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Early on Friday morning, Indian time, the verdict from Seoul was announced: India would not be allowed entry into the Nuclear Suppliers Group. For many, this had been a foregone conclusion but the strenuous efforts of the Indian government raised hope that things would ultimately come out in India’s favour as they did in 2008. They were wrong.

At Seoul, Beijing played spoil sport. Stubbornly insisting on creating an admissions process for countries not signatories to the Non-Proliferation Treaty, it refused to consider the specifics of India’s case. For China, it was a purely geopolitical calculation – Indian admission to the nuclear high table would bring the South Asian country on par with itself. Additionally, it would put India in a position of advantage over China’s client, Pakistan. Obfuscating these realities behind the rhetoric of non-proliferation, China, one of the worst proliferators in recent years, gained the support of other NSG participating governments for its “principled” stand.

Although India insists that its application was foiled by one obstinate country, other reports suggest that Austria, Brazil, Ireland, New Zealand, Switzerland, and Turkey all supported a process-based entry. Turkey may have been keeping an eye on Israel while China is the largest trading partner for Brazil and New Zealand. According to diplomats, accession to the NPT was the recurring theme during the negotiations.

Technically, the NSG is a consensus-based body and it does not have rules, at least not legally binding ones. Furthermore, as Indian diplomats have repeatedly pointed out, France joined the NSG while not a member of the NPT. Nonetheless, if the sense of the group has now changed to requiring NPT membership, there is little India can do about it. However, given the support for India’s candidacy, that does not seem to be the sense. Were China to acquiesce to Indian membership, or even abstain from making a decision, it remains a question whether the others would still hold firm to their “principles.” Admittedly, there have been complaints about pressure to vote in favour of India but such behaviour is certainly the norm for any important decision in any forum.

India will not – and should not – sign the NPT as is, and an amendment to the treaty that would recognise India as the sixth nuclear weapons state would be tougher to achieve than a NSG membership. Even the George W Bush administration, which was rather sanguine about India’s nuclear programme, did not attempt to modify the NPT during the 2008 Indo-US nuclear deal for that was too high a mountain. After nearly half a century of having its arbitrariness and hypocrisy enshrined, no state would want to be reminded of the fundamental flaw in the nuclear non-proliferation regime. Nuclear weapons states, at least one of them, would not want another competitor, and non-nuclear weapons states would feel the fool for accepting discriminatory laws all this time while a country that rejected the system for so long is admitted to its highest echelon.

How did India manage to get a waiver in 2008 and not in 2016? Several things have changed in these eight years. US president Barack Obama is not George W Bush, nor is Xi Jinping his predecessor. in 2008, the Bush administration is rumoured to have twisted arms to get India the NSG waiver; the Obama administration, though supportive of India, was probably not willing to go so far. Additionally, Sino-American relations were calmer: it was not unthinkable for Bush to personally call his counterpart, Hu Jintao, in Beijing on India’s behalf. Xi Jinping is different, intent on refashioning a Chinese empire during his time at the helm. The troubles in the South China Sea have also changed the tone of the relationship. Additionally, the 2008 waiver for India helped China in some ways: it gave them an excuse to openly sell more reactors to Pakistan against the NSG’s wishes and with no such waiver coming for Pakistan, it made Islamabad entirely dependent on Beijing for nuclear assistance. The 2016 waiver holds no such benefits for China.

The most important question now is, what next? There are several options on a broader diplomatic canvas but it is not clear whether Delhi has the courage to do so. Even Prime Minister Narendra Modi, who campaigned like a hawk in the general elections two years ago, has turned into a meek businessman since he moved to Raisina. To be fair to him, however, India cannot bite off more than it can chew – economically as well as militarily and diplomatically, India is much inferior to China and repercussions must be carefully considered.

Yet within the narrow arena of nuclear affairs, India is restricted to developing its own technology for the complete nuclear supply chain. This is easier said than done: industry will not be interested in partnering with government if there is no demand for their wares. An overt commitment to large-scale domestic growth of nuclear power with Make-in-India components will create the incentive for the private sector to develop nuclear-grade components. Furthermore, India has plenty of expertise in designing, building, and operating small to medium reactors. These also cost less than the larger Western models and may be more suitable for developing countries just embracing nuclear energy. Given India’s lower cost of labour, it may even be able to become part of nuclear supply chains of Western vendors.

Were India to commit to emerging as a nuclear manufacturing hub within the next ten years, its clout at the negotiating table would be significant. At that point, the NSG would run the risk of fuelling a parallel nuclear market were it to continue to ignore India. The value of NSG membership, for Delhi, at least since 2011, has not been the acquisition of technology but the prevention of the adoption of discriminatory guidelines in the future. It is also unrealistic to expect countries to sell their latest technology to India even if an NSG membership had been in the stars. For now, the failure to become an NSG member does not create additional burdens to the development of Indian manufacturing; that should be the point of focus.

A nuclear renaissance would need a considerable boost in India’s budget for the Atomic Energy Commission. It would also require greater private participation in the sector, perhaps even in operations. This has been a taboo subject so far for no good reason. Public-Private partnerships will catalyse capacity growth and have a ripple effect on several sectors such as labour, the environment, and, of course, the economy.

India can also speed up its languishing Fast Breeder Reactor programme. These reactors irk the non-proliferation lobby because of their excellent capacity to breed plutonium. With several of these reactors operating, India can offer to put most of them under safeguards in exchange for a seat at the nuclear high table. The investment in FBRs will not be wasted for India’s primary purpose is to use them to fuel the third stage of its civilian three-stage nuclear energy strategy.

Yet for any of this to occur, nuclear issues need to receive generous political attention that they have lacked since the days of Jawaharlal Nehru. Reforms bringing greater transparency and a focus on outcomes must be introduced to shake up what is until now a sluggish governmental behemoth. If India cannot join the NSG, it must be made largely irrelevant to India.


This post appeared on FirstPost on June 25, 2016.

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