India US Ties: Up Close, and Personal

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Published in Hindustan Times on August 13, 2025

Six months ago, at the White House, President Donald Trump and Prime Minister (PM) Narendra Modi were describing each other as ‘great’ and ‘dear’ friends, recalling the reverberating echoes of Howdy Modi in Houston (2019) and Namaste Trump in Ahmedabad (2020), and outlined an ambitious vision of India-US relations in an over 3000 word long Joint Statement.

Even as Canada rubbished Trump’s call for it to become the 51st state, NATO, Japan, and South Korea wondered about the credibility of the US nuclear umbrella, and Europeans did their best to reassure a beleaguered Volodymyr Zelensky in Kyiv, the February visit reassured India that the Modi-Trump relationship was intact and India-US ties were on a positive trajectory. Opinion polls across the world noted that Indians were the most optimistic about Trump’s second term.

Bilateral trade talks began soon after. Five rounds have taken place but trade deals take long, years at times. But Trump’s qualities do not include patience and subtlety. To push the Indians, he added a 25% tariff with a deadline of July 31.

Also, his second term was promising to be very different from his first. In his inaugural speech, he had talked of ending wars, of leaving behind a legacy as a ‘unifier and peacemaker.’ It soon became clear that in addition to deploying his favourite policy tool – tariffs, to get his trade deals, his goal was the Nobel Peace prize, preferably in the first year itself.

His tactics seemed to be working. The US has announced new trade deals with the EU, UK, Japan, and South Korea, covering more than 25% of US foreign trade, though details haven’t been worked out. In addition, negotiations are underway with over a dozen countries. China is playing hardball, and using its leverage to restrict exports of rare earth magnets. Canada and Mexico have their own leverages. China’s tactics may be working as the US has already relaxed its export controls on H20 chips to China.

On his peace-President agenda, progress has been slower. The two big conflicts that Trump had promised to sort out quickly, Ukraine and Gaza, have proved difficult. Both Russian President Vladimir Putin and Israeli PM Benjamin Netanyahu have their own ideas about their objectives and have been stringing Trump along. However, Trump has been nominated for the peace Nobel jointly by the presidents of Azerbaijan and Armenia and by Prime Minister Hun Manet of Cambodia for brokering the ceasefire between Thailand and Cambodia. The White House has also highlighted his role in ending the conflicts between Rwanda and the Democratic Republic of Congo, Serbia and Kosovo, and Egypt and Ethiopia. And somewhat cheekily, for the ceasefire between Israel and Iran especially after Trump came to Israel’s help by firing Tomahawk missiles and deploying B2 bombers to deliver the GBU 57 bombs on Iranian targets.

Netanyahu has mollified Trump by nominating him for his role in the 2020 Abraham Accords that enabled Israel to normalise relations with the UAE, Bahrain, Morocco, and Sudan. Putin is now scheduled to have a bilateral meeting with Trump in Alaska on August 15 but Ukraine and the Europeans are not invited. Meanwhile, secondary sanctions on Russia’s oil exports have been introduced and India (collateral damage) will attract a 25% penalty, effective August 27.

However, India-Pakistan crisis is perhaps where Trump feels let down by his ‘great friend Modi.’ India was upset at Trump pre-empting the ceasefire announcement on 10 May and claiming credit as a “US brokered ceasefire.” Since then, he has repeated the claim more than 25 times adding how he prevented a nuclear war, and he employed the threat of cutting trade if they continued. Each time, it was denied by Indian foreign office and military officials, and most recently by the external affairs minister S. Jaishankar and defence minister Rajnath Singh, in parliament.

Meanwhile, Pakistan was quick to thank Trump for his positive role and expressed the hope that he could continue to remain engaged and mediate on Kashmir, while nominating him for the Nobel Peace prize. Encouraged by Pakistan, Trump invited Modi to the White House on June 18 on his way back from the G-7 meeting in Canada but was turned down. Trump was presumably trying to set up a meeting with Pakistan army chief Field Marshal Munir who was invited to lunch that day at the White House. With so much happening, its easy to lose sight of the big picture.

Relations between States are governed by national interests and patient negotiations. Good ties between leaders can help but cannot be the principal driver. That’s why neither Modi nor Trump is going to pick up the phone to resolve their misunderstanding.

