ML20205E678
| ML20205E678 | |
| Person / Time | |
|---|---|
| Site: | 07002131 |
| Issue date: | 07/20/1976 |
| From: | NRC COMMISSION (OCM) |
| To: | |
| References | |
| NUDOCS 9904050265 | |
| Download: ML20205E678 (182) | |
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s 9s UNITED STATES OF AMERICA f
NUCLEAR REGULATORY COMMISSION
\\
l In the Matter of:
i Docket No. 70-2131 EDLOW INTERNATIONAL COMPANY License No. XSNM-845 (Agent for the Government of India to Export Special Nuclear Material)
I Room 1115 1717 H Street, N.
W.
Washington, D.
C.
Tuesday, 20 July 1976 Hearing in the above-entitled matter was convened, pursuant to notico, at 10:00 a.m.
BEFORE:
CHAIRMAN MARCUS A.
ROWDEN COMMISSIONER EDWARD A. MASON COMMISSIONER VICTOR GILINSKY COMMISSIONER RICHARD T.
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.r CggIggIS PAGE STATEMENT OF:
HON. CLARENCE LONG, U. S. House of Representatives HERBERT SCOVILLE, JR.
ADRIAN FISHER, Professor of International Law, Georgetown University Law Center WILLIAM W.
- LOWRANCE, Harvard University CARL M.
- MARCY, Council for a Livable World MYRON KRATZER, Acting Assistant Secretary of Oceans and International Environmental Affairs, Department of State, l
accompanied by THOMAS DAVIES, Deputy Administrator of the Arms j
l Disarmament Control Agency; l
l THOKAS BETTAUER, l
Legal Advisor; and DENNIS KUX, Director of the Office of Indian Affairs, Department of State
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PROCEEDINGS CHAIRMAN ROWDEN:
The scheduled time for convening this hearing having arrived, I believe it appropriate that we begin i
the proceeding.
On behalf of the members of the Commission, I would like to welcome the participants in this hearing, those of the gen eral public who are here today, and members of the press.
Because of the unique character of these proceedings, I believe it would be useful to address the background of this hearing and the format and procedures the Commission has i
adopted for its conduct.
On March 2, 1976, the Nuclear Regulatory Commission was served with petitions seeking leave to intervene and requesting a hearing in two license application proceedings for the I
l export of special nuclear material to India, for use in fueling the Tarapur Atomic Power Station.
The Tarapur facility provides electrical power for the western Indian states of Gujarat and Maharashtra, and is located some 60 miles north of Bombay.
It was built by the General Electric Company, with financial assistance to India from the United States Government, and began operations in 1969.
It is significant to note that these petitions were the first requests for intervention and for a hearing on an export licensing application ever received by the Nuclear
2 the Atomic Energy Regulatory Commission or by its predecessor, Commission.
the Commission Before ruling on the procedural issues posed, the received lengthy legal memoranda from the Petitioners, NRC Staff and the Executive Branch.
the Commission held a preliminary oral On March 17, 1976, and gave the various participants a full opportunity
- hearing, to discuss those legal and policy issues which they believed relevant to the questions bearing upon intervention and a
. hearing.
After carefully considering the views of all participants, the Commission, on May 7, 1976, issued its initial opinion on the procedural aspects of this matter.
In its 64-page opinion, the Commission determined that the three petitioners (Sierra Club, Natural Resources Defense Council, and Union of Concerned Scientists) had not demonstrated the in the subject matter of these proceedings kind of legal interest which would entitle them to intervention as a matter of right.
However, the Commission also determined that the complex issues surrounding the shipment of nuclear fuel and difficult to the Tarapur Atomic Power Station would be an appropriate vehicle to examine the usefulness of public participation in its export licensing process and the means for accomplishing Therefore, we have decided to convene this hearing, this.
which is to be conducted on the model of legislative hearings on similar subjects.
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i We believe that the character of the issues before us, involving sensitive matters of foreign policy and national security, are not suitable to the adversary atmosphere of an adjudicatory (or " trial-type") hearing.
The Commission, however, recognizes the desirability of affording interested individuals and organizations an appropriate means for giving us their views and information on the issues surrounding the Tarapur applications.
This hearing should accomplish that and also permit par-ticipants to secure amplification and clarification of the views and information presented by the Executive Branch.
l We have adopted a number of procedures designed to make public participation in this catter as vigorous and open as possible, without compromising the national security interests necessarily involved in the nuclear export field.
Our procedures include use of the Freedom of Information Act to secure information in the possession of the Commission i
or cognizant Executive Branch agencies concerning the nuclear export license at issue.
We have also encouraged the participants to submit questions i
to the Commission which, (after our review for relevance, I
materiality, and responses that could involve classified in-I formation) have been posed to the other participants.
Thus, participants have had the opportunity of testing each other's assertions.
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o I would also like to repeat what I stated at our earlier that this is not the first presentation hearing on March 17th, the Commission has had concerning shipment of special nuclear that we have received material to the Tarapur facility; classified briefings and written submissions from the Department of State and other Executive Branch agencies, now a part of the that the Commissioners have also had docket of this matter; numerous discussions with the NRC Staff and among themselves and that we have reviewed a regular flow of in these matters; State Department cable traffic bearing upon the supply of U.S.
nuclear material to India.
Therefore, the written submissions and oral discussions in connection with the present hearing supplement an already de-tailed consideration by the Commission of the issues involved.
I would Because of the novel character of this hearing, like to outline briefly how the Commission intends to proceed These procedures, in the considcration of the matter before us.
I might note, are more completely set forth in the Federal Register Notice announcing the hearing, which was published on Monday, May 17, 1976.
I should indicate that although this hearing takes
- First, I
place in the context of a pending license application for the export of nuclear fuel for the Tarapur Atomic Power Station, the focus of our attention is broader than merely this single
- license,
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5 When petitioners originally filed their Petition for Intervention in March, two fuel license applications (XSNM-805 and XSNM-845) were pending before the Commission.
1 On May 20, 1976, the Department of Justice, on behalf of the Department of State, and petitioners reached an agreement which was also concurred in by the NRC Staff, that this hearing might be continued from its original June date on the under-standing that petitioners would raise no objection to issuan e of license number XSNM-805, as amended to include an additional quantity of nuclear material.
In light of this agreement and our subsequent determination that all requisite statutory licensing standards had been met, the Commission issued XSNM-805 on July 2, 1976, with one member of the Commission noting his dissent.
In the order granting that license, the Commission majority l
stated:
"The urgency with which this license is required by Govern-ment of India and the need to avoid, on the part of the l
United States, undue adverse impact on U.S.
foreign policy l
l interests, persuade us to make our decision at this time.
This action is taken wholly without prejudice to our review of the issues arising in connection with License Application XSNM-845 which will be the subject of forth-coming public hearings before the Commission."
The present application (XSNM-845) covers 315.16 kgs of U-235 contained in 12261.0 kgs of uranium enriched to a
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Since the same issues are raised by maximum of 2.71 percent.
any shipment of low-enriched special nuclear material to India for use in the Tarapur facility, the information and views to be developed in these hearings are generally applicable to the issues posed by other such exports.
the Commission wishes to make Notwithstanding this fact, clear its intention to act on license XSNM-845 only after the record of this hearing has been closed.
the issues which are the focus of the Commission's
- Second, concern in this hearing arise from our statutory obligation to determine that exports of special nuclear material which would be inimical to the common defense and security of the United States are not licensed.
This statutory focus means that certain issues which have been raised by one or another participant in earlier proceedings are not germane to our analysis of-this export license.
In our opinion of May 7, we set out at length the type of issues which would be most relevant for our decision on these licenses.
Matters such as health and safety of the Tarapur Atomic Power Station, and the possible environmental impact of the and are beyond the scope of this hearing, facility in India, are the responsibility of the Government of India.
free to make what-Although participants are, of course, ever presentation they wish to during their allotted time
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period, we hope that their remarks focus on the determinative U.S. common defense and security issues.
Third, the Commission would like to make explicit its desire to conduct these public hearings on an open and unclass-l l
ified basis.
These proceedings are not governed by the Commis-l sions's regulations on adjudication of domestic licensing matters.
l However, we would encourage the participants to make their pre-1 sentations in the spirit of the enjoinder in Subpart I of our Rules of Practice, which provides that, as far as practicable, j
parties are under an obligation to avoid the introduction of classified materials.
Of course, the essence of our decision on " common defense and security" involves matters of great sensitivity, and the l
Commission is required to receive and consider classified in-formation in reaching that decision.
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At the same time, we believe this hearing should be con-ducted in an open and public mode, and that reference to class-ified documents should be make only as a last resort.
In the event that submission of classified information can-l l
not be avoided, we would request the participant offering it l
also to submit an unclassified summary for the public proceedings.
Next, I would like to outline the format of the hearings and the. order in which we intend to receive the views of the J
participants.
Each of the participants has already submitted to the Commission a written statement of the views which it intends
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L Although participants may read their full written to present.
statements into the record, if they wish, we would encourage them to summarize their statements and to emphasize those parts I
of their arguments which they feel to be most.important, f
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we would appreciate it if initial presenta-In any event, tions were kept within the 20-minute time period.
The Commission intends to question the participants, and we will feel free to interrupt a presentation to pursue a particular point or line of inquiry.
Although there will be no cross-examination between the participants, we expect to put to the participants a number t
of questions submitted by the petitioners and the NRC Staff on July 16.
Yesterday, July 19, we issued an order indicating that the Commission was interested in receiving answers to all questions posed by petitioners and the NRC Staff, except for two relating solely to arrangements between the Executive Branch and the NRC on which we already possess adequate information.
t (over 100 posed Because full responses to these questions cannot be expected in by petitioners and seven by the Staff) i the short period since our order, we have provided an additional fifteen days after the conclusion of this hearing for the record to remain open to receive such answers.
We particularly wish to note the presence of Congressman Clarence Long of Maryland, who requested an opportunity of making a statement to the Commission.
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We shall take his presentation first this morning.
Then we will move on to the presentations of four others, Mr. Adrain Fisher, Mr. Herbert Scoville, Mr. William Lowrance and Mr. Carl Marcy.
-Considering that questioning by the Commission will accompany their presentations, we expect that the five statements will take-the full morning session.
We will reconvene at 2:00 p.m. to entertain the statements of representatives of the Executive Branch.
We understand that Deputy Assistant Secretary of State Myron B. Kratzer will make the presentation for the Department of State, accompanied by a number of other of ficials of the Department and other Executive Branch agencies.
I After Mr. Kratzer, we would expect to hear from the Commission's staff, represented by Dr. Michael Guhin, Assistant Director of the Office of International Programs.
Thereafter, counsel for NRDC and the other participating l
groups will make this presentation.
After all statements have been presented, the Commission would like to receive brief summations of the main points which each of the participants in our earlier proceedings believe we l
1 should consider in our licensing decision.
We would like to note that the Government of India has not asked to appear at this hearing, although it has provided oral views to the State Department for use in this proceeding.
i 10.
The'Edlow International Company, which is the applicant in this case, has submitted a letter to the Commission reflecting However, it has not expressed a desire to make its own views.
an oral statement in these proceedings, or to offer a statement in i'ts capactly as agent for the Government of India.
It may well be that some questions posed by the Commissioners to a participant cannot be answered without additional materials the Commission will request that or analysis.
In this event, an answer be furnished for the record at a later date.
But the Commission is not able to keep the record open We request that any answers or materials supple-indefinitely.
menting oral presentations be supplied within 15 days following the end of this hearing.
The Commission has reserved two days for the conduct of We believe this to be realistic.
this hearing.
This morning we hope to be able to complete testimony by the Congressional and individual participants, and in the after-noon to hear the presentations of the Department of State and the NRC Staff, prior to a recess at 5:00 p.m.
Tomorrow we will be available for petitioners and summations of the views of the three main participants.
At this juncture, I believe it appropriate to inject a personal note.
I held the position of General Counsel to the Atomic Energy Commission in 1974 at the time of the explosion of India's I
I t
e 11 nuclear device, and so participated in that Commission's discussion of the U.S.
response to that event.
In substance, I advised the Commission that I believed it l
appropriate for the U.S.
to obtain assurances regarding the use of heavy water supplied by this country in order to bring hcme the U.S.
position that peaceful nuclear explosives, (PNEs) were not permitted under guarantees that U.S.-supplied material would be used for peaceful purposes only.
Similarly, I urged that consistency with previously stated U.S.
positions, as well as U.S. obligations under the NPT, made it important to assure that American assistance to Tarapur was not used to support PNE's.
And I was consulted on the drafting of correspondence between the Commission and the Government of India, embodying the decision which the Commission reached.
I carefully considered whether the involvement would in any way prejudice my participation in these proceedings.
I concluded that it would not.
The advice I offered was of a general policy character, conveyed in the context of general policy discussion.
The issues were not factual in character.
I was not an advocate for a party to a dispute, and I was not shaping positions that others would take in future disputes.
I am fully confident in my ability to view freshly all I
factual and policy issues on the basis of the data views and circumstances now before us.
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let me underline a Finally, before we begin the hearing, basic aspect of their purpose.
The safeguards and nonproliferation issues with which we are dealing are among the most important confronting this 1
country'and the international community.
the members of the Commission have sought Mindful of this, to address those issues with a corresponding sense of responsi-as respects This hearing -- an experimental "first" bility.
nuclear export licensing -- affords an opportunity for contri-bution of public views in a complex and sensitive area of U.S.
foreign policy.
That opportunity calls for a matching sense of responsi-bility on the part of all participants.
serve not only our Informed viewpoints, soberly stated, Commission's purpose but also the broader purpose of public understanding.
I think we With that background, and.in that spirit, should begin.
Congressman Long, we welcome your presence here and invite you to present your views.
Thank you, Commissioner Rowden.
MR. LONG:
Commissioner Mason, Commissioner Gilinsky, and General I want to thank the Commission for enabling Counsel Strauss, issues raised by the proposed their ventilation of the urgent export of enriched uranium to India for use at the Tarapur I also express my thanks to the petitioners Atomic Power Station.
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and Representative Ottinger.
Were it not for their efforts, today's hearing would not have been held.
Because Congressman Ottinger.could not be here today, I submit his statement for t
the record.
I agree with the Commiasion that the Atomic Energy Act as amended,'provides for a periodic re-look at these issues through the export licensing process.
The long life of agreements for cooperation makes this procedure necessary if we are to take corrective action when warranted by the changing circumstances l
that-imperil mankind.
I appear before the Commission in opposition to continued nuclear fuel shipments to India under current arrangements which pose a threat to world peace and the security of the United l
States.
I urge in the strongest possible language the stoppage
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of all' nuclear fuel shipments until the Commission can assure itself that no diversion of special nuclear materials supplied l
by the United States can take place.
It is time that the United L
l States move beyond mere detection toward prevention.
l The actions of the Government of India undermine our con-fidence in its good faith in the area of nuclear development.
India has refused to sign the Nuclear Non-Proliferation Treaty t
and has rejected the universal international safeguards that the Treaty's proponents intended to establish.
On May 18, 1974, Indian scientists successfully detonated a nuclear explosive ostensibly designed for peaceful applications.
No valid distinction'can be me.21 between a purportedly peaceful l
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f This position of the nuclear explosive and a nuclear weapon.
d United States was stated to the Indian Government before an l
l after the explosion.
Indian actions have severely complicated the nonprolifera-The Indian explosion is tion objectives of the United States.
blamed for spurring Pakistan to obtain nuclear fuel cycle tech-nology and for encouraging Brazil and Iran to do likewise.
For these reasons, our response to India is the first test d
of whether the United States has a policy of stemming the sprea of nuclear weapons.
If I may say so parenthetically and as a politician, when-this sets up almost impos-ever a nation, gets nuclear weapons, irresistable political pressures are set in motion in l
- sible, neighboring continues to develop nuclear weapon also.
I don' t see how any country can say, can resist the inevitable pressures that are going to emerge in that country when even the rumor begins that the country next-door has The idea nuclear weapons or the potential for nuclear weapons.
that one country _ can get nuclear explosive capability and that this won' t spread, is absolutely disingenuous.
The United States has been a major contributor to India's India's first major atomic power l
nuclear development program.
f acility, the Tarapur Atomic Power Station, was acquired from General Electric Company and financed with a S72 million U.S.
loan.
Agency for International Development 1
i 15 The United States trained over 1100 Indians in nuclear physics and related fields at AEC facilities from 1949 to May, 1974.
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In the past, the United States encouraged
- India's interest in plutonium recycle technology by training Indians in these techniques.
The United States pursued this course, despite the close connection between fuel recycle and fuel reprocessing and despite the knowledge that India had refused to place its l
plutonium recovery plant at Trombay under safeguards.
Subsequent reservations concerning the economic viability and proliferation implications of plutonium recycle have not prevented the use of American-acquired skills to construct I
India's nuclear explosive.
American technical and economic assistance amounting over the years to $10 billion has freed Indian resources for a nuclear 3
program that now undercuts U.S.
non proliferation goals.
I We have supplied this aid in the absence of ironclad assurances that India would not build a nuclear explosive.
Despite ample evidence that India was moving ahead with l
i nuclear explosives, the United States made apparently no attempt, certainly none on the record, to dissuade India in the months preceding the explosion.
The case can be made that U.S.
technical assistance acquired over a number of decades was misused for purposes contrary to the American-Indian Agreement for Cooperation.
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16 training, hardware and special Our technical know-how, nuclear material were given to India with the explicit under-standing that all would be used for peaceful purposes.
It now transpires that heavy water supplied by the United States was used in the Canadian CIRUS reactor from which India produced its explosive.
The contract with India provided that the heavy water could be used only for research into and use of atomic energy for peaceful purposes.
Mr. Greenberg, counsel for the petitioners and one who has exhaustively researched the public record on our nuclear "while in policy toward India notes in his prepared statement, (from the U.S.)
1970, an aide memoire was correct reportedly sent to India stating the view that nuclear weapons and explosives it apparently and weapons were particularly distinguishable, went unanswered."
Commissioner Gilinsky is persuasive in arguing that once we permit reprocessing of irradiated fuel, we abandon effective safeguards over the fissionable by-products such as plutonium.
The temptation to violate an existing agreement safeguarding special nuclear material becomes irresistible when ready stock-piles of plutonium are available and when a military threat from a neighboring country is perceived to make the need for nuclear explosives critical.
Diversion for illicit use could be so rapid that present methods of detection would fail to give adequate warning.
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17 Granted, this is an argument for restricting the scope of all fuel reprocessing whether or not materials are now subject to safeguards.
Nevertheless, India insists on reprocessing fuel in plants subject to no detection safeguards at all and the U.S. Administration continues to ratify these arrangements by approving fuel transfers to India.
RECOMMENDATIONS:
I urge postponement of favorable action on the pending license application (XSNM-845) until the Commission has deter-mined more exacting safeguards against diversion of nuclear material and has stipulated these as conditions for granting the license.
U.S.-supplied special nuclear material should be protected against diversion at every phase of the fuel cycle.
If U.S.-supplied fuel, after irradiation, were to find its way to an unsafeguarded reprocessing facility, the plutonium contained in that fuel could be used in nuclear weapons.
The Commission's final action on this license could pru-dently await the outcome of the Executive Branch's review of the Tarapur reprocessing facility.
To assure against illicit diversion of special nuclear material, India shculd be required to agree to U.S.
repurchase of all irradiated fuel from Tarapur by the United States.
Such repurchase would prevent an addition to any plutonium stockpiled by the Indian Government.
f 18 the U.S. would Admittedly, under a repurchase agreement, have to store and dispose of highly toxic material at consider-However, the quantity of spent fuel able expense and risk.
discharged from the Tarapur reactors, while containing plutonium for a large number of nuclear bombs, represen'ts a small per-centage of the nuclear waste material which the U.S.
now regularly handles domestically.
Clearly, the United States should refuse permission to origin in Indian facilities.
reprocess irradiated fuel of U.S.
Albert Wohlstetter has conducted in a study commissioned by the Arms Control and Disarmament Agency that countries may accumulate large quantities of reprocessed material without necessarily violating existing international safeguards.
This stored nuclear material could be fabricated rapidly into a nuclear explosive within a week after the decision to Thus, if reprocessing is permitted, International divert.
Atomic Energy Agency safeguards would not provide timely warning of diversion of special nuclear material.
I urge the Commission to play a more active and assertive I
role vis-a-vis the Executive Branch in halting the spread of nuclear weapons capability.
The Commission should be more outspoken in advising the Executive Branch to make appropriate changes in existing agree-ments for cooperation and in setting conditions for the export of special nuclear material that better assure against its I
diversion for illicit purposes.
19 The official non-proliferation policy of the United States is seriously flawed.
Safeguards that now rely on detec-ton, however timely, have been outmoded by technical advances which may permit a nuclear fuel fait accompli.
More forceful approaches are required to prevent the spread of nuclear explosive capabilities.
In a story reported in today's Baltimore Sun, Arms Control Agency Director Fred Ikle argued that the U.S.
con-tributed for a generation to the global spread of nuclear weapons technology.
According to Ikle, the United States was operating under the idea that the key to developing nuclear weapons was in the design of the actual weapons; therefore, the U.S. was overly generous in providing knowledge of how to process uranium and plutonium.
The Commission cannot determine our nuclear non-proliferation policy.
That task belongs to the Executive proliferation policy.
That task belongs to the Executive Branch and to Congress, which have so far unfortunately not seen it as their job to bring nuclear proliferation under control.
Indeed, they have done much to make control more difficult.
In order, therefore, to investi-gate where our various policies are leading us and to fashion a nuclear export policy that will not take us all headlong into disaster, I have introduced H. Res. 951, which would establish a Select Committee on Nuclear Proliferation and Nuclear Export Over 140 members of Congress and 18 national public Policy.
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20 policy organizations and, David Lillienthal, the first Director of the Atomic Energy Agency, have endorsed my legislation.
Until legislation has been enacted, however, the Commission can fulfill its function under the Atomic Energy Act of setting conditions on granting of nuclear fuel export licenses that more effectively safeguard the security of the United States.
t, By holding up this license until strict conditions are me the Commission will give the Administration additional incentive to amend an inadequate and dangerous agreement with India.
Thank you, gentlemen.
21 CHAIRMAN ROWDEN:
Thank you, Congressman Long.
If I may, it would be useful to our understanding if I could pose several questions to you to gain a clarification of your views in this regard.
As the record before us reflects, there are two basic government-to-government commitments to which the government of India has now subjected itself in connection with the use of fuel supplied by the United States for the Tarapur facility and with regard to its ability to reprocess that fuel.
The first of those commitments reflected in a correspondence re-garding the agreement for cooperation several years ago, commits the government of India to use U.S.-supplied fuel only for use in the Tarapur Atomic Power Station unless otherwise agreed to by the United States government.
And the second commitment, embodied in the agreement for cooperation in effect gives the United States government a veto right with respect to reprocessing of U.S.-supplied fuel, that right being conditioned on a determination by our government that effective safeguards can be applied.
Do I understand your position correctly that those government-to-government commitments are not sufficient in pro-viding safeguards which you believe are desirable.
l MR. LONG:
Yes.
I feel that way entirely.
In the first place, the Indian government has demonstrated itself to be entirely untrustworthy.
I wouldn't trust any commitment that the Indian government as presently constituted made.
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22 for example, For example, very di2 ingenuous uses of words, can be twisted in all kinds of ways.
the phrase " peaceful cses -
I don't think I would trust any government, As a matter of fact, if it"was hardpressed, to live up to an agreement with another i
country.
That is why I feel that it's important if we continue to supply nuclear fuel to India, that we get the plutonium out of India, into the United States.
That leads to my next question.
I take CHAIRMAN ROWDEN:
it that is your basic recommendation, that some arrangement for buy-back of irradiated fuel, including the rather substantial quantities that are of course already in India, is necessary.
Is my understanding correct in that regard?
l That would be certainly the minimum condition MR. LONG:
India has demonstrated its bad faith to that I would make.
ideally, we should not in a sense ratify such an extent that, or indicate our approval of their nuclear policies by selling them any nuclear fuel at all.
CHAIRMAN ROWDEN:
Recognizing that there is a rather sub-stantial quantity of irradiated fuel of U.S. origin already in India, aus f ar es exceeding the amount involved in this particular do you believe it important for the Commission con-
- shipment, to take sidering the course of action it should follow here, into account whether that action would impair the applicability i
of safeguards for fuel already in India?
23 Just to make the premise of my question clear, it has been suggested to the Commission by the Executive Branch and I believe by the NRC Staff, that action on the part of this Commission or this government which could be considered a substantial breach of our agreement for cooperation with the Indian govern-ment would call into question the continuing applicability of safeguards for enriched fuel already in India.
Do you believe that is a relevant consideration for this Commission to take into account?
MR. LONG:
I can see where the Commission would want to take that in consideration.
However, I can't help feeling that the Indian government will do what it wants to do in any case.
A chain reaction has begun.
The Pakistanis are almost certainly going to go ahead with a reprocessing plant purchase from France.
The Indians are surely now going to perceive this action by Pakistan as a kind of threat that will justify their doing whatever they have to do to develop nuclear weapons.
I am not arguing, you see, that by refusing to go through with this fuel shipment we can somehow prevent India from getting nuclear weapons.
