Wheat, Bombs & Fetters: How India fought off US sanctions in the 1970s

One wintry morning of 1977, I entered the cold classroom of my school. The teacher handed us students, a chit which I opened with trepidation. It read "Prejudice... and how mine proved unfounded" 

This was the topic for the year for the inter-Jesuit essay competition. The elite essay writing of that era where the very best all India Jesuit school - English writing talent collided. 

It was extempore. You got the topic. You just wrote for 3 hours. Now let's face it: this is a pretty difficult topic, especially for a kid in the 8th standard. But it took me less than 1 minute to find my purpose for the next few hours.

  I wrote. I wrote about the biggest prejudice I had been carrying for years: that was against the US. The gravamen of my plaint were the two major issues du jour, surrounding the India- US relationship in the 1960s and the 1970s: 7-10 million tonnes per annum of PL 480 wheat. And 7. 62 tonnes of enriched Uranium that we needed in 1977.

  Back in the 1970s, in the Eastern part of India, we were blessed to have had a newspaper called 'The Statesman' led by the legendary C. R. Irani. My biological father as well as the priest 'Fathers Rev xyz SJ' had made it almost a cultural thing for students to read this paper, more from the perspective of learning how to write English better than practically anybody in England. 

I took this instruction seriously: 'The Statesman' was my daily evening reading routine. And that's how I learnt about the political lance of first, wheat, and then, nuclear fuel, that America had used to needle India through those years. 

First, PL 480. (PL stood for Public Law). Post-independence, hollowed out by the British Raj, through the 1950s well into the 1960s, India ran chronic shortages of food, in particular, of wheat. The USSR, back then, was wheat deficient and hardly the bread basket of Europe that it was to become later. (As an aside, the USSR pulled a massive stealth operation in wheat buying, in 1972, called the 'The Great Grain Robbery', in which it bought around 10 million tonnes of wheat from America on the sly, spreading its purchases through various layers of intermediaries.  And just 2 years later, Indira Gandhi blindsided America, by conducting 'Smiling Buddha'; i.e., Pokhran 1, on the sly. That era was not the best for American intelligence, clearly).

  America became India's supplier of choice for wheat, often giving between 5-10 million tonnes per year through the 60s. However, America being America, wheat became less food, more a leash around India's, then emaciated, neck. President Lyndon Johnson would yank this rope often, to bring India to heel, whenever America so deigned.

 

And then, there was the Smiling Buddha, Pokhran 1, in May 1974. America, the Imperial power, was stung to the quick: its reaction, against India, was response was swift, punitive. Even systematic.

  The immediate American Actions post Pokhran 1 were:

 

1. Suspension of Nuclear Cooperation  The U.S. stopped shipments of enriched uranium fuel for the Tarapur Atomic Power Station (TAPS), which had been built under a 1963 Indo–US agreement. This left Tarapur in crisis, since it was a Boiling Water Reactor (BWR) that could only run on enriched uranium. 
2. Technology Denial  Washington froze all pending nuclear technology transfers, including reactor parts and reprocessing equipment. Even spare parts for Tarapur became difficult to obtain. 
3. Diplomatic Condemnation  The test was officially described by India as a "peaceful nuclear explosion," but the US rejected this argument, simply because it could. Never India's best buddies, Secretary of State Henry Kissinger and President Richard Nixon's administration accused India of using civilian nuclear aid for weapons development.

Pokhran 1 further resulted in Institutional & Long-Term American Moves:

 

1. Formation of the Nuclear Suppliers Group (NSG)  In 1974, the US led efforts with Canada, Japan, the USSR, and other nuclear exporters to create the NSG, a cartel to regulate global nuclear exports.  The NSG made it mandatory that any nuclear exports could only go to countries under full-scope International Atomic Energy Agency (IAEA) safeguards — which India rejected. 
2. Cutting off Canadian Cooperation  Canada, whose reactor design (CANDU) and heavy water had been supplied for India's CIRUS reactor, also cut ties under US pressure.  This was especially damaging because the plutonium used in Pokhran-I came from CIRUS. 
3.  Legislative Actions in the US  The US Nuclear Non-Proliferation Act of 1978 imposed strict conditions on nuclear exports, targeting India specifically.  This law made it illegal for the US to supply nuclear materials to countries that hadn't signed the Nuclear Non-Proliferation Treaty (NPT).

  The impact of these sanctions on India was brutal.

  The Tarapur plant was just weeks away from shutting down.

  India was made a pariah, branded a "proliferator" and was excluded from almost all nuclear commerce.

  In short: after India's 1974 test, America cut off uranium fuel, halted technology transfers, formed the NSG, passed restrictive laws, and pressured allies like Canada — effectively putting India into nuclear quarantine for the next 30+ years.

  My pen was flowing as the Kosi in full spate. I was angry. Indira was angry. India was angry.

  The PL 480 and Uranium 235. These two numbers were embalmed...nay... blood-glyphed into every India's hippocampus.

  And it's those same lash marks that are searing India again. We can get mad. Or we can get more than just even. 

Rear view mirrors are extremely handy in such situations as what India confronts today.

  Let's examine India's policy responses to the PL 480:

  India set up Food Corporation of India (FCI) and Agricultural Prices Commission (1965) to stabilise procurement and pricing.

  1965–1966 under PMs Lal Bahadur Shastri / Indira Gandhi  Because of a severe drought, India was compelled to massively PL-480 import,: at ~10 million tonnes in 1966, this was the single largest food export of all time. But it came after much grovelling at the feet of President Johnson, who sadistically, drip fed India, wheat, often much less than what was needed.