The end of the Cold War provided the impetus for the shift in India-US relations when President George H W Bush (41) and PM PV Narsimha Rao took the initiative in 1992 to initiate a dialogue on nuclear issues and the first baby steps for defence cooperation were taken. Gradually, despite ups and downs, and changes in governments in both countries, the positive trajectory continued and a bipartisan consensus based on mutual trust and converging interests evolved. If the nuclear tests in 1998 marked a low point, the Strobe Talbott-Jaswant Singh dialogue, and the positive US intervention in 1999 during the Kargil conflict restored trust. The story was repeated after the parliament attack in 2001 and during Balakot when US facilitated the quick release of Wg Cdr Abhinandan from Pakistani custody.

There is a difference between back-channel diplomacy and public diplomacy. While Trump has a fondness for TruthSocial, India’s geography dictates prudence. US is larger than Trump just as India is larger than Modi, and there is life after Trump and there is life after Modi. This becomes clearer if interests are given primacy as foreign policy drivers. It also helps avoid the trap of believing one’s own propaganda. The simple question is – is it in national interest to sustain relations with the US. The answer should be obvious.

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Redeeming India’s Nuclear Power Promise

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Published in the Hindu on July 23, 2025

If India is to meet its ambitious target of 100GW of power generating capacity by 2047, it needs foreign partners as well as private entities to participate in the nuclear sector which has been till now completely under the government

The Union Budget for 2025-26 marked a significant shift in India’s nuclear energy plan by announcing an ambitious target of 100 GW of power generating capacity by 2047, up from the present 8.18 GW. This positions nuclear power as a major pillar in India’s energy mix, given the two goals of emerging as a developed country (Viksit Bharat) by 2047 and achieving “net zero emissions” by 2070.

Simultaneously, the Nuclear Energy Mission announced a special allocation of Rs. 20000 crores to develop “at least five indigenously designed and operational Small Modular Reactors (SMR) by 2033.” Such ambitious plans will need involvement of private players, both domestic and foreign, into a hitherto government sector, requiring significant changes in the legislative, financial and regulatory framework. Government has indicated that some changes in the Atomic Energy Act, 1962 and the Civil Liability for Nuclear Damage Act (CLNDA), 2010 are in the offing. However, the comprehensive reforms needed also require a change in mind set.

India’s nuclear journey

India had an early start, setting up Asia’s first nuclear research reactor, Apsara, in 1956, and beginning work on Asia’s first nuclear power reactors at Tarapore in 1963. As early as 1954, Dr Homi Bhabha, the architect of India’s nuclear programme presented a target of generating 8 GW of nuclear power by 1980!

However, the journey has been long and difficult. Following the war with China in 1962; its entry into the nuclear club in 1964; India’s decision to stay out of the Nuclear Non-proliferation Treaty (NPT) in 1968; and the Peaceful Nuclear Explosion (PNE) test in 1974; India was excluded from the emerging nuclear order. International cooperation ceased and gradually, export controls further slowed down the nuclear power programme. The first unit at Rajasthan was barely set up while the second was under construction: it only went critical in 1981. The nuclear power target was pushed to 10 GW by 2000.

Moreover, India took time to successfully indigenise the design of the 220 MW Pressurised Heavy Water Reactor (PHWR), employed in Rajasthan. The advantage was that it uses natural uranium as fuel unlike the design of the Tarapur Light Water Reactor (LWR), a design that used Low Enriched Uranium (LEU) that India obtained from the U.S., and later, from France. Subsequently, the same 220 MW PHWR units were established at Narora, Kaiga, Kakrapar etc; the design was upgraded to 540 MW (set up at Tarapur TAPS 3 and 4 in 2005-06) and to 700 MW with two units getting operational at Kakrapar in 2024. Since the nuclear establishment was excluded from civilian exchanges, an understandable and unintended consequence of the 1974 PNE was that the it became inward looking and wary about external engagement.

After the nuclear tests in 1998, followed by intense negotiations with the U.S. and other strategic partners, India finally gained acceptance as a responsible nuclear power. It also got a special waiver from the Nuclear Suppliers Group (NSG). India was thus ready to resume exchanges with other nuclear powers to import both nuclear fuel and more advanced reactors to expand its nuclear energy programme.

