The Global Nuclear Nonproliferation Regime

* Scope of the Challenge * Strengths and Weaknesses * U.S. Nonproliferation Policy Issues * Recent Developments * Options for Strengthening the Nonproliferation Regime

Scope of the Challenge Nuclear weapons proliferation, whether by state or non-state actors, poses one of the greatest threats to international security today. Iran's apparent efforts to acquire nuclear weapons, what amounts to North Korean nuclear blackmail, and the revelation of the A.Q. Khan black market nuclear network all underscore the far-from-remote possibility that a terrorist group or a socalled rogue state will acquire weapons of mass destruction (WMD) or materials for a dirty bomb. In April 2009, U.S. President Barack Obama reignited global nonproliferation efforts through a landmark speech in Prague and subsequent actions on the international stage. The problem of nuclear proliferation is global, and any effective response must also be multilateral. Nine states (China, France, India, Israel, North Korea, Pakistan, Russia, the United Kingdom, and the United States) are known or believed to have nuclear weapons, and more than thirty others (including Japan, Germany, and South Korea) have the technological ability to quickly acquire them. Amid volatile energy costs, the accompanying push to expand nuclear energy, growing concerns about the environmental impact of fossil fuels, and the continued diffusion of scientific and technical knowledge, access to dual-use technologies seems destined to grow. The existing global nonproliferation regime is a highly developed example of international law. Yet, despite some notable successes, existing multilateral institutions have failed to prevent states such as India, Pakistan, and North Korea from "going nuclear," and seem equally illequipped to check Iran (to say nothing of terrorist groups). The current arrangement must be updated and reinforced if it is to effectively address today's proliferation threats, let alone pave the way for "the peace and security of a world without nuclear weapons."

Strengths and Weaknesses Overall assessment: Opportunity for a revitalized system International instruments for combating nuclear proliferation were largely successful before 1991, but are proving unable to meet today's challenges. Although three states (India, Israel, and Pakistan) are known or believed to have acquired nuclear weapons during the Cold War, for five decades following the development of nuclear technology, only nine states have developedand since 1945 none has usednuclear weapons. However, arguably not a single known or suspected case of proliferation since the early 1990s Pakistan, Iraq, Iran, North Korea, Libya, or Syriawas deterred or reversed by the multilateral institutions created for this purpose. Many recent nonproliferation success stories, such as Libya's abandoning its nuclear program in 2003 and the accession of all of the Soviet successor states except Russia to the Nuclear Nonproliferation Treaty (NPT) as nonnuclear weapon states, have been the result of direct government-to-government negotiations and pressure rather than action by global bodies. In dealing with today's proliferation challenges, international organizations work in tandem with ad hoc forums of interested parties, such as the Six Party Talks on North Korea and the P5+1 grouping on Iran. But such forums have often proven inadequate to arrest the spread of nuclear technology, and states such as Iran and North Korea continue to pursue nuclear capability, if not outright weaponization. Given these trends, rising doubts about the sustainability of the nonproliferation regime are no surprise. But nonproliferation as an international issue has recently benefited from revived attention. The United States and Russia signed a legally binding replacement agreement to the Strategic Arms Reduction Treaty (START), which expired in December 2009. New START entered into force in February 2011. President Obama has made nuclear issues a centerpiece of his international agenda, convening a high-level Nuclear Security Summit in April 2010, dedicating serious political effort to strengthen the NPT at the Nuclear Nonproliferation Treaty Review in May 2010, and building consensus in the UN Security Council for a fourth round of economic sanctions against Iran. The Obama administration has also pledged to win U.S. Senate ratification of the Comprehensive Test Ban Treaty (CTBT) and reduce the role of nuclear weapons in U.S. defense doctrine. Yet even with these renewed efforts, major challenges and threats remain, namely with regard to Iran and North Korea.

Major weakness in the global nonproliferation regime include: * Incomplete coverage * Inadequate monitoring and enforcement mechanisms * Gaps in the legal regime * Inadequate regulation of dual-use technologies * Failure of NWS to meet disarmament commitments * Lack of legitimacy: NNWS often do not fully accept the NPT, UNSCR 1540, and other key elements of the nonproliferation regime Establishing a normative and legal framework: Fairly comprehensive, but with significant gaps The Nuclear Nonproliferation Treaty (NPT) is the core component of the global nonproliferation regime, and establishes a comprehensive, legally binding framework based on three principles: (1) states without nuclear weapons as of 1967a year before the treaty opened for signature agree not to acquire them; (2) the five states known to have tested nuclear weapons as of 1967the nuclear weapon states (NWS)agree to not assist other states in acquiring them and to move toward eventual disarmament; and (3) nonnuclear weapon states (NNWS) are guaranteed access to civilian nuclear technology. NNWS are subject to safeguards to ensure that materials and technology from civilian activities are not diverted to weapons programs. The International Atomic Energy Agency (IAEA) is the implementing body for the NPT, monitoring compliance with the treaty and assisting NNWS in developing civilian technology. Although the scope and mandate of the NPT and the IAEA are relatively broad, there is a critical gap in coverage: 190 states are party to the treaty, but three of the world's nine nuclear powersIndia, Israel, and Pakistanhave never joined, and a fourth North Koreawithdrew in 2003. Thus, even if enforcement of the existing regime were not an issue (see below), nearly half of the world's nuclear-armed states are excluded from its provisions. By design, the NPT does not address proliferation by nonstate actors. After the September 11 attacks, the UN Security Council adopted Resolution 1540, a legally binding instrument requiring all UN member states to enact and enforce measures to prevent nonstate actors from acquiring WMD. Many states in the General Assembly, however, have argued that the Security Council did not have the authority to impose a binding resolution in this area. Partly as a result, some states have resisted cooperation with the 1540 Committee established to oversee

