News

Brazil Shops for Help With a Nuclear Submarine

Brazil is trying to buy a sintering furnace for its nuclear submarine program, U.S. and industry officials say. The special projects branch of Brazilian navy, COPESP, wants to use the furnace to make uranium fuel pellets for the submarine’s reactor.

The sale ran into opposition last month in the Subgroup on Nuclear Export Controls (SNEC), a U.S. interagency group that handles sensitive applications for nuclear export licenses. The Pentagon opposed the sale, but the Commerce Department favored approval and so did the Arms Control and Disarmament Agency (ACDA), provided non-nuclear use conditions were attached.

Before the case could be resolved, COPESP rejected the furnace offered by the American seller, Thermal Technology, Inc. of Santa Rosa, California, for a more sophisticated, continuously-operating furnace offered by British and German sellers, a spokesman for Thermal Technology told the Risk Report.

The sale was controversial because international inspections don’t expressly cover naval reactor fuel. Also, naval reactor fuel can be made powerful enough to fuel atomic bombs. Brazil is expected to refuse inspection to avoid, in the words of a U.S. official, “an intrusion that no military would accept.”

Nuclear submarines are widely viewed as strategic weapons. They provide long-range striking power, whereas coastal defense can be done more cheaply by modern diesel submarines which are equally quiet. Current U.S. export policy is “not to participate in … foreign naval propulsion plant projects” without a government-to-government agreement, which doesn’t exist for Brazil.

Testimony: The Proliferation of Weapons of Mass Destruction

By Gary Milhollin

Testimony of Gary Milhollin

Professor, University of Wisconsin Law School and
Director, Wisconsin Project on Nuclear Arms Control

Before the House Committee on National Security
Subcommittee on Military Procurement and on Research and Development

March 15, 1995

I am pleased to appear here today to discuss the threat posed by the proliferation of weapons of mass destruction. I am a member of the University of Wisconsin law faculty and I direct a research project here in Washington devoted to tracking and inhibiting the spread of nuclear and chemical weapons and the missiles to deliver them.

The Subcommittees have asked me to comment on the current U.S. response to the proliferation threat. I believe that for U.S. policy to succeed, it needs to be consistent and it needs to give nonproliferation a high priority. In fact, it is failing on both counts.

I would like to begin by pointing out that nuclear weapons have grown up in an unusual political climate. The cold war created a bi- polar world in which things were fairly predictable. It was possible to work out elaborate models of deterrence, or of “flexible response,” in a controlled atmosphere. There were only two main actors in the nuclear drama. Each could watch the other, and be fairly confident how the roles would be played.

Today, Russia and the United States no longer target each other with nuclear weapons. Both countries are committed to drastic reductions in their arsenals. The risk that thousands of nuclear weapons will obliterate civilization has gone down. But the risk that a few nuclear weapons will obliterate a few cities is probably going up. The cold war’s stability is being replaced with the instability that shook the worlds of 1914 and 1939. One doesn’t know where the next local conflict will break out, who will back whom, or with what arms.

The chances of nuclear war are probably greatest in South Asia. India and Pakistan can each deploy a small arsenal of one dozen to a few dozen atomic bombs. They also have a border conflict and a tradition of mutual hostility. These ingredients create a potentially explosive mix. Both countries are also building nuclear-capable missiles, which will destabilize things even further if the missiles are deployed.

I have provided the Subcommittees with copies of a new publication that my project has just launched, called the Risk Report. The first two issues cover India’s nuclear and missile programs. They contain unclassified lists of the Indian companies that are building India’s rockets and missiles, and helping produce plutonium free for use in atomic bombs. There are also lists of the sensitive products India is trying to import on the world market. The Subcommittees may wish to include these two issues in the record of this hearing. The lists are designed to help exporters avoid risky buyers.

In North Korea, the situation is still unsettled. The agreement made last October will probably unravel if North Korea insists on receiving light water reactors from some country other than South Korea–unless the United States caves on that point. The administration and the South Korean government are predicting that North Korea will cave.

What is settled, however, is that the accord is creating problems for U.S. nonproliferation policy. The Clinton administration has agreed to let North Korea keep any bombs it may have made while breaching the Nuclear Nonproliferation Treaty. The CIA says the number of bombs could be one or two. The administration has also agreed to give North Korea four billion dollars’ worth of light water reactors, and to supply millions of dollars’ worth of oil over the next ten years to reward North Korea for not making any more bombs. All of this will happen while North Korea builds up its powerful army on the South Korean border and develops missiles for sale to the Middle East.