However, the CLNDA created new difficulties that have prevented the anticipated external participation, from France and the U.S. In fact, Russia is the only country that is partnering with us at Kudankulum with six VVER-1000 power reactors because this government-to-government agreement, signed in 1988, predated the CLNDA.   

Towards green development

To become a developed country by 2047, India’s annual per capita income needs to grow from the current $2800 to $22000, and correspondingly, the GDP from the current $4 trillion to over $35 trillion. There is a well-established correlation between economic growth and energy consumption. In 2022, India’s per capita electricity consumption stood at 1,208 kWh, compared to 4,600 kWh for China, and over 12,500 kWh for the U.S.

India’s electricity generation capacity, currently at 480 GW (divided almost equally between fossil fuels and renewables), will have to grow five-fold, accounting for growth in population and urbanisation. However, solar, wind, and small hydro provide intermittent power. That is why out of 2030 TWh, the total electricity generated in 2024, renewables, with half the generation capacity, accounted for 240 TWh. Coal fired thermal plants accounted for 75 percent of the generation, the balance added by nuclear and large hydro projects.

The climate change commitments announced by Prime Minister Narendra Modi in 2021 at the Glasgow COP26, of “net zero emissions by 2070, raising non-fossil energy generation capacity to 500 GW by 2030 while meeting 50 percent of the energy demand through renewables, and achieving a carbon intensity reduction of 45 percent over 2005 levels by 2030” means that that India will not be able to rely on fossil fuels for its growth. The potential from renewables (including solar, hydro, wind, and biomass) is estimated at providing 20% of the demand and up to 25% with investments in battery and pumped storage.   The obvious candidate therefore to fuel India’s growth is nuclear power.

There is a renewed interest globally in nuclear power. It was reflected in the Dubai 2023 COP28 ‘Declaration to Triple Nuclear Energy’, acknowledging nuclear power as ‘a critical input in reducing reliance on fossil fuels, enhancing energy security, and move towards a low carbon future’. in June, the IAEA and the World Bank agreed to work together to support nuclear energy in developing countries, marking a significant policy shift. World Bank President Ajay Banga pointed out, “nuclear (energy) delivers base load power, which is essential to building modern economies.” It is quite likely that the World Bank lead will be followed by other development funding banks and organisations.

Creating an enabling environment

Government is looking at three routes ahead. One is to standardise the 220 MW PHWR design and apply it to the Bharat Small Modular Reactors, that significantly reduces costs and commissioning time. This would be relevant to replacing captive thermal power plants that today account for over 100 GW and will be replaced over the next two decades.

The second track is scaling up the Nuclear Power Corporation of India  Ltd (NPCIL) plans for the 700 MW PHWR into fleet mode by facilitating land acquisition, streamlining licensing, and strengthening indigenous supply chains.

The third track is to accelerate negotiations with partners in France and the U.S. partners that have been moving at a glacial pace for the last 15 years.

Under the Atomic Energy Act, nuclear power is a sector reserved by the government. The NPCIL is a government owned company that builds, owns, and operates the PHWRs, the first two Tarapur LWRs, and the Russian designed VVERs.

Nuclear power financing is qualitatively different because of the higher upfront capital costs, lower operating costs, a lifecycle of 50-60 years, and costs associated with decommissioning and radioactive waste management. The indigenised PHWR model has a capital cost of $2 million/MW while the equivalent cost for a coal fired thermal unit is just under a million. Given NPCIL’s annual budget of $1.2 billion, government realises that to achieve the target of 100 GW, private sector companies will have to be brought into the sector, necessitating a comprehensive set of amendments to the Atomic Energy Act.

Questions of majority/minority ownership, whether the nuclear operator is exclusively NPCIL; responsibility and control over the nuclear island part of the plant; and concerns over assured fuel supply and waste management responsibility will need to be considered with the potential stakeholders that include major players like Tatas, Adani, Ambani, Vedanta and L & T. The power plants will be under IAEA safeguards and ensuring this is a sovereign responsibility, necessitating a different legal framework. All these will require amendments to the 1962 Act.