implementation of the resolution. Likewise, a legally binding Convention on Nuclear Terrorism, which defines nuclear terrorism and requires international cooperation to prevent and punish such acts, had only forty-eight parties as of 2008. Moreover, two important elements of the nonproliferation regime have never come into effect, largely because of resistance by the United States and other nuclear weapon states. The Comprehensive Nuclear Test Ban Treaty (CTBT) of 1996 has been signed by 178 countries but cannot enter into force until all forty-four states with significant military or civilian nuclear capacity ratify it. China, India, Israel, Pakistan, and the United States have not yet done so. Efforts to conclude a Fissile Material Cutoff Treaty (FMCT) to ban the production of weaponsgrade material have also stalled. The United States has been criticized for blocking progress on both issues, but the Obama administration has signaled that it will move to again ask the Senate's advice and consent on ratification of the CTBT (the body rejected the treaty in 1999) and to revive negotiations on an FMCT with verification measures. A review of the NPT in 2010 concluded with modest success. The final document recommits signatories to the principles of the treaty, provides some specific action plans for nonproliferation and disarmament, and calls for the elimination of nuclear weapons from the Middle East through the establishment of a nuclear weapons-free zone in the region. The need for unanimous agreement resulted in some U.S. initiatives, such as stronger verification requirements, being eliminated from the final document. Preventing proliferation by state actors: Poor record on compliance since 1990 Despite the broad legal coverage of the NPT, a string of failures since the early 1990s have highlighted the ineffectiveness of existing nonproliferation instruments to deter would-be nuclear weapon states. In theory, the IAEA can refer countries that do not comply with the NPT to the UN Security Council, which in turn can impose sanctions or other punitive measures. In practice, however, political calculations have often caused deadlock at the Security Council, enabling nuclear rogues such as Iran to defy successive, fairly weak UN sanctions resolutions with virtual impunity. Another problem is the lack of adequate verification and enforcement mechanisms available to the IAEA, whose budget, intelligence capabilities, and technological resources fall far short of what would be needed to detect, prevent, or punish NPT violations. In 2010, the IAEA's inspections budget was approximately $164 million. Not surprisingly, even discounting nuclear facilities the IAEA does not have access to, such as those in Iran and North Korea, nuclear materials have reached the black market from installations under IAEA safeguards, namely, from several in Pakistan. One positive step has been the adoption of IAEA Additional Protocols, which strengthen the agency's inspections mandate by eighty-nine countries, including all five recognized nuclear weapon states and as of 2009, India. Nonetheless, more than half of all NPT member statesincluding Syria and Iran (which has ratified but not implemented the protocol)

have yet to agree to the toughened inspections regime. A review of the NPT in 2010 failed to reach consensus on U.S. efforts to make the Additional Protocol mandatory. Other multilateral, informal organizations also play a role in implementing and enforcing the NPT, notably the Nuclear Suppliers Group (NSG). Made up of forty-six advanced nuclear states, the NSG prohibits the transfer of civilian nuclear materials or technology to states outside the NPT, or those that do not fully comply with IAEA safeguards. However, the NSG's export bans are not legally binding, and members (including the United States, Russia, and China) have taken advantage of the weakness of the NSG regime to pursue civilian nuclear projects with non-NPT members. Interdicting illicit nuclear transfers: Some progress since 2001 In addition to legal frameworks, several multilateral initiatives have been created in recent years to improve international coordination in preventing nuclear terrorism. The Global Initiative to Combat Nuclear Terrorism, launched in 2006, seeks to coordinate international efforts to detect, investigate, and respond to proliferation by nonstate actors. One goal is to develop a comprehensive detection mechanism to monitor trafficking in nuclear material and related financial transactions. The U.S.-led Proliferation Security Initiative (PSI), established in 2003, today involves more than ninety countries in developing best practices, joint training exercises, and information-sharing activities to improve multilateral interdiction efforts. Although often cited as a flexible approach to coordinating the international response to proliferation, PSI does not grant any legal authority for ship-boarding or interdiction beyond the UN Law of the Sea treaty and various bilateral agreements, and India and China, which do not participate in PSI, have questioned the legality of its interdictions. PSI also cannot interdict ships of nonmember states unless master consents to being boarded are allowed, such as Iran and Pakistan. Whether the 2003 interdiction of a ship supplying nuclear materials to Libya was the direct result of PSI activities, for example, is still disputed. Analysts have also criticized the PSI for being a club of developed economies and not addressing the problem of increasing independence among a growing number of developing countries and nonstate actors from the controls enacted by the traditional supporters of the nuclear establishment. Others have pointed out that the initiative is limited by having neither an independent budget nor coordinating mechanisms, and does not provide a legal framework in which to lock in long-term, verifiable, and irreversible member state commitments. Securing fissile material: Significant progress since the 1990s, but incomplete Possibly the most successful element of the nonproliferation regime has been the effort to secure so-called loose nukes and fissile material throughout the former Soviet Union. This is critical given that some 135 nuclear facilities worldwide use highly enriched uranium (HEU) as fuel

enough HEU to create some 400 nuclear weapons. If terrorist or criminal groups were able to buy or steal even a small portion of this material, they could use it to construct (PDF) a crude nuclear weapon or dirty bomb. The United States and Russia have led this effort since 1991. By 2008, some 75 percent of sites in the former Soviet Union with weapons-usable nuclear material had been secured. U.S.-funded efforts such as the Cooperative Threat Reduction program, the Global Threat Reduction Initiative, and the Global Initiative to Combat Nuclear Terrorism have been complemented by other multilateral initiatives, such as the G8 Global Partnership against the Spread of WMD, which has provided funding and technical assistance to secure nuclear facilities, repatriate fissile material to origin countries, and promote international cooperation to counter proliferation. The Obama administration brought additional attention to this issue, pledging to secure all vulnerable nuclear weapons materials by 2014 and convening in 2010 a high level Nuclear Security Summit. The summit yielded tangible results, with Ukraine announcing that it would get rid of all its Soviet-era highly enriched uranium, and five other countries stating intentions to convert their research reactors to run on low-enriched uranium, which is less dangerous. The next summit is scheduled for 2012 in Seoul. Oversight of civilian nuclear programs and dual-use technologies: Inadequate monitoring and verification mechanisms Some analysts note that the NPT, which guarantees states' rights to develop civilian nuclear technology, enables a peaceful path to proliferation through fuel cycle activities. Many of the processes used to produce civilian nuclear power can be converted to military ends. As noted, the IAEA does not have the capacity to adequately monitor every nuclear site. Iran has almost certainly used its civilian program as a cover for illicit weapons activities. The challenge of monitoring and verifying NPT safeguards will probably only increase as more countries look to nuclear power to offset volatile energy prices and reduce reliance on carbon-based fuels. Disarmament: Not enough action toward nuclear disarmament by NWS The five recognized nuclear weapon states have committed under the NPT to pursue in good faith nuclear disarmament and a treaty on general and complete disarmament. The NPT does not specify an end-date for achieving disarmament. Although almost everyone believes that complete disarmament or even nuclear disarmament remains a distant goal, the record of NWS on pursuing nuclear disarmament is mixed. At the 1995 NPT Review Conference, in return for agreement from the nonnuclear weapon states to extend the treaty indefinitely, the United States and other nuclear powers reaffirmed their commitment to nuclear disarmament. But despite major cuts in the numbers of U.S. and Russian operationally deployed nuclear warheads, both countries still retain massive stockpiles that account for more than 90 percent of the world's nuclear weapons. Many NNWS have repeatedly

called for the NWS to make even deeper reductions in their arsenals and argued that the NWS foot-dragging is undermining the legitimacy of the NPT. This perceived failure to make progress toward disarmament has been one factor in the unwillingness of many UN members to support sanctions against Iran for NPT violations, which many developing countries see as a justifiable even admirableresponse to the hypocrisy of the nuclear weapon states. Recently, the NWS have recommitted themselves to disarmament, particularly in the New Strategic Arms Reduction Treaty (New START) and the outcome of the 2010 NPT Review Conference.

