MR. WOOLSEY: Thank you, Mr. Chairman. I was honored by the invitation, and particularly in light of your leadership and the leadership of this committee on proliferation issues over the years. I have begun to follow your fine publication, "Proliferation Watch," and I agree that this issue is of extraordinary importance to the Senate, to the US government as a whole, and to the world.

If I might say just at the outset, I agree that public testimony on particularly this important issue is not only useful but crucial to the job that you have to do. I am mindful, however, as I know you and Senator Lieberman and the staff are, of my responsibilities to protect sources and methods of intelligence collection, and on many of these issues that means that details will invariably have to be provided in some classified forum.

Also, I will apologize for being an inveterate editor. The President has shown us the way with respect to continued editing, and I have been working on my testimony up until the last minute and, indeed, will probably revise it some as I give it. So for those who are trying to follow exactly what I'm saying, stay tuned.

Also, once you and Senator Lieberman -- I've finished the statement -- would like to ask questions, I'm sure, I'm going to ask Larry Gershwin, the distinguished national intelligence officer for strategic programs, and Gordon Oehler the very able head of the Non-Proliferation Center, to join me at the table so we can do a better job within the context of security in responding, if that's all right.

SEN. GLENN: That's fine. Any staff you want to join you at the table whenever is okay.

MR. WOOLSEY: Mr. Chairman and members of the committee, I welcome the opportunity to speak with you this morning about the proliferation of weapons of mass destruction. It reflects the subject's importance that my first appearance as DCI before any congressional committee is devoted to proliferation. Of the many issues that have emerged in recent years, few have been more serious, have more serious and far-reaching implications for global and regional security and stability than proliferation. Proliferation poses one of the most complex challenges the intelligence community will face for the remainder of this century.

A growing number of countries are seeking advanced weapons, including nuclear, chemical and biological ones, as well as missiles to deliver them. As international awareness of the problem increases, countries are becoming more clever in devising networks or front companies and suppliers to frustrate the export controls and to buy what would otherwise be prohibited to them.

The challenge that we face in controlling proliferation is multi- faceted. We must decipher the myriad web of suppliers, middle men and end- users, we must distinguish between legitimate and illicit purposes, particularly for dual-use technology, and we must help interdict the flow of materials, technology and know-how to potential proliferating countries.

Just a brief overview of proliferation concerns around the globe underscores the threat posed to the United States and to our interests abroad, to our friends and allies, and the importance of stemming this trend.

More than 25 countries, many of them hostile to the US and to our friends and allies, may have or may be developing nuclear, biological and chemical weapons, so-called weapons of mass destruction, and the means to deliver them. Aside from the five declared nuclear powers, numerous countries have or are pursuing nuclear weapons capability. Iraq and Iran, for example, have the basic technology eventually to develop such weapons. More than two dozen countries have programs to research or develop chemical weapons, and a number have stockpiled such weapons, including Libya, Iran and Iraq. The military competition in the always volatile Middle East has spurred others in the region to pursue chemical weapons. We've also noted a disturbing pattern of biological weapons development following closely on the heels of the development of chemical weapons.

More than a dozen countries have operational ballistic missiles, and more have programs in place to develop them. North Korea has sold Syria and Iran extended-range Scud Cs and has apparently agreed to sell missiles to Libya. Russia and Ukraine are showing a growing willingness to sell missile technology prohibited by the Missile Technology Control Regime. Egypt and Israel are developing and producing missiles, and several Persian Gulf states have purchased whole systems as well as production technology from China and North Korea. Some have equipped these missiles with weapons of mass destruction, and others are striving to do so.

Reducing the proliferation problems in numbers and generalities risks painting a problem too sweeping to tackle. Let me now briefly describe some of the causes of proliferation and outline some of the most dangerous proliferation threats.

Why are so many nations still pursuing these dangerous weapons despite the positive global changes that have led to our own sense of greater security? As President Clinton said in his inaugural address, the world today is a less dangerous place, but it is also less stable. The collapse of the Soviet Union jarred long-standing alliances and encouraged an increasing number of states to further bolster their own military capabilities, including by developing weapons of mass destruction.

Yet apart from these consequences of the Cold War's end, many states have concluded that weapons of mass destruction are valuable for other reasons. Many nations seek these weapons for the prestige that leaders believe they convey, or they seek them to dominate their neighbors. Some, like Iraq, develop them not just for symbolic reasons, but to use against their enemies in war, or, tragically, against their own people. Others think that the only way to offset a hostile neighbor's threatening weapons is to develop similar capabilities. We can see this particularly in South Asia, where mutual Indian and Pakistani suspicions have fueled a nuclear arms race, increased the risk of conflict, and gravely increased the cost of war, if it should occur. Still others view these weapons as a way to buy security on the cheap -- a short-cut to achieve a chilling military capability that they believe will serve as a compelling psychological deterrent.

