That's only for imported fuel, not the fuel from their own uranium mines.
They'll use seperate facilities.
http://www.thenews.com.pk/daily_detail.asp?id=66014 The US-India nuclear deal: myth and reality
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The agreement grants India "prior consent" to reprocess fuel for plutonium to be used in its fast breeder reactors. India has all along insisted on such a full-fledged "right", which is strongly contested by non-proliferation advocates in the US. But to earn it, India will have to build a dedicated reprocessing facility for imported fuel and place it under safeguards (inspections) of the International Atomic Energy Agency (IAEA).
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First and foremost, India will only subject 14 of its 22 operating/planned power reactors to IAEA inspections. It can continue to produce weapons-grade material in the remaining eight reactors, as well as fast breeders and dedicated weapons facilities. Together, these can yield enough fuel for several hundred weapons. In fact, India can use its indigenous uranium, which is in short supply, exclusively to make weapons, while importing uranium for its power reactors. Far from capping India's nuclear weapons production, the deal will allow its substantial expansion.
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India's nuclear power plans have always been marked by utopian and constantly missed targets. For instance, India was projected to generate 43,500 megawatts of nuclear electricity by 2000. Today, India produces less than 1/10th of that amount in nuclear reactors. However, even if India's romantic plans fructify, the contribution of atomic energy to total electricity generation will rise by 2030 to 6 percent, from the current level of 3 percent. That can hardly be a source of energy security!
As for the fabled "three-stage programme", eventually to be based on thorium reactors, it is a futuristic project inspired largely by wishful thinking. Nobody has yet proved the feasibility of thorium reactors on an industrial scale. A crucial precondition for exploiting thorium thus is a huge successful fast-breeder programme. But fast breeders have failed everywhere in the world, including France, which invested heavily in them.
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