I spoke recently with a Russian diplomat about the North Korean agreement. He was defending Russia’s decision to sell light water reactors to Iran. He said he thought it was absurd for the United States to object. “Whenever the Americans want to sell something it is good,” he said, “but whenever the Russians want to sell something it is bad.” It was hard to contradict him. Iran is a member in good standing of the Nonproliferation Treaty; North Korea is openly breaching it. In fact, North Korea will remain in breach while American taxpayers put North Korea’s economy on life support with oil shipments and while North Korea gets five or more years’ worth of construction on the light water reactors.

With respect to Iran, there are problems. The United States has not been able to convince other countries of its point of view. Our intelligence agencies keep announcing that Iran is going for the bomb, but never produced any proof. If there is evidence that Iran is building nuclear weapons, and thus breaching its pledge under the Nonproliferation Treaty not to do so, it is time for these agencies to speak up. The United States needs to convince the Europeans not to sell Iran sensitive equipment. To do that, the United States has to cough up the evidence of why they shouldn’t. Unless our diplomats are willing to get specific, we are wasting time and lowering U.S. credibility.

That credibility is important as we try to extend the Nonproliferation Treaty. It is up for renewal next month and the vote count is close. Mexico and Egypt are leading the opposition to an indefinite extension. When the administration decided recently to bail out Mexico financially, it apparently did not get a pledge of Mexican support for the Treaty. It is hard to understand why the administration did not get it, if the Treaty is as important to the administration as it says.

Egypt is concerned about Israel, which is estimated to have at least a hundred and probably closer to two hundred nuclear weapons. Israel also has a large missile that can deliver nuclear warheads throughout the Middle East. Egypt has asked that Israel make at least some gesture in the direction of limiting its arsenal in exchange for Egypt’s promise under the Treaty to abstain from nuclear weapons forever.

This request seems entirely reasonable. America and Russia are cutting their arsenals, and nuclear weapons are losing their luster as emblems of status. Yet, the United States has not publicly encouraged Israel to make such a gesture, and Israel has not done so.

And one cannot speak of the Middle East without considering Iraq. Russia, France and China, three of the five permanent members of the U.N. Security Council, are lobbying to lift the Iraqi oil embargo. The U.N. inspectors are convinced that if the effort succeeds, Iraq will try to revive its mass destruction war machine and the network of foreign suppliers who have nourished it. The inspectors plan to do all they can to thwart such an effort, but they cannot ensure success.

The chance that Iraq, Iran or Libya will get nuclear weapons also depends on Russia. As far as we know in the West, the former Soviet Union’s nuclear warheads are still protected. The same cannot be said of its nuclear materials. The United States has helped Russia install security equipment at one site where nuclear materials were at risk, but there are scores of similar sites that do not have such equipment. The world will be lucky if bomb quantities of fissile material do not find their way from Russia to the Middle East by the end of the decade.

If I had been making this presentation a few years ago, I would have covered Argentina and Brazil. But these countries are turning into success stories. Both have pledged to give up nuclear weapons and Brazil may join Argentina in giving up long-range missiles as well.

These victories were due in large part to export controls. Argentina and Brazil were denied high-technology exports as long as they persisted in proliferation. The same policy will still work with the remaining holdouts. However, the Commerce Department seems intent on reducing U.S. export controls as rapidly as possible, and there will be an effort during this session of Congress to legislate a weakened Export Administration Act. Last session, this Committee’s bipartisan amendments blocked such an effort and preserved the U.S. national security interest in strong controls. I hope the Committee will be equally vigilant during this session. It should stop any legislative attempt to weaken existing law, and it should make sure that the Commerce Department does not weaken existing controls by unilaterally changing its regulations.

If there are going to be more victories for nonproliferation, U.S. policy must be more coherent. The administration cannot make deals with North Korea that destabilize the Middle East. It cannot make renewing the Nonproliferation Treaty a high priority without pressuring countries to vote for it. And it cannot stop the spread of dangerous technology by cutting export controls. There have been plenty of administration speeches about nonproliferation. It is time for coherent action.

Iraq: U. S. Thwarts Saddam’s Smuggling Efforts

Recent U.S. efforts to control the spread of weapons of mass destruction have paid off, with a guilty plea from the man who arranged the shipment of 30 tons of rocket fuel to Iraq probably for long-range missiles and the arrests of two other men who allegedly financed the deal.