I expect they are going to go on as they wish, but I do think we have to tell the whole world that we are not putting our stamp of approval on the Indian nuclear program.
Because it isn't just India that we have got to concern ourselves about.
It's Iran, it's Egypt, it's South Africa, it's Brazil, it's Argentina, and many other countries that we have to worry about.
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We do have power, We still do have many aces in the hole.
It isn't we do have influence that can be exerted at this time.
And particularly true that we have given the whole ballgame away.
I think we especially have to make sure that we do not encourage nuclear proliferation economically.
A great deal of what we are doing in the nuclear field, through export-import bank loans for nuclear reactors, for example, is not so much technological as it is economic.
We are providing the credit that enables countries to go ahead with nuclear development that they probably couldn't do It's somewhat disingenuous to argue the United States otherwise.
has no control over countries nuclear development because they Economics is an important con-will go ahead with it anyway.
sideration in all of this.
I think the right decision in this instance could be the beginning, a token really, of our good faith and our intention to_do something to curb nuclear proliferation, even though we may not all together succeed in accomplishing every objective.
This One final question in that regard.
CHAIRMAN ROWDEN:
relates to what I understand to be a basic recommendation on t
That-is the matter of buy back of irradiated fuel your part.
that is of U.S. origin.
As you recognize in your statement, a very complex proposition, not only in connection with fiscal matters but in connection with the logistics and health and safety aspects of it.
1 25 MR. LONG:
But, as I pointed out, this adds only marginally 1
to the problem we already have.
CHAIRMAN ROWDEN:
Yes.
But if there were promising prospects for buy back and considering that even Congressional, Congressional auth'orization might be required to institute a buy back arrange-
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ment, should we take into account in acting on the present licensing application, if for example, as has been suggested, denial of the present application might prejudice the climate for a happy resolution, let us say, of a buy back transaction?
MR. LONG:
Well, in my view the buy back is not the main thing.
It's a necessary but not a sufficient condition, in my view.
If we went ahead with this fuel shipment we should insist on the buy back, but I would not want to go ahead with this agreement merely in order to get a buy back, to try to get fuel out of their hands.
I am sure that the Commissioners have been reading some of the reports about current events in India.
It's not only because India has scrapped the democratic system which they had for so long--the existence of which democracy was for decades given as our main reason for helping India.
It's not only because India is becoming a police state, but according to scholars such as Ved Mehta, India is practically moving toward a totalitarian police state.
For us to be encouraging this sort of development, to be helping it in any way, I think is a reflection on our good
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26 faith as a country which claims to be the chief sponsor of democratic regimes in the world.
CHAIRMAN ROWDEN:
Thank you.
l The first COMMISSIONER MASON:
I have two questions.
question is a general one on which you might help me understand That is, you make several recommenda-your position more clearly.
tions regarding repurchase of material until the exacting safe-Yet, in your guards presently under discussion are in place.
answers to Chairman Rowden's questions, you indicated almost a complete distrust of the Indian government and just recently sal you would not enter into agreements with them.
Does this mean that if effective and exacting safeguards could be established or if we could buy back this material, that You Or is this merely a backup?
this would be sufficient?
would rather that we did not deal with them at all?
I would rather you did not deal with them at MR. LONG:
all, quite frankly, but if you have to deal with them and insist on dealing with them, and I understand the facts of life then I would politically, having been in Congress for 14 years, insist on these minimum conditions.
That brings me to the second question.
COMMISSIONER MASON:
Then one of your recommendations is that India should be required As to agree to the repurchas-[ of all irradiated fuel from Tarapur.
a Congressman -- and I am concerned about the implementation of funds would that recommendation -- are you aware whether or not
27 now be available or would this require Congressional authorization and appropriation action?
MR. LONG:
Well, without some research I couldn't give you a definitive answer on that.
It's possible there are emergency funds available, if the amount of money involved was not great, it might not require Congressional authorization.
But I would think it would require a Congressional authorization and appro-priation.
I would certainly support that.
I think there would not be great difficulties getting it through Congress.
COMMISSIONER MASON:
Thank you very much.
COMMISSIONER KENNEDY:
I greatly appreciate the clarifica-tion you have given us thus far.
I have just a couple o.f brief questions.
I take it that you don't believe that any assurances i
which we might get would really pay off in the long run, that in fact you believe that any assurance we might get would be suspect from the or.tset.
Is that a fair statement?
MR. LONG:
I believe that is so, yes, sir.
COMMISSIONER KENNEDY:
In that case then, if India accepted a broad scale application of IAEA safeguards, would this give us any comfort in your judgment?
MR. LONG:
IAEA safeguards have a number of flaws, in my opinion. 'As you very well know, they are more accounting measures than they are anything else.
There is a great need for strengthening them and for developing sanctions against which violate these safeguards.
1
a 28 COMMISSIONER KENNEDY:
Do you think, sir, that our withholding --
The Agency does not have nearly enough in-MR. LONG:
spectors, as you well know, to properly inspect all the nuclear facilities for which the IAEA is responsible.
COMMISSIONER KENNEDY:
Do you think our withholding of this shipment would have a significant bearing on the attitudes.
of people in Iran or Brazil or indeed, sir, in other supplier nations?
If this were the only thing we did, it's quite MR. LONG:
But possible that the impact would be no more than marginal.
I think our whole nuclear export policy as I have indicated, needs a very drastic overhaul.
That is the purpose of my intro-
~
duction of House Resolution 951 to set up a committee to go into all of this.
The present Joint Atomic Energy Committee doesn' t see bl.is as their job.
They are very able people.
I have no wish to downgrade them in any way but they simply don't see this.as a I think the threat of nuclear proliferation is more
{
problem.
f and more being perceived in the country as a whole as a major problem.
I think rightfully so.
COMMISSIONER KENNEDY:
Thank you.
CHAIRMAN ROWDEN:
Thank you, Congressman'Long.
I will repeat what I stated at the outset and what I told We welcome your active interest you at your last appearance.
l i
C 29 in this proceeding as well as in the subject matter and your views will be given very careful consideration.
MR. LONG:
Thank you very much, Mr. Chairman.
i e
30 CHAIRMAN ROWDEN:
Mr. Scoville Would it be more convenient if you sat while you made your presentation?
)
STATEMENT OF HERBERT SCOVILLE, JR.,
6400 GEORGETOWN PIKE, MCLEAN, VIRGINIA 22101 Mr. Chairman, members of the Commission, MR. SCOVILLE:
I am pleased to be able to come before you today and give my views on this proposed licensing of nuclear fuel supply to India.
I will just cever some of the high points of my prepared statement, which you have before you.
The first point I would like to make, and I won't go into any detail because I don't believe there is much difference of opinion on it, that the further proliferation of nuclear weapons around the world is a real detriment to the security of the United States.
I don't think there is much argument on that.
I think everybody agrees that nuclear weapons and nuclear explosives being available around the world is a real security risk not only to the United States but to the rest of the world as well.
the second point I would like to make is that the
- Now, Indian acquisition of a nuclear explosion capability was a major setback to the U.S. policy of trying to halt further proliferation of nuclear weapons.
Unfortunately it appears from the information that has been released rather recently, that the U.S. may have actually contributed to that explosion, both in the supply of heavy
31 water, which was used in the CIRUS reactor, and by providing technical assistance to Indian scientists and others in their nuclear program.
But the fact that we erred and made a mistake in the past, that cannot be corrected now, should not be used as an excuse for going on and making additional mistakes by additional contributions to the Indian program in the future.
In this conection, I think that this is one of the basic responsibilities of this Commission; perhaps one of the reasons the Commission was established was to see that in the future we don't repeat the same mistakes that we have made in the past.
CHAIRMAN ROWDEN:
Let me just interject a question to j
that point.
1 l
Do you believe that this is a fundamental responsibility
)
of this Commission or rather that it lies in the realm of political responsibilities, and that it is a responsibility that - 'in terms of charting basic national policy -- more prop-erly lies with the President and Congress?
MR. SCOVILLE:
I am not a lawyer, so I mm not qualified to speak authoritatively.
It is obvious this is clearly a responsibility of the Executive Branch, but the Commission was set up to license foreign sales of material and as part of that responsibility you are holding this current hearing.
CHAIRMAN ROWDEN:
I asked it more in terms of a social question than a legal question.
1 32 It is not the sole responsibility of the MR. SCOVILLE:
Commission, but I think the Commission has an important function in this particular respect.
Now, it is probably too late to get the Indian government On the other hand, I to give up its nuclear explosive program.
there is an essential think it is important to remember that difference between an Indian program which is based on the CIRUS reactor and their native heavy water reactors and the Tarapur Nuclear Power Station.
The CIRUS reactor only produces 6 kilograms per year which is a relatively small quantity.
On the other hand, the Tarapur Power Station will produce about 100 kilograms per year of plutonium.
This is a significant difference.
I think one should not make a judgment to go Therefore, ahead with Tarapur on the basis that the horse is out of the barn and there is nothing we can do about it and that therefore we might as well go ahead with this supply of fuel for Tarapur.
There is really a difference between 100 kilograms a year and 6 kilograms a year.
I think it is important that the Commission Therefore, look at this sale as'a separate problem and not be influenced by the fact that they can't stop the entire Indian program.
In that respect I would like to recommend two actions which seem to me in order to prevent a bad security situation from t
becoming even worse.
l
I 33 I
First, the U.S. should attempt to exercise the buy back provisions in the Indian agreement for cooperation and return f
the spent fuel with its plutonium to the United States so it I
cannot be used in the future for Indian nuclear explosives.
In the past the Indian government has offered to make such a sale, but incomprehensibly the U.S. government has apparently shown no interest in making such a purchase.
At least, that is, until recently.
I don't know the exact status of the negotiations today.
Since the U.S. has been financing the Indian program through AID and long-term deferred payment, low interest loans, this purchase should be able to be made without economic sacrifices on our part.
In any case, the cost would be miniscule by com-parison to the billions being spent by DOD and ERDA for national security and should not, therefore, be a major consideration in such a vital matter.
Secondly, no export of fuel for TAPS should be licensed by the Commission until this potential weapon stockpile has been removed from India.
The Commission cannot allow this fuel to be used to blackmail the United States into making their stockpile larger.
COMMISSIONER MASON:
Are you talking about the fuel already there?
MR. SCOVILLE:
Yes.
COMMISSIONER KENNEDY:
You mean nothing should move until it is returned physically to the United States?
l
34 MR. SCOVILLE:
I believe that is somewhat of a debatable since India has demonstrated it wants to use the plutonium
- point, it has for nuclear explosives, we should ensure having the fuel at least well on the way to the United States.
I wouldn' t say absolutely all out, but certainly not until you got the demonstration they were going ahead and do it.
If India allows the removal of this spent fuel, it would be an indication of its intention not to use TAPS as a source of explosive material.
Then the Commission could reconsider licensing further exports with the proviso that all future plutonium would also be returned to the United States as soon l
as possible after it has been removed from the reactors.
Only when it can be guaranteed that all_ existing and l
future plutonium will not remain in India can the further supply l
of nuclear fuel to a nation which has the-avowed goal of pro-ducing nuclear explosives be reconsidered.
only under such conditions could future export be deemed l
l not inimical to the common defense and security of the United l
l States.
1 Furthermore, I think such actions must be taken now for the size of the Inidan stockpile of plutonium that can be turned into weapons is growing daily.
Even if IAEA safeguards provided an absolute guarantee against diversion of this material to nuclear explosives, there is nothing to prevent the Indian government from suddenly
4 35 l
l breaching its undertakings with the United States to use such material only in the TAPS reactors.
The Indian ~ government's refusal to commit itself not to use the plutonium in " peaceful" explosives -- as demonstrated by Commissioner Ray - Sethna their exchanges -- is a bad omen in this regard and is in my view insufficient justification for halting any further fuel supply.
Our inexcusable failure to insist on this has already i
been a setback to our nonproliferation goals.
The inhibitions of the Indian government for abrogating l
its agreements will decrease rapidly as India becomes more and more nuclearly independent.
The Commission should hold the line now.
However, much more important than the effect on India's program is the effect of these actions on the possibility of other countries going nuclear, since as I mentioned earlier, it is probably too late to change India's plan to acquire nuclear explosives.
Unless some restrictions are rapidly placed on the Indian nuclear explosion program, Pakistan is almost certain to acquire nuclear weapons of its own.
i It has already made motions in this direction by taking steps to procure.a fuel reprocessing facility which can only be justified by Pakistan if it seeks a capability for obtaining weapons materials.
36 Strong actions to contain the Indian program now are the only hope for persuading Pakistan that is should not acquire nuclear weapons.
Maybe it is a vain hope for persuading Pakistan it should not acquire nuclear weapons but we'should try.
But the Indian precedent will be applicable not only in 1
that part of the world.
The U.S. reaction to India is a test case which will be All watched by all other potential nuclear weapons countries.
other nations contemplating such a move will be influenced by the success of the Indian action and by the reaction to it of
)
the United States and other supplier nations.
Continued U.S.
supply of fuel to India, even without a guarantee that the
)
plutonium will not be used in an explosive program -- this is j
what we have done up to now -- will convince them that the U.S.
is not serious about halting proliferation.
The Administration has made strong representations to the effect that it must demonstrate reliability of supply of nuclear fuel if it is to maintain its influence in persuading nations that they should not acquire nuclear explosives.
Such reliability is important and indeed should be a reward for nations that have demonstrated that they do not intend to acquire nuclear weapons.
But to continue to guarantee the supply of fuel to a nation which has demonstrated its intention to acquire nuclear weapons is sending just the wrong signal around the world.
I 37 If a nation knows it can continue to be supplied with nuclear fuel even'after it has acquired nuclear explosives, then l
they will have no inhibitions at all making a decision in that direction.
There will be no penalties to deter such a move.
On the other hand, if the U.S. made it clear that the l
l acquisition of a nuclear explosive capability meant the end l
of nuclear assistance, then a nation which was dependant on nuclear energy would have strong disincentives for taking such l
l a step and the security of the United States would be greatly l
enhanced.
i l
l Commission action to refuse licensing further nuclear fuel l
export to India would be a positive step toward this goal.
In this connection I would like to mention the State Depart-ment in its representation made much of the fact that halting i
l the supply of fuel to Tarapur would inflict great hardship on l
l the Indian people because of the need for the power that is developed at Tarapur.
Well, I think it is important that the Indian government and the Indian people be made to realize that l
their decision to acquire nuclear explosives is one which involves l
hardships, and other cou'ntries around the world have got to l
l realize this same drawback to acquiring nuclear explosives.
They must be made to realize they are going to have to pay something for it.
I find it incomprehensible that we do not make the Indians realize that the acquisition of nuclear explosives does involve some penalty.
38 Not only make the Indians realize, but make the rest of q
the world realize, which is probably the important area in which one can do some good.
Finally, I should also like to refer briefly to impact of continuing to supply fuel to India when only parts of its atomic program are under safeguards.
Nations which are parties to the NPT and have thus under-taken not to acquire nuclear explosives must have safeguards on Thus India, which has developed all their nuclear programs.
nuclear explosives, is being given preferential treatment.
How can we induce nations to join the NPT with this type of policy?
In the early days of the NPT this might have been excusable, as many countries required long periods to go through the political process of becoming party to the NPT.
This is no longer applicable; now is the time for the Commission to disapprove any further licensing of nuclear exports to countries that have not placed safeguards on all their nuclear materials.
The proposed exports to India are an ideal case to start this policy which will halt discrimination in favor of countries acquiring or keeping open the option to acquire nuclear l
l weapons.
l The United States should have taken actions to withhold nuclear fuel immediately after the Indian test in May 1974, i
t
O 39 but our failure to do so then is no excuse for the Commission to approve continuing this dangerous policy now.
There is still time to send a strong message to many countries around the world that the U.S. nonproliferation policy is not a mere matter of words but instead is supported by mean-ingful concrete actions.
The argument that the U.S.
should not adopt this policy alone but await similar moves by other nations would doom our nonproliferation goals at the outset.
The U.S. must provide the leadership and then work to persuade other nations to follow suit.
Action by the Commission to deny further export of nuclear fuel to India until it could be firmly established that it could not, under any circumstances, be used to support the Indian nuclear explosive program would be the kind of example which would be useful in convincing other nations of the seriousness which we attach to this problem and persuading them to follow a similar course.
On the other hand, continued sales would be evidence that the U.S.
is not serious and is so interested in competing in the nuclear market that it will even continue actions that can be inimical to our common defense and security.
And, in summation, I would like to again repeat that I think three criteria should be established before any rurther fuel is licensed for transmittal to India.
40 First, the U.S. should get in hand the plutonium which is now in existence as spent fuel in India in the Tarapur Station.
Second, we should have an arrangement by which all future fuel is returned plutonium produced in this reactor with U.S.
to the United States as soon as possible after it has been removed from the reactor.
Third, that until India accepts IAEA safeguards or, all its nuclear materials and programs, then we should not send any further materials or provide any further support for their nuclear program.
CHAIRMAN ROWDEN:
Thank you.
COMMISSIONER KENNEDY:
Sir, you said IAEA safeguards on all nuclear materials.
Does this imply that you have some belief that the IAEA safeguards will be effective?
MR. SCOVILLE:
I believe IAEA safeguards can be effective for at least detecting any diversion.
I think sometimes people expect IAEA safeguards to do more l
l than they were intended to do.
They are essentially a detection l
Therefore, in the case of India, which has demonstrated mechanism.
a clear intention to acquire nuclear explosives, IAEA safeguards by themselves are probably not enough.
What one needs in India is some arrangement by which the plutonium that is produced is not stored in India itself in a form in'which it can be used readily for nuclear weapons.
In other words, that is why I have added the additional requirement that we must remove the material that is now the
!k
F i
e 41 l
spent fuel that is now there and any future plutonium produced from India itself.
You need that dual requirement because otherwise it is too easy to abrogate the arrangement and just sieze the material.
COMMISSIONER KENNEDY:
But that would apply only to U.S.
material.
MR. SCOVILLE:
That is true.
I would hope we can persuade other countries to do likewise but there is nothing we can do j
about a native Indian program.
But to withhold U.S.
assistance puts their power program in jeopardy because if they have to use their own materials for a weapons program it would cut into their supplies for their power plant.
COMMISSIONER KENNEDY:
Do you believe that action to with-hold further shipments of fuel could in some way encourage others, Iran and Brazil were mentioned, not to pursue an ex-plosives program?
MR.-SCOVILLE:
Yes.
I think it can.
I won't guarantee that it will succeed, but I think it will encourage them in the right direction.
They will then realize that they are not going to get any nuclear assistance, at least from us, if they go the explosives or weapons route, and also I think it puts us in a very strong position to persuade other suppliers to follow suit.
As long as we fail to act in this direction there is very l
little influence we can have on other countries as well.
l l
42 Can I ask a follow-up question in that CHAIRMAN ROWDEN:
regard?
Does our past experience bear out your expectations in that regard?
Specifically you mentioned Brazil and some other instances ii ith where the United States has adopted a very strong pos t on w regard to the export of technology and equipment.
Has that resulted in the sort of an optimistic outcome ition?
that you project might be the case if we took a strong pos I think unfortunately one of the unfor-MR. SCOVILLE:
No.
tunate situations as far as the German-Brazilian deal, we sn apparently at least did not make very strong political repre e -
tations to Germany against their breaking the line there.
I think this was a very unfortunate step backward, but let think we will never persuade other countries to me say this:
I Perhaps our follow this kind of line if we don't do it first.
f ailure to withhold fuel from India convinced Germany and other suppliers that they should go ahead.
then necessarily I am not saying if we don't do it first, but I think there is a better chance they will follow suit, that they will.
Without indicating any value judgment in CHAIRMAN ROWDEN:
but simply for purposes of inquiry, this regard on my own part, and noting that you made a rather compelling presentation, take into account the policy consequences this Commission must license applications:
of an affirmative decision or their export e
t 43 are we also obliged in that regard to take into account from a safeguards and nonproliferatian. standpoint negative aspects which would follow if we were to deny the application?
MR. SCOVILLE:
I think-you obviously have to look at all the pros and cons.
My view, as I have tried to put it is that I think the negative aspects are very small and I think the positive aspects are very strong.
CHAIRMAN ROWDEN:
Thank you very much for a very thoughtful presentation.
Mr. Fisher.
I
44 STATEMENT OF ADRIAN FISHER PROFESSOR OF INTERNATIONAL LAW (EORGETOWN UNIVERSITY LAW CENTER WASHINGTON, D.
C.
l MR. FISHER:
Mr. Chairman, Members of the Commission, fol-lowing the Chairman's statement, I will summarize my statement and I
hope to deal with your questions.
My name is Adrian Fisher.
I am currently Professor of Inter-national Law at Georgetown University Law Center.
From 1961 to '69 I was Deputy Director of the U. S. Arms Control and Disarmament Agency.
I have held other jobs in the Government.
I mention in my statement I was legal advisor to the Department of State.
The reasons are not wholly clear to me, I am embarrased that I left out the fact that I was once general counsel to the Atomic Energy Commission.
You will understand my blushing in having left that out.
COMMISSIONER KENNEDY:
Does that qualify you or disqualify you?
MR. FISSER:
It would be hard for me to make a statement on that, Mr. Commissioner.
Frankly, the reason I didn' t mention that I was general counsel was becausa ay work didn't have much to do with what I am testifying about now, it was an eariler stage, 1948-49, when the whole history of U.S.
action on nuclear exports was quite different.
However, as legal advisor to the Department of State I had a great deal to do with other countries involving treaties and obligations and as Deputy Director of the U.S. Arms Control Agency
l O
O 45 I was at Geneva, when we came to agreement with the Russians on the text of the Non-Proliferation Agreement and helped to get a pat of approval on the head for it in the General Assembly of the United Nations, as one of our representatives to the U.N.
assisting Justice Goldberg.
Now, I don't need to go into the national security considera-tions, underlying non-proliferation, I would be carrying " coals to Newcastle" in the grossest, possible way.
However, I can point out it is a policy that goes back a long period, from Bernard Baruch to Henry Kissinger.
The Indian explosion, even though called peaceful, was a setback to this policy.
Also, if the U.S.
goes on like nothing happened, people won't think we take our support for the Non-Proliferation Treaty very seriously.
I am repeating what Dr. Scoville has already said, we have a situation, put yourself in the position of a decision-maker of a country debating whether to sign the Non-Prefileration Treaty.
If you don't sign it, you get full assistance from the U.S.,
albeit that assistance is safeguarded.
We can argue about how good the safeguards are.
Sign the treaty and you put all your programs under safeguards.
If you are going to get all you want out of the U.S.
anyhow without signing it, why sign it?
Just purely from the point of view of, I take it the more civilized term from the " carrot and stick" is incentives and disincentives, isn't it a positive disincentive which would tell the decision-makar not to : sign the Treaty.
Why should he?
What is in it for my cour.try.
46 This is particularly true in India, where they have built up a nuclear industry with our assistance, and then with the know-how, and there is no way you can put safeguards on the mind of a man, they go ahead and produce a nuclear explosive device, saying, "My, isn't this peaceful?"
Well, you know it is no surprise to the Indian Government that the U.S. takes a rather dim view of a " peaceful nuclear the explosion."
As you know, all know much better than I, There scientific facts, the nuclear explosive device is the same.
The U.S.
is no last minute U.S. position we arrive at in 1974.
position on that was taken publicly as far back as 1966 at Geneva and it is incorporated in the Treaty.
So, we are not all of a sud-den saying, "The Treaty makes a great distinction between peace-ful activities and peaceful explosions."
It treats peaceful explosions exactly as weapons.
Now, for that reason, you know, I would urge that this Commission work towards the policy against positive disincentive, which we now have, whereby a country has no reason to sign the Treaty.
It is silly if it does.
You might get political gains that is true but purely from the point of view of the from it, decision-maker they get all they want out of the U.S. if they don't I
sign.
Why sign?
Why sign and take a greater safeguards problem.
Now, some people have urged and I am not urging this, Mr. Chairman, that we take the position that the Treaty prohibits I don't think the us from shipping other than to Treaty parties.
Treaty so reads, but the Treaty doesn' t require us to ship to
i I
47 non-parties.
That raises the problem of, have we somewhere along the line, somewhere along the line committed ourselves that we have to go ahead with the policy which is destructive of our non-proliferation objectives, on the basis of something we agreed to in 1963.
Now, welle the Congress doesn't so regard it.
If you read the agreement itself and particularly the contractural provisions, that have been entered into pursuant to the agreement, those agree-ments do not bind the U.S. Government against a decision that this Commission that I respectfully submit should decide is contrary with the national security interests.
We have an easier case really than in many other cases because of the fundamental differences of opinion, explained in the correspondence following the nuclear explosion as to what is peace-ful.
It is true that the final agreement between Commissioner Ray and the Indian authorities said, we will use it just for Tarapur unless we agreed to the contrary, a clear indication, however, that we consider such an agreement negotiable.
It is clear that the Government convinced against its will, maybe unconvinced still, at the risk of sounding like a lawyer, there is a well-known legal doctrine here.
I put it in English in my statement.
