IDSA COMMENT

Towards Indo-Japan nuclear agreement: Prospects and Challenges

August 24, 2010

Katsuya Okada, the Japanese Foreign Minister, confirmed during a press interaction in New Delhi that Japan and India are seriously engaged in trying to forge a nuclear cooperation agreement. Okada stated that “the decision to launch the negotiation for the nuclear cooperation agreement was probably one of the toughest decisions that I had to make as Foreign Minister.”1 But he did not set any time line as to when the two sides would be able to conclude negotiations on the issue. Japan’s slow and steady approach in this regard suggests that the nuclear allergic nation has still to do major home work to clear obstacles in reaching an accord. It may find it difficult to generate a consensus at home and convince its anti-nuclear lobby which is against extending nuclear cooperation to non-NPT signatory countries including India.

Japan took almost five years to move from commitment to negotiation stage. It had made a commitment to India to enhance civil nuclear energy cooperation “through constructive approaches under appropriate IAEA safeguards”2 in a Joint statement signed by Prime Minister Manmohan Singh and then Japanese Prime Minister Shinzo Abe in 2006.

However, the recent push for a nuclear agreement with India has been driven by Japan’s entrepreneurial needs and the Kan administration’s economic growth strategy (which includes increasing export of infrastructure technology including nuclear technology). As part of this growth strategy the Japanese government intends to create an overseas infrastructure market worth US $230 billion. The Japanese government under the supervision of Ministry of Economy, Trade and Industry (METI) has set up the International Atomic Energy Development Company with an aim to form a centralized platform to increase Japan’s competitiveness in winning contracts for nuclear power projects overseas. The newly formed enterprise is eyeing the nuclear energy potentials of UAE, Jordan and India.

The pressure on Japan to conclude a nuclear cooperation also stems from the fact that US and French companies have won contracts from India to set up nuclear power plants. Two US companies - General Electrics and Westinghouse Electric Company – which have bagged contracts to set up nuclear plants in Gujarat and Madhya Pradesh are either partly or wholly owned by Japanese companies. Japan’s Hitachi had bought a 40 per cent stake in GE’s international joint venture in 2006, while Toshiba Corp. fully acquired the Westinghouse Electric Company the same year. Japan’s Mitsubishi Nuclear Fuel Company acquired a 30 per cent stake in French firm Avera in 2008; it is Avera that has bagged the contract to set up a nuclear power plant in Jaitapur, Maharashtra. However, these atomic power companies cannot use Japanese technology as Japan has put in place a ban on the transfer of military and arms-related technology since 1976. Thus, without Japan entering into a civil nuclear agreement with India and easing this ban, it will not be possible for these companies to use Japanese nuclear technologies. A civilian nuclear pact between Japan and India is also vital given that Japanese companies have stakes in all US and French firms which would be setting up nuclear power plants in India.

The negotiation with India for a nuclear agreement comes at a time when Japan’s business groups and industry bodies are mounting pressure on the government to permit some arms export when it announces a new Defence Guidelines in December 2010. Japan’s biggest business lobby, Nippon Keidanren, in a presentation to the Kan administration has said that the government’s arms export ban poses a potential security risk as dozens of Japanese companies have already quit weapons production and have demanded a relaxation of the ban.3

Japanese media reports have hinted that both India and Japan may reach a civilian nuclear cooperation agreement during Prime Minister Manmohan Singh’s visit at the end of this year. There has been sustained pressure on Tokyo from Japanese think tanks and from certain sections of the Ministry of Foreign Affairs to go for the deal. The Japanese Institute for International Relations, a leading think tank, was the first to underscore the need for nuclear cooperation with India. In a 2007 policy recommendation it suggested that the government should forge an agreement with India, arguing that “because of the need to reduce global warming, India will presumably want to depend much more heavily on nuclear power in the future. Japan’s technology and expertise in generating and ensuring the safety of nuclear power is among the best in the world, so it is in an excellent position to cooperate with India in these areas.” To allay Tokyo’s nuclear proliferation concerns, the think tank argued that “even though India developed nuclear weaponry…, it has always called for global nuclear disarmament, it has strongly maintained policies promoting nuclear non-proliferation and it has not abandoned those policies even after it had acquired a nuclear force. For these reasons we call upon the Japanese government to cooperate with India on this issue…”4 It is hoped that the think tank and academic community which support a civilian nuclear cooperation with India would re-energize their efforts to counter forces that are opposed to the deal.

Certain sections of the Japanese Ministry of Foreign Affairs also support nuclear cooperation with India. Japanese ambassador Yasukuni Enoki represented their sentiments when he stated in 2007 that Japan should propose a “NPT+Regime”. At a public forum he said that “NPT+Regime” will enable India to have access to nuclear fuel and technology for which it had sought the Nuclear Suppliers Group’s approval. He added that “this NPT+Regime is only for India, not for North Korea or Iran. Once this regime is agreed (upon) and the NSG approves this, India will be allowed full access to nuclear fuel and nuclear technology.” He also said that “this regime will also open up cooperation in nuclear technology trade between the two countries.”5 These statements suggest that those in Japanese Ministry of Foreign Affairs (MOFA) who support nuclear cooperation with India will not consider India’s signing the NPT a prerequisite for concluding the accord.

