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Did US nix 'Koodankulam Plus' deal with Moscow?

By B Raman
November 15, 2007 15:34 IST
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Prior to Prime Minister Manmohan Singh's just concluded 28-hour visit to Moscow on November 11-12, 2007, for talks with President Vladimir Putin and other Russian leaders, it was widely speculated in New Delhi that the visit would see the signing, inter alia, of a 'Koodankulam Plus' agreement under which Russia would help India in setting up four more civilian nuclear power reactors at Koodankulam in southern Tamil Nadu.

These would be in addition to the two already under construction under an agreement signed by India and Russia in 1988. When work on the two reactors was about to start, the Clinton Administration in the US had strongly opposed it on the ground that even though the 1988 agreement was signed before the restrictions on civilian nuclear trade imposed by the Nuclear Suppliers' Group came into force, these restrictions would retrospectively apply to the 1988 Indo-Russian agreement too. The US contention was rejected by Moscow and New Delhi, and Moscow went ahead with the construction. The US did not raise any further objection.

Under an agreement on civilian nuclear co-operation signed between China and Pakistan in 1985, Beijing had agreed to help Pakistan in the construction of a nuclear power station at Chashma, which is now referred to as Chashma I. The US did not object to it. Its construction has been completed and it is now operational.

PM, Putin had strategic discussions in Moscow

Subsequently, China accepted a request from Pakistan for the construction of another nuclear power reactor at Chashma, to be called Chashma II. An agreement was signed under the overall framework of the 1985 grandfather agreement. The Clinton Administration objected to this on the ground that the NSG restrictions would retrospectively apply to Chashma II. Both Beijing and Islamabad rejected the US objection and pointed out that Russia was going ahead with the construction of the two reactors at Koodankulam. They went ahead with the construction and the Clinton Administration did not raise any further objection.

When Pakistan heard that Russia had agreed in principle to construct four more reactors at Koodankulam under the 1988 grandfather agreement, it requested China for assistance in the construction of more power reactors. Musharraf requested the Chinese leaders during his State visit to China in February 2006, for Chinese assistance in the construction of six more nuclear power stations, with a capacity of 600 or 900 MW each. The Chinese reportedly agreed in principle to supply two stations of 300 MW each to be followed later by four more.

This subject again figured in the General's bilateral discussions with President Hu Jintao on the margins of the Shanghai Co-operation Organisation summit at Shanghai in June 2006, and in the subsequent discussions between the officials of the two countries who met at Islamabad and Beijing for doing the preparatory work for President Hu Jintao's visit to Pakistan from November 23 to 26, 2006. China agreed to construct two more power reactors at Chashma to be called Chashma III and Chashma IV.

Musharraf and his officials were so confident that an agreement in principle for the construction of Chashma III and IV would be initialed during Hu's visit that they even set up a site selection task force. But, before the arrival of Hu in Islamabad, the spokespersons of the foreign ministries of Pakistan and China tried to discourage expectations in Pakistan that Musharraf and Hu would be initialling a memorandum of understanding on the Chinese supply of two more nuclear power stations. They described the reports in this regard, which had been appearing in the Pakistani media for weeks before Hu's visit, as speculative and not based on facts.

Well-informed Pakistani sources attributed the decision not to initial the MoU to the bilateral discussions between President George Bush and Hu at Hanoi on the margins of the summit of the Asia Pacific Economic Co-operation organisation on November 18 and 19, 2006. The speculation was that during these bilateral discussions, Bush pointed out to Hu that the Chinese supply of new nuclear power stations to Pakistan could not be projected as a continuation of the Chinese assistance to Pakistan under the 1985 bilateral co-operation treaty under which Chashma I and II were given and hence would need the clearance of the NSG. According to this speculation, Bush was also reported to have referred to the Pakistani rejection of repeated requests from the International Atomic Energy Agency to hand over Dr A Q Khan for an independent interrogation and pointed out that the Chinese supply of the new power stations could encourage Pakistan's non-cooperation with the IAEA.

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It was believed by these sources that Beijing, which has been projecting itself as a responsible and co-operative interlocutor of the US, Japan and South Korea on the question of North Korea's nuclear programme and had won praise for its role in bringing North Korea back to the negotiating table, did not want this positive image to be dented by disregarding the reservations of Bush relating to the supply of new power stations to Pakistan. It, therefore, changed its stance at the last minute and agreed not to go ahead with Chashma III and Chashma IV.

There was no substantive reference to the co-operation between China and Pakistan in the field of civilian nuclear energy during Hu's visit to Pakistan. The joint statement issued on November 25, 2006 by Gen Musharraf and Hu said: 'The two sides also agreed to strengthen cooperation in the energy sector, including fossil fuels, coal, hydro-power, nuclear power, renewable sources of energy as well as in the mining and resources sector.' Addressing a press conference after his talks with Gen Musharraf, Hu said in reply to a question on nuclear co-operation: 'Cooperation in the energy sector is an important component in the relationship between the two countries. We reached a common understanding on strengthening energy cooperation. We would continue this cooperation in future as well.' While Hu himself did not refer to any future supply of new nuclear power stations, some Pakistani analysts interpreted Hu's remarks as indicating a willingness to supply more nuclear power stations.

