What is the 123 Agreement and why is it called so?
The 123 agreement is the proposed agreement for civil nuclear cooperation. It is called the 123 Agreement because in the US Atomic Energy Act, (AEA) 1954 civil nuclear cooperation with other countries is permitted under Section 123. The agreement is the follow-up action by the executive (the President, Secretary of State and the Secretary of Energy in consultation with the Nuclear Regulatory Commission) of an enabling legislation passed by the Congress (in the Indian case this was the Henry J. Hyde Act United States-India peaceful Atomic Energy Cooperation Act of 2006).
The United States has entered into Agreements for Cooperation with the following states or group of states (24 in total): Argentina, Australia, Bangladesh, Brazil, Bulgaria, Canada, China, Colombia, Egypt, European Atomic Energy Community (EURATOM), Indonesia, International Atomic Energy Agency (IAEA), Japan, Kazakhstan, Morocco, Norway, Republic of Korea, Romania, South Africa, Switzerland, Taiwan, Thailand and Ukraine.
What is the duration, nature and scope of an agreement for cooperation?
Though the duration of the agreement for cooperation between the US and other countries is not specified in the AEA, the agreement is generally entered for an initial period of 30 years. The cooperation is carried out only for peaceful purposes and material, nuclear material, equipment and components transferred pursuant to the cooperation is not to be used for any nuclear explosive device, for research specifically on or development of any nuclear explosive device, or for any military purpose.
Apart from supply of material, nuclear material, equipment and components, the agreement for cooperation also encourages exchange of experts between the two countries, facilitation of supply and exchange of information relating to health, safety and environmental consideration.
Are there any requirements laid down by Section 123 that have to be incorporated into a proposed agreement?
Section 123 of the AEA, lays down nine requirements that any proposed agreement for civil nuclear cooperation has to include. These are:
(1) Safeguards to be maintained on all nuclear materials, equipment transferred or materials produced [snip] as long as the material and equipment remains under the jurisdiction or control of the cooperating party, irrespective of the duration of other provisions in the agreement or whether the agreement is terminated or suspended for any reason. (Emphasis added)
(2) in case of non-nuclear-weapon states [snip] IAEA safeguards be maintained with respect to all nuclear materials in all peaceful nuclear activities within the territory of such state, under its jurisdiction, or carried out under its control anywhere. (Emphasis added) [Exempted by Hyde Act for India]
(3) … a guarantee by the cooperating party that non nuclear materials and equipment or sensitive nuclear technology to be transferred pursuant to such agreement, and no special nuclear material produced through the use of any nuclear materials and equipment or sensitive nuclear technology transferred pursuant to such agreement, will be used for any nuclear explosive device, or for research on or development of any nuclear explosive device, or for any other military purpose.
(4) … a stipulation that the United States shall have the right to require the return of any nuclear materials and equipment transferred pursuant thereto and any special nuclear material produced through the use thereof if the cooperating party detonates a nuclear explosive device or terminates or abrogates an agreement providing for IAEA safeguards (exceptions to this clause are in the case of cooperation with a nuclear-weapon-state and agreements entered under Section 91c. which deals with military application of nuclear energy ).
(5) a guaranty by the cooperating party that any material or any Restricted Data, any production or utilization facility, any special nuclear material produced through the use of any such facility or through the use of any material transferred pursuant to the agreement for cooperation will not be transferred to unauthorized persons or beyond the jurisdiction or control of the cooperating party without the consent of the United States.
(6) a guarantee by the cooperating party that adequate physical security will be maintained with respect to any nuclear material, any special nuclear material used or produced, production facility or utilization facility transferred pursuant to such agreement.
(7) a guaranty by the cooperating party that no material transferred pursuant to the agreement for cooperation and no material used in or produced through the use of any material, production facility, or utilization facility transferred pursuant to the agreement for cooperation will be reprocessed, enriched or (in the case of plutonium, uranium 233, or uranium enriched to greater than twenty percent in the isotope 235, or other nuclear materials which have been irradiated) otherwise altered in form or content without the prior approval of the United States;
(8) a guaranty by the cooperating party that no plutonium, no uranium 233, and no uranium enriched to greater than twenty percent in the isotope 235, transferred pursuant to the agreement for cooperation, or recovered from any source or special nuclear material so transferred or from any source or special nuclear material used in any production facility or utilization facility transferred pursuant to the agreement for cooperation, will be stored in any facility that has not been approved in advance by the United States.