The case is significant, said John Despres, U.S. Commerce Department assistant secretary for export enforcement, because it “shows that U.S. persons are subject to U.S. criminal law even if and when they confine themselves to transactions outside of the United States with non-U.S.-origin items.” The case also marked the first time the 1991 Enhanced Proliferation Control Initiative (EPCI) regulations have been extended to acts outside the United States.

The rocket fuel was ammonium perchlorate, which is controlled for export under the Missile Technology Control Regime (MTCR).

The shipment could have been destined for missiles or to extend the range of artillery shells, said Tim Trevan, special advisor to the U.N. Commission on Iraq. The “huge amount” involved and the powder’s grain size was consistent with missile use, Trevan said, adding that Iraq’s poor economy made it unlikely that Baghdad would pay for 150,000 new artillery shells the amount that could be produced from 30 tons of ammonium perchlorate.

Iraq is allowed to have short-range missiles, but is forbidden to have any missile with a range greater than 150 kilometers. Iraq never sought approval from the U.N. sanctions committee to import the chemical, and has denied trying to buy it, Trevan said.

The cargo, which came from China via Hong Kong, was seized from a German ship, the Asian Senator in a Saudi Arabian port in December 1993. The chemical was intentionally mislabeled as ammonium sulphate, a water purifying agent, and was being sent to a company in Jordan run by Zeid Khorma, a 34-year-old Jordanian that U.S. officials say was doing Iraq’s international shopping. Khorma ran another company, Zak and Partners, specifically for funneling illegal shipments to Iraq, officials said.

“They would give him a shopping list and his business was to get it,” said Michael Nestor, a U.S. Customs agent in New York.

Storm Kheem, a U.S. exporter, went to Iraq in January 1992 to meet Khorma’s Iraqi contacts, according to the complaint filed in U.S. district court in New York. In late 1993, Kheem allegedly used his Long Island company, Bkesco Inc., to arrange the rocket fuel shipment through an agent in Hong Kong, the Chemical Import Export Corporation of Guangdong. U.S. officials were tipped to the shipment by the People’s Republic of China.

Kheem pleaded guilty in January 1995 to failing to get a license required by U.S. nonproliferation laws and breaking the embargo on sales to Iraq. He faces a maximum penalty of $250,000 or five years jail for each offense. Zeid Khorma’s father and brother, Ahmad Khorma, 61, a Jordanian citizen, and Mosab Khorma, 29, a naturalized U.S. citizen, were arrested for financing Zeid Khorma’s operation. As the Risk Report went to press, they had not entered a plea.

Ammonium Perchlorate
This solid rocket fuel is used in virtually all modern missiles, including Iraq’s small tactical missiles and artillery rockets.

Control
Listed in Missile Technology Control Regime Annex. Exporters in MTCR states must obtain an export license before shipping this material.

India Moves from Smuggling to Exporting Heavy Water

India’s nuclear program requires a steady stream of heavy water, which looks and tastes like ordinary water but is used to run reactors that make plutonium. In the past, India relied on clandestine imports to help fill its reactors, but today India makes enough heavy water to sell abroad. Last year, India agreed to sell 100 tons to South Korea for nearly $23 million. India needs nearly 2,000 tons of heavy water to run its unsafeguarded reactors. To meet this demand, India bought its first production plant from Germany in 1962 and then built seven more with help from France and Switzerland. Until recently, most of the heavy water plants were plagued by fires, breakdowns and production shortfalls, causing India to depend on foreign supplies.

During the 1980s, India arranged secret shipments of Chinese, Soviet and Norwegian water to help start the Madras and Dhruva reactors. Secrecy was essential to enable India to start the reactors unfettered by international controls. Plutonium made in uninspected reactors is free for use in atomic bombs whereas plutonium made in inspected reactors is not. Buying the heavy water openly from legitimate sellers would have obliged India to put its reactors under inspection. India denies it ever imported heavy water clandestinely, despite overwhelming documentary evidence of the sales.

The Risk Report possesses shipping declarations, company audits and diplomatic cable traffic showing that India received clandestine shipments of Chinese, Norwegian and Soviet heavy water in the 1980s through a West German nuclear materials broker named Alfred Hempel, now deceased. The documents reveal the exact cargo amounts, flight numbers, departure and arrival times, officials involved, and in one case, even the bribes paid.

The documents show that between 1983 and 1989 India received at least 80 tons of Soviet heavy water under the table, and 26.5 tons of Norwegian heavy water through diversions. Norway took diplomatic steps to recover its water but announced in 1992 that it had no legal means to compel India to return it. Norway had confronted India with official Romanian records proving that 12.5 tons of Norwegian heavy water were diverted to India through Romania in 1986.