A set of comprehensive amendments will also be needed for the 2010 CLNDA. The Liability Law was intended to be consistent with the international Convention on Supplementary Compensation (CSC) for Nuclear Damage to which India is a party. The CSC provides liability to be channelled only to the ‘operator;’ however the CLNDA added a ‘right of recourse’ by the ‘operator’ to the ‘supplier’ as well as the possibility of legal proceedings under other applicable laws. The government has tried to square the circle by providing explanations that but appears to have finally accepted the need for legal clarity through amendments.

A third area is commercial disputes relating to tariffs. Nuclear electricity tariff for NPCIL is notified under the Atomic Energy Act. Generally, commercial disputes fall under the Electricity Act and are settled by the Central Electricity Regulatory Commission (CERC) but a recent dispute between NPCIL and Gujarat Urja Vikas Nigam has led to conflicting views by the CERC and the Appellate Tribunal. The case is now under consideration before the Supreme Court. With the entry of private sector in the field, should the tariff setting come into the ‘levelized cost of energy’ as applicable to thermal, solar, wind and hydro will depend on how the question of ownership and control are determined.  

While India has had an impeccable nuclear safety record, the certification and safety oversight is the responsibility of the Atomic Energy Regulatory Board (AERB) that is ‘autonomous’ but not a legal entity and is subordinate to the Department of Atomic Energy. In 2011, a draft Bill was circulated to establish AERB as an independent regulator, but the Bill lapsed. With the entry of the private sector, the need for an independent regulator becomes paramount.

In addition, a raft of financial incentives will need to be introduced. While nuclear energy is a low-carbon energy source, it is not classified as “renewable,” like solar or wind. Revising this classification would make nuclear power projects eligible for tax incentives and specially designed ‘green financing’ instruments. Long term power-purchase-agreements and provision for viability-gap-funding are other incentives. The sector also needs to be opened for FDI participation, perhaps up to 49 percent, to ensure Indian ownership and control.  

In the past, the process of reform has been tentative. In 2011, NPCIL set up a Joint Venture (JV) with the National Thermal Power Corporation (NTPC) but it languished till it was revived last year. It will now build and operate 4 units of 700 MW each, scheduled to come up at Mahi Banswara in Rajasthan. Land acquisition has been underway and once completed, the first unit will take seven years. A JV with Rural Electrification Corporation (REC) is also envisaged. Both REC and NTPC are PSUs and these JVs will be wholly government entities.

However, if India has to deliver on the promise of 100 GW by 2047, India needs foreign partners and the private sector. This has been accepted by the government Now it has to move forward the reform process comprehensively and decisively.  

*****

Remaking the Nuclear Order in West Asia

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Published in The Hindu on July 8, 2025

While both the U.S. and Israel agree that Iran cannot be allowed to have a bomb, Mr. Netanyahu goes one step forward to deny Iran any nuclear capabilities. However, for Iran, nuclear deterrent assumes a greater importance now, even if there is a change of regime

There is hardly any political leader who understands the laws of political survival better than Israeli Prime Minister Benjamin Netanyahu. Realising that he is in a morass with respect to Gaza where Hamas has not yet been dismantled even though its leaders have been killed, and all hostages have not been brought home resulting in growing domestic pressure, Mr. Netanyahu employed an old tactic – to distract attention from a crisis you cannot get out off, create another crisis.

Israel’s surprise strikes on Iran, launched on June 13, created a new and larger crisis. The military action has been spectacularly successful, with the U.S. finally coming on board. For the moment, PM Netanyahu is firmly back in the driver’s seat, but this has also opened a Pandora’s Box of what next.

Israel’s calculations

Mr. Netanyahu wants to keep Israel as the only nuclear power in the region. He is convinced that the Libyan model, where the nuclear programme was completely dismantled, is the only acceptable option, preferably with a change of regime. In 2015, he opposed the Joint Comprehensive Plan of Action (JCPOA) primarily because it conceded a limited uranium enrichment right to Iran.  