(9) a guaranty by the cooperating party that any special nuclear material, production facility, or utilization facility produced or constructed under the jurisdiction of the cooperating party by or through the use of any sensitive nuclear technology transferred pursuant to such agreement for cooperation will be subject to all the requirements specified in this subsection.
What are the next steps that have to be effectuated after India and the US reach an agreement on the specifics of the 123 Agreement in order for the civil nuclear cooperation to begin?
Immediately after an agreement is reached between India and US on the 123, the proposed agreement along with the Nuclear Proliferation Assessment Statement (NPAS) will be submitted by the President to the Senate Committee on Foreign Relations and the House Committee on Foreign Affairs. The NPAS consists of two parts: a classified annex prepared by the Director of the Central Intelligence Agency; and an unclassified part prepared by the Secretary of State which a) analyses the consistency of the text of the proposed agreement for cooperation with all the requirements of this Act, with specific attention to whether the proposed agreement is consistent with each of the criteria set forth in this subsection, and b) analyses the adequacy of the safeguards and other control mechanisms and the peaceful use assurances contained in the agreement for cooperation to ensure that any assistance furnished there under will not be used to further any military or nuclear explosive purpose.
The Committees of the Congress will then consider the proposed agreement for a period of thirty days of continuous session once they receive the proposed agreement for cooperation together with the approval and determination of the President. (Emphasis added) After, the committees of the Congress make their recommendations within the thirty day period, the proposed agreement is sent to the House and the Senate which then deliberate on the agreement for a sixty day period.
As specified in the Conference Report “…nuclear cooperation with countries, such as India, that do not satisfy all the conditions of 123(a), such as full scope safeguards, can come into effect only if both Houses of Congress pass a joint resolution of approval within 90 days. If either chamber does not approve the resolution, the agreement does not enter into force.”
Are there other sections in the US Atomic Energy Act, 1954 (apart from Section 123) which are of relevance to the Indo-US civil nuclear cooperation?
Apart from Section 123 of the AEA there is Section 127 governing US nuclear export of source material, special nuclear material, production or utilization facilities and any sensitive nuclear technology. Section 129 is also of relevance as it deals with termination of nuclear exports. Section 131 which deals with arrangements entered into by US or government agencies with respect to cooperation with any nation or group of nations. Sec 131(a)(3), 131(b)(2) and 131(d) talk about reprocessing rights. Section131(d) clearly states that “Nothing in this section is intended to prohibit, permanently or unconditionally, the reprocessing of spent fuel owned by a foreign nation which fuel has been supplied by the United States, to preclude the United States from full participation in the International Nuclear Fuel cycle Evaluation provided for in section 105 of the Nuclear Non-Proliferation Act of 1978…”
What are other issues that are of concern and what are the provisions in the US AEA, 1954 as well as other Agreements for Cooperation with respect to these issues?
Fall-back Safeguards – One issue that has caught the attention domestically is with respect to fall-back safeguards. Fall-back safeguards come into place only when IAEA is unable to fulfil its safeguard duties required under the agreement. The likely arrangement that India and the US will enter into with respect to fall-back safeguards can be extrapolated by studying previous Agreements for cooperation entered into by the US with other countries. For example in the US agreement with EURATOM as well as with Japan, the text of the agreement states that “in the event that IAEA Safeguards is not being applied [snip] the parties shall immediately establish safeguards arrangements for the application of safeguards which provide for effectiveness and coverage equivalent to that provided by the safeguards Agreement required by the agreement for cooperation.”
Reprocessing Rights – The second issue that has generated a lot of debate within India has been the issue of refusal of reprocessing rights by the US to India. Unlike what is indicated by the general tenor of debate within India, the US AEA, 1954 does have provisions whereby by it grants reprocessing rights under agreements for cooperation with other countries. Sec 131(a)(3), 131(b)(2) and 131(d) of the US AEA, 1954 and in particular, Section 131 clause (d) talks about reprocessing rights. This article states that, “Nothing in this section is intended to prohibit, permanently or unconditionally, the reprocessing of spent fuel owned by a foreign nation which fuel has been supplied by the United States, to preclude the United States from full participation in the International Nuclear Fuel cycle Evaluation provided for in section 105 of the Nuclear Non-Proliferation Act of 1978…”
It is important to note that, wherever the US has granted reprocessing rights to countries under the agreement for cooperation, the countries have placed the reprocessing facility under IAEA safeguards. However, in the Indian case both the Kalpakkam reprocessing plant and the Fast Reactor Fuel Reprocessing Plant are not placed under the civil list.