A 1988 report by the Indian Comptroller and Auditor General shed light on India’s heavy water deficit. The Auditor’s report calculated India’s total heavy water production from 1978 through 1986 at about 190 tons, far short of the production level needed to make the 600 tons to run India’s four uninspected reactors. India was forced to turn to foreign sources to make up the difference, and India chose secret sources to keep its reactors and plutonium free from international controls.

India plans to start several new reactors by early next century that will require a steady supply of heavy water. To help finance them, India hopes to sell heavy water to South Korea and perhaps supply reactor technology to Iran. The water would come from its new production plants. If heavy water production lags, however, India could turn again to foreign suppliers. Producers in Canada and the United States are not permitted to sell heavy water to India until it allows international inspection of all its plutonium-making reactors.

Plant: Current annual output* (tons), Total thru 1994 (tons)

Nangal: 10, 285
Tuticorin: 45, 465
Baroda: 45, 350
Kota: 50, 325
Talcher: 1, 10
Thal: 45, 260
Hazira: 70, 265
Manuguru: 100, 305
Total 366; 2,265

*Annual output is estimated from reports on the plant’s operating history but also takes into account the plant’s design capacity.

Sanctions Felt Worldwide

Foreign company executives often worry about the reach of U.S. sanctions for selling nuclear, missile or chemical and biological products to the wrong buyer. But companies that screen their sales with U.S. controls in mind can minimize their risk.

The sanctions for knowingly aiding missile or chemical/biological weapon efforts grew out of the Gulf War, and after discoveries that U.S. and European goods helped Saddam Hussein build bomb factories. Since 1991, U.S. manufacturers have been required to pay close attention to their product’s final use, and non-U.S. firms are wise to adopt that stance, too.

U.S. sanctions law applies even if the seller, the product and the transaction were all foreign to the United States. If the U.S. determines, for example, that a Swiss manufacturer is shipping precursor chemicals to a plant in Iran that it knows is making chemical weapons, it could lose its U.S. government contracts and be barred from doing any business with the United States. The same sanctions apply for making direct contributions to missile development in countries that are not members of the Missile Technology Control Regime (MTCR).

Last year, the U.S. Congress added nuclear technology sales to unsafeguarded plants as an offense that could trigger sanctions even if the material wasn’t a U.S.-origin product or technology, but would have been controlled under U.S. law. Nuclear sanctions are modeled on the missile and chemical/biological sanctions, but lack an import ban.

The sanctions are an effort over the last five years to make companies more responsible for their sales. “We want to take the profits out of proliferation,” says a key Congressional aide. “We want individual and corporate responsibility for this.”

A ban on government contracts could be important to European companies working on large U.S. projects, like the space station. And though the reach of U.S. law is disconcerting to one European company executive, he sees it as part of business. We don’t expect to ever be affected by these sanctions,” he says, because his company now reviews sales with an eye on U.S. law.

Sanctions against foreign companies are triggered by a Presidential finding, after consultations and negotiations with foreign governments. The U.S. President must find that a company “knowingly” exported or “materially” or “directly” contributed to a weapon of mass destruction program. Sanctions are a last resort, says one top official. “If you are subject to sanctions, you have had opportunities to correct your behavior.”

India’s A-Bomb Potential

The plutonium produced in the Cirus and Dhruva reactors is ideal for making atomic bombs. The power reactors at Madras, Narora and Kakrapar generate plutonium that is also suitable for bombs and free from international controls. However, India’s plutonium must be processed into weapon-ready form at extraction plants that have not performed to capacity. With a new extraction plant starting at Kalpakkam, India could rapidly increase the size of its arsenal.

India could have over 50 bombs in its arsenal today, but U.S. officials say the number is closer to 20. India could make scores more by the year 2000.

Reactor: Cirus
Start-up: 1960
Pu created through 1993: 260 kilograms

Reactor: Dhruva
Start-up: 1985
Pu created through 1993: 160 kilograms

Reactor: Madras I
Start-up: 1983
Pu created through 1993: 730 kilograms

Reactor: Madras II
Start-up: 1985
Pu created through 1993: 580 kilograms

Reactor: Narora I
Start-up: 1991
Pu created through 1993: 170 kilograms

Reactor: Narora II
Start-up: 1992
Pu created through 1993: 65 kilograms

Reactor: Kakrapar I
Start-up: 1993
Pu created through 1993: 40 kilograms

Reactor: Kakrapar II
Start-up 1994

Notes: * Cirus makes about 9 kg and Dhruva makes about 25 kg of plutonium per year. The amount of plutonium produced by the power reactors is calculated from electricity output.