Pakistani officials and analysts close to the government tried to give the impression that the fact that no memorandum of understanding was signed did not mean that the Chinese were not going ahead with the project. But, the Chinese foreign office spokesperson was very clear on this point during a media briefing on November 20, 2006 at Beijing. He said: 'As far as I know, there will be no new arrangement in this area.'

Interestingly, in reply to a question on this subject, Sean McCormack, a US State Department spokesperson, said in Washington, DC, as follows on November 27, 2006: 'The US welcomes strong ties between China and Pakistan and urges China to play a constructive role in world affairs. We encourage development of bilateral relations between Pakistan and its neighbours. China and Pakistan have a long history of relations. As for any sort of nuclear angle on this, I'm not aware of anything new that was announced or is allowed for by these agreements other than what was already grandfathered in by the Nuclear Suppliers Group. So I don't think there's anything new on that front.'

What he apparently meant was that in addition to the Chashma I and Chashma II power stations given by China under the old agreement of 1985, there would be nothing new for the present till approved by the NSG. What was significant was that China paid attention to the US reservations on this subject instead of going ahead with its assistance as it did in the past in matters such as the supply of M-9 and M-11 missiles and nuclear equipment to Pakistan. This new attention to US reservations is what the Americans welcomed as China's constructive role.

There was no reference to China's possible assistance to Pakistan for the construction of Chashma IV and V for nearly seven months -- either from the Pakistani side or from the Chinese side. On July 18, 2007, there was a surprising reference to it in a Chinese statement on the Pakistani commando action in Lal Masjid. This caused anger against the Chinese, who were suspected to have forced Musharraf to order the commando action after the kidnapping of six Chinese women by some students of the girls' madrasa attached to the masjid.

The China Daily reported as follows on July 18, 2007: 'China did not push Pakistan for operations against the Red Mosque, Chinese Ambassador to Pakistan Luo Zhaohui said. It is the consistent policy of China not to meddle in the domestic affairs of other countries, he told The News, a major Pakistani daily. Luo said he was considering an invitation to visit the mosque but it was made impossible due to the unstable security situation.'

'We enjoy very cordial relations with the ruling party here and likewise we maintain friendly ties with other segments of the society including the political parties of the opposition,' he said. 'I had no knowledge as to why Chinese nationals are being targeted and were the victims in five recent incidents,' Luo said, referring to several Chinese who were killed in that country. He said if Chinese continued to be targeted, cooperation between the two countries could suffer. To protect the 3,000 Chinese working in Pakistan, China and Pakistan have decided to set up a Joint Task Force, the ambassador revealed. China and Pakistan are still close friends and neighbors, Luo said. The Chinese government is in discussions about proposed Chashma-III and IV for nuclear power projects. Chashma-II will be completed early next year, he said.

Apparently concerned over the anti-Chinese turn in some sections of public opinion in the tribal areas, the Chinese once again started talking of possible Chinese assistance for the construction of Chashma III and  IV in order to reassure Pakistani public opinion that China would continue to be a steadfast friend of Pakistan.

During President Putin's visit to India in January 2007, the two countries signed a Memorandum of Intent on the Russian supply of four more power reactors for Koodankulam. A formal agreement was subsequently negotiated in pursuance of this and this agreement was expected to be signed during Dr Manmohan Singh's visit to Moscow. It is believed that in the meanwhile the US pointed out that the proposed supply of four more nuclear reactors could not be 'grandfathered' under the 1988 agreement. The US interpreted them as fresh sales, which would attract the restrictions of the NSG just as it had done in the case of Chashma III and Chashma IV.

Since China and Pakistan had accepted the US interpretation in respect of Chashma III and Chashma IV, it would have been difficult for India to disregard the US objection and go ahead with the signing of the agreement. The decision of the Government of India not to go ahead with the signing, but to await the lifting of the restrictions by the NSG on nuclear trade with India is, therefore, understandable. Moreover, since the US has agreed to steer the 123 Agreement with India through the NSG after India has signed an India-specific Safeguards Agreement with the International Atomic Energy Agency in Vienna, it would have been difficult for India to go ahead with the signing in Moscow.

The US had taken up the issue of the four new reactors not only with the Government of India at New Delhi, but also with the Russian government in Moscow. Russian officials have been quoted by the media as claiming that while they were prepared to go ahead with the signing, India was not. One does not know how far this is factually correct. In view of the Chinese acceptance of the US interpretation in November 2006 as to what could not be 'grandfathered', it would have been equally difficult for Moscow to ignore the US objections.

(The writer is Additional Secretary (retd), Cabinet Secretariat, Government of India, New Delhi, and, presently, Director, Institute For Topical Studies, Chennai. He is also associated with the Chennai Centre For China Studies. E-mail:

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B Raman