Fuel Supply Assurances – The third issue of is of fuel supply assurances. India wants that the US should ensure that an assurance should be in place for fuel for the life of the reactor in question. However, as can be seen in other nuclear agreements for cooperation, the US ensures a reliable supply of fuel and provides a reserve of fuel as may be required to operate the reactor for a reasonable amount of time.
What are the causes that lead to termination of the agreement for civilian nuclear cooperation and how is it implemented?
As outlined by Section 129 of the AEA, termination of nuclear exports will occur in case the President finds that any non-nuclear-weapon state has detonated a nuclear explosive device [as outlined under the Hyde Act exemption granted to India regarding any actions that occurred before July 18, 2005]; terminated or abrogated IAEA safeguards; materially violated and IAEA safeguard agreement; or engaged in activities involving source or special nuclear material and having direct significance for the manufacture or acquisition of nuclear explosive devices, and has failed to take steps which, in the President’s judgment, represent sufficient progress toward terminating such activities [as outlined under the Hyde Act exemption granted to Section 129 (1)(D) regarding any actions that occurred before July 18, 2005].
Apart from these provisions, nuclear exports can also be terminated in case any nation or group of nations violates an agreement for cooperation; assisted, encouraged, or induced any non-nuclear-weapon state to engage in activities involving source or special nuclear material and having direct significance for the manufacture or acquisition of nuclear explosive devices, and has failed to take steps which, in the President’s judgment, represent sufficient progress toward terminating such assistance, encouragement, or inducement; entered into an agreement after the date of enactment of this section for the transfer of reprocessing equipment, materials, or technology to the sovereign control of a non-nuclear-weapon state except in connection with an international fuel cycle evaluation in which the United States is a participant or pursuant to a subsequent international agreement or understanding to which the United States subscribes.
Though, the AEA does not outline, the procedures to be followed for termination of the agreement, it is possible to extrapolate from other similar agreements that the US has entered into with other states. Either party has the right to request for termination of the agreement by giving six months written notice to the other party. Other US agreements for cooperation state that, “Before either party takes steps to cease cooperation, to terminate the agreement or to require of nuclear material, equipment or components transferred pursuant to the agreement they shall consult for the purpose of taking corrective steps and shall carefully consider the economic effects of such actions, taking into account the need to make such other appropriate arrangements as may be required.” Further these agreements state that, “if either party exercises its right to require the return of any material, nuclear material, equipment or components, it shall compensate the other party or the persons concerned for the fair market value thereof.”
The United States has entered into Agreements for Cooperation with the following states or group of states (24 in total): Argentina, Australia, Bangladesh, Brazil, Bulgaria, Canada, China, Colombia, Egypt, European Atomic Energy Community (EURATOM), Indonesia, International Atomic Energy Agency (IAEA), Japan, Kazakhstan, Morocco, Norway, Republic of Korea, Romania, South Africa, Switzerland, Taiwan, Thailand and Ukraine.
What is the duration, nature and scope of an agreement for cooperation?
Though the duration of the agreement for cooperation between the US and other countries is not specified in the AEA, the agreement is generally entered for an initial period of 30 years. The cooperation is carried out only for peaceful purposes and material, nuclear material, equipment and components transferred pursuant to the cooperation is not to be used for any nuclear explosive device, for research specifically on or development of any nuclear explosive device, or for any military purpose.
Apart from supply of material, nuclear material, equipment and components, the agreement for cooperation also encourages exchange of experts between the two countries, facilitation of supply and exchange of information relating to health, safety and environmental consideration.
Are there any requirements laid down by Section 123 that have to be incorporated into a proposed agreement?
Section 123 of the AEA, lays down nine requirements that any proposed agreement for civil nuclear cooperation has to include. These are:
(1) Safeguards to be maintained on all nuclear materials, equipment transferred or materials produced [snip] as long as the material and equipment remains under the jurisdiction or control of the cooperating party, irrespective of the duration of other provisions in the agreement or whether the agreement is terminated or suspended for any reason. (Emphasis added)
(2) in case of non-nuclear-weapon states [snip] IAEA safeguards be maintained with respect to all nuclear materials in all peaceful nuclear activities within the territory of such state, under its jurisdiction, or carried out under its control anywhere. (Emphasis added) [Exempted by Hyde Act for India]
(3) … a guarantee by the cooperating party that non nuclear materials and equipment or sensitive nuclear technology to be transferred pursuant to such agreement, and no special nuclear material produced through the use of any nuclear materials and equipment or sensitive nuclear technology transferred pursuant to such agreement, will be used for any nuclear explosive device, or for research on or development of any nuclear explosive device, or for any other military purpose.