** The table assumes roughly 6 kg of plutonium per bomb. If operated to capacity, India’s three plants at Trombay, Tarapur and Kalpakkam could extract enough plutonium for more than 100 bombs per year.

India: Nuclear Helpers

Western companies have supplied India’s controversial nuclear program for more than three decades. All of India’s plutonium-making reactors and heavy water production plants are based on foreign designs.

Canada
Supplied the Cirus reactor, which produced plutonium for India’s 1974 nuclear weapon test
Supplied India’s first two power reactors at Rajasthan, which India copied to build unsafeguarded reactors

China
Sold at least 130 tons of heavy water to a German broker who smuggled the material to India for use in unsafeguarded nuclear reactors

France
Helped build the unsafeguarded Baroda and Tuticorin heavy water plants
Helped build the unsafeguarded Fast Breeder Test Reactor (FBTR) at Kalpakkam; trained Indian engineers in France and sent French engineers to work in India

Germany
Supplied unsafeguarded Nangal and Talcher heavy water plants; sold teleperm process control system to Hazira heavy water plant
German firm was fined $800,000 by the U.S. for illegally re-exporting U.S.-origin beryllium
German broker arranged illicit sales of more than 200 tons of heavy water to India
Supplied natural lithium useful in making tritium to boost nuclear bombs
Sold zircalloy pipes which are used as reactor fuel cladding

Norway
More than 26 tons of Norwegian heavy water was diverted to India through Romania and Switzerland

Soviet Union/Russia
Secretly sold at least 80 tons of heavy water to run unsafeguarded reactors

Sweden
Supplied specialized steel tube plates for heavy water reactors
Sold flash X-ray devices, which can be used for nuclear weapon development

Switzerland
Helped build the unsafeguarded Baroda and Tuticorin heavy water plants

United Kingdom
Supplied turbine generator designs used at several unsafeguarded reactors
Repaired damaged heavy water equipment at Madras reactor

United States
Supplied heavy water for Cirus reactor that made plutonium for India’s first nuclear bomb

Sizing Up the North Korean Nuclear Deal

By Gary Milhollin and Diana Edensword

Foresight (Tokyo)
March 1995

Roughly one month ago, the United States detected the first violation of the nuclear accord that it signed with North Korea last year. Pyongyang seems to have diverted to an unauthorized purpose some of the oil that Washington supplied under the agreement. And to make matters worse, North Korea is still arguing over who will supply the reactors it is scheduled to get under the accord–a point that the Clinton administration thought was settled.

Indeed, the U.S.-DPRK “agreed framework” raises as many questions as it answers. First, what are the security gains under the agreement, compared to the losses? Second, what are the dangers of treating North Korea as a “special case” under international inspections? Third, how might North Korea take advantage of the agreement to strengthen its military program?

The principal gain under the agreement is the freeze in North Korea’s plutonium production. North Korea has promised not to extract the plutonium from 8,000 spent fuel rods in its possession. There are an estimated 25 kilograms of plutonium in the rods, enough for four to five nuclear weapons. North Korea also promises not to complete two graphite reactors that have been under construction. Those reactors could produce enough plutonium for 25-30 bombs per year if they came on line as scheduled over the next two years. North Korea also promises to stop operating a small graphite reactor that discharged the 8,000 fuel rods.

In exchange for the freeze, the United States must supply or arrange for the supply of millions of dollars’ worth of oil, and arrange for the construction of two large light water reactors worth over $4 billion, while North Korea remains in violation of the Nuclear Nonproliferation Treaty. North Korea is refusing to open the doors of two nuclear waste sites where the United States believes evidence of illicit plutonium production is hidden. This illicit production has resulted in enough plutonium for one or two bombs, according to U.S. intelligence.

In effect, over the first five years of the agreement, the United States has agreed that North Korea gets to keep any bombs it has already made, and that North Korea should be paid not to make any more. North Korea is the only country ever to join the Nuclear Nonproliferation Treaty and then openly break the Treaty’s inspection obligations. Even Iraq tried to keep its program secret while appearing to comply with inspections. Pyongyang’s strategy has obviously paid off. North Korea is being rewarded not only with oil and reactors, but with diplomatic recognition and the elimination of the trade restrictions that are now driving down its fragile economy.

The message to other countries is clear. If you join the Nonproliferation Treaty, and break it by secretly making bombs, you will receive billions of dollars’ worth of free nuclear- and fossil-fuel energy. And you will get these benefits even if you are committing human rights violations, have an undisputed record as a terrorist nation, are threatening a neighbor, and are exporting nuclear-capable missiles to other terrorist nations.