The lawyers put it in Latin, rebus sic stantibus, in other words, change every condition, if we are in disagreement as to fundamental points, which has been U.S. policy since 1966.
It is no surprise to them, it is incorporated in a treaty presented to the Senate and approved by the Senace, isn' t it time to say,
(
k
48 "We have a fundamental difference and therefore the doctrine do require that we continue to do things that are counter productive to our stated objective.
I think that summarized my statement, Mr. Chairman.
I would be, of course, happy to entertain your questions.
CHAIRMAN ROWDEN:
If I might, Mr. Fisher, I now have before me not only a distinguished professor but a lawyer, as well, and What we are talking about, at least in certain public servant.
is a major policy determination, respects, as you have described it, In acting upon this which this Commission is called tipon to make.
Where should that fundamental policy deter-license application.
relating to the conduct of our foreign policy in relation
- mination, be to other governments and the consequences that ensue from it, in the context of a review of the license made:
by this Commission, application, or by the President and/or the Legislative Branch of our Government?
MR. FISHER:
Mr. Chairman, I don't want to go all the way back to Humphrey, Executor, Versus the United States but the Congress did establish, this as an independent commission with a mandate and it seems to me your position is to follow on that Whether a former government offcial says this would be
' mandate.
that bad policy and the Department of State says is would be good, you should take mine, but you have to listen to all of the views and also, the including the Executive Branch, of the Government, Legislative Branch, but ultimately, it has to be the four of you
49 who have to decide an opinion are the four distinguished public servants I am addressing.
It is your conscience you have to satisfy in terms of what you think the security interests of the United States are concerned.
You might even pay attention to me, but clearly with the Secretary and others but the final decision is one that you wrestle with yourself, as I know you will, as men who have taken the oath to support the Constitution and men who agreed to serve on this Commission and following up the mandate the Commission gave you.
l That sounds terribly blunt but I mean it.
I know I am not i
i speaking to people who don't have equally as high a concept to 1
l the obligation of public service as anyone around, but that is what I consider your role to be.
If that sounds too pious, put it back to the bad habits of a professor.
COMMISSIONER GILINSKY:
You referred to the exchange of letters between the heads of the respective Atomic agencies.
What weight attaches in international law to such an exchange of letters?
Does it have weight equivalent to terms of the agree-ment itself?
MR. FISHER:
Not quite but it is evidentiary to what people think it means.
I would support on this one -- my problem with i
that, is, it came so hard, and it was sort of, a little qualified I
when you got it and with sort of whisper an a murmur maybe things could be changed a little bit.
That was my problem.
It indicated a fundamental dishgreement which I submit the U.S.
submitted
50 I
1966, but certainly under itself to, I guess it didn't start until there is no difference between a three Administrations that is, nuclear explosive device and a nuclear weapon.
To me there is more of a warning flag then it is an assurance to this Commission.
Do you regard this exchange of letters COMMISSIONER GILINSKY:
h to have rectified whatever deficiencies there may have been in t e agreement itself?
MR. FISHER:
Not really.
I would think a complete re-Frankly, I am negotiation of the agreement would be called for.
if I may use their term.
My a little more radical than that, students would not beleive me describing myself that way, but I We ought to work think Dr. Scoville's recommendation is right.
"Unless you return all the materials toward the policy of saying, to us, and unless you accept IAEA safeguards across-the-board, we are not going to have any more exports."
To avoid the disincentive, I have indicated er the decision-That implies, as "Why should I sign the Treaty?"
makers to say, Commissioner Kennedy's questions ask, do we " trust the idea of a Well, not completely but they are better than nothing safeguard?"
it and the various political forums where I have attended where is customary to denounce the IAEA and usually the criticism is the U.S., didn't do something we were based on the fact that we, And I say, okay, if we go ahead with the Indian ship-told about.
It warns ment without the IAEA system we can't blame the IAEA.
the system warns you, you have violations.
- you, z
1 1
51 But it is the best we got.
I say we can't put the genie back l
in the box and say, "Okay forget about atomic energy."
That is not j
going to happen.
I think rather wide statements about, declare a j
boycott on everything, isn't going to happen either.
It is an i
easy thing to make; as witnesses you can make all sorts of "show-
)
{
boat" statements and you gentlemen --
CHAIRMAN ROWDEN:
Decision-making is somewhat more taxing.
)
MR. FISHER:
Y'es.
Accept IAEA system across-the-board.
Why i
do I say that, rather than adopt a policy of no more shipments.
i to non-parties?
Well, it would be awfully hard to get French cooperation in the latter.
They are not a party.
They have, i
i however, said, they will do nothing that the Treaty prohibits.
If
)
we adopt as a way to implement the Treaty the policies I have indicated, we should be able to give that a hard try.
I think i
it would indicate, maybe we can't get-the Indian nuclear explosion back in the box but what about 8, 9, and 10?
Well, if we don't do something, we are saying it doesn't matter.
I think giving that impression to the world is a very, very dangerous thing to the cause of world peace, and U.S.
inter-national security.
COMMISSIONER GILINSKY:
What would you seek in a renegotia-tion of the agreement?
MR. FISHER:
I would say accepting the IAEA safeguards across-the-board.
Accepting IAEA safeguards in all their operations, and then a clarification that at least a peaceful
52 I
explosion is an explosion.
Why we need to explain that now, Maybe I am unduly sen'sitive.
don't know.
this up in Geneva in The U.S. representative that brought 1966 was me, and no one apparently paid too much attention to it, but it's been repeated by somewhat more influential people since We shouldn't say we are going to make it easy to develop a then.
We are serious about that.
nuclear industry and detonate a bomb.
At least we can reread the General Assembly resolutions on which we agreed to try to get the widest acceptance of the Non-Proliferation Treaty with a straight face because if we continue what we are now doing we are not trying to get the widest acceptance We are taking the points in exactly the other of the Treaty.
direction.
This is stated, from the point of view, if Mr. Chairman, as I said earlier in your my own point of view in saying this, this Commission I do it with complete confidence, first question, I say will decide it as their consciences will lead them to.
that with complete confidence.
I wonder if I could get your comment COMMISSIONER GILINSKY:
The State Department seems to on NRC authority in this case.
suggest on page 6 of their statement that cooperation provided for in the agreement with India is not subject to the laws or U.S.
agency licensing requirements.
in The Senate has taken the position, MR. FISHER:
the rider to the ERDA bill, that all the 364 agree-anticipation, I would take the position that a
ments are subject to this bill.
fundamental difference of opinion on what is " peaceful" brings in
53 to the Doctrine of rebus sic stantibus.
An I would thirdly take the position that when Congress set up this Commission it did not say if the State Department says we are committed that it, it gave you the authority which you have to exercise to the best of your abilities because I know you will.
CHAIRMAN ROWDEN:
I think it is a fair observation.
That question I believe we are going to explore with the Department of State.
COMMISSIONER KENNEDY:
Can we pursue your comments, sir, about the requirement, in your judgment, to refuse any further ship-ment until we get, as I understand your comment, agreement on IAEA safeguards, agreement across the board, and agreement that this was an explosion and therefore prohibited?
Also as to the NPT, ins't the Indian agreement to use our supplied strategic nuclear material only at Tarapur a sufficient assurance?
MR. FISHER:
If they really meant it I would think so.
Reading the history of that agreement they were quite reluctant to come to the agreement on the simple facts, and they say only at Tarapur, unless otherwise agreed, which holds out that that otherwise agreement maybe is a negotiable matter.
There is no clear indication that they accept our position on peaceful explosive devices.
COMMISSIONER MASON:
You feel that that caveat was intended to apply to weapons or perhaps their desire to get undue authority on the cycle?
54 MR. FISHER:
I don't know.
But the entire correspondence and one is less than that lead to the final exchange of letters, enthusiastic about what Professor Williston said I should never use, the term " meeting of minds."
When one is 1ess than enthusiastic, we are not necessarily talking the same language.
I am personally prepared, not withstanding the things that have been thrown at it, to accept the IAEA safeguards.
We can't say "Put the nuclear matters back in the box and come see us later."
I am talking about other countries, when we were negotiating the treaty, the other countries feel this is the wave of the future and they want it.
That is the indication that the IAEA is the best we got.
You can play worst case games with it like you can everything, but you have to make support for it more or less a key to cooperation by the U.S.
COMMISSIONER KENNEDY:
To pursue it just a bit, sir, you
' indicate you.would accept, I take it, these assurances if we could get them from India, but you would not accept the existing I
I am not sure what the distinction is.
1 assurance.
)
MR. FISHER:
They only provide two things.
Only the U.S.
material and there is enough of a bad history in that to make us a little nervous.
They apply only to U.S. material.
You know, they broke their work to Canada, even after Canada had made the same statement we made, do not apply to other than U.S. materials and given in a_way with respect to U.S. material that it frankly makes me nervous reading the whole thing.
4 55 A total IAEA structure brings in the International Civil Service and a whole group of other things, you can say you can throw them out,'but they aren't apt to do it.
From the decision-maker's point of view, it's one thing to chisel on an agreement and it's another thing to tell the IAEA to get out of the country.
I am not one that says you can't accept it --
CHAIRMAN ROWDEN:
Isn't there a greater risk than that in breaching their agreement with the U.S. government?
MR. FISHER:
I think there is.
Covering the entire program, to avoide the disincentives, Mr. Chairman.
COMMISSIONER MASON:
You make a statement that the Indians f
broke their word to the Canadian government.
I believe the Indian government claims they didn't.
As a professor of inter-f national law, do you feel the agreement between the Canadians and India was sufficiently explicit that it can be stated flatly they 4
have broken their word?
MR. FISHER:
I think so, because there was a splice in that even after General Burns indicated that a peaceful agreement, explosion was not a peaceful explosion because the nuclear devices weapons are identical.
They continued to accept materials from the Canadian government with full knowledge of their position.
With respect to the U.S. position, we have doubts whether our material was used, you get back to the heavy water, was that used, was that a breech.
It was.
I don't need to belabor that again.
The sum total knowledge of this would not be helped by any comments from me.
56 3
Nevertheless, I think they did break their word to the Canadian goverment because they accepted materials from Canada with full recognition of what that interpretation was, which was As I say, if you would like me to supply the made in 1966.
observations made from the record at what was then called the I would be happy to do 18-nation Disarmament Committee at Geneva, so.
This was made by Canada, following, it's true, a U.S. observa-tion; it was by Canada also.
COMMISSIONER GILINSKY:
What you are saying, if in fact U.S.
heavy water was used in the Cirus reactor to make plutonium for explosives they have also broken their pledge to us.
MR. FISHER:
Yes.
But I am not quite as, I think you can from the detect a slight difference in the tone of my voice, distinguished witness before, Congressman Long, I think the thing Even though to do because of that is to get the IAEA in there.
we are not happy with the situation, get basically a third party or bid going, get an international structure going and even though we can all say how poor it is, it's easy to make fun of, it's the best we got.
I seems to me in the future that is what lies ahead of us --
CHAIRMAN ROWDEN:
Let me explore that aspect.
It's clear what U.S. policy has been in this regard to the status of peace-ful nuclear explosions, so-called, but the meeting of the minds that you referred to -- is it clear that in the negotiation there was the sort of meeting entered into and subsequent to that,
1 l
57 of the minds on this particular provision which would lead to a common understanding.
MR. FISHER:
The U.S. did not take a position on this issue until sometime in August of 1966.
The U.S. and Canada both made their positions on this very, very clear.
All these agreements have been acted under.
They have been renegotiated since then, and it seems to me there has been no data as to the U.S. position.
Mr. Chairman, if I ma not imposing on you, I would like to request to submit the two statements made by the U.S.
representative.
CHAIRMAN ROWDEN:
I would be happy to have them for the record.
MR. FISHER:
And the Canadian record at the ENDC in '66.
Unless my fading memory serves me falsely, Mr. Chairman, they were pretty explicit.
CHAIRMAN ROWDEN:
Can agreements for cooperation be unilater-ally amended, nunc pro tune, if I may use that term?
MR. FISHER:
No.
But things happen after that.
You know, if this were just a statement of will, do we now say, "a" means "b"
and you are stuck with that for the rest of life, maybe not.
But here you have two differences.
One is, I have never talked to a scientist yet that has said that there is any difference in the nuclear capability of a " peaceful" explosion and a. bomb.
It's far from being, not like TNT, easier to turn it into a weapon than making a nuclear explosive device, you have to be good at making weapons.
It's further up the scale.
Not the bottom.
That is a scientific fact.
We are not changing that.
58 It's a f act that existed in ' 63 and it existed in '66.
The other is, these agreements were supplemented, it was done with the knowledge of the U.S.
CHAIRMAN ROWDEN:
Other agreements were entered into?
MR. FISHER:
They have had other contracts under them.
Contracts, but the basic provisions haven't CHAIRMAN RnNDEN:
been altered.
But there have been shipments made under MR. FISHER:
No.
them.
If this were a drastic provision, if we were saying "a",
the purpose of this contract means "b,"
I think the anti nunc pro This is tunc would be very strong but this is really not the case.
merely an admission of what all scientists will admit and which all scientific information indicates to be the fact.
In fact the Indians have indicated they are rather proud of Of course, they hint that does mean we have a nuclear that.
weapons capability.
So if we were engaging in some sort of Orwellian language change I would be embarrased to make this sir, but I think we are making clear what every position to you, person that has ever studied this has known from the very beginning, COMMISSIONER KENNEDY:
Sir, I have two questions.
One, do you believe that a licensing decision which may be contingent, as is being suggested here, in effect is a renegotiation, if you will,-or a unilateral renegotiation of the agreement for cooperation.
l I
59 Secondly, do you believe there is any purpose from a non-proliferation policy standpoint to be served in our continued nuclear trade with India?
MR. FISHER:
It depends on the terms in which the trade is carried out.
I think trade under the current terms, with a benign smile, well, boys will be boys, and nuclear explosion, you call it peaceful, that is all right with us, I think that would be the total impact of that.
This is never completely a black and white situation, Commissioner Kennedy, and there would not be people of your quality making these decisions, if they didn't have l
judgmental factors in it.
I think the total impact is adverse to the U.S., if we can only do it on the terms we are now doing it.
I Would a denial on a contingent basis -- it's clear by an act of Congress you can deny it.
It seems to me you might give your l
reasons for it.
I think that would be carried out by -- not Humphrey vs. Executor, forget my shorthand, I am talking about an independent commission that will te carried out directly by negotiators, but nevertheless I think you still have authority to f
do it.
This isn' t the first time this matter came up.
It comes up in other commissions that have decision-making roles in areas where the Executive Branch, even in foreign policy --
I CHAIRMAN ROWDEN:
Are you familiar with anything in the area of foreign policy where the President doesn't have the last say, as far as the decision-making process of an independent regulatory commission?
60 You can say at least putting a value on claims, MR. FISHER:
the President doesn't have the last say.
You are talking about adjudication.
CHAIRMAN ROWDEN:
MR. FISHER:
Yes.
The President, however, has to negotiate the final settlement.
In terms of decision making by an individual CHAIRMAN ROWDEN:
regulatory commission, the only analogy I am familiar with is the Civil Aeronautics Board, which has the provision for submission Are there any analogies?
of its recommendations to the President.
/
It used to take the position that its MR. FISHER:
Yes.
the President recommendation had to be approved by the President, When I was couldn't tell them what recommendation to make.
legal adviser I negotiated a rather unpleasant dispute between Continental and Colonial Air Lines in Canada which looked like it and Canada to be was going to require all traffic between U.S.
by dogsled.
The CAB was stubborn about that.
They said the President We have to make the can't tell us how to make the decision.
And I would recommend this approach to you.
decision.
CHAIRMAN ROWDEN:
Which approach is that?
l You make the decision you think is proper and MR. FISHER:
what is required after that --
Our decision in your view is a final and CHAIRMAN ROWDEN:
l There is nothing otherwise in the law.
dispositive one?
l l
L
61 l
i MR. FISHER:
If that is the case, that is the status in which you chose to serve.
COMMISSIONER MASON:
You used the word, in reply to Cbmmissioner Kennedy's question, we would have the right to deny the license.
Do you think we would be on firm legal ground if we would attempt to condition the license, putting certain l
conditions on it, or do we merely have the decision to make yes or not, as the Chairman just used?
MR. FISHER:
My own recommendation, Mr. Commissioner, would l
be not to condition it but to deny it and give an indication of the reasons and then see where the ball bounces and take it from there.
If you are conditioning it, you are sort of like a judge negotiating a consent decree or something like that. -This is only a personal view.
COMMISSIONER KENNEDY:
Could I pursue that?
Why do you prefer that we would simply close it off and not, as you say, be a little more involved?
In what way do you see that involvement?
MR. FISHER:
Give a statement of your reasons and then see what happens.
It seems to me the second you start conditioning it, you get into is that condition acceptable, is that condition acceptable, and you become a negotiator rather than an autonomous review body.
This is not a recommendation which I would presume to put myself in opposition to your general counsel if he has a dif ferent view on this, but nu recommendation would be it's
62 probably better in this type of proceeding to decide and say l
why and then see what happens from there, but that is purely a personal view.
For you own information we have asserted CHAIRMAN ROWDEN:
the position that our authority extends not only to denying a It's the application of that license but to conditioning one.
authority which is in question.
I merely expressed my own personal view on that.
MR. FISHER:
At least I would not in any way argue with the general counsel.
2 or 3 of the former general counsel are here, and I would not if that is what you think your authority is.
argue with them, I don't mean to press you, you did COMMISSIONER KENNEDY:
I don't think you answered the answer one-half of my postulate.
You made clear that you thought we certainly should other half.
not go forward under the present circumstances, as that would have Is there any positive effect, on any effect a negative effect.
If in at all that we should seek, if we were to go forward?
fact we could accomplish something vis-a-vis the Indians, is there a reason for pursuing this?
aided by your MR. FISHER:
We, if you assert you own view, I would prefer own staff, that you have the authority to condition, but if you made the condition of the type I have not doing it, indicated that would be preferable to just saying go ahead and we hope you won't explode any more of these any time soon, but in order to be really to cover, the condition in my judgment,
r.
63 i
meaningful, in order to take away the disincentive that now exists for countries signing the Non-Proliferation Treaty would have to be an across the board acceptance of IAEA safeguards as a condition.
CHAIRMAN ROWDEN:
Thank you very much, Mr. Fisher.
MR. FISHER:
Thank you.
It's an honor to appear before you.
l I
{
l i
l l
i t
i
F-1 l
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64 1
l CHAIRMAN ROWDEN:
Mr. Lowrance.
STATEMENT OF WILLIAM W. LOWRANCE HARVARD UNIVERSITY To identify myself and my background for these MR. LOWRANCE:
Lowrtice--chemist and biologist by hearings, I'm William W.
training.
I'm currently involved in nuclear science and public policy, and am pursuing those studies at Harvard Unisersity.
At the outset, I I'm speaking as a concerned citizen.
l believe the United States Nuclear Regulatory Commission should not I say that be expected to set major broad foreign policy.
because that view will pervade everything I say subsequently.
is to find a way within established i
The task, as I see it, foreign policy to make a decision on this particular fuel U.S.
I will speak to that first issue specifically, license application.
and then move on to some slightly broader issues.
It seems to me that in the present case, withholding nuclear fuel from India (12,000 kilograms or so), as compared to the kilograms or so of material already in India, would have 1
190,000 I have no evidence that withholding fuel would little effect.
cause India to change its course.
looking at the reaction of India to the There is evidence, that such embargos have little effect.
Canadian embargo, find a serious flaw in much of the written I must say that I testimony I have had a chance to read before this hearing, as
F l
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65 l
an underestimation of India's nuclear capability.
Both in the technicians I have seen coming through the universities I have been affiliated with, and in the publications I see in the open scientific literature, I'm very impressed with what India is doing in nuclear technology.
Again, that will pervade what I say subsequently.
On the other hand, there is no need to forego this present opportunity to refine whatever controls there are on the nuclear regime and make the best of what is really a very difficult j
situation.
I think I should review briefly, since it hasn't been done i
this morning, the conditions on which this must be used by India.
l 1
It must be used at Tarapur only.
It may not be substituted for in the Tarapur reactors by other special nuclear material.
It may'not be used to irradiate other materials.
It's fully subject to IAEA's safeguard, and may not be reprocessed without U.S.
concent.
When discharged, the spent fuel may be bought back_
by the United States.
In view of all the foregoing I believe the United States I
should supply the fuel requested in application 845, but on a f
lease basis.
By saying " lease," or by using some word sich as l
" lease," we would imply that we have every intention from the l
outset to retrieve that material after its use in the reactor I
and perhaps following some brief thermal cooling-off period.
COMMISSIONER GILINSKY:
Could I interrupt?
66 You are referring then to the return of the fuel in the form f
of spent fuel?
Is that correct?
MR. LOWRANCE:
Yes.
Rather than in the form of separated COMMISSIONER GILINSKY:
In fact, I'm referring to fuel elements.
MR. LOWRANCE:
Yes.
The advantage of a lease agreement is that's my next point.
in a sense, we can encapsulate material in the United States by
- that, putting into fuel elements.
It goes into bundles; sealing those zircaloy rods here; puting whatever temper-proof seals we need; taking whatever technical measures we need to assure ourselves sending that material has not been removed, or substituted for; and then those intact encapsulated amounts of material to India; bringing it back without its ever leaving those capsules.
I think, although that's just a quasi-technical measure that would give a certain assurance to us that the material has not been removed and we can clearly identify it and so on, as you know.
CHAIRMAN ROWDEN:
You are saying this shipment, if it goes forward, should go forward on that basis?
I'm saying this shipment should go forward on MR. LOWRANCE:
should begin to very seriously begin that basis.
Further, the U.S.
s to consider supplying fuel to all countries on a lease basis, sealing it up, identifying it properly, sending it over, making retrieval, and the time period, all arrangements for transportation, and bringing it back still encapsulated.
t 67 CHAIRMAN ROWDEN:
And the fuel in India already in India?
MR. LOWRANCE:
I believe that all that fuel should be retrieved.
I believe that if India accepts the conditions of leasing in the present transport license application, the U.S. then has a certain obligation to expedite that shipment.
That is, not to let red tape get in the way, because the Commission has asked for some renegotiation, putting it on a lease basis, rather than on a sale and repurchase option.
CHAIRMAN ROWDEN:
If there is no authority to lease this material--there may be a legal question in that regard--what would you suggest in that circumstance?
MR. LOWRANCE:
If there is a legal impediment on an issue as important as this, it could be removed without undue difficulty.
l Of course, there will be financial burdens, but again, I think that shouldn't stand in the way on an issue as important as this.
COMMISSIONER MASON:
I was going to ask about the financial aspect.
or whoever carries out this financing The U.S. Government, might be accused of subsidizing the Indian program because at the present time, there is no commercial use for plutonium, so we would be-buying back at the present time something which has no commercial l
value, and this would be subject to some negttiation as to how much l
we would charge for lease of the fuel.
.Then there is the financing.
Have you thought through the necessary legislative', if any, or governmental steps that would be required to implement your recommendations?
68 MR. LOWRANCE:
I am working on that now.
It is important, but I
it only becomes important to aid one country and not another.
would say we should move toward a leasing regime with regard to all nuclear fuel exports and should begin to apply it across the board.
CHAIRMAN MASON:
Suppose it would result in the public reaction of no export of fuel?
That is, people would say the U.S. should not get in the business of exporting nuclear fuel, and, there fore, there should not be export of nuclear fuel because of the safeguard dangers.
and one worthwile Would you think this was a positive step, being considered?
MR. LOWRANCE:
I think the leasing proposal is positive.
I don't see it any different from dealing with it in reproc-essing or --
COMMISSIONER MASON:
Except it might involve U.S.
financing.
MR. LOWRANCE:
That's right, but I believe one can argue that on grounds of national security, of course, we subsidize all kinds of programs, nuclear and otherwise.
It would be a small expense, and I believe one could mount a very reasonable defense of that as a policy.
the U.S. has been involved The question of leasing is not new, in leasing before, as I understand it.
Some thougne has been given to it, in the past, and I understand some at the present.
l Let me say that I do think the Commission has the opportunity here to call for a broad review of leasing.
To call for experiments and for thinking about the domestic situation, possibly concerning
59 environmental outcry that might arise, because we are bringing nuclear waste back from other countries and so on.
I can even envision a year from now having hearings where the very same petitioners would be on the other side, saying "I'm not sure we want all that material back in the United States."
I mean, that's just in jest, but I think in approaching it, we l
should apply the same very large grossly graduated scale to the appraisal that we do to other matters of national security.
That is, instead of worrying about $10,000 or $100,000, we should think in terms of millions and millions of dollars.
If that's what is required, then it's very small in terms of the outlays we are pre-pared to make in other matters, like national security.
I think on all grounds of security, that is stability and otherwise, this could be justified.
COMMISSIONER KENNEDY:
Could I interrupt one second, Dr. Lowrance.
Have you, in the process of your investigation, thinking about their proposal, given any consideration to the attitudes which other suppliers might have?
In other words, would there be a significant competitive advantage or disadvantage arising from such a proposal, and in either case, how would this be seen by other suppliers?
MR. LOWRANCE:
I'm not certain, I'm not able to make up my mind on that yet.
l Again, it's one of the things that I'm trying to do right now.