Since mid-April, five rounds of talks took place between U.S. Special Envoy Steve Witkoff and Iranian Foreign Minister Abbas Aragchi, with a sixth round due on June 15 in Muscat. After stumbling over the issue of Iran insisting on its right to enrichment as a party of to the Nuclear Non-Proliferation Treaty (NPT), some progress was registered on the idea of a regional nuclear fuel consortium to provide fuel for the reactors in the region. Its location remained under discussion, making Mr. Netanyahu nervous.

On June 11, PM Netanyahu barely survived a motion tabled by the opposition seeking to dissolve parliament, leading to early elections that are currently due in October 2026. PM Netanyahu has been facing domestic opposition since early 2023 due to his attempts at pushing though controversial judicial reforms that were widely seen as curbing judicial independence. The Hamas attack on October 7 had provided a reprieve that has lasted nearly two years. Given Mr. Netanyahu’s multiple domestic legal challenges, a continuing war is his “get-out-of-jail” card.

During the 20-month war, the leadership of Hamas and Hezbollah has been decapitated, and a change of regime in Damascus last December doused Iran’s “ring of fire.” On two occasions in 2024, Israel directly engaged Iran and, in the process, knocked out its air defences around Tehran and other critical installations.

Having buried the two-state-solution, and with Iran at its weakest, Mr. Netanyahu must have felt that this was the ideal time to neutralise Iranian nuclear and missile threats. The Iranians are known for their frustratingly convoluted negotiating style and given U.S. President Donald Trump’s impatience, Mr. Netanyahu was able to convince him that a little military pressure would make them more accommodating.

Iran’s miscalculations

As recently as March 26, U.S. Director of National Intelligence Tulsi Gabbard in her annual intelligence threat assessment to Congress stated, “the Intelligence Community continues to assess that Iran is not building a nuclear weapon and Supreme Leader Khamenei has not authorised the nuclear weapons programme that he suspended in 2003”. This gave Iran’s leadership a misplaced confidence that as long as the negotiations continued on the idea of a regional enrichment facility, the U.S. would block any military strike by Israel.

However, the International Atomic Energy Agency (IAEA) report in May criticising “Iran’s general lack of cooperation” and the near doubling of its stockpile of 60% enriched uranium to over 400 kgs since February proved to be more damaging that Iran anticipated. This heightened Iranian concerns about the threat of sanctions-snapback by the UN Security Council, which was waived in 2015 following the adoption of the JCPOA.  

Iran knew that given its ageing air force, it was dependent on its stocks of drones and missiles. Despite the debacles of the Hamas and the Hezbollah leaderships, Iran underestimated the extent of Mossad’s penetration of its systems, evidenced by the targeted assassinations of its key military leaders and nuclear and missile scientists.

The entry of the U.S.

When the U.S. began to withdraw non-essential staff from its embassies in the region in early June, it was anticipating Israel’s likely military action. In the past, U.S. reluctance to get involved had prevented Israel from military strikes but this time, Mr Netanyahu took a gamble and it paid off. Impressed with the success of the Israel’s military actions, Mr. Trump ordered supportive strikes on June 22, with B-2 bombers dropping GBU-57 ‘bunker-busters’ on Fordow and Natanz, and Tomahawk cruise missiles hitting Isfahan. Some advance notice was provided to Iran, possibly via Qatar. Following token retaliation by Iran the following day, Mr. Trump declared an end to the “12-day-war”.

Israel thus claimed victory, Mr. Trump declared the underground sites “obliterated,” the Gulf states heaved a sigh of relief, and for Iran’s Supreme Leader, regime survival was a victory. Iran suffered over 600 casualties, and all its air defences and half its stock of missile launchers, were destroyed. It failed to take down a single Israeli aircraft though it did bring down some drones. Of the 500 missiles that Iran fired, over 30 were able to get through causing 30 casualties.

While Mr Netanyahu’s suggestion that sustained military pressure may bring about a regime change in Tehran has some support from the Iran-hawks in Washington, it is anathema to Mr. Trump’s MAGA support base, wary of entanglements abroad. The U.S. interventions in Afghanistan and Iraq in 2001 and 2003 respectively, were messy and costly, leaving behind a legacy of instability. Iran is three times larger, and Iranians are a people with a deep sense of nationalism based on their civilisational history. The current theocratic regime may be weak and its replacement may be less religious, but no less nationalist, and would therefore push ahead with the nuclear deterrent. Mr. Netanyahu may not be averse to a forced regime change but the U.S. and the Gulf Arabs would not want to open this Pandora’s box.