The collapse of the Soviet Union, regardless of its positive result, has raised new opportunities for determined nations to access to sensitive technology and materials. Russia's ability to maintain control of its special weapons and associated technologies has somewhat weakened under the stresses and strains of the Soviet break-up. Most reports of transfers out of Russia or the Soviet Union appear to be scams, hoaxes, or exaggerations, but a few transfers of sensitive technology have occurred. Some black market transactions in Western Europe have included radioactive material from the former Soviet bloc.

So far, we have detected no transfers of weapons-grade material in significant quantities. We have no credible reporting that nuclear weapons have left CIS territory, and we do not believe that nuclear weapons design information has been sold or transferred to foreign states. Moscow has publicly opposed illegal transfers of technology that would lead to the proliferation of weapons of mass destruction.

We consider it highly unlikely the Russian government would willingly transfer nuclear warheads to any outside state. However, in light of its financially strapped defense industry, Russia's growing dealings with China and Iran are of concern regarding proliferation. Even if critical nuclear weapons technologies have not been transferred to these countries, expanding bilateral contacts could lead to such transfers in the future. Russia, for example, recently sold Iran diesel submarines and advanced aircraft, giving the Tehran regime important naval and air capabilities. Moscow is also holding civilian nuclear cooperation discussions with Tehran.

China continues to obtain missile technology from Russia and Ukraine, and China is actively pursuing agreements covering increasingly more sensitive areas. This raises concern not only because the transfers improve China's military capabilities, but also because it introduces the possibility that China could, in turn, pass more advanced Russian- or Ukrainian-derived technology to other states, as Beijing has done previously with its own technology.

Despite important high-level Russian political support for establishing effective export controls, Moscow's fledgling efforts have not yet produced solid results. Legal, personnel, and funding problems are slowing progress. Moreover, many agencies involved in controlling exports are also responsible for promoting military exports, creating obvious concern. Some Russian agencies responsible for implementing new non-proliferation controls evidenced disruption and commercial incentive within themselves. This is further hampering efforts to prevent the transfer of sensitive weapons technologies.

During any period, such as now, when the Soviet economy is deteriorating, the lure -- the Russian economy is deteriorating, the lure of large illegal profits means that the risk of such transfers will grow. At the same time, unfortunately, the still weak Russian legal system is currently by its weakness somewhat hindering the government's ability to apprehend and punish offenders.

Today's faltering CIS economy and the attendant hardships among individuals with military and scientific expertise could lead to more disturbing military transfers and could also encourage illegal exports of technology or material. Tens of thousands of former Soviet scientists were involved in sensitive weapons programs. Many may be tempted by more lucrative work abroad. The current immigration and customs bureaucracies cannot monitor more than the most critical personnel. Moreover, a substantial number of former Soviet scientists involved in weapons of mass destruction research and development are of Ukrainian origin, so the risk of leakage and brain drain is not simply a Russian problem.

Economic and nationalist pressures are causing some Russian and Ukrainian leaders to question the wisdom of adhering to the Missile Technology Control Regime. Some Russians contend that national laws, not the MTCR, will govern their export of missile technology. Our initial understanding of the Russian regulation indicates they may not be consistent with the MTCR. Russia, for example, has already sold rocket engine technology to India that would be inconsistent with MTCR guidelines. At a recent arms show in Moscow, the Russians advertised a derivative of the older SS-23 missile for sale as a civilian rocket, raising additional MTCR concerns.

Resolving the dispute over control of strategic forces in Ukraine is critical to establishing a more stable security environment. We face a critical period as Russia attempts to maintain control over all of the 30,000-some tactical and strategic nuclear warheads within the former Soviet Union in the face of mounting political difficulties, widespread violence on its borders, and the possibility of disruptions within Russia itself.

Although we believe that all of the tactical warheads have been returned to Russia, nearly 3,000 strategic warheads remain outside of Russia. The Russians continue to maintain strong centralized control of their nuclear forces, and we think under current circumstances, there's little prospect of failure of control, but we are concerned about the future. Leaders in Russia and the other three states where the warheads are located have pledged to destroy much of the former Soviet stockpile, but it will take more than 10 years to do so unless the process can be speeded up.

The former Soviet Union is by no means the only source for countries seeking sensitive technology and materials for weapons of mass destruction. We're facing a sophisticated hydra of suppliers. For every shipment we stock, new suppliers seem to appear willing to manufacture, broker, sell and transport material to any and all clients, no matter how dangerous or unsavory. And while we've witnessed progress on the supply side of the equation, we detect little reduction in the demand for weapons of mass destruction. As long as nations perceive these weapons as enhancing their security and others are willing to sell, we will all have our work cut out for us. Nations that seek these weapons, such as Iran, Iraq, and North Korea, are not going to give up because we reorganize or because we claim that we are more effective.