U.S. Nonproliferation Policy Issues The United States deserves both praise and criticism for its recent policies on nonproliferation. On one hand, since the Cold War, the United States has been at the forefront of efforts to secure nuclear material and facilities worldwide, spending more than any other country through programs such as Cooperative Threat Reduction and the Proliferation Security Initiative. However, efforts to reduce and reverse the spread of nuclear weapons technology took up only a small part of the resources devoted to nuclear weapons and defense under the Bush administration. According to an independent analysis, the entire 2008 U.S. budget for programs to secure nuclear material around the world was only $250 millionless than the cost of one day of the Iraq war. After September 11, the Bush administration led the world in creating international normative and legal frameworks to address the threat of nuclear proliferation by nonstate actors, supporting the passage of UNSCR 1540 and the Nuclear Terrorism Convention (which the United States has signed but not ratified). On the other hand, the administration did not support efforts to broaden constraints on states' nuclear weapons programs, refusing, for example, to accept verification measures as part of any treaty banning the production of fissile material, and failing to push for Comprehensive Test Ban Treaty (CTBT) ratification. President Bush did call for, and achieved, a 65 percent reduction in U.S. operationally deployed strategic nuclear weapons. But the Bush administration's position on missile defense (among other issues) hampered bilateral negotiations with Russia and contributed to the failure to extend the seminal U.S.-Russia Strategic Arms Reduction Treaty (START) before its expiration at the end of 2009. The much weaker 2002 Strategic Offensive Reductions Treaty (SORT) requires the countries to dismantlenot destroy only a portion of their warheads. The United States and Russia have signed and ratified a treaty to replace STARTNew STARTwhich limits both countries to 1,550 operationally deployed nuclear weapons. It entered into force in February 2011. By contrast, President Obama laid out his vision for a new nonproliferation strategy in Prague in April 2009, where he reaffirmed "America's commitment to seek the peace and security of a world without nuclear weapons." In doing so, he pledged that the United States would reduce the role of nuclear weapons in the U.S. national security strategy, negotiate a new START treaty

with Russia, pursue U.S. ratification of the CTBT, strengthen the Nuclear Nonproliferation Treaty (NPT) with increased resources and authority for international inspectors, work toward building a new framework for civil nuclear cooperation and an international fuel bank, and create a new international effort to secure vulnerable material globally within four years. The April 2010 Nuclear Posture Review identifies nuclear terrorism and nuclear proliferation as urgent threats, necessitating a U.S. nuclear policy focused on rebuilding the nuclear nonproliferation regime through international efforts. Despite President Obama's shift in tone from the Bush administration, several nonproliferation issues continue to spark debate in the United States. Recent Developments Iran * In June 2010, the United Nations Security Council passed a resolution that again calls on Iran to cease its uranium enrichment and imposes additional sanctions on the country. While the resolution was not passed unanimously, it reflects growing consensus among the permanent five members of the security council on the need to respond to Iran's intransigence. * In October 2010, the United States and the European Union invited Iran to reopen negotiations on its nuclear program, offering an overseas uranium processing deal less favorable to Tehran than the one that Ayatollah Ali Khamenei rejected in 2009. Iran accepted the offer of renewed talks, while also announcing that it would begin uranium enrichment at its Bushehr reactor. Iran and the P5+1 (the United States, China, Russia, France, Britain, and Germany) met for two days in early December 2010, but failed to reach any agreements about Tehran's nuclear program. January 2011 talks in Istanbul, Turkey were similarly unsuccessful. * Pakistan has also ramped up its production of nuclear bombs, nuclear delivery systems, and fissile material. In February 2011, non-govermental experts estimated that Pakistan's nuclear arsenal has almost doubled since 2007, now totaling around one hundred nuclear weapons and Pakistan is suspected of building a new plutonium reactor. Options for Strengthening the Nonproliferation Regime Recent trends have brought the nuclear nonproliferation regime to a moment of grave crisis. The regime is under siege from both rogue states and nonstate actors, and its core bargain between the nuclear haves and have-nots continues to erode. Bolstering international restraints on the world's deadliest weapons will require the United States and its international partners to adopt realistic, concrete steps to strengthen and close gaps in existing treaty regimes, institutions, and partnerships.

In the near term, the United States and its partners should consider the following steps: Increasing the IAEA budget and reforming the safeguards, security, and personnel systems * The International Atomic Energy Agency (IAEA) is the globe's technical agency in charge of ensuring that countries maintain safeguards on their peaceful nuclear programs. Safeguards help deter a country from diverting nuclear technology and materials from peaceful to military programs. The major concern is that safeguards capabilities have not kept up with the increased use of nuclear power and the projected expansion of nuclear power to many counties. In the words of the Bush administration's head of the National Nuclear Security Administration, "safeguards equipment is outdated and personnel preparedness declining as the agency failed to replace retiring experts with new hires." The IAEA provides services on improving nuclear security in order to prevent nuclear and radiological materials from falling into the hands of terrorists. In 2008, the Eminent Persons Commission advised the IAEA director general that the agency needs to substantially increase its budget for safeguards and security work. The IAEA, however, needs member states to commit to place the agency on a sustainable funding path. It also needs to reform its personnel rules to allow experts to stay in one type of job for longer than seven years and for highly qualified senior personnel to stay employed beyond the mandatory retirement age of sixty-two. Increasing national and international efforts to bring the Comprehensive Test Ban Treaty into force and boost funding to the CTBT Preparatory Commission to continue to improve the international monitoring system * The Comprehensive Test Ban Treaty (CTBT) is specifically linked to the overall nonproliferation regime, and entry into force would strengthen the norm against proliferation of nuclear weapons and make it more difficult for states to have confidence that nuclear weapons would work without testing. For the CTBT to enter into force, forty-four nuclear-capable states must ratify it. If the United States ratifies, it can then apply more leverage to the remaining holdout states to do the same. Nonratifying states include China, Egypt, India, Indonesia, Iran, Israel, North Korea, Pakistan, as well as the United States. In a February 2010 speech, Vice President Biden reaffirmed U.S. commitment to ratify the treaty. The United States will need allied states to reach out and apply diplomatic pressure to holdout states to help secure entry into force. To ensure the requisite technical support for the treaty, the United States and its allies need to provide enough funding and other technical resources to the CTBT Organization (CTBTO) and Preparatory Commission. Such support will improve the global monitoring system that is designed to detect relatively low yield nuclear tests throughout the world.