Iran’s nuclear capability

Iran has had an ambitious civilian nuclear programme going back to the 1950s. It joined the NPT in 1970. Initially, the Islamic regime was uninterested in the nuclear programme, seeing it as a part of Western influence. This changed after the Iran-Iraq war and in the 1990s, it began developing a clandestine enrichment capability.  The 2002 disclosures by a group of Iranian exiles, followed by the U.S. invasion of Iraq in 2003, led the Supreme Leader to shift direction and aim for threshold status rather than develop a full-fledged nuclear weapon. The centrifuges and higher levels of enrichment also provided for bargaining space as Iran could negotiate for sanctions relief with the U.S.

Today, the situation has changed. Iran’s proxies (except for the Houthis) have been decimated and its missile and drone capabilities found wanting. The threshold state is no longer a safe place. Therefore, a nuclear deterrent assumes greater importance, even if there is a change of regime.

Questions remain about the extent of damage to the underground centrifuge sites as well as the fate of the 400 kg of the 60% enriched uranium stockpile. While the scale of the attacks makes resumption of Iran-U.S. talks tricky, Iran has raised the stakes by terminating IAEA inspector’s access to its nuclear sites.  Mr. Trump would like to conclude a deal with Iran to build on his success with the ceasefire. He would do well to remember the U.S. scholar Thomas Schelling’s advice that successful coercion requires both a credible threat as well as credible reassurance, if Iran is to be ‘persuaded’ during any future talks.

There has always been a difference between the U.S. and Israeli positions – both agree that Iran cannot be allowed to have a bomb, but Mr Netanyahu goes one step further to deny Iran any nuclear capabilities. However, since Mr. Trump has obliged him with the June 22 strikes, he may find it difficult to deny Mr. Trump his Iran deal provided the Iranians play the game.

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Iran is learning the hard way that being a nuclear threshold state isn’t safe anymore

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Published in The Print on June 24, 2025

Israeli Prime Minister Benjamin Netanyahu is delighted that his gamble has paid off. After decimating Iran’s proxies – Hamas and Hezbollah, and substantially weakening Iranian air defences through air strikes last year, Netanyahu was convinced that this was the most opportune moment to target Iran’s nuclear and missile programmes. The challenge was to get US President Donald Trump to join him in the exercise.

And Trump did. In the early hours of June 22, the US targeted three nuclear locations in Iran: Fordaw, Natanz (another enrichment site), and Isfahan (a uranium conversion site). After declaring that the nuclear sites were “totally and completely obliterated,” Trump added, “NOW IS THE TIME FOR PEACE.”

Hours later, Iran responded with a missile strike on US forces at the Al Udeid air base in Qatar, causing no damage or casualties. The move appears to have been a choreographed exercise, reminiscent of Iran’s retaliation in January 2020after Quds Force General Qassem Soleimani was killed in Iraq. Meanwhile Trump has declared that “a full and complete ceasefire” will be in effect shortly, though neither Iran nor Israel has confirmed it yet.

Iran’s nuclear programme – a long journey

Iran’s nuclear journey has been long and tortuous. It began under the Shah’s regime in the 1950s with a civil nuclear cooperation agreement signed with the U.S. and the first research reactor went critical in 1967. Since then, the nuclear programme has been seen as a symbol of scientific progress and a source of nationalist pride.

Iran became an original state party to the Nuclear Non-Proliferation Treaty (NPT) in 1970 when it entered into force, placing all its activities under International Atomic Energy Agency (IAEA) safeguards. The Shah embarked on an ambitious civil nuclear power generation programme signing cooperation agreements with Germany and France. Siemens began work on the Bushehr power reactors (2x1200MW) in 1975 but later withdrew. The plants finally went online in 2011 with Russian assistance.