Whether an explicit support comes from the MOFA or not, the METI is pushing hard for a civil nuclear cooperation agreement.6 An Indian media report suggested that METI minister Masayuki Naoshima’s meeting with the Planning Commission’s Deputy Chairman Montek Singh Ahluwalia during his recent visit to Delhi resulted in the creation of a working group on civilian nuclear energy. The group has deliberated on the issue and has agreed to carry forward the deliberations over cooperation in this field.7

Another factor which has pushed Japan to expedite its efforts to sign a nuclear deal with India is South Korea, which appears set to reach an agreement on nuclear technology cooperation with India by the end of this year. South Korean companies have outshone Japanese companies in the Indian market especially in electronics. They have already outbid Japanese companies’ tender for a UAE nuclear power plant project. So the Japanese are closely watching the developments in the India-South Korean nuclear cooperation front. Japanese companies do not want to lose their economic clout in India’s lucrative nuclear power generation market, and thus have been pressurizing the METI to expedite the matter. Seen from these perspectives, the chances for the conclusion of an India-Japan civilian nuclear cooperation seem bright.

The challenges to the deal, however, come from the anti-nuclear lobbies and the Japanese media which has openly expressed concerns about the deal. The Mayor of Nagasaki, Tomihisa Taue, who is also member of various anti-nuclear groups has termed such a deal as “beyond intolerable”. The Nagasaki Peace declaration issued on August 9, 2010 criticizes the Japanese government saying that “… the government has recently been promoting negotiations on a nuclear agreement with India, a non-NPT member country with nuclear weapons. This means that a nation that has suffered atomic bombings itself is now severely weakening the NPT regime, which is beyond intolerable.”8 The Japanese media has reported that the Mayors of Nagasaki and Hiroshima have met Prime Minister Naoto Kan in an effort to persuade him not to go for a deal with a country which is not a NPT signatory. It seems that Prime Minister Kan has taken their reservations into consideration and has tried to allay the concerns of anti-nuclear groups. In one of his remarks he said that “we will pay sufficient attention to the issue of nuclear disarmament and nonproliferation and step up our efforts to get India to sign the Nuclear Nonproliferation Treaty.”9

The Japanese mainstream media has also voiced concerns about the possible Indo-Japanese nuclear agreement. As soon as reports of such an agreement came to light, Japan’s leading English daily in its lead editorial regretted the development. Commenting on the development it stated that: “Regrettably, Japan, which has advocated for a nuclear weapons-free world … has started talks with India on a pact to allow India to import civilian nuclear technology and equipment from Japan.” The daily suggested that “before agreeing to civilian nuclear cooperation…Japan should impose strict conditions on India so that Japan’s nuclear technology does not proliferate to other countries and thus the NPT regime is not undermined.”10

The Daily, in yet another editorial, suggested that the Japanese government “end the talks if India fails to commit itself to nonproliferation efforts.” Expressing concerns about the deal, the daily stated that “Japan should also be careful about its talks with India over a pact to allow India to import civilian nuclear technology and equipment from Japan. Japan should have the courage to end the talks if India fails to commit itself to nonproliferation efforts such as ratifying the Comprehensive Nuclear-Test Ban Treaty and stopping production of fissile material for nuclear weapons. Japan also should try to get India and Pakistan, both of which possess nuclear arms, to join the NPT.”11

Yet another daily, the Asahi Shimbun, has opined that such an agreement would erode the NPT and warned the Japanese government not to conclude the pact at the cost of damaging the NPT. In its editorial it reminded the Japanese government that “we must not forget that lax export controls are responsible for nuclear proliferation to India, Pakistan and North Korea. Exporting nuclear power plants is big business, and it can also help curb global warming. But is it right to develop this business at the price of damaging the NPT?”12

The sentiments expressed by the anti-nuclear groups and the media suggests that opposition is likely to increase in Japan as Tokyo inches closer to signing a nuclear deal with India, and that the Japanese government may find it difficult to generate consensus at home. But since the urge to sign a deal with India is driven by Japan’s entrepreneurial interest, and as Tokyo sees export of technology as a part of its economic growth strategy, it may give preference to the economy over its anti-nuclear diplomacy and ink the deal.

  1. 1. Joint Press Interaction of EAM and FM of Japan, available at http://www.mea.gov.in/
  2. 2. For details, see “Towards Japan-India Strategic and Global Partnership (Joint Statement),” December 2006, available at http://www.kantei.go.jp/foreign/abespeech/2006/12/15joint.pdf
  3. 3. “Arms export ban a risk to security: Keidanren,” The Japan Times, August 21, 2010.
  4. 4. “India’s leap forward and Japan” (September 2007), 29th Policy recommendation, The Japan Forum for International Relations, Tokyo.
  5. 5. “Japan makes exception for India,” The Indian Express, January 10, 2007.
  6. 6. “Nuclear cooperation talks with India eyed,” The Japan Times, June 22, 2010.
  7. 7. “India Japan working on nuclear deal to boost 123 Agreement,” Business Standard, New Delhi, May 10, 2010.
  8. 8. “ Nagasaki Peace declaration, 2010,” for full text visit http://www1.city.nagasaki.nagasaki.jp/peace/english/appeal/
  9. 9. “Kan: No-nukes code should be law,” The Japan Times, August 10, 2010.
  10. 10. “Exporting nuclear technology,” (Editorial), The Japan Times, July 2, 2010.
  11. 11. “Accelerate nuclear disarmament,” (Editorial), The Japan Times, August 6, 2010.
  12. 12. “NPT framework in peril,” ( Editorial), The Asahi Shimbun, July 14, 2007.

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Indo-Japan by Pramod Joshi