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For four decades the U.S. and Soviet Union held the world and each other in thrall with their overflowing nuclear arsenals. It became known as the balance of terror.

Today, in South Asia, two bitter enemies have given the world a preview of what the nuclear nightmare could look like in the 21st Century: Regional powers with hidden nuclear programs on the threshold of terror.

Both India and Pakistan have large stockpiles of bomb-grade nuclear material. Both are believed to be only “a turn of a screw” away from assembling bombs, even though Pakistan never has conducted a nuclear test. Both are scrambling to develop short- and medium-range missile delivery systems.

Neither belongs to the nuclear Non-Proliferation Treaty. Their nuclear establishments are beyond the prying eyes of international inspectors.

India and Pakistan have fought three wars since gaining independence from Britain in 1947. They nearly came to blows again in May 1990 after fighting broke out in Kashmir, a rebellious province claimed by both.

During that crisis, according to a still-disputed U.S. satellite intelligence report, Pakistan-which lost all three previous wars-wheeled nuclear weapons out of a remote site and began trucking them toward an air base.

President George Bush dispatched a top national security aide to shuttle between the two capitals to defuse the crisis. The U.S. subsequently cut off all military and economic aid to Pakistan, which during the 1980s had soared to $1 billion a year.

The U.S. has no similar leverage over India, which exploded a “peaceful nuclear device” in 1974. Its nuclear program is home-grown, as is its active missile development program.

After a swing through both countries in January, Defense Secretary William Perry admitted the obvious: Nuclear non-proliferation policy has failed on the Indian subcontinent.

The region offers concrete proof that endemic poverty and Third World living conditions are no barrier to willful nations obtaining the technologies needed to become full-fledged nuclear powers.

“The nuclear ambitions of India and Pakistan flow from a dynamic that we are unlikely to be able to influence in the near term,” Perry told the Foreign Policy Association in New York.

For Pakistan and its population of 130 million, the threat comes from a nuclear-armed India, an awakening giant with seven times as many people, an army three times as large and an air force five times bigger. Pakistan considers nuclear weapons the great equalizer.

But military planners in New Delhi say they inhabit a far different strategic universe. “Our security concerns are not Pakistan’s concerns. We’re concerned about China’s nuclear capability,” said Maj. Gen. D. Banerjee, deputy director of the Institute for Defense Studies and Analyses.

China humiliated India in a brief but bitter Himalayan border war in 1962. Beijing has hundreds of nuclear warheads, a half-dozen intercontinental ballistic missiles and at least 120 missiles with a range of 2,500 miles or more-making most of India an easy target from deep inside China.

Nonetheless, most of the Indian news media and public focus attention on Pakistan and its weapons potential. The hatred dividing the two nations runs deep, a legacy of centuries of religious conflict between Hindus and Muslims enflamed by post-independence border and ideological tensions.

India sees itself as a secular, democratic state. Pakistan sees itself as an Islamic homeland. Muslims comprise 97 percent of Pakistan, a sixth of whom fled India after independence. Muslims still are one-eighth of India’s population.

With independence and partition, the bitter antagonists immediately fought a war over the mostly Muslim province of Kashmir. They renewed hostilities in 1965 and fought again in 1971 when India successfully intervened in Bangladesh’s war of secession from Pakistan.

Since 1990, Kashmiri independence fighters and pro-Pakistani militants have fought a low-intensity guerrilla war against India’s occupation of Kashmir, making the Himalayan outpost a flashpoint for renewed full-scale war and nuclear conflagration.

Because neither side admits having nuclear weapons, how does deterrence work in the age of the threshold of terror? K. Subrahmanyam, a former director of the Institute of Defense Studies and a high-ranking Indian defense official, expressed the logic with elegant simplicity.

“We believe they have the weapons. We believe they believe we have the weapons. So we believe they are self-deterred,” he said.

Since the 1990 crisis, the world arms control community has pushed India and Pakistan into a series of so-called confidence-building measures, first steps toward eventually denuclearizing the subcontinent.

They have established a no-flight zone along the border, required advance notice of any division-level military exercises within 50 miles of the border and created a military hotline connecting the top brass, who engage in weekly conversations. The two sides also agreed not to attack each other’s nuclear sites.

Last month, India, China and Pakistan met in Goa to discuss nuclear questions. While no one changed long-held positions, just holding the three-sided meeting was viewed as a minor advance.

However, arms control advocates see scant likelihood of a breakthrough. Nuclear weapons programs remain popular in both countries, a point of pride in impoverished nations where per capita income lingers under $400 a year.

One opinion poll put Indian support at 85 percent. Any Pakistani politician who wavers on the country’s nuclear ambitions immediately is labeled as soft on India and a threat to national security. Religious militants in both countries are staunch supporters of overt nuclearization.

As years pass with little change in the status quo, some experts fear the subcontinent’s threshold of terror ultimately will destabilize and lead to an accidental nuclear confrontation.

Neither country has developed strategic doctrines for the use of nuclear weapons nor developed the sophisticated control mechanisms-so-called permissive action links-that are needed to keep unauthorized personnel from detonating a bomb.

“To make your threat credible, you can’t keep your bombs disassembled forever,” said Pervez Hoodbhoy, a professor of physics at Qaid-el-Azam University and one of the few nuclear scientists in either country willing to speak out against nuclear proliferation on the subcontinent. “But if you have bombs ready for use, you increase the possibility of misuse or an accident.”