After the Islamic Revolution, nuclear activity came to a standstill as the clerical regime saw it as a source of Western influence. However, sometime in the 1990s, opinions changed and gradually, nuclear research activities were gradually revived. By then, nuclear controls had tightened, curbing exports of enrichment and reprocessing technologies, though these remained permitted under the NPT. Iran revived its civilian nuclear power projects and, also began establishing a clandestine enrichment facility. It received assistance from the A. Q. Khan network as also from China to develop capabilities across the entire nuclear fuel cycle. In parallel, Iran began developing missiles.

In 2002, the nuclear activity was exposed by a group of Iranian exiles. It became clear that the regular IAEA inspections had failed to detect the clandestine programme. Negotiations began in 2003, initially with the three European powers and later including the U.S. These collapsed when President Mahmoud Ahmedinejad took over and starting in 2006, Iran was subjected to successive UN Security Council sanctions. By this time Iran had established its first enrichment facility at Natanz.

Around that time, Supreme Leader Ali Khamenei issued a fatwa against nuclear weapons, describing them as un-Islamic. The general assessment is that while the fatwa was respected, Iran pursued the technical capabilities to become a nuclear threshold state. As recently as March 26, the U.S. Director of National Intelligence stated in an official briefing to the Congress: “The Intelligence Community continues to assess that Iran is not building a nuclear weapon and Supreme Leader Khamenei has not authorised the nuclear weapons programme that he suspended in 2003”. This assessment has also been made by Rafael Grossi, Director General of the IAEA.

Can Iran remain a nuclear threshold state?

In 2009, a hitherto secret underground enrichment facility at Fordaw was exposed. Israel and the U.S. cooperated in the 2008 Stuxnet covert operation, which destroyed a large number of centrifuges before the Iranians discovered the computer malware in 2010. Thereafter, Iran expanded its uranium enrichment programme, leading eventually to talks that culminated in the Joint Comprehensive Plan of Action (JCPOA) in 2015.

Under the JCPOA, Iran accepted rigorous IAEA inspections and permanent camera monitoring. However, beginning 2019 – one year after the U.S. withdrew from the JCPOA – Iran began scaling back its adherence to the additional inspection measures, observing only the basic safeguards mandated by the NPT. On May31, an IAEA report revealed that Iran had rapidly increased its stockpile of 60% enriched uranium to 408 kg, enough to be enriched further relatively quickly to weapons-grade (90%) levels, and sufficient for approx. 8-10 bombs. On June 12, the IAEA declared – for the first time in over 20 years – that Iran was non-compliant with its nuclear obligations under the NPT. Israel, which is not a party to the NPT, struck on June 13, and the U.S. followed on June 22.

All major nuclear sites – including the research reactor in Tehran, enrichment facilities at Natanz and Fordaw, the heavy water reactor at Arak, the fuel fabrication and research reactor at Isfahan, and the suspected military site at Parchin – have been repeatedly targeted. There are questions about the extent of damage to the centrifuges, particularly at the underground sites at Fordaw and Mt Kolang Gaz La near Natanz. The whereabouts of the 408 kg of 60% enriched uranium also remain a matter of speculation. IAEA monitoring has not detected any enhanced radioactivity around the sites. Further details will only emerge after the IAEA resumes inspections, contingent on renewed talks between Iran and the U.S. and the prospect of a new deal.

Meanwhile, Iran’s leaders are likely to conclude that remaining a nuclear threshold state is a dangerous position to be in, especially when the adversary is a nuclear-armed state. The Ukraine war and the use of nuclear sabre rattling further underscores this lesson. Other countries in Asia are also likely to draw their own conclusions, revealing the growing fragility of the global nuclear regime.

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Fordaw-ard Thinking

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Published in Times of India on June 23, 2025

When Israel launched surprise strikes on Iran on June 13, Prime Minister Benjamin Netanyahu knew he was taking a calculated gamble. But the stakes were high. If he succeeded in taking out the nuclear and missile threats that he called “existential,” his political future would be secure but to achieve that, he had to bring the U.S. into the war. Only the U.S. had the bunker buster bombs (GBU-57) and the B-2 heavy bombers, necessary to take out Fordaw, the underground enrichment facility near Qom.