Negotiating new, emboldened nuclear arms control treaties

* The United States and Russia replaced the Strategic Arms Reduction Treaty (START) with the New START treaty. Successful negotiation and ratification of this agreement improved the overall condition of U.S.-Russia relations, possibly making it easier to work together on other multilateral efforts (such as ensuring the peaceful use of nuclear energy, preventing further proliferation to additional states, and implementing global best security practices on nuclear weapons and weapons-usable nuclear materials). The New START agreement preserves many of the best elements of its predecessor, such as information exchange, predictability, and permanence in reductions, verification, and transparency. But the United States and Russia must also look ahead to deeper nuclear reductions and focus on broader issues of contention, including missile defense and advanced conventional weapons. In the longer term, the United States and its international partners should consider the following steps: Reforming and strengthening the NPT by creating automatic or binding UNSC mechanisms * Rights in the NPT come with responsibilities. Nuclear weapon states have the responsibility to ensure access to peaceful nuclear technologies, and the recipient states need to show that they can manage nuclear power safely and securely. Although Iran has cited its inalienable right under the NPT to access peaceful nuclear technologies, including dual-use enrichment technologies, it has not met its responsibility to ensure adequate safeguards on its peaceful nuclear program. It has also not provided enough transparency into suspected nuclear weapons development activities to assure the world that it is meeting its responsibility to not acquire nuclear weapons. North Korea left the NPT under the Article X supreme national interests clause, but it did so while under suspicion of developing nuclear weapons. Moreover, it never placed its nuclear program under safeguards. Although amending the NPT is admittedly a difficult task, states should commit to strengthening the interpretation and application of the treaty's rules. In particular, the UN Security Council should require that any state in violation of its safeguards agreement should suspend the suspect activity until the violation is resolved. The Security Council should also require any state in violation of its safeguards agreement that wants to leave the NPT to return nuclear technologies and materials obtained while a member to countries of origin. In addition, the Security Council should call for a special inspection in any country that has violated its safeguards commitment and is under suspicion of having a nuclear weapons program. Nuclear weapon states have a special responsibility to reaffirm their commitment to pursue nuclear disarmament. They need to demonstrate what concrete actions they have taken and intend to take on the disarmament front. The 2010 NPT Review Conference provided an opportunity for treaty

signatories to recommit themselves to a world free of nuclear weapons; however, U.S. efforts to include language on stronger verification measures in the final document failed. Determining whether to institutionalize PSI * In his April 2009 Prague speech, President Obama advocated that the world should "come together to turn efforts such as the Proliferation Security Initiative...into a durable institution." The purported benefits of creating a formal institution out of PSI are still being debated. For example, turning the PSI from an informal cooperation agreement into an organization with a secretariat and a budget has the potential to increase its resource endowment and expand its reach. Institutionalizing the initiative may also help clarify commitments and increase operational transparency, making it easier to evaluate performance and measure progress. Bringing the PSI under UN aegis, some analysts have argued, could boost its international legitimacy and appeal to China, India, and Middle Eastern states, whose cooperation in policing the nuclear trade market remains important. One way to put PSI on a firmer institutional footing without folding into an explicitly formalized institution would be to strengthen its legal foundation. This would place interdiction on grounds consistent with international law. Creating a global alliance against nuclear terrorism * The terrorist attacks of September 11, 2001, while non-nuclear, renewed fears of catastrophic nuclear terrorism. In response, the United States and partner countries have revived or initiated international efforts to counter this threat. In particular, the G8 countries in 2002 launched the Global Partnership against the Spread of Weapons and Materials of Mass Destruction, in which the United States committed to spend at least $10 billion over ten years, and other partners pledged to match that sum. In 2004, the United States formed the Global Threat Reduction Initiative, which was an umbrella program including several programs to secure and reduce fissile materials as well as radioactive materials. Russia is a major partner in this initiative. In 2006, Russia and the United States joined forces again when then President Bush and then Russian President Putin began the Global Initiative to Combat Nuclear Terrorism, which as of early 2010 had about eighty countries voluntarily taking part in sharing intelligence on nuclear terrorist threats as well as pledging to work toward better security practices over nuclear and other radioactive materials. These programs and initiatives have achieved significant results, but more committed and coordinated global efforts are needed. The challenge for the new U.S. administration is to urge countries to meet their financial and resource commitments pledged under these programs and to increase funding and personnel to ensure that President Obama's goal of securing all vulnerable nuclear material can be achieved by 2014. The Nuclear Security Summit, held in Washington, DC, in 2010, is a solid step in this direction. The next summit is scheduled for 2012.

Developing a system of layered nuclear fuel assurances * The spread of nuclear fuel making facilities under a single state's control can increases the risk of diversion of peaceful nuclear technologies into weapons programs. Issuing an edict to prohibit this activity runs into the barriers of state sovereignty and the "inalienable right" to pursue peaceful nuclear programs. States have built fuel making facilities for reasons of satisfying national pride, developing a latent weapons capability, and trying to make a profit. To take away or at least to reduce the economic rationale for these facilities, several fuel assurance programs have been proposed. Many of these proposals were studied decades ago. Concerns about proliferation in response to Iran's nuclear program have prompted a dusting off of these proposals or a dressing up with more incentives. The important point is that the nuclear fuel market has worked effectively and there is no reason to expect it to fail in the foreseeable future especially with the expansion plans of the established nuclear fuel producers. To further strengthen nonproliferation, it makes sense to offer a layered system of fuel assurances that would be available to any country that is in compliance with its safeguards commitments. The first layer would be the existing market in which a handful of major producers have been meeting customers' needs. The second layer would consist of political commitments and insurance policies that would form in effect a virtual fuel bank to back up the existing market. The final layer would consist of an actual fuel bank containing sufficient fuel or low enriched uranium that can be readily converted to fuel. Such a bank should contain at least enough fuel or enriched uranium to supply the needs of a few large power reactors over a two to three year period. Even with this layered approach, certain countries may still decide to pursue new fuel making endeavors, but a robust layered fuel system will at least expose that these countries are doing such activities for other than economic reasons. These recommendations reflect the views of Stewart M. Patrick, director of the program on international institutions and global governance.