(4) … a stipulation that the United States shall have the right to require the return of any nuclear materials and equipment transferred pursuant thereto and any special nuclear material produced through the use thereof if the cooperating party detonates a nuclear explosive device or terminates or abrogates an agreement providing for IAEA safeguards (exceptions to this clause are in the case of cooperation with a nuclear-weapon-state and agreements entered under Section 91c. which deals with military application of nuclear energy ).
(5) a guaranty by the cooperating party that any material or any Restricted Data, any production or utilization facility, any special nuclear material produced through the use of any such facility or through the use of any material transferred pursuant to the agreement for cooperation will not be transferred to unauthorized persons or beyond the jurisdiction or control of the cooperating party without the consent of the United States.
(6) a guarantee by the cooperating party that adequate physical security will be maintained with respect to any nuclear material, any special nuclear material used or produced, production facility or utilization facility transferred pursuant to such agreement.
(7) a guaranty by the cooperating party that no material transferred pursuant to the agreement for cooperation and no material used in or produced through the use of any material, production facility, or utilization facility transferred pursuant to the agreement for cooperation will be reprocessed, enriched or (in the case of plutonium, uranium 233, or uranium enriched to greater than twenty percent in the isotope 235, or other nuclear materials which have been irradiated) otherwise altered in form or content without the prior approval of the United States;
(8) a guaranty by the cooperating party that no plutonium, no uranium 233, and no uranium enriched to greater than twenty percent in the isotope 235, transferred pursuant to the agreement for cooperation, or recovered from any source or special nuclear material so transferred or from any source or special nuclear material used in any production facility or utilization facility transferred pursuant to the agreement for cooperation, will be stored in any facility that has not been approved in advance by the United States.
(9) a guaranty by the cooperating party that any special nuclear material, production facility, or utilization facility produced or constructed under the jurisdiction of the cooperating party by or through the use of any sensitive nuclear technology transferred pursuant to such agreement for cooperation will be subject to all the requirements specified in this subsection.
What are the next steps that have to be effectuated after India and the US reach an agreement on the specifics of the 123 Agreement in order for the civil nuclear cooperation to begin?
Immediately after an agreement is reached between India and US on the 123, the proposed agreement along with the Nuclear Proliferation Assessment Statement (NPAS) will be submitted by the President to the Senate Committee on Foreign Relations and the House Committee on Foreign Affairs. The NPAS consists of two parts: a classified annex prepared by the Director of the Central Intelligence Agency; and an unclassified part prepared by the Secretary of State which a) analyses the consistency of the text of the proposed agreement for cooperation with all the requirements of this Act, with specific attention to whether the proposed agreement is consistent with each of the criteria set forth in this subsection, and b) analyses the adequacy of the safeguards and other control mechanisms and the peaceful use assurances contained in the agreement for cooperation to ensure that any assistance furnished there under will not be used to further any military or nuclear explosive purpose.
The Committees of the Congress will then consider the proposed agreement for a period of thirty days of continuous session once they receive the proposed agreement for cooperation together with the approval and determination of the President. (Emphasis added) After, the committees of the Congress make their recommendations within the thirty day period, the proposed agreement is sent to the House and the Senate which then deliberate on the agreement for a sixty day period.
As specified in the Conference Report “…nuclear cooperation with countries, such as India, that do not satisfy all the conditions of 123(a), such as full scope safeguards, can come into effect only if both Houses of Congress pass a joint resolution of approval within 90 days. If either chamber does not approve the resolution, the agreement does not enter into force.”
Are there other sections in the US Atomic Energy Act, 1954 (apart from Section 123) which are of relevance to the Indo-US civil nuclear cooperation?
Apart from Section 123 of the AEA there is Section 127 governing US nuclear export of source material, special nuclear material, production or utilization facilities and any sensitive nuclear technology. Section 129 is also of relevance as it deals with termination of nuclear exports. Section 131 which deals with arrangements entered into by US or government agencies with respect to cooperation with any nation or group of nations. Sec 131(a)(3), 131(b)(2) and 131(d) talk about reprocessing rights. Section131(d) clearly states that “Nothing in this section is intended to prohibit, permanently or unconditionally, the reprocessing of spent fuel owned by a foreign nation which fuel has been supplied by the United States, to preclude the United States from full participation in the International Nuclear Fuel cycle Evaluation provided for in section 105 of the Nuclear Non-Proliferation Act of 1978…”
What are other issues that are of concern and what are the provisions in the US AEA, 1954 as well as other Agreements for Cooperation with respect to these issues?