It seems to me that for many countries, there will be a positive advantage in receiving the material in this form, already
70 That saves fabricated and in the fuel elements, in-the bundle.
)
Clear arrangements made for transportation, and a lot of trouble.
all those kinds of f
physical protection of the material in transit, just as leasing of automobiles things, under a leasing basis, and other things, often turns out to the pruchaser's advantage, I think it could be worked as opposed to some other arrangement.
out that way here, so that it would not be a disadvantage.
Why leasing, rather than simply an arrange-CHAIRMAN ROWDEN:
ment to repurchase the material?
Is there some attribute of leasing you find attractive?
In leasing, one is explicitly saying from MR. LOWRANCE:
It will be "This is our material all the way.
the very beginning, leased used, something of it will be consumed in the sense that a from the automobile is consumed partly by its user, but you expect beginning to retrieve it.
d of There is no question what is going to happen at the en All That doesn't have to be renegotiated.
a year or two years.
that is, when one does the cost balances, the expenses involved, be brought on knows in advance about what time that will have to so the arrange-One knows what inventory will be there, back.
The same is ments for storage and so forth, can be worked out.
the case on the return.
l tone Also, I think there is a certain policy psychologicamaterial to the word " leasing," which implies it's United States brought back, lent out, It's put in capsules here, all the way.
l
j l
with a certain fee paid for that service.
But, at all times, it remains U.S. material.
It's understood from the very beginning i
l that those containers are not to be sawed open or otherwise tampered l
j with.
l So, I think that's the kind of difference.
I COMMISSIONER GILINSKY:
You stressed the importance of keeping the material encapsulated, both on the way out and on the way back.
1 Could you comment on the differences that would flow from permitting reprocessing or separation of the plutonium in the importing country and then return of the separated plutonium?
MR. LOWRANCE:
As opposed to keeping it in the capsules all the way?
I see that as a very different situation.
That opens up a lot of messy legal questions for substitution of materials.
I think that may come.
India is preparing reprocessing.
I think another question the Commission will have to deal with one of these days is whether purchase material should be allowed to be broken into and reprocessed and so on.
I don't have an opinion right now, expect to say it would be a very different set of questions.
I like the interim solution of leasing it, keeping it in the capsule round trip, so that there simply isn't question of its be reprocessed.
I feel I probably didn't speak to your question directly.
COMMISSIONER GILINSKY:
I was really referring to the safe-guard differences that might be there, between the two cases, where the material is always encapsulated and where you allow separation of the plutonium.
o 72 One knows in leasing that 100 percent of the MR. LOWRANCE:
I material comes back, barring a break of the rods by freight accident l
l Barring that, or some accident that I would hope wouldn't happen.
if all the containers were sti$1 sealed, and we could check that out, one would have the assurance that all the material came back.
In the case of reprocessing or handling at the other hand, I have had the unavoidable experience of losing as a chemist, If you transfer materials enough times, you do lose i
material.
You have been through the safeguards argument enough material.
Leasing is like an to know this would be a different situation.
It gets around your question, barring a full serious end around.
decision to reprocess that material.
Of course our experience in the past with CHAIRMAN ROWDEN:
leasing is that it does not necessarily insure that the material comes back to this country.
As a matter of fact, this We leased material for many years.
government spent a long time trying to get out of the leasing business.
Much of the material that was shipped overseas on a lease l
basis, of course, never came back to this country.
That is why I was interested in the mechanism.
If this were one of my classes rather than MR. LOWRANCFt your hearing, I would certainly turn the question back around and Perhaps I can do that privately, but ask a handful of questions.
I would hope that van be a~oided both by technical measures of making those fuel containers solid, so there wouldn't be any
l 73 leaking or broken containers and so on; and that we make it very, very clear in leases that this has become a much more serious matter in the United States and we have every expectation of getting all that material back.
If we don't get it back, obviously we wouldn't export it anymore.
If you lease something to some-body and they steal it, you have no reason to lease to them any-Maybe we can return to leasing if you have other questions.
more.
The second part of my proposal is that we immediately exercise
)
our buy back option and buy back the entire spent fuel in India.
This is something like 80,000 kilograms of material.
Of course, l
in that connection, the Commission and others would have to review our provisions for storing that material, for transporting it, and so on.
We have to think about the implicationa for other countries with whom we have fuel contracts and might also wish to exercise buy back.
I understand there is that agreement.
But I see no j
i reason why we shouldn't repurchase every bit of that material.
Having mentioned those aspects of the current license, although I don' t tie them together necessarily, I think we should lease I
There are some the material, I think we should repurchase.
broader questions which come up.
I know the application is con-cerned with the question of safeguards.
I simply would say that I think safeguards are absolutely essential for the whole nuclear i
business, but that they have inherent limitations.
They are best to follow process streams, prepared to follow material in transit, to follow mixtures of materials and that is, materials which are I
l I
l 74 still diluted in some form and are not in weapons grade form, but they are much less well prepared to follow large batches of highly That is why safeguards refined material, such as plutonium oxide.
simply come to their limits, because that material can be i
expropriated, we all know the scenarios, a theft can be mounted l
the The' larger the bulk of material in refined form, and so on.
less powerful the safeguards would be in' acting as a deterrent.
I think the distinguishing feature is the amount of time That is material required to convert the material to a weapon.
that has to go through many. process stages before it can be made It can be protected by safeguards.
But the material a weapon.
which' is only 12 hours1.388889e-4 days <br />0.00333 hours <br />1.984127e-5 weeks <br />4.566e-6 months <br /> away from being an explosive device certainly should come under safeguards in transit.
The safeguards, as they are currently carried'out, and even as we envision them in the future, with much upgraded budgets and so on,. simply will be too slow a device for reacting to expropriation.
Again, I would assert, that safeguards are essential in all of the nuclear enterprises.
That brings me to the point that I hope the Commission will continue to move toward, that is working with other parts of the in examining the government and with other countries, U.S.
We question of the plutonium stockpile or plutonium repository.
are now at a stage where a tremendous amount of plutonium is free in the world.
A lot of it is tied up as sludge.
It's difficult material, but a good bit of it now is coming to highly refined It's that material I think should be moved toward a form.
repository.
6 s
75 l
I At first it might be repositories in the fully established nuclear weapons state, but I think as quickly as possible should be moved into repositories under fully international supervision.
The kind of consequences that are going to come before the
~
Commission will have to do with supply of fuel for a broader program.
Italy has a fast breeder program.
It's going to need I
material to fuel.
At least at the experimental stage.
Japan also.
l We know the United Kingdom, the Federal Republic of Germany, France, the Soviet Union, ourselves, all have impressive breeder programs.
Whatever the United States decides to do about its own breeder, which is quite a separate question, we are going to have to learn how to handle the highly concentrated plutonium which will be used as fuel in those breeder reactors.
Again, the plutonium repository question has merit and I would like to see it explored.
j j
one last observation.
We have a unique opportunity here for high level diplomacy.
It occurs not necessarily two years and not next year but right now.
That diplomacy would come with India and Canada.
Canada has now placed its embargo in effect.
The IAEA safeguards on the material coming out.
Candu reactors and the Candu style successors have to be met in some way.
I would like to see the United States undertake very high level, urgent diplomatic missions to discuss with the Indians the disposition of that material.
We have to recognize that the Candu style reactors within a short couple of years, if they don't already, will
o 76
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t account for far more megawattage than the pair of Tarapur reactors, I think the U.S. could offer and it's a very different question.
Also, with Pakistan, because there to act in the role as liaison.
has been a lessening of the tension between India and Pakistan in This again may be an opportunity for high level recent weeks.
diplomacy to discuss the future of the reprocessing program at and the Tarapur and the reprocessing plant planned for Pakistan, I
United States is fully involved with both of those governments.
see no reason it shouldn't raise this very question of reprocessing with the two governments.
It's a job for All of this seems to me to fit into a package.
Thus I have recommended that the State Department and many others.
the fuel requested in the application be supplied but on a lease that all appropriate reviews of leasing be undertaken basis; notify India of its intention to repur-immediately; that the U.S.
chase the entire inventory of U.S.-supplied Tarapur fuel; that all appropriate reviews be conducted to help us manage that extend such reviews to cover other repurchase; that the U.S.
that if India accepts countries, with whom we have fuel contracts; expedite the transfer of materials the conditions of leasing, U.S.
so there is nothing punitive about that conversion.
Throughout all of this, the United States should emphasize the seriousness of the present situation, that the leasing is not If we supply the fuel, we will do it only on repeated for nothing.
in many assurances of care on the part of the government of India, different regards.
77 I have mentioned plutonium repository and the kind of diplomacy that is before us.
I thank the Commission for allowing me to appear and I commend the Commission for the kind of courage it has shown in opening itself up to receiving testimony not only on its own business but that on the part of the United States State Department, Congress, ERDA and other parts of the government.
CHAIRMAN ROWDEN:
Thank you very much, Doctor.
COMMISSIONER KENNEDY:
I have only one question.
Do you think that the program which you have laid out, if all of those things were done, would give us reasonable assurance that there would be a significant change in the Indian program?
I am going back to your initial statement in which you said, a great flaw in much of the written testimony that you have read is gross underestimation of India's nuclear capability.-
In other words, should we assume that India's nuclear pro-gram can go ahead no matter what we do?
That is Point 1.
Point 2.
If we pursued this entire program, would the program have any significant effect upon the intentions of any other nations to go the nuclear route?
MR. LOWRANCE:
It seems to me in the present case, some version of such a plan, the only remaining entree we have with India that we should recognize.
We are the only country at the moment which does have this kind of nuclear cooperative power t
78 I
I am not with the Indian government and.we should exercise it.
in a sense that it's simply the best I can do happy with it, I think not doing it is under the difficult circumstances.
I can't see the advantage of saying we will now unproductive.
that we won't supply this 12,000 kilograms stop supplying fuel, of fuel, when in fact there are 190,000 kilograms of U.S.-
supplied fuel and a very large amount of waste from Candu reactors, I can' t see that withholding it would much more on its way.
I have any particular advantages, except as a demonstration.
haven't been impressed in the past with what such demonstrations have achieved with India or for that matter with anyone else.
l Have we ever undertaken a demonstration of CHAIRMAN RONDEN:
that nature in the past?
I am not aware that we have.
MR. LONRANCE:
Canada has.
Do you see the utility of sending--
CHAIRMAN ROWDEN:
I think we should send the signal at the highest MR. LOWRANCE:
level that we are concerned about this as an issue.
is this When does this become believable, CHAIRMAN ROWDEN:
when we have a smoking gun or when it becomes an issue?
I can' t see that withholding this fuel would MR. LOWRANCE:
constitute that strong a signal.
I am aware of the dilemma that obtains here.
If we don' t supply it, somebody else will.
Do you pull out and force the nation to develop its indigenous capabilities or do you try to keep a hand in and do what you can to exert some control?
r 4
l
l 79 l
I am impressed with the technical expertise of India and given the fact it now is able to make all the heavy water it needs, or shortly will be able to make all the heavy water it I
needs.
In fact it may become an exporter.
It has natural uranium,
~
thorium, many trained technicians, many large pieces of hardware installed and many more on the way.
It seems to me that withholding this one shipment would not achieve the desired end.
COMMISSIONER KENNEDY:
Would ii make any difference it was not just this one shipment?
MR. LOWRANCE:
Doy you mean a statement we would withdraw all nuclear aid, for instance, or something of that sort?
COMMISSIONER KENNEDY:
Or that this action would be interpreted l
as a step in that direction.
MR. LOWRANCE:
I don't believe even that a complete nuclear cut-off would stop India from developing nuclear weapons.
I don't think even that signal and that action would stop India from developing its nuclear program.
i I
I have every hope, perhaps I am overly optimistic, but I l
hope that India will emerge as a very strong leader in that part l
of the world and may join with some of its neighbors, especially in the context of the much larger neighbor to the north, to exert some control over nuclear growth.
COMMISSIONER GILINSKY:
Your comments about heavy water and India becoming an exporter surprise me.
It seems to me that at the present time India is dependent on external sources.
r 1
80 By adding up the capacities of the heavy water MR. LOWRANCE:
plants now completed and under construction, but not yet operating 1
1 I
within (this is the technical logical development time scale,)
something like five years or within a decade, India will be making I could be wrong in over 200,000 kilograms of heavy water a year.
my figures, Commissioner, but there are about five fairly large I don't have privileged plants, some built with foreign systems.
I am told that those are largerly indigenous information.
technology.
COMMISSIONER GILINSKY:
Right now the operation of their heavy water reactors, it seems to me, depends almost entirely on foreign heavy water and will for a while.
MR. LOWRANCE:
I can't speak to it.
I don't know the balance I do know the most successful plants in operatior sheet for material.
But I understand that very large plants--that is are'quite small.
plants on the order of 60,000 kilograms a year--are actively under construction and. components have been subtracted to suppliers.
COMMISSIONER GILINSKY:
About half of present stocks were supplied by the United States.
MR. LOWRANCE:
Any other questions?
CHAIRMAN ROWDEN:
Thank you very much.
I l
81 Mr. Marcy.
I appreciate your patience, Mr. Marcy.
We saved you for last.
STATEMENT OF CARL M. MARCY COUNCIL FOR A LIVABLE WORLD MR. MARCY:
To keep the audience, I promise to keey my state
- ment short.
I am legislative consultant to the Council for a Livable World, which was established in 1961 by Leo Szilard, who was one of the principal scientists in helping develop nuclear power.
These are my own views, although the purpose of the Council is to do all it can to limit the proliferation of nuclear weapons in any way, shape or form.
Prior to coming with the Council for a Livable World, I was J
staff director of the Senate Foreign Relations Committee, and in that position I had a good bit to do in dealing with diplomats of various countries, and concentrating on foreign policy legislation, some of which related to nuclear matters.
Prior to that time, I was never as distinguished as Mr. Fisher.
I was only an assistant legal advisor at a very low level.
I am glad he wasn't my boss.
Since a member of points which I wanted to make have been I will concentrate rather narrowly on some of the things
- covered, f
which concern Congressional attitudes.
I call your attention to the fact that the House and Senate to the International recently approved the Symington Amendment Security Assistance Act.
t
82 That amendment provides that no United States economic and military assistance may be given to any country which delivers or receives nuclear reprocessing equipment, materials and technology, and which (a) does not place all such equipment, terms and technology under multildteral auspices and management when available, which does not place all such equipment, materials and and (b) technology and all nuclear fuel and facilities within the country under the safeguards systems of the International Atomic Energy Agency.
I ask your permission to include the short provision of law That is, at the time I prepared this in your record, if I may.
It was the President had not signed that into law.
statement,
)
I signed into law on June 29 and is part of PL 94-329.
This legislation could have the effect of requiring a cut-off of United States economic and military assistance to Pakistan, l
I should Pakistan acquire a reprocessing facility while leaving the system in India unaffected.
An absolute minimum condition for This doesn't make much sense.
the transfer of fuel to India, would be to apply safeguards to all indigenous nuclear facilities.
As a matter of fact, I would go further, and until we know much more about the economics of plutonium recycling and our I would ability to apply safeguards in reprocessing facilities,
1 1
83 prohibit the reprocessing of United States supplied fuel and require that such fuel be removed from the country which has received it.
I call your attention to one other recent Congressional development.
It relates to the question of the adequacy of information which is available to you to make your decision.
(
)
It is my understanding that our access to information has been so limited under current conditions that it is difficult for j
t us to know precisely what is going on within the Indian area.
This problem was outlined and underscored at hearings held last June by Zablocki in the House International Affairs Subcommittee which he chairs.
That Subcommittee has drafted an amendment to the Export Act of 1969, which would require the United States to have access to information on foreign nation stockpiles of nuclear material in time to provide timely warning of diversion.
It seems to me in recent months there is evidence that Congress has become increasingly concerned at the dangers of proliferation.
Certainly, the Symington and Zablocki amendments indicate a strong feeling that the Executive Branch has been dragging its heels and not worried enough -- sufficiently -- about the problems of proliferation.
I would like to come back to one point Mr. Fisher mentioned.
That is the capacity of the United States to, in effect, l
renegotiate or even ignore earlier agreements.
l 1
l l
l l
84 i
The international legal doctrine " rebus sic stantibus" is l
defined as follows.
"It is a name given to a tacit condition, said to attach to all treaties that they shall cease to be obligatory so soon as the state of facts and conditions upon which they were founded has substantially changed."
t The condit.ons have substan aally changed, certainly, with l
4 respect to our relationships with India.
Two rather irrelevant points, but I think they are worth perhaps injecting for you to think about.
I noticed in the New York Times a few days ago that the United States is now developing what is called a master plan to cope with We hope The reference is to domestic nuclear disasters.
disaster.
f these disasters won't occur, but just in case, we better be ready.
It seems to me that perhaps the State Department -- maybe you gentlemen could give some guidance in this -- ought to begin to I am not just talking think in terms of international disasters.
but about explosions of peaceful -- of power generating equipment, other kinds of disasters which can certainly occur as proliferation i
goes on.
It does seem to me that the nuclear powers do have very,
'very wide common interests which have not adequately baen explored.
I suppose, now, in For example, we have a common interest, is suppressing what I would ca]1 just " simple terrorism." It simply terrorism to hijack an aircraft with 300 or 400 people At least it is simple terrorism compared with the aboard it.
i
7 85 kind of terrorism which might be down the road as these weapons spread and as a terrorist might hold a city as hostage.
So I hope you will have that kind of consideration in mind, because I think it is in the minds of a good many citizens, and
{
certainly in the Congress.
It is very good of you to hear me, and to set the precedent for hearings of this kind.
Thank you very much.
CHAIRMAN ROWDEN:
Thank you very much, Latin phrases fascinate me.
" Rebus sie stantibus."
To what extent does that allow India to walk away from
)
agreements?
MR. MARCY:
I think it applies to them, as to us.
CHAIRMAN ROWDEN:
In terms of international law, as far as it relates to the matter.
COMMISSIONER KENNEDY:
I will ask about the same kind of questions I have asked of previous witnesses, do-you think that a withholding of this license would have any effect on our relations with India, India's intention to move forward with its program of PNE on the one hand; or on other suppliers?
MR. MARCY:
In the first place, I do not think that with-holding a license is going to improve our relations with India any more than withholding economic assistance dis.
Our relationships with India are not very good and haven't been good for a long time.
k
86 On the other hand, the attitudes of nations toward each other are very transitory, and it is quite possible that the attitudes might change substantially.
I rather doubt -- I will be guided by the more knowledgeable people in the field -- I rather doubt that our withholding the license is -- whether you gentlemen grant the license or not --
will prevent the Indians from going to go ahead.
I think India is too far down the road.
I don't think they can be stopped.
Now, as far as the effect on other nations are concerned, I
keep thinking of the situation we have gotten ourselves into i
with respect to the sales of military equipment.
If we don't supply, We give the same kinds of argument now.
the French will, or some other country will, and the in this case, result is that this is a self-defeating argument.
Someone has got to start, to stop.
We have talked for years and years about what a great leader the United States is and I would like to see us for once perhaps lead a bit by example instead of leading in this sort of framework where we say if we don' t do these horrendus things, it somebody else will.
If we do it, -- we are going to be able to apply controls, goes the argument.
If we sell them an aircraf t, then they want a part, so we say we can exercise controls.
But it just doesn' t work that way.
I think you are at the beginning of that kind of development in the nuclear proliferation field, and I hope we as a nation do v
1 0
87 I
all we can to resist it, and I think you have a chance to i
start here.
COMMISSIONER KENNEDY:
Are the Brazilian and Pakistan cases instructive in any way in this regard?
MR. MARCY:
I think they are.
COMMISSIONER KENNEDY:
How?
MR. MARCY:
Well, yes, they are instructive in the sense that other nations will, but if someone wants to supply all the equip-ment and all of the reprocessing, I am perfectly willing to let j
them do it, and take the onus of the consequences.
COMMISSIONER KENNEDY:
What does that do for our non-f proliferation objectives?
MR. MARCY:
I don't see that our non-proliferation objectives are helped by our assisting in proliferation.
As soon as we start going down the road of supplying fuel without safeguards for reprocessing equipment, that is what we will get into.
I certainly think we ought to take the lead in trying to develop multilateral reprocessing facilities.
COMMISSIONER KENNEDY:
You spoke of selling fuel without in safeguards, but as a practical ma'tter, do we not now have, L
terms of the agreement for cooperation and the assurance of India, 1
the appropriate safeguards in respect to our own fuel?
MR. MARCY:
Yes.
I understand we do.
The Symington Amendment, of course, is trying to apply it more broadly.
That refers to all the facilities within a country.
L
r-88 l
COMMISSIONER KENNEDY:
Thank you.
CHAIRMAN ROWDEN:
Thank you very much, Mr. Marcy.
l At this point, I think it would be appropriate to adjourn.
We will stand adjourned until 2:00 p.m. this afternoon.
I i
(Whereupon, at 12:30 p.m., the hearing was recessed, to reconvene at 2:00 p.m., the same af ternoon.)
l l
l
89 AFTERNOON SESSION l
(2:05 p.m.)
CHAIRMAN ROWDEN:
We can resume our session.
The next presentation will be by Deputy Assistance Secretary of State Mr. Myron Kratzer.
Mr. Kratzer, I understand you are accompanied by several other colleagues from you Department and perhaps
\\
others from the Executive Branch.
They are welcome to join you at the table.
STATEMENT OF MYRON KRATZER, ACTING ASSISTANT SECRETARY OF OCEANS AND INTERNATIONAL ENVIRONMENTAL AFFAIRS, DEPARTMENT OF STATE; ACCOMPANIED BY THOMAS DAVIES, ASSISTANT DIRECTOR, DEPUTY ADMINISTRATOR OF THE U.S. ARMS DISARMAMENT CONTROL AND DISARMAMENT AGENCY, THOMAS BETTAUER, LEGAL ADVISOR AND DENNIS KUX, DIRECTOR OF THE OFFICE OF INDIAN AFFAIRS, DEPARTMENT OF STATE.
CHAIRMAN ROWDEN:
I would appreciate it if you would identify them for the record.
MR. KRATZER:
Thank you, Mr. Chairman, members of the Commission.
I am accompanied by staff of the Department of State and the Arms Control Disarmament Agency.
At my left is Mr. Thomas Davies, Assistant Director of the Arms Control and Disarmament Agency.
Mr. Ronald Bettauer, of the Office of the l
Legal Advisor, and Mr. Dennis Kux, the director of the Office i
of Indian Affairs, Department of State.
i f
90 There are others of the members of the State Department staff who won't quite fit at the table but will be able to support me I hope, without objection from the Commission.
l f
Mr. Chairman, we" do welcome the opportunity to comment on the issues related to the Nuclear Regulatory Commission's con-1 siderations of a license for the export of vitally enriched uranium for use as fuel in India's Tarapur Nuclear Power Station.
In our written submission of July 8th we have addressed the f
specific issues which the Commission has identified as particularly i
relevant to its consideration.
l I would like at this time to provide general background I
l information on U.S. nuclear cooperation policy, with particular In doing that I will draw relation to this proposed export.
principally upon the introductory section of our July 8th written submission.
The United States policy of international cooperation in the peaceful uses of nuclear energy had its origin in 1953, when it became evident that the policy of secrecy and noncooperation followed since the end of World War-II was proving to be inef fec-tive-in halting the acquisition of nuclear weapons by other nations.
A new policy was given Congressional endorsement and legislative charter by the Atomic Energy Act of 1954, which pro-vided for the conclusion of Agreements for Cooperation with other nations, to be entered into under carefully prescribed
-~
9
e i
91 While these agreements could cover a broad range procedures.
of cooperative arrangements, their existence was prerequisite to certain specific activities, including the export of special nuclear material.
The Atomic Energy Act also prescribed certain guarantees which were to be included in each agreement for cooperation These guarantees negotiated under the authority of the Act.
include solemn assurance by the cooperating nation that material transferred by the United States "will not be used for atomic weapons, or for research on or development of atomic weapons or for any other military purpose.
i the centerpeice of the new cooperative From the outset, policy was the supply of nuclear materials, and especially of enriched uranium, which U.S. development work had shown to be More-the most efficient fuel for civil nuclear power reactors.
over, it was recognized that the use of enriched uranium had impo'rtant advantages in reducing the risk of nuclear prolifera-since the limited availability of enriched uranium made
- tion, it far more practical to secure and maintain peaceful use con-trols on reactors operated with this fuel than on those utilizing natural uranium fuel, which was much more widely available.
Thus, U.S. policy encouraged the use of the slightly l
such fuel then only being avail-i enriched uranium reactor system, I
able in commercial quantities from the United States.
I
s 92 This important policy advantage, however, had as a corollary that few, if any, nations were willing to make major investments in nuclear reactors dependent on enriched uranium fuel unless the continuing availability of this material was assured on a long-term basis.
To meet this problem, policies and practices were developed These policies and practices to provide the necessary assurances.
were reinforced by policy statements from the highest levels of the U.S. government indicating the readiness of the United States to act as a reliable supplier of enriched uranium on stable and attractive terms and conditions.
COMMISSIONER GILINSKY:
May I interrupt you for a moment?
