The supply of French nuclear fuel for India's American-built Tarapur atomic power plant -- the centerpiece agreement of President Reagan's talks with Prime Minister Indira Gandhi last month -- has hit a snag, reportedly because of Indian refusal to consider any new safeguards on reprocessing spent fuel.
Indian officials insisted today that discussions with France are continuing and that the agreement is not in serious jeopardy, but France has announced that a scheduled visit here this week by a high-level technical delegation has been postponed. The officials said that Indian Atomic Energy Commission Chairman H.N. Sethna would raise the issue with the French again in about two weeks when he visits the International Atomic Energy Agency in Vienna.
Doubts about the U.S.-India agreement, which ended a dispute that had soured relations between the two countries for four years, arose when India made it clear to France that it will not accept any new reprocessing safeguards and would resort to its own alternative sources of nuclear fuel if it could not reach agreement with the French.
The Reagan-Gandhi agreement shifted from the United States to France the responsibility for resupplying the Tarapur plant -- Bombay's primary source of electricity -- providing that the French-supplied fuel remains under international safeguards against possible misuse.
The 1978 U.S. Nuclear Nonproliferation Act bars the United States from resupplying the Tarapur plant because India has refused to accept full international inspection of all its nuclear facilities, including a nearby reprocessing plant reportedly capable of producing enough plutonium for nearly 200 explosions the size of India's 1974 nuclear test.
India, according to official sources, remains adamant in its refusal to accept controls that extend beyond the 1963 Indo-U.S. nuclear fuel supply agreement, which limited international inspection to Tarapur. India is insisting that the same inspection limitations be applied to any supply agreement with France.
When asked whether France had advanced new inspection conditions to its supply of nuclear fuel, a Foreign Ministry spokesman said the French government had not "disavowed" what French Foreign Minister Claude Cheysson said in a press conference here on Aug. 8.
Cheysson said then that France would impose no special conditions on supplying enriched uranium to Tarapur and would not exercise any control over the reprocessing of spent fuel, other than to demand a guarantee that fissionable material derived from the spent fuel be placed under standard IAEA safeguards.
However, the French foreign minister, who was in New Delhi on a 24-hour stopover on his way home from Japan, appeared less than fully prepared for the spate of questions on Tarapur during the press conference, remarking at one point, "You seem to know more about it than I do." It was only afterward that reports surfaced that France was insisting on the same additional safeguards that the United States had earlier insisted upon.
Later, India's foreign secretary, Maharaj Krishna Rasgotra, was reported to have summoned the U.S. charge d'affaires, Marian Creekmore, to say that since the Reagan administration had promised that France would supply the nuclear fuel under the terms of the 1963 U.S.-Indian accord, it was the United States' responsibility to assure that France adhered to the agreement.
Western diplomatic sources confirmed that Rasgotra warned that if France persisted in its demand for extra safeguards, India would abrogate the 1963 agreement and reprocess spent fuel without constraints, using the derived plutonium for operating Tarapur with mixed-oxide fuel.
However, the sources noted that the mixed-oxide process would satisfy India's nuclear fuel needs for only a limited period, and with less efficiency than enriched uranium.
The visit here by the French technical delegation was understood to have been postponed when the Indian government was informed that the purpose was to discuss the commercial terms and "modalities" and that the delegation would have no authorization to discuss the substantive aspects of the agreement.
The Indian government reportedly informed France that there was no point in discussing technical aspects of the agreement while the major disagreement over safeguards remained unresolved. Indian Foreign Ministry officials said that those "confidential" negotiations are still underway.
The Indian position, they said, remains that France has agreed to act merely as a surrogate supplier of nuclear fuel, and should not be obligated to impose any safeguards not included in the 1963 U.S.-India agreement.