The light water reactors create a special problem. The world cannot endorse such reactors for North Korea without giving the green light to China, Germany and Russia to build them in Iran. The Russians recently announced that they will complete the two Iranian light water reactors at Bushehr. These reactors have a unique history. American diplomacy convinced Germany, which started the reactors, not to finish them, and Iraq found them so threatening that Iraqi planes bombed them during the Iran-Iraq war. Now, in the wake of the U.S.-North Korean deal, the Russians are stepping into the picture. If the Russians finish the first Iranian reactor within five years, which is the current estimate of the construction time, Tehran will have its first access to weapon quantities of plutonium. This will be a disaster for Middle East security and for U.S. diplomacy, which has tried for many years to prevent Iran from reaching this point.

Last month, Moscow again refused U.S. requests to cancel the Iran reactor deal. Russia has decided to jeopardize its American aid in order to make the sale. Russian officials have specifically told the United States that they have every right to sell the technology to Iran, since America and its allies are sending the same technology, free, to North Korea. This retort should surprise no one.

Why are light water reactors important? Because they, like all other nuclear reactors, make plutonium that can be used in atomic bombs. The spent fuel from LWRs is not “proliferation resistant,” as the Clinton administration claims. That is why the International Atomic Energy Agency (IAEA) inspects light water reactors in countries around the world, including Japan, and why the United States has opposed their sale to Iran. The two reactors going to North Korea will make twice as much bomb-grade plutonium as the graphite reactors North Korea has now, including the ones under construction. The U.S. administration does not disagree; it only points out that the LWR plutonium will not be available as soon as plutonium from North Korea’s indigenous reactors would have been. But the two giant LWRs could turn out at least 70 bombs’ worth of “weapon-grade” plutonium per year. North Korea’s existing graphite reactors are only one eighth as big, and could make only 25-30 bombs’ worth per year.

These numbers are easy to verify, and defenders of the agreement do not dispute them. Each standard-sized light water reactor has a power rating of about 1,000MW(e). That makes 2,000MW(e) for two. Taken together, North Korea’s three graphite reactors are rated at only 255MW(e). If operated to maximize electricity production, the two light water reactors would make at least 500kg of plutonium per year. That plutonium would be almost all “reactor grade.” It could be used in bombs but would not be of optimum quality for such a purpose. (It is no consolation to be blown up by a low-quality bomb.) If operated to produce “weapon-grade” plutonium, the light water reactors would have to be shut down and reloaded more often. In such a mode they would produce at least 400kg per year, enough for roughly 70 bombs. The Iranian light water reactors at Bushehr could do the same. By contrast, the three North Korean graphite reactors would not produce more than 150kg per year of “weapon-grade” plutonium, enough for 25-30 bombs.

Neither North Korea nor Iran now has a plant to extract plutonium from light water reactor fuel, but North Korea could modify its existing plutonium plant to do so, and Iran could build a plant. Both countries could do this without violating the Nonproliferation Treaty. Under the October agreement, however, North Korea must dismantle its plutonium plant and other nuclear facilities. Unfortunately, the dismantling is not required to begin until the first new reactor comes on line, around 2003 at the earliest. And Pyongyang does not need to finish the dismantling until the second reactor comes on line, several years later. Since the agreement does not specify which facilities must be dismantled first, North Korea could save its plutonium plant until the second LWR is nearly ready to run. By then Pyongyang will have studied the new spent fuel from the first reactor, which will have been operating for several years. During those years North Korea could try to develop the technology to convert its plutonium plant to handle the new spent fuel.

Why does North Korea want light water reactors? Nobody outside that country seems to know. The United States could provide coal- or oil-fired plants much faster and cheaper, and without creating dependence on outside suppliers for fuel. North Korea’s coal reserves would provide energy independence. And why does Iran want light water reactors? Iran is sitting on one of the biggest pools of oil in the world. Iran can make electricity from oil or gas for a fraction of what it would cost to make it from uranium. And with reactors, Iran too would start depending on outside suppliers for fuel. To believe that North Korea and Iran need light water reactors to make electricity is to believe in fairy tales.

There may be a more plausible reason for North Korea’s strange desire for a light water reactor: delay. If South Korea supplied gas-, oil- or coal-fired plants, the deal could be done in one or two years instead of five or ten. But that would mean that North Korea would have to perform its side of the bargain in one or two years instead of five or ten. North Korea would have to let international inspectors see the plutonium it is hiding and would have to start dismantling its nuclear plants–right away. But North Korea has no desire to perform so quickly. It prefers to receive the oil shipments and keep its bomb program alive for as long as possible. The light water reactor, because it takes so long to build, meets both of those needs. Delay has always been North Korea’s strategy.