In discussing the shift in policy in the early '50s, are you saying that the new policy was adopted because it would more effectively deal with the problems posed by the spread of nuclear weapons?
It had a number of rationales, I think is MR. KRATZER:
the best way to answer that, Commissioner Gilinsky.
It certainly had an element in it of assistance to other countries, the belief we should share with others the benefits of peaceful uses It had in it the element of desiring to of atomic energy.
establish our leadership, our scientific leadership in the it had in it the element of wanting to secure conditions
- world, t
which would make it more feasible for us to continue our role j
in essential defense nuclear programs but certainly the element
r' l
I o
93 that the policy which we had been pursuing, the policy of secrecy, not being adequate to deal with the problem of pro-liferation was clearly recognized.
I think it's very evident in President Eisenhower's 1953, December 1953 speech, which inaugurated, the so-called'" Atoms for Peace" program and the earliest papers prepared on this subject _made it clear that that was an important objective.
COMMISSIONER GILINSKY:
Thank you.
MR. KRATZER:
Shall I continue?
CHAIRMAN ROWDEN:
Yes.
MR. KRATZER:
The principal mechanisms employed to effect this policy of dependable, long-term fuel supply were, and are, the agreement for cooperation, and the long-term fuel supply contracts entered into pursuant to these agreements.
It was the objective of this policy, which is clearly reflected in agreements for cooperation and the associated fuel supply con-t tracts, to provide the cooperating party with the strongest possible assurance of that supply would continue on an unin-terrupted basis.
It is particularly relevant to point out that these policies and practices had their' origin during a period when not only the production, but also the ownership of all special nuclear material was confined to the United States government and exports were exclusively within the governmental purview, not subject to licensing.
l
94 Thus, all the steps required to give the fullest possible effect to the policy of assured supply of fuel material, from contracting, through production of enriched uranium, to approving its actual export, were carried out by and under the control of the United States government.
The statutory requirements for the conclusion of agreements for cooperation fully supported this policy by providing for a Presidential determination at the time an agreement was entered into, that the performance, and I have underlined that, of the proposed agreement will promote and will not constitute an un-reasonable risk to the common defense and security.
The Agreement for Cooperation with India, pursuant to which the proposed export would take place, was negotiated under the regime described above.
That is, during 1963, the ownership of all special nuclear material in the United States was still vested in the United States government.
CHAIRMAN ROWDEN:
The following year that was changed by legislation calling for private ownership, which had consequences as far as the export of nuclear material.
MR. KRATZER:
That is right.
And obviously the Private Ownership Act did not happen overnight.
It had been the subject of lengthy discussion before it was finally passed.
And in the 1963 agreement and fuel supply contract, there was actually provision in the 1953 supply contract which enabled us to modify --
CHAIRMAN ROWDEN:
You mean '63?
I l.
l 95 l
l l
MR. KRATZER:
I am sorry.
1963 contract.
l CHAIRMAN ROWDEN:
This is the contract?
l MR. KRATZER:
Fuel supply contract.
There is a provision in that' fuel supply contract under which we were able to amend the contract, as we'later did, to take into account the con-sequences of private ownership.
I think it's significant, when you look at that particular l
provision of the fuel supply contract, that it stated that the necessary changes could be made by amendment to the contract to
-accommodate private ownership, but that these would be without prejudice to the basic obligations of the United States to sell all the necessary nuclear fuel and the government of India to buy it.
CHAIRMAN ROWDEN:
This again is a contract, and the agree-ment for cooperation is a form of executive undertaking, albeit subject to a period of congressional review?
It is not a i
statute, certainly not a treaty, and I am asking this question because of the suggestion in the submission of the State Depart-ment that the arrangements with India were unique in that there is no provision, as is commonly contained at least in subsequent agreements for cooperation, making the form subsequent to licensing and regulation which are in force and applicable in the United States under our domestic legal regime.
My question is, is this simply a historical observation on the part of the State Department or is there an operational sig-nificance in terms of our authority to act or not to act on this transaction?
1 1
96 MR. KRATZER:
Well, I believe that the best answer to that, and I think Mr. Chairman, is that in most of our agreements, this is true both with agreements which were entered into before the 1963 agreement with India and after, thn scope of cooperation provided for was so large that the ag_eement was what we normally looked upon as an umbrella agreement.
In other words, it authorized a number of things, but with the one important exception of fuel supply, very few things were committed.
Since the authorization is so broad, we felt the need to include in those agreements some saving clause.
In other words, something that would make it clear that beyond our own discretion, which was also operative in most of those authorizing provisions, that our freedom to cooperate, our ability to cooperate, might very well be subject to applicable laws, regulations and license requirements, so that most of our agreements of cooperation contain the provision that cooperation provided for thereunder shall be subject to laws, regulations and license requirements.
Now, the Indian agreement, the unique feature of it, was that it was very specific to cooperation on the Tarapur project and because of that, I believe, and I don't want to maintain that this is demonstrable from records, but I believe as a participant that it was simply felt to be unnecessary to have that broad saving clause applicable to cooperation under the agreement as a whole.
i i
[.
97 I
I think I should point out, and this is particularly evident when you take into account that practically all of our agreements, even though many of them have since been amended, had their origins in the bre-1964, the pre-private ownership days of the Atomic Energy Act.
It wasn't contemplated that the export of nuclear material would be subject to license.
It could not have been contemplated.
It actually was not legall[ permissible under the Atomic Energy Act, in those days when the agreements were first entered I
into.
Obviously things have changed.
The Act provides now for private ownership and export licensing.
Most of our agreements have been brought up to date by subsequent changes, subsequent to 1964 to take that into account partly because they are broad agreements which have to be amended from time to time, to increase the quantity of fuel supplied and so on.
That has not occurred in the case of the Indian agreement.
And I believe it is relevant that the regime which the the parties understood at the time they entered into it is not one that prevails today.
CHAIRMAN ROWDEN:
Well, that may be relevant in terms of historical evolution but in terms of our licensing authority, is it relevant?
We operate under a statute which was amended in 1
1964, to give us specific responsibility--that is, the Atomic Energy Commission--responsibility which this agency inherited, l
98 It may be that so to speak, with the Energy Reorganization Act.
there was no explicit provision in the agreement for cooperation i
with India but even treaties entered into by this country are f
subject to being modified by the enactment of subsequent 1
legislation.
I want to clearly understand whether there is any contesting of our authority to act on this license application.
MR. KRATZER:
No.
I think, Mr. Chairman, that this Commission clearly has the statutory authority to act on this license appli-It can't be granted without Commission action.
cation.
I think that my point is, that it's relevant to the intent of the parties which the Commission, I hope, would agree is relevant to their licensing determination.
Then you comment on page 6 of your statement, MR. GILINSKY:
" incorporated and provided for in the agreement with India is not explicitly subject to the laws, regulations and licensing requirements," is an observation on the situation at the time the agreement was signed?
It's an observation of the situation at the MR. KRATZER:
time, which as I just suggested I think is indicative of the intent of the parties as to what would take place under the In other words, that the licensing, that the export f
agreement.
of fuel would not really be subject to a case by case reexamina-I tion, whether you call it licensing or whether you call it some-It's my view that the agreement intended to create thing else.
the strongest possible presumption that fuel would be supplied.
i j
l 99 COMMISSIONER GILINSKY:
But still the parties entered into a sales agreement wich specifically provides for licensing.
MR. KRATZER:
That was the amendment to the agreement I
l that I referred to.
As I indicated in my comment a moment ago 1
that amendment took place pursuant to article 11 of the original sales agreement.
As I say, it was foreseen that there would be l
a modification in our domestic law.
I don't think that we i
foresaw all the details, all the consequences that would have j
for procedures that would ensue in the case of export of nuclear materials.
1 But we did go on to say in article 11 that nothing contained in this article shall affect the obligation of the seller to sell, at the Commission's published charges and so on, and that of the purchaser to purchase, all of the purchasers' enriched j
uranium requirements for the Tarapur Power Station.-
It was seen that certain procedural changes would occur but these were not to be contrary the basic obligation to supply all the fuel needed at the station.
COMMISSIONER GILINSKY:
At the prevailing price.
Well, the article itself speaks about changes in applicable laws or policies of the United States of America.
MR. KRATZER:
With respect to ownership and supply.
In other words, it foresaw that there would be very probably a change in the law regarding domestic ownership of special nuclear material.
100 In this case the parties would get COMMISSIONER GILINSKY:
if any, were reqtired together and determine ahat modifications, to this contract.
But within the frame work, That is right.
MR. KRATZER:
h t the basic you might.2y, within the boundary conditions, t a d d for the Tarapur understanding to supply all of the material nee e Station would not thereby be affected.
Given that those modifications COMMISSIONER GILINSKY:
were agreed to.
The amendment to the contract MR. KRATZER:
They were.
the licensing.
provides that exports can take place subject to But it also provides for possible COMMISSIONER GILINSKY:
United further modifications upon changes of policies of the States.
Certainly not unilateral ones.
MR. KRATZER:
It suggests the parties would have COMMISSIONER GILINSKY:
to join together to discuss the matter.
MR. KRATZER:
Right.
Proceed, Mr. Kratzer.
CHAIRMAN RONDEN:The negotiation of this Agreement with India MR. KRATZER:
It l
important one.
was recognized to be a unique and especial y f
uards was at came at a time wheta U.S. policy relating to sa eg Under the U.S.-sponsored policy of peaceful a crossroads.
it was contemplated from the outset in 1953 nuclear cooperaton, d by an international that safeguards ultimately would be applie f the United Nations atomic energy organization under the aegis o with world-wide membership.
i
101 1
Following the passage of the 1954 Act and for some time thereafter, however, responsibility for safeguards was necessarily assumed by the United States itself, since the International Atomic Energy Agency had not yet come into being.
j The Agreement for Cooperation with India was the first new agreement of importance to be negotiated after the adoption by the United States of this policy, and was understood to be a critical test of whether safeguards administration could be generally transferred to the IAEA.
In common with many other countries, however, India had serious reservations regarding the application of safeguards by an Agency without demonstrated experience in the field and whose safeguards system was still under development.
Other special circumstances affected the negotiation of l
this Agreement, including India's strongly held views that safe-guards were appropriately associated only with the supply of materials, and not of equipment.
As a result of these circumstances, the Agreement for Coopera-tion with India as ultimately entered into is a unique one in many respects.
Its scope is confined to a single project --
Tarapur -- and its associated fuel cycle.
It provides not only that the United States will furnish fuel for the project, but that the project will employ no other fuel than that obtained from the United States. O And I will omit the portions which deal with the subjects which I just discussed, of the special circumstances relating to the licensing requirements.
102 The United States government was well aware that India had other nuclear facilities and programs, not all of which were or were likely to become subject to peaceful uses, assurances and safeguards.
Certain provisions of the Agreement implicitly The United States also understood that recognize this fact.
India intended to develop as nearly a self-contained fuel cycle and other provisions of the Agreement within India as possible, are specifically designed to accommodate this intention.
Which ones are you referring to?
COMMISSIONER GILINSKY:
The provisions of the Agreement that relate MR. KRATZER:
to substitution, and those that related to reprocessing as well.
It was understood that India would have a reprocessing facility that some of the material that would or intended to have one, be introduced into that reprocessing facility might be for por-tions of the India program which would not be subject to safe-guards and provisions were explicitly built into the Agreement that allowed a rational operating and administrative arrangement, principles referred to as substitution to accommodate this fact.
As outlined in the earlier description of United States nuclear cooperation policy, the credibility of the United States and as a reliable supplier of nuclear materials, equipment, services is an essential element in achievement of our nonprolif-Our Agreements for Cooperation and their eration objectives.
f subsidiary supply contracts are the principal mechanism in i
establishing this credibility.
l I
103 Efforts directed toward unilateral modification of matters particularly dealt with in these arrangements will inevitably weaken the perception abroad of the validity of United States supply assurance.
The result, in our considered judgment, would be to set back, rather than advance our nonproliferation objectives.
l l
104 I assume we don't continue to carry it CHAIRMAN ROWDEN:
Circumstances can change, events can occur which out in fact.
call for reexamination.
It's been suggested this is one of the principal matters that events in India, in 1974, and for consideration here, ld certain actions occurring since then, are matters that we shou ity consider in assessing the desirability from a national secur standpoint of authorizing this shipment of fuel.
I am talking specifically now about the peaceful nuclear explosive device detonated by the Indians in 1974.
Man's vision is Is that not a relevant consideration?
limited, in his ability to see the consequences of his actions and his agreements in 30 or 40 years.
Can you address yourself to that matter and specifically in the context of a rather forceful assertion in this morning s that the matter of reliability as of the U.S.
as submissions, supplier, although it had validity, also has to deal with the.
context of whom we are dealing with and their attitude toward nonproliferation objectives which are at the heart of our nuclear foreign policy?
the I think clearly the event of 1974, MR. KRATZER:
- Well, the kind of Indian nuclear explosion, was the kind of event, unexpected and unfortunate development which must give rise to a reexamination of what is taking place in our nuclear cooperation with the country involved and probably, even more generally and that occurred.
i
4 105 Two things occurred.
First of all, we did interrupt ship-ments to India following the nuclear explosion of 1974.
And that I think in itself is an extremely important and relevant circumstance.
I said earlier that as a whole, the intent of our agreements l
for cooperation and fuel supply contracts entered into under them, is to provide as strong as possible assurance of supply, the assurance of a stable, long-term supply of enriched uranium, but I intended to and I believe I refrained from saying that this could or should be an absolute assurance.
In point of fact, we did, in 1974, interrupt our deliveries to India.
To my knowledge, that is the only time that such an action was taken by the Executive Branch.
.We then entered into discussions which I believe the Commission is well aware of, which led to a reaffirmation on our part, that these deliveries would be continued on the understanding, which was reduced to writing, that the material produced in Tarapur, the plutonium derived from it, would be used only as fuel for the Tarapur reactors unless otherwise agreed.
So my conclusion is we took into account that circumstance l
and we felt we adequately dealt with it by the exchange of l
letters and we have resumed deliveries under the agreement.
I do not know of any subsequent actions on the part of India that in any way can affect the understanding that was reached at that time.
t
106 One it's somewhat of There are issues at two levels here.
an oversimplification but it's true and I think this morning's one is whether the nuclear assistance discussion bears it out, we give will be diverted to what we believe to be a nonpeaceful including peac'eful nuclear explosions.
- use, The second issue is whether we continue as a nuclear training partner with a country which has embarked upon a policy which we believe is c:ontrary to this country's nonproliferation objectives.
Does the Department's position, the execu-CHAIRMAN ROWDEN:
tive branch position, take into account both of those aspects?
MR. KRATZER:
It does, Mr. Chairman.
I think they are both very important points.
We did Let me deal with the first one as I have in part.
receive a reassurance from the government of India as to the use of plutonium from the Tarapur reactors, which we feel has made it entirely clear, completely unambiguous, that this material cannot be used in anything other than Tarapur reactors without our agreement.
that agreement Obviously, and the Indians are.well aware, will certainly not be given for use in nuclear explosives or any other use which is contrary to our policy.
as I Now, the nuclear explosion which occurred in India, said, quite properly gave the occasion for serious reexamination and for actual interruption of our deliveries.
But that event took place in relation to an agreement which was f ar less precise then our :. resent one, to put it mildly.
F
]
i 107 It's not an event which we condone in any way, but I do
)
not believe you can reason from the occurrence of that event that anything has been demonstrated as to the willingness, the ability of the government of India to fulfill its clear u' nam-l biguous agreement undertakings.
I think we have, as I say, very clearly eliminated any ambiguity of the undertaking in the present agreement.
With respect to policy --
You eliminated the ambiguity by tying CHAIRMAN ROWDEN:
i our nuclear aid specifically to uses in connection with the l
f Tarapur facility?
-MR.
KRATZER:
That's correct.
CHAIRMAN ROWDEN:
But you have not eliminated the under-lying ambiguity?
I raise this because it was raised repeatedly l
this morning.
MR. KRATZER:
I think, with the assurance that we have, that this material will not be used for nuclear explosives, that it would be contrary to clear, unambiguous undertakings and that assurance is every bit as good under the arrangements which l
l we have as if we secured another form of undertaking, namely, that it would not be used for any form of nuclear explosive.
in the Obviously, to have obtained that other undertaking, view of some, would in some way have perhaps vindicated U.S.
policy, that it would be to our advantage to have it.
I certainly would have no objections if we did have it, but it's not clear to me that it would have any real policy significance.
w
108 In other words, if the Indian government had agreed to I
that particular provision in the case of this agreement, don't think in any way it would affect the broader situation in common with several that in general the Indian government, others, has not been willing to adopt the position that peace-fuel nuclear explosives are indistinguishable from nuclear weapons and therefore should not be undertaken.
turning to the suggestion which I know has come from
- Now, a number of members of the public, that our policy should be l
like to withhold nuclear shipments from countries, which, India, have exploded nuclear devices, I have stated I think that under some circumstances that is a policy which has a certain appeal.
I think I think it does deserve serious consideration.
one of the difficulties we would have, and I know that several of the prepared submissions of other witnessen tend to make the point that we should adopt a policy of assured supply for those who do not seek nuclear weapons, while adopting a clear-cut policy of nonsupply to those who do so.
the difficulty I think we would run into, in attempting
- Now, in the case that we now have before to apply a policy like that is that the inperception of others, I don't think us of India it would be clear that that was in fact our policy.
I don't think I don't think that we can avoid the fact, that there are suggestions we can close our eyes to the fact,
p a
109 f
l being made in the United States that nuclear supplies be conditioned on a number of things.
It may be the acquisition of nuclear weapons or nuclear explosives by a country, but it may be other things.
It may be conditions which the recipient country itself has not in any way contributed to, conditions such as the nature of reprocessing provisions in the agreement which we have with that particular country.
And I really think it would be very difficult to persuade other governments that an interruption of supply to India, a
denial of this license, was a reflection of a policy to perhaps even strengthen our fuel supply assurances to those who don't seek atomic explosives devices, while applying the unique criterion of denial to those who do so.
CHAIRMAN ROWDEN:
I hear your statement, and I don't discount that there may be an element of realism behind it, but I have some difficulty accepting it, as a universally applicable position.
Are you saying that if we adopt a policy of that sort it would not be taken--let's not say at face value--as a sign of bona fide intent on the part of the United States to pursue a specific nonproliferation course and to implement it by concrete systems of assistance or nonassistance as that policy may dictate?
MR. KRATZER:
I am saying in the eyes of many other countries, I am not saying all, but I believe in the eyes of a number of other countries it would reflect more an intention and readiness
110 on the part of the United States to deny nuclear fuel, not like only when a very specific and highly objective criterion, the explosion of a nuclear device took place, but rather when in full approval of something which the United States was not took place.
I think that is a difficulty that would be very hard for us to avoid, given the large number of suggestions that we should condition our fuel supplies in various ways.
There are various points iv-the spectrum CHAIRMAN ROWDEN:
in terms of our nonpro-of national discomfort, it seems to me, liferation objectives, when we are dealing with the detonation of a nuclear explosion, whether it's denominated peaceful or not.
You are approaching one end of the spectrum as contrasted to other elements of national concern in the nuclear area.
MR. KRATZER:
That's right.
If a policy like that were made against the backdrop of an unmistakable reaffirmation that that this was the condition, perhaps the only condition, would lead to an interruption of fuel supply on our part, then I think that the problem that I suggest would exist might But I the problem of credibility of the policy.
be overcome; that backdrop exists at the present time.
don't believe that Am I wrong in believing--as a matter CHAIRMAN ROWDEN:
of fact I recall your earlier statements in response to Commissioner's Gilinsky's question--that our position as a supplier of enriched uranium, reliable supplier, had l
111 nonproliferation as.one of its principal objectives?
It wasn't.
just a matter of market penetration on the part of this country.
i MR. KRATZER:
That's absolutely right.
One thing I can confirm, is that the consideration of the commercial element in our nuclear policy was minimal from the very start.
I don't say it was nonexistent, but it was minimal.
Throughout the long history of the evolution of this policy, you will find many, many references to the belief that by supplying enriched uranium and thereby encouraging the use 1
of enriched uranium reactors, we have better insured the con-trols and safeguards --
CHAIRMAN ROWDEN:
I assume it remains so.
MR. KRATZER:
Very much so.
CHAIRMAN ROWDEN:
It's merely a question.
It's not incon-sistent with past U.S. policy and as I understand, is presently our policy.
MR. KRATZER:
That's correct.
COMMISSIONER GILINSKY:
Are you saying if one had adopted a more stringent policy a few years ago, that would have made l
sense but the time for that is past?
MR. KRATZER:
Well, what I was suggesting, Commissioner Gilinsky, was, if you want to adopt that policy, you have to be -- you do have an uphill fight to make it a credible one.
It would have been more easy to make it creditable two ir. the absence of the many suggestions that now years ago, I
112 exist, as to various reasons, various bases on which we can condition nuclear cooperation as far as fuel supply is concerned.
COMMISSIONER GILINSKY:
Would you reconsider that in event of another explosion?
MR. KRATZER:
Another explosion on the part of the govern-ment of India?
COMMISSIONER GILINSKY:
Yes.
MR. KRATZER:
I think the consideration of that would involve many more people than I.
I think the fact that there have been no further explosions in India since the first'unfor-tunate one in 1974 is a very -- is a gratifying development.
I hope it indicates a restraint, conscious restraint on the part of the government, but I am really not prepared _to say what the consequences would be if there were another one.
CHAIRMAN ROWDEN:
I think this is an appropriate juncture to ask if there is anything we have to learn by the Canadian experience, including the recent termination of Canadian-U.S.
nuclear cooperation, in terms of pursuing the course that was suggested in my question.
MR. KRATZER:
I think the Canadian decision is certainly an appropriate one in their circumstances.
I don't think the circumstances are the same.
I also would point out, although they are the only authorita-
}
tive spokesman for their particular decision, and decision-making process, it's clear I think from the open public record that this was a very tough, close question for the Canadians.
4 113 l
They did undertake to develop, and negotiate a new agreement with India.
It was carried to an advanced stage and it was decided on f
l at the highest levels in Canada that they should not go ahead.
I say that not to indicate that their ultimate decision was not correct but to indicate it was a close call.
l The factual circumstances in my view are quite different.
The. Canadian cooperation with India, had it continued, involved not the continued supply of fuel to almost completed reactors.
That is not involved since the Indians supply their own fuel for those particular reactors.
l It involved the completion of a reactor which was not yet l
l completed.
In other words, an enhancement and enlargement of the Indian productive capacity.
It also involved what I believe was a quite different form l
l of involvement on the part of Canada in the events which led up to the Indian nuclear explosion in 1974.
So all in all, there were different circumstances and I think they reached a decision which on their part must be viewed as a correct one but I don't think that it governs or should govern our decision.
COMMISSIONEE GILINSKY:
Since the Canadian involvement in that '74 explosion has come up, I think at some point we will want to address possibly U.S.
involvement.
3 i
I
114 Do you plan to do so?
MR. KRATZER:
At any time.
At any point it's convenient.
but I would be happy It'isn't included in my prepared statement, to receive questions.
COMMISSIONER GILINSKY:
Indications appear to be pretty strong that our involvement was fairly heavy, too.
Our heavy water seemed to be involved in the production of the plutonium that was used in the Indian explosion.
with the That heavy water was supplied under a contract, the Indians use it only for peaceful purposes.
agreement that Where does that lead us?
MR. KRATZER:
Well, I think you are aware of the fact, Commissioner Gilinsky, that the Indians produced heavy water in amounts which at a relatively early stage in the operation of that reactor, exceeded by a large margin, by an increasingly large margin the amount of material, the amount of heavy water that was needed to maintain the operation of the reactor, so that long before the time when the plutonium for that explosion might have been produced, India was no longer dependent on the heavier water which we supplied.
COMMISSIONER GILINSKY:
But that isn't what the contract says.
Are we interpreting that to mean not that heavy water is not to be used in connection with nuclear explosive activities, heavy but that India is not to be critically dependent on that water?
l l
o a-115 MR. KRATZER:
The question of use, I think, is a difficult one to address'in the context of that agreement.
We do know that India had additional production, had out-side production, that it commingled.
It was standard practice to mix the heavy water with other heavy water available to it.
I think that is a very understandable operating practice.
It means that the way you would consider the regular, the well-established principles of nuclear materials accounting for safeguards purposes, namely that fungible materials, inter-changeable materials, don't have to be separately identified,
.that there is no way to establish the role which the U.S. heavy water played in the~ production of the Indian plutonium.
COMMISSIONER GILINSKY:
Do we know that this heavy water was mixed with Indian heavy water?
MR..KRATZER:
We know there was commingling.
We don't know, of course, whether every portion, every element of the material we supplied was commingled with every l
element of the heavy water produced in Indie.'s own facility.
l In other words, we have no way of saying which heavy water l
or in what proportion to the heavy water inventory of any given moment, in terms of U.S.
or Indian origin, was in the reactor at the time.
There is no basis for doing that.
There was no separate accountability for U.S. heavy water.
COMMISSIONER GILINSKY:
Have we inquired-about this?
i --
116 l
i MR. KRATZER:
Well, I would be able, I think, because it involves the possibility of communications with other governments, l
I would be able to answer the question more fully in a closed i
l session.