Idiosycratic Factor: In 1953 President Eisenhower proposed the establishment of the Atoms for Peace program to share nuclear technology with other states for peaceful applications. This program also recognized that effective controls had to be placed on peaceful nuclear trade to ensure against its use for military purposes. Following the Atoms for Peace speech, the United States amended its Atomic Energy Act and led the effort to establish the International Atomic Energy Agency (IAEA) and its safeguards system. Beginning in 1955, the U.S. entered into agreements for cooperation with other countries to share in the research and power applications of the atom. The basic philosophy of the Atoms for Peace program rested on two principles. The first was that countries should have a right to enjoy the peaceful benefits of nuclear energy and that governments should encourage and facilitate international commerce in nuclear materials, equipment, and technology in order to promote global economic development and welfare. The second was that states that desired the benefits of peaceful applications of nuclear energy must make effective commitments not to misuse that technology for non-peaceful purposes and to accept adequate verification of those commitments. 8 These same two principles formed the basis of the NPT. Indeed, the NPT strengthened and expanded the nonproliferation side of the equation in two important respects. While the Atoms for Peace program made international cooperation dependent on certain nonproliferation assurances, these assurances were not comprehensive. No renunciation of nuclear weapons or nuclear explosives in general was required as a condition of export, and no commitment to verify the peaceful character of all nuclear activities was required. The NPT, on the other hand, reflected the conviction that to enjoy the benefits of peaceful uses of nuclear energy, a country's commitments must be complete and comprehensive. Hence, Articles II and III of the NPT obligate non-nuclear weapon states party to the Treaty to forgo the manufacture and acquisition of nuclear weapons and nuclear explosives and to accept safeguards on all their peaceful nuclear activities. In return, Article IV of the Treaty reaffirms the right of all parties to develop and use nuclear energy in conformity with their nonproliferation obligations and binds all parties to facilitate the fullest possible exchange of equipment, materials, and scientific and technological information for the peaceful uses of nuclear energy. Article IV also requires that parties in a position to do so cooperate in contributing to the further development of the applications of nuclear energy for peaceful purposes. Reagan While the world's attention remains riveted on the unsteady course of strategic and theater arms control, concern for the horizontal spread of nuclear weapons has been decisively upstaged. 1 With the inauguration of Ronald Reagan and the subsequent decision to devote the bulk of

American foreign policy energy to East-West competition, this more immediate threat to peace and stability now has become a side issue. During his campaign, President Reagan spurred some controversy by proclaiming that horizontal nuclear proliferation was "none of our business." In office, however, the President has retreated from this position. Indeed, the President announced that nonproliferation is a "fundamental national security objective." 2 Similarly, Undersecretary of State Richard Kennedy recently declared that "there can be no more dangerous possibility in the world than further proliferation of nuclear weapons." 3 Still, in the last three years there has been a radical redirection of American foreign policy and a much lower priority for nonproliferation. 4 The present administration is committed of reversing the foreign nonpoliferation policy practiced by the United States during the years 1974-80, a policy set in motion by the dramatic events of May 1974, when India detonated a nuclear explosive. 5 The Reagan Administration's approach threatens the progress made in the aftermath of 1974, and erodes the international nonproliferation regime. The policies of the Reagan administration manifest a general disregard for nonproliferation. The London Economist observed that "the Reagan Administration policy looks less like a show of sensible flexibility than like ... CHALLENGES FACING THE NONPROLIFERATION REGIME AND POSSIBLE NEW DIRECTIONS Although the nonproliferation regime has been largely effective in limiting the spread of nuclear weapons, many experts and observers believe that the end of the Cold War has accelerated the risks of proliferation and that the current nonproliferation system needs to be strengthened. They have expressed concern that certain countries that possess nuclear weapons, fissile materials or sensitive nuclear technologies that can produce weapons-usable materials might transfer them to other states or to terrorist organizations. The Government of Pakistan has admitted that A.Q. Khan, the former head of the Khan Research Laboratory, has transferred enrichment technology to North Korea, Iran and Libya, as well as nuclear weapons technology to Libya. Some experts also believe that, although the NPT has generally worked well since it went into effect in the 1970s, several legal loopholes have become apparent, which have allowed some states to abuse the Treaty by using it as a cover to obtain nuclear material that could subsequently be used to develop nuclear weapons. They believe that Iran and Iraq both joined the NPT in order to reap the rewards promised by Article IV of the Treaty, while seeking to develop covertly a nuclear weapons capability. Under the NPT, a non-nuclear weapons state is free to acquire enrichment and reprocessing plants so long as such states conform to the provisions of Article II not to manufacture or acquire nuclear weapons or nuclear explosive devices and Article III to place all of their peaceful nuclear activities under IAEA safeguards. Many experts fear that, under the NPT, states such as Iran have acquired the technology needed to produce separated

plutonium or highly enriched uranium and that, once having acquired these weapons-usable materials, they could withdraw from the Treaty on 90-days notice and develop nuclear weapons without violating the NPT. Thus in recent years attention has largely focused on the risks of proliferation associated with the spread of enrichment and reprocessing facilities and the weapons-usable materials that they produce. This problem has led to a number of proposals to discourage the spread of enrichment and reprocessing capabilities. These have included calls by the Director General of the IAEA, Mohammed El Baradei, urging states to place enrichment and reprocessing facilities under some form of multinational control and 12 proposals to improve international nuclear fuel assurances as an inducement to states to refrain from acquiring and operating enrichment plants. Further, in a speech on February 11, 2004 at the National Defense University, President Bush proposed two new initiatives designed to address this specific problem. Specifically he proposed that (a) the members of the Nuclear Suppliers Group should refuse to sell enrichment and reprocessing equipment and technologies to any state that does not already possess fullscale, functioning enrichment and reprocessing plants and (b) the world's leading nuclear exporters should ensure that states have reliable access at reasonable cost to fuel for civilian reactors in order to discourage the spread of enrichment and reprocessing facilities. Since then, the U.S. had been engaged with other suppliers and the IAEA in discussing the challenges of assuring fuel services to those states that foreswear enrichment and reprocessing. For example, at the 2005 IAEA General Conference the U.S. Secretary of Energy announced that the U.S. intended to establish a strategic reserve based on 17.4 tons of highly enriched uranium (HEU) that would be blended down to help qualified states deal with any disruptions in supply from their nuclear fuel suppliers, provided that these qualified states are fulfilling their nonproliferation obligations. Subsequently, six states, France, Germany, the Netherlands, Russia, the UK and the U.S. made a proposal at the June 2006 IAEA Board of Governors Meeting that offers improved fuel assurances in order to discourage countries from building enrichment and reprocessing facilities. In addition, at its meeting in July 2006 the G-8 group of nations issued a statement in support of establishing improved fuel assurances in order to discourage the spread of sensitive nuclear technologies. In particular, it supported the six-nation proposal submitted to the IAEA Board of Governors in June 2006. Lastly in February 2006 the U.S. Department of Energy (DOE) proposed a major new initiative, the Global Nuclear Energy Partnership (GNEP) aimed at the development, demonstration and deployment of advanced separations and burner reactor systems. The initiative has several important features: 13 The demonstration of new separation techniques for recycling nuclear