Never before has the United States treated a country in open violation of international inspections as a member in good standing of the Nonproliferation Treaty, or arranged for such a country to get nuclear reactors. U.S. law forbids the sale of a reactor to such a country. The State Department hopes to finesse this point by having its allies do the actual supplying, and by withholding key components until the inspection questions are settled. But reactor construction will begin, years will pass, and lots of money will be spent while North Korea is still defying the inspectors. Much of that money will flow from South Korea and Japan. North Korea is already enjoying trade and diplomatic benefits while it remains in breach of its international obligations. This undermines both U.S. nonproliferation policy, the Nuclear Nonproliferation Treaty, and the IAEA inspection regime.

The lack of inspections raises the third issue: how North Korea might take advantage of the agreement to advance its military ambitions. The CIA says there is a “better than even” chance that North Korea has already incorporated its secret cache of plutonium into bombs. If so, North Korea will remain a nuclear power while being paid not to be. If North Korea has not made a bomb yet, it has at least five years to perfect one secretly, because surprise inspections are barred until then.

North Korea also is allowed to keep its three graphite reactors, its plutonium processing plant and its 8,000 plutonium-bearing spent fuel rods intact until the next century, after the first light water reactor is completed. The risk is that North Korea could accept the oil, trade, and diplomatic benefits until it gets back on its feet. Then, it could kick out the inspectors and make five more bombs’ worth of plutonium from the spent fuel rods. A revived and stronger North Korea would be harder to deal with than the North Korea we are facing now.

Pyongyang’s military threat is unaffected by the agreement. North Korea’s troops and tanks are still massed on the South Korean border, and they can be fueled with oil freed up by U.S. deliveries. As former Undersecretary of Defense Paul D. Wolfowitz wrote recently, North Korean’s military should have been required to stand down in steps, in exchange for each delivery of oil. Instead, the U.S. extracted only a vague promise that North Korea will “engage in North-South dialogue,” and that it will “consistently take steps to implement the North-South Joint Declaration on Denuclearization of the Korean Peninsula,” signed in 1991.

The October accord also lets North Korea continue to develop its medium-range NoDong missile for sale to Libya, Iran and Syria. The NoDong’s range is estimated at 1,000km, enough to deliver a nuclear weapon to Japan from North Korea. Depending on the launch site, a NoDong missile could reach cities in Western Japan from Nagasaki to Sapporo. Pyongyang’s missiles could also be launched from Libya to reach Southern Europe, and from Iran or Syria to reach Israel. The October agreement should have required North Korea to reduce its military pressure at the border and to restrain its missile development.

The best time to confront the North Korean nuclear threat was in the 1980s. The program had not yet reached the threshold of success, and there was still time for sanctions to work. But neither Japan nor America reacted. The problem, like a foundling, wound up at the door of the young Clinton administration. In October, Clinton made a deal that will probably push the problem into the next administration, since that is when a breach by North Korea is most likely to occur. Pushing problems off to one’s successor may be tempting politically, but it is a risky way to deal with the spread of nuclear arms.

India’s Nuclear Shopping List

India still looks to foreign suppliers for equipment to advance its nuclear program. Though it has strong capabilities in most areas of the nuclear cycle, India needs help with fissile material production, materials processing and fusion research, according to an annual Pentagon study which ranks countries’ military capabilities. India would particularly benefit from outside assistance to enrich uranium, extract plutonium or weaponize nuclear material. India is especially lacking in sophisticated electronic and testing equipment, the Pentagon study says.

Topping the list of needed products are computers. High-speed computers are critical to India’s nuclear weapon development, but according to the Pentagon study, India has “limited capability” in digital computing, “no capability” in hybrid computing, and “capabilities in some critical elements” of advanced computing.

From 1988 to 1992, according to a U.S. General Accounting Office report, “sensitive” nuclear end-users in India tried to buy over $30 million dollars in U.S. computer equipment, but got licenses to import only half that. The recent decontrol of computers may have helped India fill more of its orders.

The GAO study says the second-largest category of Indian requests was specially designed pressure measuring instruments for lasers and optical equipment. Then came applications for photosensitive components, lasers, and optical equipment. India also tried to buy measuring and test equipment, and special materials such as lithium and beryllium that are useful in both reactor and nuclear weapon development.