Wouldn't COMMISSIONER GILINSKY:. Suppose it was commingled.
the requirement of the contract then apply to all heavy water?
I think that depends upon the details of the MR. KRATZER:
I don't think we have enough information -- I commingling.
don't believe enough information exists at this stage to be able to answer that question definitively.
In other words, I don't believe that the commingling was an instantaneous and continuous thing.
I don't think we can rule r
out the possibility that at certain times the material from The only one source or another was charged to the reactor.
reactor may have been -- we understand that it was drained from time to time.
It may have been refilled and operated for a time with heavy water exclusively from the Indian source.
We really don't know.
I don't mean to maintain that that, in fact, happened.
There apparently were not adequate records.
I shouldn't say " adequate," because there was no require-ment for separate accountability.
There weren't records kept to enable this kind of determination to be made many years after the fact.
COMMISSIONER GILINSKY:
I just am troubled by thie notion that we interpret the peaceful use requirement as extending only to situations in which India -- in which our material is actually required.
t 117 l
I mean, if we adopt this principle, where is it going to stop?
I For example, suppose India did not have available to it indigenous heavy water, but was able to purchase heavy water.
Would that --
MR. KRATZER:
No.
I think that clearly doesn't -- I think there has to be a physical presence, a physical availability, and ability to, in fact, place under the same restraints that the governing agreement calls for, material of like quality and like quantity.
This is a provision which is not extended for the exclusive benefit of other parties to their agreement.
It is in the provision which appear in the very agreement we are talking about, the 1964 agreement; that is, not only in terms of Indian i
I rights and privileges, but our own.
As you undoubtedly know, the 1963 agreement allows -- more or less authorizes the return of plutonium to the United States from India, plutonium produced in the Tarapur reactors.
We made it very clear in the negotiation of that agree-ment that we could agree to safeguards on that material, which the Indians felt strongly should be applied, only on the under-standing that the same element of substitution would be avail-able to us, and it is.
COMMISSIONER GILINSKY:
Are you saying we would apply the same principles to plutonium?
i l
f f
l l
118 Of like quality, I think we would.
MR. KRATZER:
Produced in India.
COMMISSIONER GILINSKY:
What detail are you What do you mean by like quality?
getting into?
MR. KRATZER:
Isotopic quality.
In other words, our plutonium can COMMISSIONER GILINSKY:
be commingled.
MR. KRATZER:
Yes.
this --
Before commingling -- the agreement is clear on the Indians are required to place at the disposal of the safe-guard authority -- in other words, place under the safeguard of il the IAEA in advance
- a quantity equivalent to that which w l be intermingled, and therefore not clearly subject to continuing safeguards.
add that that has to be done in such a way And I might that any process losses are charged not against the safeguarded material but against the unsafeguarded material.
The agreement reads, before this substitution takes place, the words of the agree-India will in advance -- in other words, ment are "has placed under safeguards an agreed equivalent Then there is no allowance made for process losses.
quantity."
if safeguarded materials So this means that, in fact, if we were to agree -- and we haven't done so are introduced; and if it
-- to the reprocessing of this material in India; were to be introduced into a plant that contained or had pre-and if the Indians viously processed unsafeguarded material:
I i
l 119 l
wanted to avail themselves of this right of substitution, they would have to, in advance of the introduction of the Tarapur material into the separation portion of the plant, probably at the dissolver, on the basis of measurements which we have to agree to, place under safeguards, drawing from their unsafe-guarded stocks of plutonium under safeguards, the entire quantity of Tarapur plutonium being introduced in the plant.
That in effect removes from India's stock of unsafeguarded material the full quantity of plutonium at a time before the equivalent quantity, reproduced in Tarapur, less process losses, would be available to them.
COMMISSIONER GILINSKY:
I can't tell you why, but it makes me uneasy.
If there were some suggestion in the situation like that, in India or elsewhere, that there may have been some material missing, in that case all the country has to do is, in effect, produce upon the visit of the inspector an amount of material equivalent to the amount that was originally safeguarded.
Is that right?
In other words, there is no longer a question as to whether the original material was misused.
MR. KRATZER:
Substitution has to be made for in advance,
'and it has to be made for on agreed measurements without allowance for process losses.
If safeguarded material in fact -- turns up to be missing, is unaccounted for and a search, investigation has to be l
l
120 that would clearly be undertaken in an attempt to locate it, the first step by the International Atomic Energy Agency.
Then if that particular country did have unsafeguarded material and were able to reintroduce it into a place available to it, where the missing plutonium were likely to be found, provided the replacement was done with a certain amount of skill, I am not sure how that safeguarding authority would be able to verify that the substitution had taken place.
Given the presumption I make that it requires some skill, how I don't know what means are available to look behind it, to tag the atoms so that the agency knows it is finding the atoms of the safeguarded material.
But clearly, the answer to this is that the safeguards, with respect to various kinds of various material, have to be l
sufficiently frequent so there cannot be a removal of material between inspections or checkpoints that could work to the j
country's advantage and-subsequent replacement so that the In inspector finds all the material there when he comes back.
fact, that replacement can take place, as you can see, whether there is material available for substitution or not.
It is clear to me that on sensitive material, on strategic material such as separated plutonium, safeguards frequency has to be very, very high so there cannot be even a temporary removal of material that a country can use to its advantage in an improper way.
7 121 i
COMMISSIONER GILINSKY:
You are relaxing constraints by allowing this substitution.
l MR. KRATZER:
I don't think it works out that way.
I can only say it's been the subject of a great deal of debate and study.
Obviously, the opportunity is open to the Commission and l
l others to reexamine it, but I believe under the conditions which are imposed by our agreement and under the conditions imposed by the IAEA safeguards system -- and it is a specific provision I
of the IAEA system INFCIRC '66 -- I believe you can demonstrate that it would not work to the advantage of the country that was allowed to do it.
The reason for that is that the substitution has to take so there can't be a period l
place in advance and by agreement, of time during which the country is benefiting from the unauthorized use of the otherwise safeguarded material.
COMMISSIONER GILINSKY:
Still, doesn't this argue for com-prehensive safeguards?
I think there are many, many reasons to have MR. KRATZER:
comprehensive safeguards.
in all candor, this is one of the principal I
I don't believe, I think it would be better to not have to deal with reasons.
this principle because of the complexities in some respects, but I think it doesn't give the country who is able to use it an advantage, with the one exception of being able to operate its facilities in a more convenient and rational way.
l
(
122 In other words, in the absence of this provision, it would probably be necessary for India or any other country which had both safeguarded and unsafeguarded material to completely clean out a facility in which it was handling both kinds of material, so that inspection could strike a complete material balance with respect to the safeguarded material.
COMMISSIONER GILINSKY:
But you are removing an inducement for them to accept safeguards on all their material.
There is an element of convenience here, so MR. KRATZER:
but I think it is a very to that extent there is an inducement, small one.
I don't think that this controls on the acceptance or non-acceptance of comprehensive safeguards whether under voluntary I can't believe it safeguards or the nonproliferation treaty.
would have that much influence.
CHAIRMAN ROWDEN:
Let me extend an invitation.
You have been on your feet over an hour.
I suspect this dialog we will continue for some time longer.
COMMISSIONER GILINSKY:
Can I follow up this heavy water --
COMMISSIONER KENNEDY:
On several occasions during the dialog, you referred to process losses.
At what point are they accounted for, by whom and by what agreement?
What is the effect of those process losses, however they are determined, on the amount of material which is actually substituted?
a 123 MR. KRATZER:
Under the agreement with India, the process --
if substitution is relied upon, then the agreement on the quantity and material to be subst tuted, as I stated, has to be i
reached in advance of the substitution.
The substitution has to.be made in advance, and there is no allowance for process losses.
Perhaps in just a moment here, I can cite the actual language of the agreement to that effect.
Now, if there is no -- if there is no application of the principle of substitution -- in other words, that the other government should decide to simply allow the safeguards to follow the material through the process or operation without substitution
-- then the process losses which actually occur, as determined by the safeguarder or the IAEA, will not be charged against,
-- if they are bona fide process losses -- will not be charged against the other government.
In other words, there is a slight penalty for India in using substitution.
I don't want to represent that this is the major element, but I can tell you that it was a rather There hard fought issue in the negotiations for this agreement.
is a certain penalty imposed on the Indians if they should avail themselves of the principle of substitution, because they l
l then have to make up for any process losses, in effect, from i
their unsafeguarded stock of material.
t
r 124 Either there is a penalty or they COMMISSIONER KENNEDY:
have to work more efficiently, but their problem is some penalty.
"Notwithstanding anything contained in the MR. KRATZER:
agreement,' India shall have the right to remove from tHe scope of this agreement quantities of special nuclear material, provided it has to be completed action, pur-it has" -- in other words, In other words, we suant to mutually acceptable arrangement.
have to agree on the amount of material which is being taken out of the scope of safeguards and being substituted for, place equivalent quantities of the same type, that is the quality issue, of special nuclear material under this agreement.
the reference is to -
" equivalent quantities,"
So, again, meaning not what is going to be processed minus the process losses, but everything that is going into that particular process.
In the case of heavy water which COMMISSIONER GILINSKY:
we supplied in 1956, there wasn't any --
There was no reporting or safeguard provisions MR. KRATZER:
What we are saying is that there had been established either.
in the field of nuclear material safeguards a practice that has become the custom of the industry, so to speak, to apply this But it can't be confused with the 1956 agreement, principle.
because it had no safeguard provisions or no reporting requirements.
125 COMMISSIONER GILINSKY:
What is the relevance of there not being safeguard provisions?
I think we can now go back and decide whether or not U.S.
heavy water was used in that reactor.
The relevance is it evidences an understanding MR. KRATZER:
on the part of various governments, including our own, that you cannot distinguish between materials, and it is not reasonable to require segregation of materials of a particular type, as long as equivalent quantities of that material are held under conditions that fulfill the requirements in the agreement.
We actually extended to India in a later heavy water lease contract, a contract of 1959, a substitution provision.
And the reason that was done was because they pointed out to us then, as early as 1957, when the negotiation of that 1959 least contract began, that there would be commingling of their So we were on notice from at least that time heavy water.
onward, 57 onward, that it was an Indian practice to do this, that there would be no separate accountability for materials.
COMMISSIONER GILINSKY:
That pledge could extend to other material.
What you are doing is resolving the ambiguity in a way that is - in the least stringent way.
MR. KRATZER:
I believe there was an ambiguity, and I believe that is the major element in our current situation.
CHAIRMAN ROWDEN:
A major element --
MR. KRATZER:
In the everts which subsequently transpired, there is a major ambiguity in the meaning of the contract,
126 in the observations of the contract and the ability to determine what the contract meant and whether it was being performed in that way.
the issue -- at least as I CHAIRMAN ROWDEN:
Let me put principal issue -- directly before us.
see it, I certainly wouldn't discount the importance of safeguards.
I would assume that the When you are dealing with a nation-state, principal safeguard is the confidence you can justifiably have Its guarantee must be a bulwark of in that country's word.
confidence in any such regime.
Is there anything in the sequence of events that has transpired, beginning in 1956, carrying us through 1974 and perhaps beyond, which would justifiably -- and I know this is but this is a primary consideration --
a sensitive issue, which would justifiably undermine our confidence in the Indians' peaceful uses commitment.
I know exactly what you are referring MR. KRATZER:
- Well, The and I would like to be equally explicit.
to, Mr. Chairman, Indian nuclear explosion in 1974 obviously made use of plutonium from the CIRUS reactor, and it was certainly not an event that we took any satisfaction from.
it had relation to our supply of heavy To the extent that I think, is a water -- and I have tried to explain that that, very murky question -- to the extent that it can be imputed to the use of our heavy water, we certainly do not share the a nuclear Indian view that a peaceful nuclear explosion,
l 127 t
I explosion undertaken for peaceful purposes, is a permissible r
peaceful use within the meaning that we attach to agreements, such as the 1956 contract, which contain that language.
But I really cannot conclude that the decision of India to do that, to take.that step -
and let's dismiss the problem of our involvement, as I said, because it relates to the supply of heavy water, and that introduces ambiguities.
CHAIRMAN ROWDEN:
Let's try to separate the two issues.
MR. KRATZER:
Yes.
Consider it in terms of the significance of that step, under an agreement which says that whatever instru-mentality was used was to be used for peaceful purposes.
We can't agree and don't agree that that is a pea'ceful use within the meaning of the term, as we give it in our agreements.
l However, I do not believe that you can take the step from that action on the part of the government of India to conclude
-- in the light of all the circumstances, in the light of India's established record of fulfillment of agreements, I do not believe you can take a step from that and conclude that India is going to violate a clear and precise undertaking, such as i
the type that we have in the 1963 agreement.
I do not understand the reasoning which allows you to go from one to the other.
In one case it operated in accordance with an agreement as it interprets it.
CHAIRMAN ROWDEN:
It communicated that interpretation to us?
Was there any misunderstanding?
MR. KRATZER:
I think it was clear that the Indians did not l
accept our interpretation of the 1956 contract.
128 CHAIRMAN ROWDEN:
By direct statement?
Here again I have to rely -- not rely, but MR KRATZER:
refer to the fact that this involves communications of other Those communications, if they are not available governments.
But I don' t believe they to you, can be made available to you.
f "We allow for any doubt that the Indians were saying to us, I
/
don't agree with your interpretation," and that statement was made by the reporting officer at the time.
But it sounds like they didn't i
COMMISSIONER GILINSKY:
accept our interpretation of the 1963 agreement either.
The difference is that they do not MR. KRATZER:
No.
If we were accept the interpretation of the 1963 agreement.
that the prohibition of the 1963 to say, and we certainly have, the statutory prohibition that our mcterials should agreement, not be used for atomic weapons or in research or development of atomic weapons, as precluding peaceful nuclear explosions, they don't accept that interpretation.
But -- there isn' t anything to be interpreted in the prop-osition, in the understanding that plutonium derived from Tarapur will be used as fuel only in Tarapur, unless otherwise That isn' t interpretable; I don' t think there
.b agreed.
I think they will fulfill that.
any ambiguity in the meaning.
COMMISSIONER GILINSKY:
It seems that way, but when you negotiated the 1963 agreement, you must have thought the same about that.
I believe there is a major distinction, MR. KRATZER:
Mr. Gilinsky, in the interpretation of " peaceful" and the
p 1
i le 129 meaning of a straightforward geographical criterion.
They can use the plutonium from Tarapur only as fuel in Tarapur.
I wouldn't know how to interpret that differently.
I don't know when we first became aware of the defect, the
' defect of the prohibition of the 1956 agreement.
I'm sure that occurred, that awareness occurred to different people at different times.
But it was certainly long before 1970, when we first notified them of our views.
COMMISSIONER GILINSKY:
Can I ask you, when we notified the Indian government in 1970, I believe your statement has it in the context of the heavy water problem, is --
MR. KRATZER:
Let me explain that.
i The entire document relates to both agreements; in fact, I should say all agreements between us, but that is really equiva-lent to saying both.
There were only two nuclear cooperation agreements with them; one, the '63 agreement, which was by then six years old, and the contract.
We have cited in certain material we have sent only the portion of it that relates to the
'56 contract.
However, once again, you have that document.
COMMISSIONER GILINSKY:
Right.
Can I just ask you, concerning the letter of Ambassador Call which was referred to by the State Department along the way to confirm the fact that U.S. material had not been used I
in the reactor -- we knew all along that the Indians have a l
supply of heavy water, so if that were the argument that was t
I l
available at all, it is.
e 130 Yet you appeal to this letter.
Subsequently, I guess it I
decided that it should be read differently than originally.
wonder if you can comment on that.
I think the letter was clearly misinterpreted.
MR. KRATZER:
I don't know where.the misinterpretation first appeared, but as often happens in that sort of circumstance, after having it appear, it became an accepted interpretation of it by those who did not reread and satisfy themselves exactly what the original language said.
the letter does not even speak to the question As you know, of whether U.S. material was supplied, but rather whether Canadian It was a letter written in response to material was involved.
a statement by a government official that it was Canadian material that might have been misapplied in connection with the Indian It didn't even deal with the question of U.S. material.
explosion.
If the Indian government felt it COMMISSIONER GILINSKY:
had the right to use the material for what it regarded as peace-ful purposes -- these included explosives uses -- why do you think they were so insistent on showing that Canadian material was not used?
There was a long history of negotiation between MR.'KRATZER:
Canada and India in regard to the safeguards on the CIRUS The reactor was supplied without safeguards, as I reactor.
just as our heavy water was supplied with-think we are all aware, out safeguards.
f l
l i
i l
131 l
At a later date -- this depends on recollections that are now rather old, but I believe it is substantially accurate.
At a later date, Canada sought to acquire safeguards on the over-all project, and India took the position that safeguards were not properly attached, applied to the reactor, particularly since it had already been sold, but also because of the general view on their part that equipment was not subject to safeguards.
Equipment should not " trigger" safeguards, as the saying goes in the safeguards field.
But they did reach agreement that Canadian uranium, when supplied -- in other words, Canadian fuel, when supplied to this reactor, would be subject to safeguard.
And the first charge of the reactor -- in fact, I think it was only half of the first charge of the reactor -- was Canadian uranium and was subject to safeguard.
But all subsequent fuel introduced into that reactor was of Indian origin.
So I think the Indians were sensitized to this question of whether the plutonium came from Canadian fuel.
I think they were trying to make the point that it came from Indian fuel.
If you read Ambassador Kaul's letter, he says, in using our own material "put through" the CIRUS reactor, and the waste products and so on, you can only conclude from the phrase "using our own material which was put through the CIRUS reactor" --
l COMMISSIONER GILINSKY:
Later he speaks of "100 percent i
Indian material," "100 percent Indian technology and personnel."
And certainly the technology and the personnel are not part of
132 presumably, they relate to the production the materials, but, of the material.
You are referring to the following statement:
MR. KRATZER:
"I would like to emphasize that we did not use or divert any we used 100 percent Indian material."
Canadian material.
In fact, And, again, given the overall context of the letter, it is clear it means Indian fuel.
By Indian technology and Indian per-l sonnel, he obviously means technology used to transform that 1
material into a nuclear explosive device.
I am sure, given the ready acknowledgment on the part of l
the Indian government that it was the CIRUS reactor which pro-that there was certainly no intent in this duced the plutonium, letter to disguise that fact.
It was a clear fact.
You cannot read this letter to mean that he was at that l
point attempting to say that the reactor was not a Canadian I
reactor.
Had it been unambiguous that the COMMISSIONER GILINSKY:
U.S. material was used, or it was almost entirely U.S. materials, would that have been a violation, or is that a violation of our 1956 contract?
I think that would involve an interpretation MR. KRATZER:
is really a subject of legal analysis, of the document and that that one would have to take into account the ambiguities of it in view of the fact that there was no agreement on its meaning.
I think that in dealing with the facts that we have before us and not speculating what might have been concluded had they 1
p 133 i
l been otherwise, we are unable to determine whether there was any violation of the agreement.
CHAIRMAN ROWDEN:
Okay.
MR. KRATZER:
I think I have nearly reached the conclusion of the statement.
I would like to turn now to the question that we know is of interest to the Commission,'and that is the question of a possible return of plutonium produced in the Tarapur reactors to the United States.
The Executive Branch has under examination the questionlof the possible accumulation of plutonium from the Tarapur reactor, and is considering several affirmative approaches to this question and on present agreements.
In particular, the Department of State plans to explore with the Indian govern-ment the arrangements under which such material might be returned to the United States, and we will inform the Nuclear Regulatory Commission of the_results of our exploration in connection with i
its current consideration of export license applications for i
the Tarapur projects.
COMMISSIONER GILINSKY:
When you speak of such material, are you speaking of plutonium or spent fuel?
MR. KRATZER:
I think that is exactly one of the' things we will have to explore with the Indian government.
I can't predict the outcome of it, but I think both pos-sibilities -- certainly that specifically includes spent fuel
-- are entirely possible.
l 1
I 4
134 and I We ask that both be looked at, CEAIRMAN ROWDEN:
assume they are.
The finding which the Commission is called MR. KRATZER:
license upon by statute to make before granting nuclear export involves a careful balance of complex and competing factors --
Does that finish your presentation COMMISSIONER MASON:
on the arrangements under which material might be returned to us?
I am trying now to cover the points in very MR..KRATZER:
broad perspective, Mr. Mason, but I would be glad to respond to more detailed questions on this.
How much more of your statement?
COMMISSIONER MASON:
There is very little lef t.
MR. KRATZER:
if I am going to make the suggestion, CHAIRMAN ROWDEN:
you can complete your prepared statement within the next five minutes, I will call a 10-minute recess.
The finding the Commission is called upon to MR. KRATZER:
make involves a careful balance of complex and competing factors.
It cannot be made in isolation from the entire fabric of United foreign States nonproliferation policy or, indeed, overall U.S.
It is essential in every case not only to consider the policy.
effects of approval, but those of denial as well.
It is our judgment that when that balance is struck, a f
finding that the proposed license should be issued is the appropriate one.
The case of India is a particularly difficult one.
l C~
1 i
135 The Indian nuclear explosion was a severe setback, not only for our global nonproliferation objectives, but for our j
j carefully nurtured policy of sharing the peaceful benefits of nuclear energy with other nations.
I know of no one, whether within government or outside, who does not share the deep sense o] disappointment and concern that this explosion took place.
We must, however, identify our objectives with the utmost care and clarity.
If our sole or even our principal objective were to i
register our disapproval, there is no doubt that the termination of deliveries to India would be an effective course of action.
Our concerns, however, are far broader.
The findings which the Commission is called on to make requires the evaluation of approval or denial on the possibilities for diversion or
~
I improper use of U.S. materials, of the effect on our global non-i proliferation objectives, and on the continued validity of the important safeguards and controls in the agreement.
Thank you.
CHAIRMAN ROWDEN:
Thank you, Mr. Kratzer.
As I sta+.ed' before, we will recess for 10 minutes.
I would like to reconvene promptly -- we will make it 12 minutes -- at 20 minutes to 4:00, so we can make practical use of the time we have available.
Thank you.
(Recess.)
136
)
I suggest we resume this session.
CHAIRMAN ROWDEN:
Mr. Kratzer, you have completed your prepared presentation.
We can begin the questioning or resume the questioning.
~
Dr. Mason.
COMMISSIONER MASON:
Yes.
Mr. Kratzer, shortly before the break you were mentioning efforts on the part of the Department of State to explore with the Indian Government the arrangements under which materials Many participants, might be returned to the United States.
both tcday and in the prepared testimony, have proposed that an efficacious safeguards system would involve a lease or some buy-back arrangement of irradidated fuel and plutonium from India.
Since I understand you are going to be investigating those matters,-I would like to ask some questions.
If you don't I hope you could provide us with them have the answers now, I would like to explore some of the possible later.
- First, legal difficulties.
Does the U.S. currently have the authority to enter into such arrangements with the Indian Government, either by an agreement of cooperation or under domestic law?
Would new legislation either be required or preferred?
Do you have any comments on those points?
I am sure you are aware there is a provision MR. KRATZER:
of the agreement which provides for plutonium buy-back, which This is not negotiable, except obviously gives us the option.
in the administration of it there are many details that would
7 1
136 i
i CHAIRMAN ROWDEN:
I suggest we resume this session.
Mr. Kratzer, you have completed your prepared presentation.
We can begin the questioning or resume the questioning.
Dr. Mason.
COMMISSIONER MASON:
Yes.
Mr. Kratzer, shortly before the break you were mentioning efforts on the part of the Department of State to explore with the Indian Government the arrangements under which materials might be returned to the United States.
Many participants,
]
both today and in the prepared testimony, have proposed that an efficacious safeguards system would involve a lease or some buy-back arrangement of irradidated fuel and plutonium from India.
Since I understand you are going to be investigating those matters,-I would like to ask some questions.
If you don't have the answers now, I hope you could provide us with them later.
First, I would like to explore some of-the possible legal difficulties.
Does the U.S. currently have the authority to enter into such arrangements with the Indian Government, either by an agreement of cooperation or under domestic law?
Would new legislation either be required or preferred?
Do you have any comments on those points?
MR. KRATZER:
I am sure you are aware there is a provision of the agreement which provides for plutonium buy-back, which gives us the option.
This is not negotiable, except obviously in the administration of it there are many details that would I
l l
136 J
CHAIRMAN ROWDEN:
I suggest we resume this session.
4 Kratzer, you have completed your prepared presentation.
Mr.
We can begin the questioning or resume the questioning.
Dr. Mason.
COMMISSIONER MASON:
Yes.
Mr.~Kratzer, shortly before the break you were mentioning efforts on the part of the Department of State to explore with the Indian Government the arrangements under which materials Many participants, might be returned to the United States.
both today and in the prepared testimony, have proposed that an efficacious safeguards system would involve a lease or some buy-back arrangement of irradidated fuel and plutonium from India.
Since I understand you are going to be investigating those matters, I would like to ask some questions.
If you don't I hope you could provide us with them have the answers now, First, I would like to explore some.of the possible later.
legal difficulties.