Hoodbhoy blames India for starting the arms race. He says its iron-fisted rule of Kashmir keeps tensions between the nations unnecessarily high.

“Pakistan now is so smug about its nuclear capability that it feels it can interfere in Kashmir by sending arms and men across the border,” he said. “India has effectively weakened itself by pursuing nuclear weapons.”

So the two adversaries are engaged in an endless proxy war in the shadow of a nuclear standoff-minor powers frittering away precious resources in their own mini-version of the Cold War.

Pakistan’s singular purpose

A.Q. Khan is a national hero in Pakistan. In the early 1960s, the young metallurgist went to work for Urenco, a Belgian company that enriched uranium for European nuclear power reactors.

In 1971, with the war in Bangladesh raging and India’s nuclear program well under way, deputy Prime Minister Zulfikar Ali Bhutto told the United Nations that Pakistan would wage a thousand-year war against India. “My people will eat grass if necessary,” he said, “but we will have the bomb.”

Khan would play a key role in that effort. He stole the blueprints to Urenco’s uranium-enriching centrifuges and fled to his native land. Today he oversees the 2,000-person Kahuta labs.

The installation opened in the early 1980s. Because Pakistan has no nuclear power reactors, the labs serve only one purpose: To enrich uranium for nuclear bombs.

According to David Albright’s 1992 “World Inventory of Plutonium and Highly Enriched Uranium,” Pakistan produced anywhere from 286 to 484 pounds of bomb-grade uranium by the end of 1992, enough for 8 to 15 bombs.

While Pakistan says it froze production in 1991, at any moment Kahuta could resume producing enough enriched uranium for three to five bombs a year.

But enriched uranium is only the first step. It must be fashioned into components for a bomb. The uranium implosion bomb requires an external explosion to push the uranium in the core together at an even pace and with equal pressure from all sides.

It is not a complicated task as modern technology goes but one that requires a high level of machining sophistication. According to U.S. intelligence documents released in the 1980s, Pakistan had obtained most of the machinery from the U.S. and Europe.

Pakistan bought 40 F-16s capable of delivering atomic bombs from the U.S. during the 1980s when it served as the front-line state in the Afghan resistance to Russia. However, 71 new F-16s were put on hold, even though Pakistan already had paid $658 million for them.

The shipment was frozen in 1990 when the Bush administration invoked the so-called Pressler amendment, named after Sen. Larry Pressler (R-S.D.). The 1985 measure calls for an end to all U.S. aid to Pakistan if Washington cannot certify it does not have nuclear weapons.

Pakistan also has obtained medium-range missile components from China, and has demonstrated short-range missiles built with Chinese technology.

Clinton administration officials concede that sanctions levied under the Pressler amendment haven’t impeded Pakistan’s nuclear program.

They may even be counterproductive. “If the U.S. continues to weaken our conventional defense, it pushes us in the nuclear direction,” said retired Gen. Bashir Ahmad, director of the Institute of Regional Studies in Islamabad.

Does Pakistan in fact have the bomb? Prime Minister Benazir Bhutto recently castigated former Prime Minister Nawaz Sharif for telling The New York Times that Pakistan has the bomb.

In February 1992, Foreign Secretary Shahryar Khan told The Washington Post that his country had the components and know-how to assemble at least one nuclear device, making explicit what the U.S. had discovered through its own intelligence services in 1990.

India has some help

India’s bomb program relies on plutonium, a byproduct of spent fuel from a civilian power reactor program in operation since the 1950s. The country currently has five operating nuclear power stations, at least two of which are not under international safeguards.

There is no doubt about India’s ability to build a bomb. In 1974, India shocked the world when it tested a nuclear device in the Great Indian Desert.

The nation’s plutonium reprocessing plant is at the Bhabha Atomic Research Center near Bombay. The “World Inventory” estimated India’s plutonium stockpile was 704 pounds in 1992 and will rise to 935 pounds, or enough for 70 weapons, by the end of 1995.

To deliver its bombs, India is developing a mid-range missile called the Agni, although it insists the missile is a “re-entry technology demonstrator” for its space program. It has tested but not deployed the short-range Prithvi missile.

Besides missiles, India has British Jaguar jet fighters and Russian MiG-29s, both of which can be reconfigured to deliver nuclear weapons. It also has launched satellites into space, a capability suggesting it quickly can develop intercontinental ballistic missiles.

India’s dual-use nuclear and missile programs are riddled with ironies. When France stopped supplying India with low-enriched uranium in 1993 because of its refusal to join the Non-Proliferation Treaty, it turned to its supposed nuclear nemesis. China agreed to supply fuel as long as it was put under safeguards of the International Atomic Energy Agency. The first shipments arrived last December.

Its power limited, Washington continues to try to maneuver the antagonists toward a nuclear detente.

Last year, deputy Secretary of State Strobe Talbott told Pakistani officials the Clinton administration would ask Congress to lift the Pressler ban if Pakistan would agree to a verifiable freeze on production of additional bomb-grade nuclear material.

Indian Prime Minister P.V. Narasimha Rao told the U.S. in January that he would support an international treaty freezing the production of bomb-grade material currently under discussion in Geneva.

But the Non-Proliferation Treaty is another matter. Pakistan long has said it would join the treaty only if India joins.

But India bitterly complains the treaty is unfair because it allows the five declared nuclear powers to hold onto their weapons as it prohibits anyone else from building them.

As long as China remains among the nuclear haves and India the have-nots, India never will sign the treaty, its leaders say.