  PM Shastri launched the slogan "Jai Jawan, Jai Kisan" - a political push for food self-sufficiency. The iconic movie of that era was the Manoj Kumar starrer 'Upkar'; which captured the Zeitgeist. 

Between PM Shastri and the next PM Indira Gandhi, India literally sowed the seeds of its food security: the Green Revolution.

  The Green Revolution introduced with high-yield variety (HYV) wheat from Mexico, expanded irrigation, and fertiliser subsidies.

  1966–1969 (Indira Gandhi, first tenure)

 

President Johnson's "ship-to-mouth" PL-480 tactics had humiliated India. 

India went all in. Massive import of HYV seeds (e.g., Sonora, Lerma Rojo) ensued. The Agricultural Prices Support program was devised→ farmers were guaranteed procurement prices, to incentivise production. 

The Intensive Agricultural District Programme (IADP) and later, Intensive Agricultural Areas Programme (IAAP), were launched. 

In the early 1970s, Indira Gandhi's government focused on the creation of buffer stocks through FCI, to reduce reliance on imports. 

The government did large-scale public investment in irrigation (dams, canals) and in fertiliser plants.

  India went further. 

In 1974, food self-sufficiency was declared a national policy priority.

  Policy: Public Distribution System (PDS) was expanded to ensure food security for the poor. By 1973-74, the PL-480 dependence had been consigned to the rubbish heap of ignominies that superpowers heap upon the lesser nations.

  India had yanked off the American noose of subjugation. 

In fact, it was precisely the success of Indira Gandhi's PL 480 fightback that laid the ground for India's post Pokhran 1 nuclear sanctions and isolation. A quick look at this most fascinating case study of India's rapid policy measures a poor, third world country implemented at warp speed when confronted by a glowering, domineering global overlord. 

Indira Gandhi (1974–77; 1980–84)

Indira Gandhi accelerated the PHWR programme (Pressurised Heavy Water Reactors) → India shifted away from US-supplied enriched uranium (Tarapur) to natural uranium + heavy water reactors.

  Heavy Water Production Plants were set up at Kota, Baroda, Tuticorin to ensure reactor independence.

  Uranium mining at Jaduguda (Jharkhand) was expanded rapidly to secure domestic supply. Plutonium reprocessing was sanctioned at Trombay and Kalpakkam to build a closed fuel cycle. 

Morarji Desai ( PM1977–79) was a pacifist. Nonetheless, he didn't oppose the peaceful utilisation of nuclear power.

 

Under Rajiv Gandhi (PM 1984–89), India's nuclear program went, well, critical! ( Do check what this term means in a nuclear sense!) 

The Narora PHWR was commissioned (1989) → it was a trenchant proof of full indigenous reactor capability.

  Plutonium stockpiling was quietly expanded despite international pressure.

  Under P. V. Narasimha Rao (1991–96), India floored the gas pedal.

  Prototype Fast Breeder Reactor (PFBR) project was sanctioned at Kalpakkam. India launched Stage 2 of Homi Bhabha's three-stage programme.

  Weapons integration was approved (warheads with delivery systems).

  PV Narasmiha Rao had already moved aggressively on Pokhran-II test preparations (1995), but the actual test was halted under US pressure. However, the infrastructure to conduct such a test had been completed. 

PM Atal Bihari Vajpayee then actually detonated Pokhran 2. Years of sanctions followed under the Clinton administration.

  Finally, PM Manmohan Singh signed the landmark Indo–US Civil Nuclear Agreement (2005–2008), ending India's nuclear winter. 

In 2008, India got the NSG waiver → restored India's access to global nuclear trade without signing the Nuclear Non-Proliferation Treaty (NPT). 

Indian audiences are now viewing 'The Hegemonic America Part 3'; PL 480. Uranium 235. 50 per cent Tariffs.

  Separated by 50 years, each sequel has been potentially more phantasmic than the previous one.

  India's policy measures to the first two were near flawless, almost seraphic. Far from kneeling in front of tormentor, India, a far less prosperous India, chose to stare down the hegemon.

  The India of today is far more sun-kissed. What's needed is something similar to what was crafted in the 60s, 70s and thereafter.

  The speed of execution of policy measures must be urgent. Great ideas mean nothing without fast hands, tireless legs, sleepless orbs, relentless minds. 

Our will must have velocity.

  Back to my essay. The lava in me, at the double indignation of PL 480 and the denial of 7.62 tonnes of enriched uranium, ran all over the ruled paper. 

Of course, quick reminder: the topic was constructive: "Prejudice... and how mine proved unfounded".

 

Even at the risk of sounding arrogant, I have to say that there is a learning today, in what I wrote then.

  The 'unfoundedness' of my prejudice, as I remember writing, was that it gradually was dawning upon me that America was also giving me a lot: it had given me, back then, access to amazing science, great magazines, stupefying tech (I had just seen an electronic calculator back then which Father Hess, our American principal had brought for us from the US).

  For the India of today, this is instructive. Regimes in America will come and go. Philosophies of the current one may not last beyond the shelf life stamped on it: 4 years. But there is no denying America's value to India. Across areas far too many to be captured in 1500 words. 

So, we must not scorch the earth between us and America. Neither on Twitter nor through intemperate utterances by the media and our political loudmouths.

  But India needs to Aegis- bind itself from the latest sequel of The Hegemon. On the stealth. And on the double.  And since we are luxuriating in our Asia Cup win at hockey, I leave you with the sepia-tinted shard of an old hockey lithograph: India's 1932 Los Angeles Olympics games victory over America.

  The score was 24-1.

  Still an Olympic record.    ==============

(Shankar Sharma is Founder of Gquant, an AI firm, and a well-known investor. Views are his own.)