Does the U.S. currently have the authority to enter into such arrangements with the Indian Government, of cooperation or under domestic law?
either by an agreement Do you Would new legislation either be required or preferred?
have any' comments on those points?
I am sure you are aware there is a provision MR. KRATZER:
of the agreement which provides for plutonium buy-back, which This is not negotiable, except obviously gives us the option.
in the administration os it :here are many details that would
't 137 have to be worked out, but we do have the option to buy back, to take back and make compensation for that quantity of plutonium produced in the Tarapur reactor, which is in excess of the requirements of those reactors for fuel.
Now, in any such discussion, obviously, one would have to establish which is the amount in excess and it might well be found that all of it is.
If that is the case, then I would understand the agreement provides us with authority to repur-chase the entire plutonium output at Tarapur.
COMMISSIONER KENNEDY:
Can I interrupt for a second as to the amounts that might be excess?
Is it presumed that any amount
]
of it at Tarapur might be used?
MR. KRATZER:
The option does not extend to any amounts which India actually wants to use, and does use in the Tarapur reactors.
Now, if their decision is they don' t want to use any of it, then the option automatically extends to all of it.
This agree-ment -- this provision -- which appeared in a number of our agreements for cooperation in the past, and still is, I think, in several, has never been tried.
It has never been tested, so there are many complicated issues to work out.
Certainly, one of them is just what is the meaning of the words " excess to the country's own program."
In other words, does that mean its l
program, as they see it, for the next five years, or do they l
l mean the program as they see it for the next two years?
This is a matter for negotiation that has never been tested by
138 previous application.
If there is compensation to be made, then that would clearly have to be funded by some agency, by an agency of the federal government.
And my assumption is, I am not an expert on* legislation, that that agency would have to request authorization for that, in their annual authorization bill and appropriations to cover it in their annual appropriations bill.
COMMISSIONER MASON:
What would you say would be the proper instrument in the United States to do that requesting?
MR. KRATZER:
Well, I don't want to make assignments of responsibility to fellow government agencies.
I guess I should start by saying that I don't think the Department of State is the proper one because I don't think we are equipped to ad-minister that sort of fund.
I would assume that it might be ERDA.
I can conceive of other agencies, but I think the first approximation, is that it would be'ERDA.
COMMISSIONER MASON:
Maybe that moves it to the next question or set of questions which really deal with the practical diffi-culties you might see in implementing such a program within a reasonable time.
For instance, what is the period of time you would estimate that such a system, in which such a system could be implemented?
Let me go on.
They come together.
Would material which is exported in the future necessarily be government-owned if it were to come under-a lease or a buy-back arrangement?
l
T 139 l
f If not, who would do the buy-back?
Would it be government or l
l would it be private companies?
What would be the financial implications of government financing?
Could the 845 application await an export license until the necessary arrangments imple-menting a lease and/or buy-back had been agreed upon and were in place?
MR. KRATZER:
Well, you refer to the possibility of lease or buy-back.
I don' t want to make a major issue of it, but the agreement, of course, doesn't provide for lease.
COMMISSIONER MASON:
I didn't want to exclude anything.
Those were things discussed this morning by others in their testimony.
I wasn't advocating one or the other.
MR. KRATZER:
Without being definitive, I don't think we ought to be thinking in term of lease.
This has been an issue that has been raised many, many times in the past and the i
analysis of it which has been made in the past, concludes that the rights of control over the material, whether we are talking about safeguards or talking about rights to require its return, whether we are talking about rights to determine where it is going to be processed or reprocessed, really are matters of agreement that do not depend on whether title to the material has passed or not.
I don't think it would really be in our interest to give a great deal of encouragement to the proposition l
that these things do depend, go along with lease, because we I
have adopted a policy which, I think, is a sound one of requiring i
people to make payment for material.
140 f
Lease normally implies that the investment in material We don't think, as I is the owner's and not the lessee's.
said, that the rights of control, rights of return, and the like, depend on lease.
so, I it isn' t covered by the agreement, In any event, think, our starting point would be to try to make straightforward use of the option that we have under the agreement.
also contains a I might add that the fuel supply contract, very interesting provision, which relates directly to the same point.
The Indians in other words, the purchasers have the right to return the recoverable uranium in the fuel elements, the fuel they have been provided by us under the contract.
This is a right that they have, and if they want to return it as credit against future deliveries they are entitled to do so.
The COMMISSIONER MASON:
Who gives them the credit?
government?
Even Under the fuel supply contract.
MR. KRATZER:
Yes.
though we don' t own it and don' t f abricate the fuel, we still are the seller and they are the purchaser.
The licensee who delivers it and the like is an intermediary, it remains a government transaction.
but still, in financial terms, if there were a return of the irradiated I would assume that that a credit would be agreed upon that would fuel, for example, go toward -- to be applied against their future payments -- not for fuel, and that despite future, but the next required payment that funding might be required, I now see my earlier statement
r I
l 141 I
i there is a good possibility there might not be funding in l
the dollar sense.
It might be an offset arrangement.
But it still would require I think proper authorization.
I should return to the question of return of the residual and recoverable uranium.
They have this right, but the right is automatic only if is UF6.
it is returned in specification form, which, of course, I
COMMISSIONER MASON:
At the present time that would mean they would have to reprocess.
MR. KRATZER:
But I want to add, it is very clear under the agreement that we are authorized to agree to accept its return in other forms, so in a way all of this is provided for by the existing contracts.
What has to be principally agreed upon, is the financial terms and the very difficult questions which really involve I think this Commission more than anyone else, phe conditions, j
the health and safety conditions dependent upon its importation to the United States, the adequacy of the shipping containers and all of the other aspects of its entry into the United States.
I thin $ we should Now, you asked about timing and so on.
distinguish two checkpoints or two milestones.
I think we should distinguish between the time at which we can reach an agreement on this and the time which we might be able to actually implement it in terms of actual return, trans-portation of material back to the United States.
I
142 This is a negotiation and that is always unpredictable, but I see some reasonable prospect that the negotiation part of it, if it can be successfully negotiated, could go fairly quickly.
I don't mean a matter of days or weeks, and I hesitate to make predictions.
It may be a matter of months.
The question of actual implementation of an agreement, could clearly be more com-the physical return of the material, plicated.
it involves consideration for which you As I pointed out, have the primary responsibility, but I think that if the negotia-tion milectone can be reached, then mucn of what we want to accomplish would have been accomplished.
i COMMISSIONER MASON:
Do you foresee this negotiation mile-l 1
stone might be accomplished without legislative action?
{
j This is a question that really has to be MR. KRATZER:
I It seems to me that the authorization contained in explored.
/
the Tarapur agreement is a very important one, which probably with would be adequate for the purpose of reaching agreement, the clear understanding that it might be subject to authorization and appropriation, if any were needed, but this is a legislative issue that I think --
MR. MASON:
A problem you might look into where I would foresee difficulty is that there is no commerce now in repro-If the irradiated fuel were to be cessing in the United States.
returned to the United States, how would one agree upon the charges for reprocessing and the net credits which would result
~
f l
143 to the Indian government?
If appropriation and authorization from Congress are needed, what would be th6 basis on which Congress could decide what funding will be needed?
MR. KRATZER:
There are two difficulties.
One is the non-existence at the present time of the reprocessing services and the other is the lack of the yardstick for credit, or pricing i
of the returned plutonium which the agreement foresaw, namely the domestic price in effect in the United States.
Although it existed in 1963, it doesn't exist any longer.
I COMMISSIONER MASON:
If I can summarize, I think buy-back offers some advantages, especially in the present situation, as far as safeguards are concerned.
But the totality and the so we don't necessity of the arrangments should be looked at, seek some practically unattainable goal.
I would think that if it took three or four years to reach the goal, in the present situation -- at least -- it is not a very practical solution.
Therefore, we need to develop the information to find out over j
what time scale and with what effort would such an arrangement or alternative you may propose be logical.
The ultimate implementation of it is certainly MR. KRATZER:
very complicated.
I do believe that there is some merit in proceeding without
-- not in ignorance of the implications, but at the same time without necessarily requiring that every technical detail be I
l l
known.
f 1
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144 Many activities, many transactions in the nuclear field for better or worse have some contingencies in them, including licensing.
This may not be different from others.
This imagination has been applied in the j
CHAIRMAN ROWDEN:
I think it is all right past in developing a nuclear program.
to recognize the difficulties, but not to be intimidated by them.
It is our intention to urge adequate exploration.
Assuming you do go forward with COMMISSIONER KENNEDY:
some effort in this direction and with some reasonable measure of success, at what point, at what step, or for that matter what particular conclusion would lead you to the decision that you now have an agreement on which we could go forward?
govern-In other words, what decision on the part of the U.S.
what step would each take to give ment and Indian government, you the confidence that we were in a position to go forward?
Let me point to the particular concern I have and the interest I have which was prompted by a difference of view ex-pressed in testimony this morning.
One side suggested that until we have a very clear, unmis-takable handle on the plutonium, we should not go forward with further shipments.
I wonder what your view on this might be.
Well, of course, while we very much share MR. KRATZER:
thing to explore and we your view that this is an important
i-145 are going to do so, we have not reached the conclusion that further shipments should be contingent on it.
Among other reasons, as I indicated earlier, I do not believe that it is.the -- certainly not the intention, of the government of India, whether this plutonium remains in India or not, to violate its undertakings.
Nevertheless, I understand and accept the utility from the standpoint of the strongest as possible assurances of having this material returned to the United States.
But we do not believe that it is a condition precedent, or should not be, to further shipments or for further licenses.
Whether or not it becomes one is, of course, for the Commission to decide.
But, it is clear that we are both interested in this, and we plan to inform you of the results of our discussions.
That certainly doesn't mean simply a final yes or no answer, but it means to me, and I am quite prepared to so state, that we will keep you informed of the progress of the discussions as they go along.
I think that we can both judge and you can make your own judgment from that information as to whether or not there has been sufficient progress to provide you with the basis that you need to make a licensing decision.
COMMISSIONER MASON:
In view of the first part of your about the lack of need to recover the material presently
- answer, attached, other people that have testified today, indicated
146 they felt that unless the material presently at the Tarapur Station is recovered and the future plutonium is returned and that, in fact, all Indian nuclear facilities be placed under IAEA safeguards, there would be a disincentive to other non-NPT countries to join NPT and further, what had been put forward by yourself, as the U.S.'s nonproliferation government views.
Could you comment on that view?
We have commented several times on the suggestr:!
MR. KRATZER:
policy that we should confine our future cooperation, our future transfers of fuel to countries which have either accepted the in what is sometimes called the Nonproliferation Treaty or,
, functional equivalent of it, accepted safeguards on all their undertakings.
There is no difference in the objectives of those who counsel that policy and our own.
We simply feel this is another one of those very difficult balances which has to be made in this and many other areas of foreign policy.
We do have existing commitments.
They were entered into in the best of faith, in good faith.
Many of them, and this is an example of one of those, were concluded before there was a Nonproliferation Treaty.
We don't think that our overall interest, including our interest in the field of Nonproliferation would be advanced by dishonoring those commitments because of a subsequent policy objective which has come about.
We believe that the best way to encourage peonle to become parties to the treaty is by maintaining the supply relationships
147 with them and by that means, having a basis for dialogue, for discussion that can ultimately lead to a recognition on their part that this is a matter that is in their own interest.
I don't know of any countries that have accepted the Non-Proliferation Treaty by coercion, in effect.
I would point, for example, to Japan, which signed the treaty some years ago, I think six or seven, but ratified it 1
only recently.
This was the result of obviously rather lengthy considera-tion within the Japanese Government, and a decision on their part that adherence to the treaty was in their own interest.
COMMISSIONER GILINSKY:
Japan did sign rather early, did and so on.
put all of their facilities under safeguards, MR. KRATZER:
No.
Japan did not put all of its facilities under safeguards.
It placed under safeguards every facility which it acquired from outside sources, that were subject to safeguards, and it happened that that more or less coincides with all that they have.
There is one that is not included, which is their repro-cessing plant.
Now, these things are not subject to mathematical proof, but that's my conviction; that that is an example of a country which would not have taken that step, had there been pressure applied from the outside to do so.
COMMISSIONER KENNEDY:
Mr. Kratzer, even if one grants this, would you contend that this would be so in the case of India?
I l
148' i
(
MR. KRATZER:
I see very little likelihood.
I think I see very that's a fair question and I'm glad you raised it.
little likelihood that India will become a party to the Non-either under cir-Proliferation Treaty.under any circumstances, cumstan'ces of the strongest possible pressure that we might or on the basis of its seek to apply to our nuclear exports, own analysis and policy.
I regret to say that, but I think that's a fact.
COMMISSIONER KENNEDY:
Can we go on from there?
If it would not in any sense draw India closer to adherence l
what effects would a withholding of this fuel, or to the NPT, as to other countries who do any future fuel have as to India, not adhere to the NPT, and as to other suppliers?
j l
Could you comment on each of those?
the results of the case of MR. KRATZER:
I think the case, are relatively easy to forecast.
India, it seems to me, I think that India would clearly state that it had concluded that the agreement had been dishonored and breached by the United States.
I don't say that we would share that conclusion, but I I
think it's reasonably predictable that they would so state.
What action would follow that contention on their part, I think is more difficult to predict; whether they would at that point request that safeguards be discontinued, or whether they would at that point state that they were free to reprocess
r l
\\
l 9
149 l
the rather considerable amount of material which is present in India, in the absence of our permission, which depends upon l
the continued validity of the agreement.
Whether those and similar actions would be taken --
COMMISSIONER KENNEDY:
You are asserting these are possible?
MR. KRATZER:
These are all possibilities that would flow from a statement, an assertion on their part that the agreement had been breached by us, and I think in the case of the recent negotiations between Canada and India, which led to an unsuccess-ful conclusion, I believe the Indian Government has essentially stated it regards the agreement as no longer binding -- no longer bound by the agreement.
But it has not followed that, and I'm glad to say so, with the termination of safeguards and so on, which depended on the agreement.
I think there are some very serious risks which flow
- Now, from possible termination or even extended suspension of ship-ments on our part.
In your first category, in other words, effects in India por se.
I must say that I think these are certainly one of the I think maybe some would say the very, very important reasons, primary reasons why that step, termination of shipments, should not be taken.
In other words, termination or suspension.of shipments should not be considered an attractive alternative.
e 150 CHAIRMAN ROWDEN:
The suggestion has been made that this is a form of subtle blackmail, that the more extensive our relation-ship the greater the lever we are placing in the hands of the
-' country with whom we are having nuclear dealings, and the larger
-the Indian inventory of U.S. material, the greater leverage they have as far as breach of the agreement.
Can you comment on that?
MR. KRATZER:
Well, it seems to me that is somewhat of a looking glass way to view the problem.
To say'that a country which feels that it is released from an agreement when the other side does not perform is engaging in blackmail, I find that hard to analyze.
CHAIRMAN ROWDEN:
What is described in those materials -- at least in terms of one perspective on the matter -- is a charac-terization of what the potential consequences might be if the Indians said that we had breached our obligation.
I am merely suggesting the logic of the situation is such that the longer you continue the relationship the greater becomes the risk of that happening, should you at some point in time -- and everybody recognizes there could be circumstances when either-this Commission, or perhaps the executive branch, would so insist -- decide that the line had been crossed and nuclear ship-ments should not be made.
So there is sort of a built-in dilemma as far as;this relationship.
Since you described it one fashion, I am going to turn it over and'look at the other side.
r 9
151 Is there any set of circumstances where you might say, notwithstanding the consequences, the answer is no?
MR. KRATZER:
I would certainly not rule out that there are such circumstances.
l As I indicated, we in this very case did suspend shipments in 1974 and resumed them only after satisfactory agreement was reached on the future terms of delivery.
So the answer to that has to be yes.
l CHAIRMAN ROWDEN:
You are characterizing the consequences as one element that you weight in the balance, the nature of the circumstances giving rise to the concern as being the other side of it.
I am trying to appreciate what you are saying.
You are certainly not stating that in no event can we feel free in j
terms of risk to say, no future shipments, j
MR. KRATZER:
I think we have to balance our objectives.
I think in the balance of our objectives here, there has to be the consideration which Commissioner Kennedy has brought out.
It isn't an absolute.
It's one of the very important factors to be thrown into the balance.
On the question of blackmail I think it's only fair to say that the possibility that I have been describing are possibilities that I think are self-evident by examination on the part of any realistic person who reads the agreement and thinks for himself, "what normally flows from the breach of an
152 or something which can reasonably be perceived by agreement, the other parties as a breach of agreement?"
In other words, this is our analysis of what could be the It has not been, no responsible Indian officials consequences.
has used, has even referred to these consequences by way of threat or otherwise.
CHAIRMAN RONDEN:
The suggestion has been made -- as a stated this morning -- that the consequences flow matter of fact, that there are other constraints operating from our aid to India, on a nation, not simply the constraints of cooperation,-maybe not even the constraints of the agreement for cooperation.
How would you respond to that?
MR. KRATZER:
I think that's correct.
In other words, I did say I thought there was in some respects what one might one in which they would assert foresee as a two-step process; the agreement had been breached but not necessarily immediately taking all the steps, which would be very undesirable.
I think there are restraints that would operate to prevent some of those steps from ensuing, and particularly the ultimate and from our point of view by far the most undesirable and that is the actual use of material from this reactor for nuclear explosive purposes.
But other intermediate steps, such as a decision that re-processing in India which is'now subject to joint approval, will l
become a decision subject to unilateral approval, I think would not be very hard for them te :ake.
153 It seems to me rather a straightforward consequence that one could envision from that chain of events.
CHAIRMAN RONDEN:
I am sorry I interrupted your train of thought.
Proceed to the next level.
MR. KRATZER:
I was going to proceed to the level of how other countries would view our denial of a license.
COMMISSIONER KENNEDY:
Other non-NPT adherents?
MR. KRATZER:
Yes.
Well, I do not -- this is a question that would require a lot of thought, Commissioner Kennedy.
I don't want to be absolute about it.
Fortunately or unfortunately, the number of countries who remain non-NPT adherents have become, quite small, but also quite, firm, and it now represents a group of countries, let us say, with some important exceptions, who are probably rather firm in their beliefs at least as far as present policy is concerned.
Again, there are exceptions, important exceptions to that, but there are several remaining nonadherents who for various reasons have adopted that policy rather emphatically.
I would question whether it would have any effect on them.
I am sure that there are those who think that this demonstration on our part might stimulate reconsideration on the part of such other governments.
I don't believe'it.
These are not predictable things as I said earlier, but I question whether it would happen.
i
154 There are some remaining countries who are non-NPT adherents and I don't think it would be really very desirable to speculate on individual countries, who we think are moving in the right direction, who are moving toward that.
Here again, and you may feel that this is a broken record, but I believe the decision will be made on other grounds.
Would it affect suppliers?
COMMISSIONER KENNEDY:
If this Government was to take what is characterized by and direct approach which would some as a positive, forthright, evidence concern over the developments of the nuclear explosive device by India, would this affect the attitudes of other suppliers?
As I said earlier, the way in which such an MR. KRATZER:
action would be seen by other countries is a very complex equation.
When you speak of suppliers, as you know there are not many countries who are exclusively in the category of suppliers f
and not recipients.
In other words, most countries fall to some degree in both of those categories.
That includes ourselves to a minor degree.
Certain nuclear components obviously and some natural uranium is imported in the United States, but most other suppliers have a considerably larger element of being also a recipient in their overall set of policy considerations.
j l
155 I don't -- I think it's hard for them to separate one-half of that equation, one state of mind from the other.
I believe that other countries who are recipients would be rather perturbed, as I said earlier, by this evidence that the United States felt that long-standing commitments were subject to being reversed or terminated by this particular Despite the particular circumstances of this case.
process.
I really find it hard --
COMMISSIONER KENNEDY:
That is in terms of their position
)
as a recipient.
MR. KRATZER:
That is right.
I think where they come out it is kind of a mixture.
I can't visualize what specific action it would stimulate on the part of suppliers.
COMMISSIONER KENNEDY:
Let me be a little more direct.
It's been alleged in written statements, indeed, presented to the Commission and in oral testimony here, that an action of this kind would set the tone, if you will, would encourage others to move in like manner, and thereby strengthen the con-cepts that underlie the NPT.
MR. KRATZER:
Well, first we have to go into one of the very important "if's or unknowns in this equation, which I thought you may be referring to, in terms of t'he attitudes of i
those suppliers.
This is whether another supplier would step into the shoes, the gap that we just left.
I think that that question in turn, whether or not that occurred, would in turn affect the attitudes of still other suppliers who did not do so.
In other words, if the consequences of our discontinuing supply is that another suppliar steps into the breach, my guess
156 is that other suppliers would draw the conclusion that you don't withhold these things, because-if you do, someone else, in the absence of very clear understandings, will fill the I am' afraid that is a very real possibility.
breach.
Now, if that doesn't happen, if, speaking colloquially, we get by with this, it could have some favorable affect as you describe.
COMMISSIONER MASON:
Apparently you don't attach any particular uniqueness'to the Indian situation, vis-a-vis agreements in general.
Do you think that other countries might see a difference if some conditions were attached to in spite of existing agreements of cooperation, this license, in view of past actions taken by the Indian government?
As I said earlier I think there is a unique MR. KRATZER:
That is the fact that India has exploded circumstance here.
a nuclear device.
It's the only country to have done so, making use of assistance that has been supplied for other purposes, but what I attempted to say was that I felt that there were too many ambiguities in the situation, both on the in terms of whether it constituted a violation or Indian side, disavowal of agreements, and on this side as well.
in terms of whether termination on our In other words, part would really be viewed as the expression of a very clear-very unique policy, to withhold supplies in that kind of
- cut, I think it would be a case and only in that kind of a case.
a very uncertain situation and one that has great risk of n
157 being understood by others more as an expression of our ability, our power to take these actions rather than focusing on the reason why the action was taken.
There is one singular event that won't CHAIRMAN ROWDEh:
be ambiguous, and that is the event in 1974.
MR. KRATZER:
That is unambiguous.
However, I think the background is rather cloudy and I don' t know how one can over-come that.
We have changed our policies in this CHAIRMAN ROWDEN:
respect to accommodate all the circumstances -- physical protec-tion requirements for example -- even with respect to existing There is no absolute categorical requirements for cooperation.
imperative that says no change in policy with regard to ongoing arrangments -- am I correct in that?
MR. KRATZER:
Absolutely.
We have changed our policy i
l i
In some respects it was liberalized gradually in many respects.
I think those and in others it was significantly tightened.
kinds of changes without trying to predict what they will be, Certainly the trend at the present time, will always occur.
is to tighten and I don't think this is improper in any sense, i
I think that there is -- the distinction I am our policies.
trying to make is, it becomes very important how this is done, whether you do it in negotiation, it becomes very important, or whether you do it as a condition on agreements that have and which the party felt they had the already been concluded, right to rely on.
I think that is a crucial distinction.
158 Not only changes that can be accommodated CHAIRMAN ROWDEN:
in renegotiation.
The new policy of physical security has been MR. KRATZER:
I It's been very successful.
handled on a consultative basis.
f the clear think we have been able to accomplish it because o self interest of the other party in strengthening physical It was a new issue that was clearly It was a new issue.
security.
foreseen at all, was not explicitly dealth with in earlier not it.
agreements, so that the agreements were really silent on the need of the other party to apply In other words, I think people accepted that it standards to strategic material.
- icularly, was not unreasonable for us to bring it to the fore, part as I say, when the self interest of the other party was so It doesn't impose any restrictions on his ability to clear.
It says, participate in the peaceful use of the atomic energy.
that those use in which you are participating, you have to l
But new conduct under adequate physical security standards.
policies which tend to restrict the scope of activities that think are clearly more difficult another country can engage in I dition to negotiate and infinitely more difficult to make a con of an agreement that has already been made.
But you have to bring out the scales.
CHAIRMAN ROWDEN:
I don't think there is any absolute in this.
MR. KRATZER:
I don't think we are precluded from any new issues or policies but one of the things you weigh is the consequences for the
O 159 very policy that underlies all of this, the policy of nonprolif-eration.
You have to weigh in the scales, the consequences of attempting to condition agreements entered into in good faith, with new requirements.
CHAIRMAN ROWDEN:
Changing the line of questioning slightly here--here I would also invite any comments that the Arms Control and Disarmament Agency's representatives might have--wouldn't it be preferable for us to await the resolution'of the reprocessing issue before issuing their license, from the standpoint of safe-guard and from the standpoint of nonproliferation objectives?
MR. KRATZER:
Our' feeling on that is that this is somewhat lacking,in equity or logic,_in the sense that the control of that process is really in our own hands.
While we have not received a formal request from the government of India to agree to re-I l
l processing in that plant, in Tarapur, we are well aware of their i
. interest.
I am not sure that a formal request is called for by the agreement and to say that we can make no further decisions on licensing until that issue, the reprocessing issue, which is really largely in our own hands is settled seems to me to be some-what lacking in logic.
COMMISSIONER GILINSKY:
Could you comment on the status of this determination?
MR. KRATZER:
Yes.
Around 1968, I would say, we informed India that the plant, from the standpoint of the design, appeared
160 to permit the effective application of safeguards, but that this was not the final determination which is called for by the agree-that that would depend on the future review, in particular ment; of the arrangements for control and measurement of materials.
since that time there has been essentially no change
- Now, in the situation as far as India is concerned.