fuel that would allow the U.S. to close its fuel cycle and to develop somewhat more proliferation-resistant technologies by avoiding the presence of separated plutonium. In this connection, the U.S. nuclear services firm, EnergySolutions has acquired many BNFL employees as well as BNFLs technologies in modern fuel reprocessing and waste treatment and is seeking to offer an alternative to the MOX fuel cycles without separating pure plutonium. Similarly AREVACOGEMA, Inc. is also offering the prospect of treatment recycling plants with no separated plutonium. The advancement of the nuclear waste management program within the United States by coupling these new separation techniques with advanced recycling reactors with the objective of reducing the volume of waste per reactor that would have to be disposed of in Yucca Mountain. The program is specifically intended to remove the need to follow the Yucca Mountain Project with several additional geological repositories. It assumes work will continue that is devoted to completing the Yucca Mountain Project. The establishment of a new international nuclear fuel assurance regime in order to discourage the spread of enrichment and reprocessing facilities. A major long-term aspect of this objective is a proposal that those supplier states with industrial enrichment and fuel recycling capabilities should work to provide so-called cradle-tograve services to states that agree to refrain from acquiring enrichment and reprocessing facilities. Under this approach the supplier states would lease enriched uranium to consumer nations and would accept the return of the resultant spent fuel for recycling. Under the proposal contained in GNEP, achievement of this goal will take some time since such cradle-to-grave services would be put into place only after the proposed advanced recycling technologies have been proven and have become operational. The pursuit of GNEP is a major policy and technical goal of the Administration of President Bush. However, fulfilling the promise of GNEP is a long-term endeavor that will require commitment across several Administrations. The U.S. ability to fulfill this long-term promise could be aided by a strengthened U.S. civil nuclear infrastructure. In the short-term, 14 the U.S. and world is looking to expand the peaceful use of nuclear energy in the civilian sector. Iran: Options for the Next Presidency Thrse Delpech All the major actors of the Iranian crisis seem to be on hold until the U.S. November 2008 elections. Whether Iran will be the major foreign policy issue of the next U.S. administration is debatable;1 Russia, Afghanistan, Pakistan, or East Asia may well present bigger challenges in the coming years. But much is at

stake in Iran. It has presented an outstanding nuclear issue since the 2002 revelation of its clandestine program (a program that shakes the confi dence of Turkey, Egypt, Saudi Arabia, and other Gulf States) and the discovery of its violation of its safeguards agreement with the International Atomic Energy Agency (IAEA).2 Iran also represents a signifi cant long-term problem to regional and global security: its growing regional infl uence (especially in Iraq); its role as oil and gas supplier; its presence in Lebanon and Afghanistan; and its ability to plan terrorist attacks in the region and beyond all make Iran a very special case at the beginning of the twenty-fi rst century. Whether Iran continues to challenge the international system, declaring that Israel should be wiped off the map3 and encouraging suicide attacks, or becomes a more reasonable partner will make a considerable diff erence in the years and decades to come. Whatever the expectations might be, the prospects for political change in Iran are slim: civil society faces increasing governmental repression, while religious conservatives tighten their grip on power, pushing aside both veterans who helped found the Islamic regime thirty years ago and reform-minded politicians accused of being disloyal to the revolution.4 Th e results of Irans March 2008 elections confi rmed the conservative consolidation of power;5 the relationship between the Supreme Leader and the president may be more intimate than most observers believe; and the growing power of the military and paramilitary forces since 2005 does not provide grounds for optimism. Th e Iranian economy is essentially driven by the price of oil while basic investments are not made; although criticism of economic management is widespread in Iran from both hardline and pragmatic conservatives, it has produced little change so far (however, the current sharp decline in oil prices would allow additional international pressure to work, since the only legitimacy of the regime since 2005 is the improvement of the economy). Finally, it may be worth recalling that even the reputedly less diffi cult interlocutorsthe so-called pragmatists, such as Hashemi Rafsanjani would

IRAN: OPTIONS FOR THE NEXT PRESIDENCY still adopt an uncompromising policy on the nuclear program.6 If this analysis is sound, what can be inferred? First, the West makes constant mistakes regarding Iran, and this must be recognized: the Islamic revolution was not on the Wests radar screen in 1979; Mohammad Khatami was not expected to win the presidency in 1997; Mahmoud Ahmadinejad was unknown before his 2005 election andaft erwardwas not expected to make a real diff erence. Recurring and unfulfi lled hopes that Iran will adopt a more cooperative behavior for social and economic reasons surface again and again in Western capitals. Such mistakes are understandable: Iran is both complex and opaque, playing erratic games, and hopes are not entirely unfounded: young people in Iran have enormous expectations and are avid for change, and Iran is far from achieving its development potential.7 It has huge unfulfi lled economic needs. One day, reality will perhaps prevail over rhetoric and ideology. But there is little that we can do to make this happen under the present political confi guration. It is dangerous to build a policy on mistakes refl ecting our wishes triumph of reform over revolutionary spirit, irresistible power of Irans society aspirations, Tehrans reconciliation with the West rather than coming to grips with reality. Second, measure Irans infl uence in the Middle East, the Gulf, Lebanon, Gaza; its agreements with Syria; its presence in Afghanistan and Central Asia; and its role in Iraq. Saudi Arabia is probably the Gulf country most worried about Tehran, although Riyadh has expressed little publicly so far on the subject. Th e Iranian nuclear program also casts a shadow over Egypt and Turkey. Egypt is preoccupied by Tehran extending its sphere of infl uence with the bomb and afraid to be drawn into a confl ict between Iran and some of the smaller Gulf states. Turkey, for all its ambiguous policy concerning Tehran,8 will never accept a hegemonic Iran that throws its weight around thanks to nuclear weaponry. Nor will it accept a Middle East with only two nuclear powers: Israel and Iran. Concerning Iraq, an unpredicted consequence of the war is Tehrans growing infl uence there. At a time when his own citizens are fi ghting infl ation, Ahmadinejad announced a billion-dollar reconstruction loan during his state visit to Iraq in March 2008. He also said foreign forces should leave Iraq immediately,