Fall-back Safeguards – One issue that has caught the attention domestically is with respect to fall-back safeguards. Fall-back safeguards come into place only when IAEA is unable to fulfil its safeguard duties required under the agreement. The likely arrangement that India and the US will enter into with respect to fall-back safeguards can be extrapolated by studying previous Agreements for cooperation entered into by the US with other countries. For example in the US agreement with EURATOM as well as with Japan, the text of the agreement states that “in the event that IAEA Safeguards is not being applied [snip] the parties shall immediately establish safeguards arrangements for the application of safeguards which provide for effectiveness and coverage equivalent to that provided by the safeguards Agreement required by the agreement for cooperation.”
Reprocessing Rights – The second issue that has generated a lot of debate within India has been the issue of refusal of reprocessing rights by the US to India. Unlike what is indicated by the general tenor of debate within India, the US AEA, 1954 does have provisions whereby by it grants reprocessing rights under agreements for cooperation with other countries. Sec 131(a)(3), 131(b)(2) and 131(d) of the US AEA, 1954 and in particular, Section 131 clause (d) talks about reprocessing rights. This article states that, “Nothing in this section is intended to prohibit, permanently or unconditionally, the reprocessing of spent fuel owned by a foreign nation which fuel has been supplied by the United States, to preclude the United States from full participation in the International Nuclear Fuel cycle Evaluation provided for in section 105 of the Nuclear Non-Proliferation Act of 1978…”
It is important to note that, wherever the US has granted reprocessing rights to countries under the agreement for cooperation, the countries have placed the reprocessing facility under IAEA safeguards. However, in the Indian case both the Kalpakkam reprocessing plant and the Fast Reactor Fuel Reprocessing Plant are not placed under the civil list.
Fuel Supply Assurances – The third issue of is of fuel supply assurances. India wants that the US should ensure that an assurance should be in place for fuel for the life of the reactor in question. However, as can be seen in other nuclear agreements for cooperation, the US ensures a reliable supply of fuel and provides a reserve of fuel as may be required to operate the reactor for a reasonable amount of time.
What are the causes that lead to termination of the agreement for civilian nuclear cooperation and how is it implemented?
As outlined by Section 129 of the AEA, termination of nuclear exports will occur in case the President finds that any non-nuclear-weapon state has detonated a nuclear explosive device [as outlined under the Hyde Act exemption granted to India regarding any actions that occurred before July 18, 2005]; terminated or abrogated IAEA safeguards; materially violated and IAEA safeguard agreement; or engaged in activities involving source or special nuclear material and having direct significance for the manufacture or acquisition of nuclear explosive devices, and has failed to take steps which, in the President’s judgment, represent sufficient progress toward terminating such activities [as outlined under the Hyde Act exemption granted to Section 129 (1)(D) regarding any actions that occurred before July 18, 2005].
Apart from these provisions, nuclear exports can also be terminated in case any nation or group of nations violates an agreement for cooperation; assisted, encouraged, or induced any non-nuclear-weapon state to engage in activities involving source or special nuclear material and having direct significance for the manufacture or acquisition of nuclear explosive devices, and has failed to take steps which, in the President’s judgment, represent sufficient progress toward terminating such assistance, encouragement, or inducement; entered into an agreement after the date of enactment of this section for the transfer of reprocessing equipment, materials, or technology to the sovereign control of a non-nuclear-weapon state except in connection with an international fuel cycle evaluation in which the United States is a participant or pursuant to a subsequent international agreement or understanding to which the United States subscribes.
Though, the AEA does not outline, the procedures to be followed for termination of the agreement, it is possible to extrapolate from other similar agreements that the US has entered into with other states. Either party has the right to request for termination of the agreement by giving six months written notice to the other party. Other US agreements for cooperation state that, “Before either party takes steps to cease cooperation, to terminate the agreement or to require of nuclear material, equipment or components transferred pursuant to the agreement they shall consult for the purpose of taking corrective steps and shall carefully consider the economic effects of such actions, taking into account the need to make such other appropriate arrangements as may be required.” Further these agreements state that, “if either party exercises its right to require the return of any material, nuclear material, equipment or components, it shall compensate the other party or the persons concerned for the fair market value thereof.”
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