We have internally begun to anaiyze the problem, the various alternatives that are open to us and, as I think you know, we informed the Nuclear Regulatory Commission of our desire to consult with the Commission in that process.
In the meantime, the International Atomic Energy Agency has conducted a number of design reviews of the same plant and is working out the arrangements which would govern the application of safeguards by it, if and when safeguarded material were re-processed in the plant, but the determination which is called for by the agreement is ours.
I want to make clear it is not delegated to the International Atomic Energy Agency under the trilateral agreement.
They are working toward the development of their own arrange-if and when safeguard fuel is processed.
- ments, So the question is an entirely open one, with the reserva-tion.I indicated initially that we have indicated the design of
-the plant would permit the effective application of safeguards.
In other words, the determination that the ability to apply safeguards to it; that the ability to measure materials in and
161 out and so on, do not in and of themselves stand in the way of effective safeguards has still not been made.
COMMISSIONER KENNEDY:
Having made that determination, and assuming the plant to be constructed according to those basic outlines -- by whom and how is the decision made that safeguards have been applied in accordance with those understandings?
MR. KRATZER:
The application of safeguards, since the Agency will be doing that, is really basically up to the Agency, subject, of course, to the rights of the members of the agency to satisfy themselves that the Agency is doing an effective job.
If we are unable to satisfy ourselves of that, then a number of results could ensue, in terms of our own rights to do other things.
COMMISSIONER KENNEDY:
Could you expand on those rights in the particular case?
Is it possible, for example, for bilateral safeguards to be implemented alongside agency safeguards?
MR. KRATZER:
This is a very difficult question.
I think it I
has both legal and policy implications.
Let me speak first on the policy side.
It is not a new question.
It has been given a lot of thought.
It is extremely important and I don't think I need to the reasons for this, for us to ensure that the Agency spell out can be an effective safeguarder.
I don't know of any way'that we can more quickly demonstrate that it is not, and by and large make certain that it can't become i
e
4 162 than by the decision to apply our own safeguards, effective, side by side with theirs.
COMMISSIONER GILINSKY:
Are you saying agency safeguards in themselves are sufficient whatever activity is under consideration?
am saying the Agency is capable of applying MR. KRATZER:
I I think effective safeguards if it has the resources to do it.
it has the system to do it, if they can be applied.
- has, I don't think that there is a capability that the U.S.
simply because it is we rather than the agency, to apply effective safeguards in situations where they are unable to.
But there are measures we could COMMISSIONER GILINSKY:
for example, return take that the agency could not take such as, of the fuel.
We are using.somewhat different nomenclature.
MR. KRATZER:
The return of fuel I don't include; although it obvicusly 4
is a control of great importance, I don't include that in the definition of safeguards.
This is strictly a matter of nomenclature.
The return of fuel is a bilateral decision, which I described We have an option which we have a right to exercise, earlier.
although it does involve certain negotiations of amounts and the like.
That isn't included The agency has nothing to do with that.
when the agency applies safeguards.
163 In other words, it is not within safeguards.
The agency can and I feel certain would continue to apply its safeguards to the reactors even in the event that we buy back the fuel.
They are doing it right now.
They are safeguarding the reactor and I am sure that that would continue.
I took Commissioner Kennedy's question to relate to a i
different situation where we paralleled the agency's safeguard e
activities in the usual sense of the word, where we have inspectors, not necessarily side by side, but in addition to theirs and the like.
Now, the agency itself in the past has spoken to this l
point.
I won't say conclusively and for all time to come, but I recall very clearly that the agency in the past has expressed
}
l the view that it would not want to, and might very well not l
l l
apply safeguards in the event another country was in effect doublechecking it, by applying parallel safeguards in order to make sure that theirs were adequate.
CHAIRMAN ROWDEN:
You could say, "different."
MR. KRATZER:
I am speaking of the same kinds of things.
There are certain safeguard rights which flow from the bilateral l
agreement and which in turn are being exercised by the agency.
We do not in any way enlarge our safeguard rights, again am using safeguards in the usual conventional sense of the I
l I
164 word, we don't enlarge the safeguards rights by doing it instead of the agency.
You might argue we can do it more vigorously and more frequently, that we would have less restraints with respect to the resources and the like.
then we ought What I am saying is if those are the problems, We ought to correct them by working to attack them directly.
with the agency and not by simply supplanting or even supplement-think that would destroy the credibility of ing them, because I the agency safeguard system.
I think it would destroy the will of the agency to do an And I think we would find ourselves on a downhill effective job.
slope where the agency safegaurds are no longer effective.
The question I'm asking in this regard CHAIRMAN ROWDEN:
1 is, to what extent are we.-- and by "we" I mean the U.S. Govern-ment -- bound by earlier general determinations like that that it could be regarding.the Tarapur reprocessing plant, subjected to safeguards?
To what extent does that ordain a positive decision in the future?
I think there was an understanding at the MR. KRATZER:
time the agreement was entered into that was possible to effectively safeguard reprocessing plants.
I think it would be I don't think the agreement --
difficult --
m
iG5 CHAIRMAN ROWDEN:
It's a good faith compliment to look at it at least.
MR. KRATZER:
That's right.
I'm well aware there are suggestions being made now, these are not suggestions that I subscribe to, that it may be inherently impossible to safeguard a reprocessing plant.
My own feeling is that there is nothing in the past history of this arrangement which absolutely precludes that conclusion on our part and our consequent withholding of our joining in what has to be a icint determination, if we arrive at that conclusion in good f aith and apply it on a nondiscriminatory basis.
CHAIRMAN ROWDEN:
That conclusion you referred to would be l
what, a negative or affirmative determination?
MR. KRATZER:
Negative.
CHARIMAN ROWDEN:
In other words, the future isn't fore-ordained by preliminary assessments made in the past, which is the previous question I asked you.
Some steps have been taken.
The agreement for cooperation obviously reflects a threshold consideration that it might be feasible.
Following that, several years ago, as I understand it, a
preliminary review was given which went down the road a little further.
The question I am asking is, are we so far down the road that the answer is yes, or is a no still feasible?
166 I think a "no" is possible.
I don't think MR. KRATZER:
It has to be a "no" we have an infini'te degree of freedom.
and I arrived at in a rather careful and obviously good faith, would be inclined to say, nondiscriminatory way.
}
i You made reference to, and you emphasized CHAIRMAN ROWDEN:
ntially the existence of the U.S. veto -- I believe that was esse ii swer to the characterization you gave -- in a very dispos t ve an "wouldn't it be more a suggestion that has been made, which was, You said that that desirable to resolve the question now?"
o premise lacked logic as long as we had the authority the say n.
had It's not so much a question of authority, but whether steps been taken, before we indicate that a no is a realistic alternative.
tions.
That is what I have been pursuing for the past few ques On page 19 of your statement you COMMISSIONER GILINSKY:
i g is say the executive branch believes the question of reprocess n issue answer a separate issue from considerations related to the It seems to me this discussion of this export or license.
suggests the opposite.
It has been pointed out to me and I'm glad MR. KRATZER:
f our you called my attention to this, that this is a sentence o I believe I'm correct in identifying it as written submission, it was in-the only one, in which there was not unanimity and removed from this document.
advertently not If I have the flexibility So, I'm glad you pointed it out.
I would like.to ask that it be stricken.
to do.so,
........ ' ~ - ' - -.........
167 CHARIMAN ROWDEN:
What is the sentence and what is the consequence of striking it?
MR. KRATZER:
Page 19, bottom of the page, it says the executive branch believes the question of reprocessing is a separate issue from considerations related to the issue answers of this export license.
I think that that overstates the agreement on this point, within the executive branch, and because this is in other respects, a completely agreed upon document, I would like the record to show that this sentence remained in, during a rather hectic period by inadvertence and ought not to be --
CHARIMAN ROWDEN:
Do I understand you are altering your position or simply not speaking to that?
MR. KRATZER:
No.
It's a different point.
COMMISSIONER KENNEDY:
Are you suggesting that the Commission should consider that that statement is not true?
MR. KRATZER:
Well, the statement that there is no relation is not an agreed-upon position within the Executive Branch.
COMMISSIONER KENNEDY:
What does that mean?
MR. KRATZER:
What it means in my view is the following.
First of all, the agreement does not provide us, and I think this is a very important point on which there is no disagreement at all, the agreement does not provide us with a good faith opportunity to condition the export of material on'a reprocessing determination which has not yet been made.
Particularly so, when it is within our power, more than in the power of the government
168 O
O of India, since presumably they would not withhold their consent from the joint determination, particularly so when it's within our power to make the determination a joint one.
I COMMISSIONER KENNEDY:
For clarification purposes, understand that the Executive Branch position in correct as if that sentence were deleted, but the stated in this document, sentence on page 20 which concludes that paragraph remains.
There is no basis for making this joint determination a condition precedent to the supply of fuel for the Tarapur facility.
MR. KRATZER:
That is right.
You are saying it's not irrelevant but CHAIRMAN ROWDEN:
there is no basis for drawing a relevant conclusion on it.
COMMISSIONER GILINSKY:
Are you saying we should not or l
may not.
MR. KRATZER:
I am saying we should not, although --
I;think that is a fair distinctions CHAIRMAN ROWDEN:.
the difference between "may" and "should", as I understand it.
This was an important change in COMMISSIONER KENNEDY:
Recognizing that in U.S. policy which you referred to earlier.
drawing the agrecuant, we clearly understood that reprocessing and a full fuel cycle was contemplated by India, and thus was it possible essentially contemplated by the agreement, follow-that being the first such agreement of any significance, ing that change in policy, we misread the dangers that we would be faced with at some point?
4 169 MR. KRATZER:
No.
The unique features of the agreement which I attributed to that particular era, really don't involve They really involve its very narrow scope, the fact that that.
it is confined to the Tarapur project and the Tarapur project that the' reactor is to be fueled only with U.S. material.
- alone, These are features which aren't found in other agreements and there are other consequesces which flow from it.
because of that, I think it has to be said, I don't think it's productive to avoid saying so, that there has been a definite change in the views of the proliferation risks of various parts of the fuel cycle, unrelated to the particular issue of whether safeguards are to be applied by the IAEA or by ourselves.
In general, the early documents in the field of nuclear cooperation, and I include in that the statute of the Inter-
~
if not all, national Atomic Energy Agency, article 12,'and most, of our early agreements can only be fairly read to contemplate that reprocessing could take place under a variety of circumstances, i
including in recipient countries.
It was clear, that reprocessing was to be treated as a sensi-But there have been no new discoveries tive part of the fuel cycle.
Plutonium has always been a product of a reactor of physics.
and separated plutonium is one of the products of a reprocessing but I think in all fairness you can read the statute of
- plant, this the IAEA and many of our earlier agreements to mean that i
activity, while very sensitive could nevertheless be performed
170 so as to render it an in such a way, under adequate safeguards, acceptable part of the nuclear fuel cycle.
COMMISSIONER GILINSKY:
The IAEA charter addresses the so there seems to be an question of plutonium stockpiles, ambivalence.
I don't believe there is an ambivalence.
MR. KRATZER:
It says the agency shall approve the means to be used for chemical reprocessing solely from the standpoint of insuring that adequate safeguards are applied.
I didn't believe you can read that realistically to reach I think it the conclusion that the answer would always be no.
safeguards clearly indicates a presumption that there could be of such adequacy as to render reprocessing a permissible activity.
It then goes on to say that in order to avoid the stock-piling of plutonium -- not to avoid its separation, but to avoid its stockpiling -- that the agency is authorized to require storage in facilities not simply safeguarded by the agency but actually operated by the agency.
So I think the statute made a clear-cut distinction.
COMMISSIONER GILINSKY:
But there is a recognition that stockpiles of plutonium sitting around are in a sense hostages to fortune.
MR. KRATZER:
That is correct.
I think the provisions of the statute which authorize and to some extent contemplate that kind of storage are extremely
4 171 important and merit very, very careful consideration, with a view toward seeing whether they can be implemented.
COMMISSIONER GILINSKY:
That is what is at issue here.
There is a possibility that this material, if the proper determination is made, will be reprocessed and will then end up in a stockpile in India.
As far as I can see, there are no immediate plans for use of this material.
In effect, you are asking us to approve a license, knowing that the material may, upon a positive determina-tion on your part that safeguards would be adequate in the plant, will then end up in a stockpile and sit there and possibly be a source of danger.
MR. KRATZER:
Yes.
I I want to repeat what I said earlier.
That is, that I believe the government of India will honor its commitments, but I also said that we do see the merit, in l
order to reduce the risks to a minimum, of exploring this step which the agreement provides for in a rather substantial way.
But many other agreements, as you know, don't provide for.
In those cases, it seems to me that the possible applica-tion of the agency's storage provision is a very, very important and potentially very rewarding thing to be looked at.
COMMISSIONER GILINSKY:
How would you visualize safeguards i
l being applied to such a plutonium stockpile if in fact it is true you can turn the material.into explosives in a very short period of time?
e 172 The safeguards, as we have said and as this MR. KRATZER:
are a means for detecting diversion.
Commission is well-aware, That is true whether the material which is being safeguarded is separated plutonium or fuel elements, or what have you.
This is something that I know is very clear to all of you.
Isn't the point to try to do this COMMISSIONER GILINSKY:
as early as-possible?
I don't think there is any question'that Mr. KRATZER:
there is a more satisfactory situation when the time for reaction I must say, however, to a detected diversion is a lengthy one.
that I don't quite understand the argument that the possibility for corrective action after the detection of separated material
-- in other words, material which can be converted rather readily and quickly into explosive devices -- disappears when that conversion has occurred.
I really don't -- unless one is postulating that at that moment the country is prepared to make hostile use of those --
COMMISSIONER GILINSKY:
That is one possibility.
It is a possibility, but it is a very remote MR. KRATZER:
I don't believe that the opportunities for and extreme one.
rather vigorous corrective action disappear when material of that degree of purity or separation is detected to be diverted.
it clearly means is that the safeguard system I think what in the detection is a very, very rapid one, has to be such that order to allow the fullest possible scope for the application of corrective action.
173 COMMISSIONER GILINSKY:
What if it is a matter of days?
What can you do in that time?
MR. KRATZER:
This gets into an area of very, very speculative thinking.
COMMISSIONER GILINSKY:
Let me put it this way:
Should we acquiesce in a situation that leaves us this kind of a margin?
MR. KRATZER:
Well, I --
COMMISSIONER GILINSKY:
Isn't it a point of U.S. policy to discourage national stockpiles of plutonium, discourage national reprocessing plants and so on?
MR. KRATZER:
I said at the outset I think there is a lower risk situation where times of conversion to dangerous material are short.
But I find -- I don't find that there is a go/no go l
l proposition here.
I think that there are opportunities for l
think it would be highly spectulative to corrective action.
I specify them, even in the most risky or short-life situation.
CCMMISSIONER GILINSKY:
What is the point of our policy of not exporting reprocessing plants, if, in fact, we are prepared to entertain having our material reprocessed abroad?
MR. KRATZER:
I think what we are dealing here with is a desire to minimize risks.
Again, it is a part of this overall balance which I think we have to make.
We are, I think it is fair to say, now negotiating agreements where the rights of approval of reprocessing are somewhat more unqualified than in this particular agreement.
1 174 Here again, I think we are dealing with a question of balance.
Do we disavow, in effect, an early agreement entered into in good faith because it doesn't contain provisions which, if we were negotiating an agreement today, we would be inclined f
to put in it?
And what does that do in turn to our nonprolifera-tion policy?
COMMISSIONER GILINSKY:
Is that really counter to the spirit of the agreement, which is to provide India with fuel for their reactors and to make sure that the material is safe from harm?
MR. KRATZER:
Well, certainly that is an underlying principle of the agreement.
I don't think it is the only one.
Let me explain what is involved.
India had an interest in reprocessing and fabrication in India, not to increase the risk but rather -- I am perfectly satisfied, and I think this is demonstrable because given its very difficult economic situation, which requires that it husband foreign exchange very, very carefully, it was to India's substantial advantage to perform as much of-the fuel cycle in India as possible, even in some cases at the risk of higher costs for that particular operation, because they could be paid in local currency.
Now, India is performing the fabrication operation.
In other words, here is an operation which certainly has no proliferation problems, but they are performing it in India because of the reason I outlincd.
m
I
)
l 175 l
l i
There is a fiscal consequence to India if the material is returned to the United States.
In other words, implicitly, whether the reprocessing is in fact done or whether we store the spent fuel, it is as if from the financial standpoint they were no longer doing it there, but rather here.
There will have to be a financial adjustment made that takes that factor into account.
It will cost them more dollars in the long run, but I hope j
this will not become the determining factor in whether we can i
work out satisfactory arrangements.
l I don't think it is accurate to say that refusing reprocess-ing in India is not something that creates a problem for them, and that the possibility that was foreseen for reprocessing in l
l the agreement is not without purpose.
It is related to a purpose, even though not the principal purpose, which you correctly identified as being reliably supplying the fuel for the reactors.
COMMISSIONER KENNEDY:
Has the IAEA previously safeguarded a reprocessing plant?
MR. KRATZER:
The only instance of it is a safeguards develop-ment exercise which took place in the United States, I judge some six or eight years ago, during the period of time when the nuclear 1
fuel services reprocessing plant was operating in the United States.
L
176 as we had on previous During that time, we made arrangements, I
f to allow the agency to occasions in connection with reactors, apply safeguards on a demonstration and developmental basis to that reprocessing plant in the United States.
It did so very energetically over a period of a number of Many IAEA inspectors -- I have forgotten the exact weeks.
and this has all been the subject number -- are in residence, so there is a certain body of experience available.
of a report, I don't represent for a minute that it fills all the needs.
It is a very tough job and the agency will need a lot of experience and a lot of help.
COMMISSIONER KENNEDY:
Can you give us an estimate of your if it has a view on 1
confidence or the Department's confidence, this, or indeed that of your colleague agency, as to the likeli-hood that a successful program of safeguards can be developed and applied for such a plant?
I believe that you can effectively safeguard MR. KRATZER:
reprocessing plants in the sense that you can insure with a high degree of confidence the detection of diversion.
Now, again I come back to the proposition that others have advanced that that is not good enough.
When diversion takes place and it is detected by a safeguard the means which it uses to detect diversion, observation,
- system, accounting and the like, don't really distinguish between the motivating forces.
s 177 I mean, that is a later determination to be made by --
CHAIRMAN ROWDEN:
But will the resources -- the capability obviously differs when you are dealing with a national objective
-- developing a capability for the nuclear explohives -- as 1
contrasted to the situation that might obtain in a nuclear weapons state where the basic concern is diversion for malevolent purposes.
MR. KRATZER:
As I pointed out on a number of occasions, it is a different job, and in some respects --
CHAIRMAN ROWDEN:
Which aspect are you addressing?
am talking about a safeguard system which MR. KRATZER: I is undertaken j
is capable of detecting diversion even when that at the will and direction of the government itself, by the l
responsible government itself.
Since it has that capability, it also has the capability l
of detecting diversion that might be attempted by an individual or sm011 group of unauthorized individuals.
That was the only point that I was making.
I believe it is quite possible to have safeguards which
- Now, are capable of detecting diversion of significant quantities of from a material quickly, almost at the time that it occurs, reprocessing plant.
I think this has to be done by emphasis on what is called surveillance and containment.
1 agency safeguard system, i.m I think materials accountability is also very important.
think it requires a very intensive application of inspection of
%w_
178 inspection, around the parts of the plant
- either continuous thing very the clock, with the presence of individuals, or some closely approaching that.
that can be done.
Now, I believe that I don't think that the technique for doing it is obscure.
determination I think the main requirements are resources and the to do it.
I recognize people are saying that even the But here again, think we can achieve is very rapid detection of diversion which Iif you take the position no tantamount to effective safeguards, the outlet of a reprocessing that the diversion of material at don't have plant can be so quickly put to improper use that you enough time to react to it. Just to follow up one point you have COMMISSIONER KENNEDY:
the Department, or any of the I
just made, has their government, i
ss of the technical agencies made an assessment of the effect vene in process, surveillance and containment safeguards activities now by an agency in India?
Well, we have tried to be familiar with the MR. KRATZER:
including India's; agency's safeguard activities across the board, in general, we feel the I think, but not specifically India.
We think that there are agency is doing a satisfactory job.
This is a constant program areas where they can be strengthened.
is satisfactory.
in general, I conclude it to do that, but, Do I understand you to say that COMMISSIONER GILINSKY:
kpiles questions of reprocessing plants and related potential stoc
~
T-t a
179 of plutonium are matters of cameras, inspectors and audits and so on, and that, given that these are put together in the right combination, we can arrive at a satisfactory safeguard scheme?
MR. KRATZER:
I said on both occasions that I thought that safeguards could be effectively applied to reprocessing, in the sense that safeguards are generally understood, that is, as a means for detection of diversion.
I acknowledge that there are those who feel that that is not adequate by definition, because that does not occur quickly enough in relation to the time in which that material might be put to improper uses.
I think we have to realize that safeguards, whether they apply to reactors or reprocessing plants or any other part of the nuclear fuel cycle, are a means for the detection of diversion.
We have said, and I think this is correct, that because they are a means for detection of diversion, they also can be expected to deter diversion.
In other words, whether it is a diversion of the kind that has often been postulated in the past, relatively small withdrawals done in the way that would attempt to escape detection, or whether it is a massive seizure or confiscation of the material.
If they can detect the former, they certainly can detect the latter.
But it has always been implicit -- and this, again, is a fact whether we are talking about the diversion of the irradiated material from a reactor or the diversion of separated plutonium that another step, another element in the overall picture has to follow that.
That step is the application of some effective
180 sanctions or whatever you want to call them.
countermeasures, If this does not occur, then, presumably, the consequences of the diversion, namely, the misuse of the material, would flow just as certainly from the diversion of unreprocessed material --
in other words, from spent fuel -- as it would from the diversion of separated plutonium.
The dif ference is not one, let's say, of philosophy or concept.
The difference is how long you have to apply those corrective measures and sanctions.
COMMISSIONER GILINSKY:
I think that is true, but the longer the greater the chance you will pull yourself together you have, and do something, that effort will be made to defeat the diversion's parpose.
I think there is a distinction there, but I tend MR. KRATZER:
to think of it, perhaps to a gr' eater extent than yourself, as part I'm not -- I think it is of a more or less continuous spectrum.
not necessary to conclude that there could not be very prompt and decisive action to correct the effects of diversion of even material rather far down the chain.
CHAIRMAN ROWDEN:
I detect an inclination on the part of your colleague to speak.
MR. DAVIES:
In spite of the fascination with which I am following this esoteric discussion, I would like to get back to the discussion I was invited to answer by the Chairman some time ago, can the license issue answer wait until the reprocess-which was, i
ing issue is settled?
I J
A 181 I think it is our position at the moment that the optimum way to settle the reprocessing is to arrange for the return of the fuel, in order to avoid any dangerous accumulation of plutonium.
We agree on our view on the plutonium accumulation, but the optimum way to do it right now is that.
I do believe the license can wait until the executive branch is able to undertake that operation and report back to you its --
not necessarily success, because that is speculation, but make some report.
And I think that will be a matter of a couple of months.
COMMISSIONER KENNEDY:
From what you say, I'm not quite clear.
}
Would you, assuming the executive branch is able to come back and say, "Well, we have discussed this with the Indians and plan to 1
continue our discussions; these were useful exchanges, and we found many matters which we will wish to pursue at further length in our next meeting, which has been scheduled for December,"
would you then propose that the license be issued or that it wait?
MR. DAVIES:
This is a hypothetical question, and I think we have to defer.
COMMISSIONER KENNEDY:
More likely than not.
MR. DAVIES:
This is something, obviously, the Commission must make its mind up on then.
The only point is, we need a little time to go out and try to do this.
I can assure you we will make our best effort, and we hope to come back here dragging the scalp in and hand it to you, but perhaps not.
o 182 CHAIRMAN ROWDEN:
On this note, I think it is appropriate that we adjourn the proceeding for today, with the understanding Mr.
that there are some further questions still to be asked.
Kratzer, I would note the very obvious circumstance that we have not accomplished all that we sought to today.
is because our primary interest I'm not concerned about that, learning as much as we can from these contributions, and I think the contributions have been useful.
unless there is any difficulty on the part I would suggest, of counsel, that we move up the hour of convening to 9:00 o' clock rather than 10:00 o' clock so that, hopefully, we can complete the And we will complete the questioning entire proceeding tomorrow.
of Mr. Kratzer, have the questioning and presentation of NRC Staff, have the presentation by Mr. Greenberg on behalt of and then NRDC, Sierra Club, and Union of Concerned Citizens:
have the representatives of the principal participants sum up, But we will make an assessment on probably in the afternoon.
that in the morning.
We would very much like to have the participants summations and the presentations made by with everything taken into account, and we may have a question or two at that juncture.
the others, Hearing no objection, we are adjourned.
the hearing was adjourned, to (Whereupon, at 5:12 p.m.,
9:00 a.m., Wednesday, July 21, 1976.)
reconvene at
.