hoping to still increase its infl uence when this will eventually be done. In Afghanistan,9 Iran has confl icting interests: ensuring stability of a neighboring country and destabilizing U.S. troops, which explains Irans contradictory policy of helping declared enemies (the Taliban and Al Qaeda) up to a certain point. Limiting Irans ability to interfere in such a sensitive zone should be a major goal of any sound policy. Th is means preventing the acquisition of the most destructive weapon available. Th ird, we must fully realize what it would mean to deal with a nuclear-armed Iran. An Iranian bomb would strengthen the more radical elements in Iran who would be buoyed by nuclear success; it would extend Irans sphere of infl uence; it would expose the weakness of its neighbors; and it could result in a Middle East with a number of nuclear actors that would make it utterly unpredictable and even unmanageable. A nuclear Iran would jeopardize the fragile hopes of any virtuous circle in the region, and possibly the entire nonproliferation regime, which would not be able to withstand an assault of this magnitude in the most strategically sensitive part of the world. Tehran may not necessarily use the bomb to destroy Israel, as it claims, but who wants to test that hypothesis in the real world? And even if such is the case, an Iranian bomb would by its own existence be an unacceptable coercion on neighbors and on powers present in the region. In a situation in which Iran does not even acknowledge its military program, no one can describe the command and control 6. Hashemi Rafsanjani accelerated the Iranian nuclear program in 1989 after the death of Ayatollah Ruhollah Khomeini, at a time when Irans war with Iraq was terminated. 7. A public opinion poll across Iran before the March 2008 elections showed that Iranians continue to favor better relations with the West, would like to elect their Supreme Leader in a free vote, and are dissatisfi ed with Ahmadinejads economic policies. See survey conducted by telephone by the Center for Public Opinion/Terror Free Tomorrow and D3 Systems. 8. Turkey, a member of NATO and a U.S. ally, maintains strong diplomatic and economic ties to Iran. 9. Since 2002, Iran has increased its infl uence in western Afghanistan by distributing funds and investing in infrastructure. NUCLEAR CHALLENGES AND POLICY OPTIONS FOR THE NEXT U.S. ADMINISTRATION 7

or safety mechanisms that Tehran has in mind. Th is will greatly increase the fear that something might go wrong inadvertently or, in a time of crisis, possible misunderstandingsthe very situation nuclear experts dread. Realism would therefore counsel to ask the following questions: What could be expected from Tehran with the bomb, taking into account what it already does without it? And are the risks tolerable? President-elect Barack Obama answered the last question with a clear no. Fourth, we must understand the real conditions of a deal with Tehran. If Iran, as the December 2007 National Intelligence Estimate (NIE) contends,10 is to be considered a country where decisions are guided by a cost-benefi t approach, a possible solution would be to off er yet more signifi cant economic and security incentives to get a better response on the nuclear program. But this hypothesis is not warranted by facts. Unless Tehran faces a situation of extreme danger (as in 2003, for instance, when U.S. forces entered Baghdad), the margin available for eff ective negotiationas opposed to discussions allowing Iran to gain time is slim. At no point since 2003 did the Iranian negotiators, even under Khatami, ask for more or diff erent economic and security incentives.11 With the Europeans, the negotiations centered on the nuclear issue, even though economic and security discussions took place. Iran turned down the Russian proposal one day aft er it was made; it did not even contemplate the off er presented in August 2005 by the Europeans, and refused fairly quickly those presented in June 2006 and in July 2008 by Javier Solana on behalf of France, Britain, Germany, Russia, China, and the United States.12 One can always contend that not enough has been off ered. But is it true? Would any other off er of the same kind, or even more substantial, make any diff erence? Th e European experience during fi ve years of negotiations teaches the following: the only attainable deal with Iran would be to accept Iranian nuclear weapons and get some restraint in Iraq, Lebanon, and/or Afghanistan, a deal that will or will notbe implemented once Iran has nuclear weapons. Would that be a good dealor even an acceptable one? Fift h, acknowledge that even if a deal with Iran is possible, the potential discontinuities that could derail cooperation are plenty. Iran might not be seriously interested in cooperation for political reasons. Having in

mind the domestic situation more than the international scene, the current regimes survival seems to rest on the exploitation of crises and international isolation. Th e victory of the Iranian conservatives is not conducive to more cooperation with the West: it would ruin the very system the leadership tries to preserve, while an external enemy may explain economic failure, bolster nationalism, and prevent political change. Even when negotiations took place in a better environment (i.e., in 2003 and 2004), their goal seem to have been gaining time unimpeded rather than developing cooperation. Th is is at least what experience suggests.13 Finally, even partial cooperation may be derailed by constant changes in language and behavior. It makes surprises almost certain in the course of any negotiating process. If Iran has learned a few things from North Korea,14 one of them is that non-linear behavior is deeply disturbing for Western diplomacy and deeply confusing for Western strategists. Sixth, continuing to try to prevent a nuclear-armed Iran remains the only sensible option. We can pursue this in various ways. 10. The December 2007 U.S. National Intelligence Estimate did not only present a reevaluation of the Iranian nuclear program (the weaponization part would have been halted in the fall 2003), it also took a position on some political aspects of the crisis, namely that the leadership could be infl uenced by external powers. 11. In particular, contrary to some assertions, Tehran made clear that it would never believe security assurances offered by either the Europeans or even by the United States. 12. The very day the offer was made, activities were resuming at both Isfahan and Natanz, signaling Irans refusal to suspend its conversion and enrichment activities. 13. A number of offi cial Iranian statements make the point that what was needed with negotiations was time. For instance, in December 2004, Iranian nuclear negotiator Sirus Nasseri said: They [the Iranian authorities] needed to gain time to see certain projects going through unimpeded. Shargh newspaper, December 56, 2004. 14. Iran has received from North Korea ballistic missile technology and components and may have shared nuclear technology with Pyongyang. 8 Sanctions. UN Security Council (UNSC) Resolution 1803 contains more sanctions that hurt the Iranian regime,15 but measures adopted so far are unlikely to produce signifi cant divisions or even discussions within

the Iranian leadership.16 Another UNSC resolution that is more substantial on refi ned products could produce results. Is it realistic? No, particularly aft er the crisis in Georgia. Concerning China, it is doubtful that Beijing would oppose a proposal already agreed by Moscow. And Beijing may also be willing to embrace more responsibility for upholding nonproliferation norms. But an agreement on refi ned products would be the most diffi cult to achieve (just below the impossible ban on energy exports), because Beijing is Irans number one trade partner, particularly interested in energy: Sinopec, Chinas largest oil refi ner, has concluded a multimilliondollar deal in addition to the deal of the century for natural gas from Irans North Pars gas fi eld. In sum, sanctions are still worth trying, even on an essentially European/U.S. front, particularly as Iranian authorities face internal pressure, but without too many illusions concerning Russian and Chinese contributions. A deal. Th ere remains the stubborn notion that more incentives would somehow produce the desired results. Th e analysis above suggests that this may be wrong. Th e worst option for the next president would be to start another negotiation with Iran. It would give him a bad start in his foreign policy (failure: see North Korea), and it would produce only one assured result: giving more time to Irans nuclear program. However, if a new round of negotiation is decided by the next administration, as seems likely, the worstcase scenario would be to do it alone (as opposed to doing it with allies), to allow an open-ended discussion (as opposed to a time-bound one), and to take time to start it (as opposed to doing it right away). Press for political change in Iran. Th is is an excellent idea that lacks concrete content and strategy. It sounds nice to recommend a policy slowly compelling the leadership to transcend the ideological gaps that have alienated it from large sections of its population.17 Th e problem is simply how to achieve this result. Experienced Iranians recognize that they frequently do not understand themselves how the political power works in their own country. So how could we? As a matter of fact, external pressure on Iran has been very limited. For instance, in 2004 and 2005, the policy vis--vis Iran was one of great caution, in order not to allow the conservatives to use external pressure in the presidential electoral campaign. And the result was Mahmoud Ahmadinejad, an ultraconservative. Th is should not prevent eff orts to address Iranian civil society, which