India’s Big Emerging Market Poses Nuclear Risk

On a January visit to promote U.S. trade, Commerce Secretary Ron Brown spoke at one of India’s leading rocket and missile development sites. The Indian Institute of Science is developing rockets big enough to carry nuclear warheads throughout Asia and eventually the world. The Institute is a poor choice for U.S. trade promotion because U.S. companies can’t sell freely to India as long as it is building the bomb.

Selling to Larsen and Toubro, India’s engineering and construction giant, presents the same problem. The company makes ships, sports stadiums and medical equipment, but also builds nuclear reactors that produce plutonium free for use in atomic bombs. (The top contributors to India’s nuclear program are listed on pages six and seven.)

Even the safety of India’s power reactors is being undermined by its weapon program. Westinghouse has asked the U.S. Department of Energy for permission to tutor India in “severe accident management.” But the request “is not going anywhere for a while,” one U.S. official told the Risk Report, in part because of fear that India would train operators from its uninspected reactors, contrary to U.S. policy.

India’s drive for the bomb has made South Asia the most likely place on earth for a nuclear war. Pakistan has followed India’s nuclear progress step by step, increasing the chance that the next border conflict could turn nuclear.

The U.S. government now estimates that India has enough weapon-ready plutonium for about twenty bombs, a senior U.S. official told the Risk Report. The good news is that this is much lower than the widely assumed number of over fifty bombs, based on India’s production of high-quality plutonium (see plutonium table page five). Pakistan is thought to possess about a dozen bombs.

“We have told Pakistan that the difference in size between the Indian and Pakistani nuclear arsenals is not strategically significant,” the official said.

The bad news for exporters is that India is still building bombs and has a history of converting civilian imports to military use. Canada supplied India’s first large reactor, called Cirus, in 1960. The United States supplied the “heavy water” to run it. Heavy water looks and even tastes like ordinary water but is used to run reactors that make plutonium, the material used in the Nagasaki bomb. India had promised Canada to restrict Cirus to “peaceful use,” but India used Cirus’ plutonium to build and explode a bomb in 1974. To justify its action, India called the bomb a “peaceful nuclear device.” Canada broke off nuclear relations.

By 1982, India’s nuclear effort was paralyzed by a shortage of heavy water. Fires and explosions at its production plants cut India’s output to a trickle (see heavy water graph page 8). Imports were the only solution. That was easy if India agreed to international inspection, so that the plutonium its reactors made could not go into atomic bombs. The exporters of heavy water require such a pledge under the Nuclear Nonproliferation Treaty (NPT). But India wanted to keep the nuclear weapon option open, so it refused the pledge. Instead, India found a German nuclear-materials broker who smuggled enough heavy water to start three large reactors. The secret shipments allowed India to escape international controls for the first time and change the strategic balance in Asia.

India bought other bomb-building equipment in the mid-1980s. From Sweden it obtained flash X-ray machines, used to photograph the implosive shock waves in a nuclear detonation package. From the West German firm Degussa it obtained 95 kilograms of U.S.-origin beryllium, needed in the core of atomic bombs to increase the yield.

In 1987, India revealed its interest in more powerful fusion reactions by announcing that it was studying the separation of lithium isotopes. India also began to enrich uranium, but in quantities too small for reactor fuel. This created the suspicion that India wanted it to detonate the fuel in fusion weapons. In 1989, CIA (Central Intelligence Agency) Director William Webster told Congress that India appeared to be designing a hydrogen bomb. In 1993 his successor, James Woolsey, testified that Webster’s assessment was “still valid.”

Despite these ominous developments, U.S. diplomats see hope for progress. A senior official told the Risk Report that recent U.S.-India nuclear talks have been “far more businesslike.” The desire of both countries for expanded trade has created an interest in “progress around the edges,” he said. “India is sending signals that it wants to deescalate.”

Meanwhile, India continues to shop for equipment and technology to increase its bomb-making potential (see shopping list page 9). Exporters hoping to sell to India’s vast opening market need to choose their partners carefully.

Statistics

Nuclear weapon capability: Conducted nuclear test in 1974
Potential number of bombs: 20-50, with enough uninspected plutonium to make scores more
Missile delivery: Nuclear-capable Prithvi and Agni missiles
Nuclear Nonproliferation Treaty (NPT): Not a member
Nuclear Suppliers Group (NSG): Not a member
Missile Technology Control Regime (MTCR): Not a member
Chemical Weapons Convention (CWC): Signed but not ratified
Gross nuclear electrical power capacity: 2,035 megawatts