After urging Iran to come back to the negotiating table, on June 19, U.S. President Donald Trump announced that he was “giving Iran a period of time-two weeks would be the maximum”. Simultaneously, he had also asked for military options to be prepared. Two US aircraft carrier task forces, USS Nimitz and USS Gerald Ford were deployed to the region, adding another 150 fighter aircraft, to bolster the USS Carl Vinson; B-2 bombers were flying into Diego Garcia.

Mr. Trump knew that his MAGA support base was opposed to the U.S. getting involved in a war in the Middle East. He too was eager to do a deal with Iran but had bought into Mr. Netanyahu’s line that some amount of military pressure would help in persuading Iran to be more reasonable.

Israel’s calculus works

Finally, Mr. Netanyahu’s gamble paid off. In the early hours of June 22, three B-2 bombers successfully dropped two GBU-57 bombs each at Fordaw and U.S. submarines fired at least 30 Tomahawk missiles at the nuclear facilities at Natanz and Isfahan. Announcing the destruction of the nuclear sites, Mr Trump added with a characteristic flourish, “NOW IS THE TIME FOR PEACE.” A one-off strike by the U.S. that leads to negotiations with a chastened Iran may yet be the best outcome for Mr. Trump.

Iran retaliated by targeting Tel Aviv and Haifa with two waves of rocket strikes. However, the question is whether Iran will now accept Mr. Trump’s invitation to resume talks or escalate by hitting U.S. assets and bases in the region?   

Iran’s leadership can be pragmatic. It is one thing to continue the missile and drone exchanges with Israel for another week but a pragmatic Iranian leadership would not want to take on the U.S. directly. It may prefer to save the Islamic regime by accepting talks with the U.S. and getting the Israelis off their backs.

There are indications that the U.S. had informed Iran in advance about the impending strikes so that casualties could be minimised. Unlike Israel that would like to see the end of the theocratic regime even if there is no plan for a day after and it leads to wider regional instability, the U.S. will be cautious as will its allies, particularly Saudi Arabia, UAE and Qatar, and all three carry influence in the Trump White House. 

Iran’s nuclear journey

The Islamic revolution in Iran was a year old when Iraq attacked in 1980. The war lasted eight years causing heavy losses, over half a million dead. Eventually, to save the regime, Ayatollah Khomenei accepted a UN brokered ceasefire in 1988. Iraq’s blatant use of chemical weapons was largely ignored by the Western countries and the Soviet Union was preoccupied in trying to manage an exit from the quagmire of Afghanistan. It is during this period that Iranian leaders began to consider the need for a nuclear deterrent, though as a party to the Nuclear Non-Proliferation Treaty (NPT), it had forsworn the development of nuclear weapons and had accepted full-scope-safeguards by the IAEA.

It had followed India and Pakistan’s different nuclear paths but neither of the two had joined the NPT. Another example was North Korea; it joined the NPT in 1985 and announced its intention of quitting in 1993 leading to a flurry of negotiations. In 1994, it put its withdrawal notice on hold as it concluded a Framework Agreement with the Clinton administration taking the lead. However, after President George Bush included it in his “axis of evil” speech, it withdrew from the NPT in 2002 and carried out its first test in 2006. Iran’s conclusion was to remain within the NPT and develop capabilities that would lead it to becoming a threshold state, without crossing the red line.

With the losses it has incurred, both material and human, Iran will have to review its strategy but it will need breathing room for it, only possible by concluding a deal with Mr. Trump. President Pezeshkian is considered a ‘moderate’ but enjoys the support of the Supreme Leader and Foreign Minister Hassan Aragchi is a consummate nuclear negotiator who was also involved with the JCPOA negotiations. As a negotiating tactic, the Iranian Majlis could pass a resolution recommending withdrawal from the NPT. As a civilisational state, Iran understands the virtues of patience, rooted in the confidence of its longevity.

A weakening nuclear regime

For other countries pondering over their nuclear security, the writing on the wall is clear. Deterring a nuclear adversary is not going to be possible with threshold status; it needs a nuclear deterrent. Unlike in the 1970s and 1980s when India claimed to safeguard it ’nuclear option’, today, threshold status is a dangerous place to be in. Countries that enjoy the U.S.’ extended nuclear umbrella will also undertake a rethink. Meanwhile, China will be pleased at the prospects of U.S. getting involved in the Middle East, whether in negotiations or in bombings.

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