical nuclear weapons and also maintains a no first-use nuclear policy. Its robust conventional capabilities and acquiescence to a facility-specific safeguards agreement with the International Atomic Energy Agency (IAEA) significantly diminish hazards of Indian non-compliance.

With Modi successfully achieving a civil nuclear agreement with Prime Minister David Cameron during his latest state visit to Great Britain, India’s civil nuclear energy security needs have become even more apparent. India has over 11 bilateral agreements regarding the peaceful use of nuclear energy in order to trade civil nuclear materials because it has yet to become a full member of multilateral nuclear trade control bodies, most critically the NSG. Though surrounded by two nuclear powers itself, India has more pressing development and energy needs to consider than furtively diverting uranium exports from its allies and partners to its nuclear weapons program. India is pursuing Australian yellowcake for nuclear power – not for more bombs.

Poorvie P. Patel is part of the South Asia program at the Stimson Center in Washington, D.C.

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