remains the fi rst victim of the repressive and ineff ective policy conducted by Tehran: if Iran suff ers while its neighbors benefi t from peaceful nuclear cooperation, the regime should be increasingly hardpressed to explain why. Th ree decades aft er the Islamic revolution, economic challenges may lead Iran to seek practical solutions, abandon ideology, and meet the most important expectations of its population: containing infl ation and developing employment. But can these goals be attained before the bomb is built? Who would be ready to bet on that? Th e military option. If the scenario of military strikes is excluded, it will not necessarily mean than international pressure will stop, as the follow-up of the 2007 U.S. NIE has shown.18 UNSC Resolution 1803 was still adopted in March 2008, with more sanctions and only one abstention (Indonesia). But with this important option off the table, Iran will feel free to continue defying the international community in some way, shape, or form, particularly if eff ective sanctions are not adopted (see the earlier point on refi ned products). Irans nuclear military program will go on. Th e world may well have to decideand the West in particular, its reluctance notwithstandingwhether it prefers a nuclear-armed Iran or a military operation. It is doubtful that the American people will allow another military operation at a time when so much is going wrong in Afghanistan, Pakistan, and Iraq.19 Th at said, if a military action means trouble for months or even years, an Iranian bomb 15. The measures extend travel and fi nancial curbs on named individuals and companies. 16. The sanctions adopted so far have an impact on the economy but no effect on policy. 17. Ray Takeyh, Re-imagining US-Iranian Relations, Survival 44 (Autumn 2002), p. 24. 18. The NIE was widely interpreted as a way of effectively taking U.S. military action off the table. 19. Senator John McCain is famous for having declared, There is only one thing worse than military action against Iran and that IRAN: OPTIONS FOR THE NEXT PRESIDENCY NUCLEAR CHALLENGES AND POLICY OPTIONS FOR THE NEXT U.S. ADMINISTRATION 9 would certainly mean trouble for decades. Th erefore, it makes a lot of sense to think twice before the choice is made. If there is one region where deterrence should not be tested, it is the Middle East. And Iran has to worry as well, because if it goes nuclear, not only conventional but also nuclear military buildups will take place in the

region, essentially as a counter-reaction to its provocative policy. Conclusion Th ere are situations in which no good option is available. Iran is one such situation today. Iran defi es both containment and engagement, two approaches that are easy to advocate but diffi cult to carry out. And deterrence is not easy with a country that encourages suicide attacks. Under these circumstances, failing to make a decision is tempting, but is hardly a policy. Time is not on our side: Iran had assembled hundreds of advanced centrifuges by November 2008,20 refl ecting its intention to speed up uranium enrichment, and fi ssile materials remain the most important missing link of its nuclear military program.21 Th e most important point for the next administration is to decide quicklywith the European allies in the fi rst placehow best to prevent Iran from getting the bomb, avoiding the adoption of a comprehensive agenda that will only allow Tehran to gain more time. Is Contents Introduction: The 9/11 Commission Report and Long-Standing Contradictions in U.S. Policy Towards Pakistan and South Asia . . . . . . . . . 1 Squaring the Circle: Antiterrorism Cooperation with a Prime Source of Nuclear Proliferation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 Congressional Concerns and Perspectives . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 Recommendations of the 9/11 Commission:Hard Choices or the Same Choices? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 Past as Prologue: Pakistan and the Recurrent Dilemma of Conflicting U.S. Policy Goals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Indias 1974 Nuclear Test and the Beginning of the U.S. Policy Dilemma . . 7 Key Role of Congress in Shaping Basic U.S. Nuclear Nonproliferation Policy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 Alternating U.S. Policy Priorities Towards Pakistan . . . . . . . . . . . . . . . . . . . 8 Failed Efforts to Reconcile U.S. Cold War and Nuclear Proliferation Objectives: The 1985 Pressler Amendment and the 1990 Aid Cutoff . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 India and Pakistans May 1998 Nuclear Tests and the Decline of Sanctions as a U.S. Nonproliferation Policy Approach . . . . . . . . . . . 10 U.S. Policy Reversal After 9/11 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 Details on Pakistans Proliferation Activities . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 The A.Q. Khan Network . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 Other Nuclear Suppliers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 Intelligence Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 Pakistans Absence in U.S. Intelligence Reports on Proliferation . . . . . . . . 19 Transfers to Iran . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20

Transfers to Libya . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 Transfers to North Korea . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 Role of A.Q. Khan, the Pakistani Government and Military . . . . . . . . . . . . . . . . 23 Khans Motives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23 Pakistani Government Response to U.S. Concerns . . . . . . . . . . . . . . . . . . . 25 Pakistani Military Role? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26 Bush Administration Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30 Issues Concerning the Viability of the Musharraf Government As a Long-Term U.S. Security Partner . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32 Near-Term U.S. Security Needs Versus Longer Term Human Rights and Democracy Goals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32 Succession Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35 Policy Discussion: More Constraints Than Options . . . . . . . . . . . . . . . . . . . . . 36 Option 1 De Facto Acceptance of Pakistans Nuclear Activities and Non-Cooperation on the A.Q. Khan Issue on Condition of Maximum Counterterrorism Support . . . . . . . . . . . . . . . . . . . . . . . . . . 38 Option 2 Emphasize Multilateral Nonproliferation Strategies . . . . . . . . 40 Proliferation Security Initative . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40 Strengthened International Regimes . . . . . . . . . . . . . . . . . . . . . . . . . . 41 Expanded Cooperative Threat Reduction (CTR) Program . . . . . . . . . 42 Option 3 Condition High Value Assistance on Access to A.Q. Khan . . 43 Key Rationale . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43 Potentially Risky Test of Wills . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44 F-16 Fighter Aircraft Sale and the India-Pakistan Confrontation . . . . 44 Congressional Role and Powers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45 Option 4 Reimposition of Nuclear Nonproliferation Sanctions . . . . . . . 46 Legislation . . . . . . . . . . . . . . . . . . .