The Middle East remains an area of special concern. Nearly half the countries in this conflict-ridden region have or are developing weapons of mass destruction. Iran continues its massive and costly military buildup despite the blow to Iraq, its only real adversary, during Desert Storm. Iran's efforts are not limited to weapons of mass destruction but also encompass advanced fighter aircraft, long-range fighter bombers, submarines and missiles. Iran's military buildup despite severe economic crisis underscores its desire to dominate its own neighborhood and reach far beyond. Iran is already trying to export violence and to destabilize regimes in the Middle East. Adding chemical, biological and even nuclear weapons and long-range missiles to this already lethal brew is a disturbing prospect indeed.

Iran is pursuing the acquisition of nuclear weapons despite being a signatory to the Non-Proliferation Treaty. Iran probably will take at least 8 to 10 years to produce its own nuclear weapons, perhaps fewer years if it receives critical foreign assistance for its development effort. Iran also has an active chemical warfare program. It used chemical weapons in response to Iraqi use during the Iran-Iraq war, and it can still manufacture hundreds of tons of chemical agent each year. Although it produces primarily choking and blister agents, Iran may also have a stockpile of nerve agents. Biological weapons, if not already in production, are probably not far behind there.

Iraq's weapons of mass destruction programs were heavily damaged by coalition attacks during Desert Storm. Nearly two years of intrusive UN inspections and the imposition of strict international sanctions have set back their efforts, as well. Iraq has struggled to maintain important elements of each program, hoping to out-wait the United Nations and to rebuild its infrastructure for weapons of mass destruction once inspections and sanctions cease.

The extent to which the government of Iraq has lied to the United Nations has been revealed in the enormous discrepancy between what Iraq initially declared and what has subsequently been discovered during the inspection process. Iraq claimed no facilities were involved in nuclear weapons research and development, yet the United Nations has uncovered more than 20 such facilities. Iraq, after initially denying the existence of its biological weapons program, finally admitted to basic research only, never revealing the full extent of its advanced effort. Iraq's initial chemical weapons declaration of only about 10,000 munitions and less than 1,000 tons of chemicals has now grown to nearly 150,000 filled and unfilled weapons and 5,000 tons of chemicals awaiting destruction by the United Nations. Similarly, Iraq's missile declaration was grossly understated. More than 100 additional missiles and numerous launchers have been discovered during the past two years.

Iraq retains key non-fissile materials and equipment, such as centrifuge drawings, machine tools, and expertise that it could use to rebuild a centrifuge-based uranium enrichment effort. Iraq retains a significant amount of production equipment for its chemical weapons program and stockpiles of chemical agents and chemical munitions.

Similarly, Iraq has tried to prevent the United Nations from finding and destroying its missile production capability. The Iraqis retain missiles, support equipment, and propellant, and they are still capable of firing Scud missiles. Iraq's biological weapons capability is perhaps of greatest immediate concern. Baghdad had an advanced program before Desert Storm, and neither war nor inspections have seriously degraded this capability. The dual-use nature of biological weapons equipment and techniques makes this the easiest program for the Iraqis to hide.

North Korea, as recent headlines suggest, is probably our most grave current concern, and these concerns go beyond the nuclear controversy, which I will discuss in a moment. North Korea is developing other weapons of mass destruction and has emerged during recent years as a key supplier for states such as Iran and Syria, cut off from traditional suppliers in the West by stricter export controls and improved enforcement. North Korea has sold extended-range Scud missiles to, among others, Iran and Syria, and is developing and actively marketing a new 1,000-kilometer-range missile. North Korea apparently has no threshold governing its sales. It is willing to sell to any country with the cash to pay.

We have every indication that the North Koreans are hiding evidence of some nuclear weapons-related activities from the international community. Despite agreeing to IAEA inspections last year, North Korea has not allowed the agency access to two suspected nuclear-related sites. An obvious reason for the standoff is that North Korea has something significant to hide. Of greatest concern is the real possibility that North Korea has already manufactured enough fissile material for at least one nuclear weapon and is hiding this from the IAEA. We assess the two North Korean- produced reactors at Yongbyon were built for plutonium production, despite North Korean claims that the reactors are part of an electric power program. If the North Koreans decide to cooperate with the IAEA, it would substantially restrict their ability to develop nuclear weapons at the Yongbyon complex, the center of their nuclear effort. Nevertheless, we remain concerned that they could clandestinely, even in that case, develop a small nuclear weapons capability elsewhere.

Mr. Chairman, the areas I've just addressed are by no means a complete list. I've only touched on the most egregious regimes who present the greatest proliferation threat to US interests and to the security of our allies in the Mideast and North Korea. Others are also worthy of concern. Even as it publicly proclaims its good intentions, Libya is constructing a second chemical weapons production facility. The new facility, recently described in the media, is yet another indicator of the extent to which Libya, apparently unchastened, will go to evade international attempts to prevent its development of chemical weapons. Libya continues also to try to import technologies for its missile programs, and certainly no one has forgotten Colonel Qadhafi's public statement about his quest for a nuclear bomb.

The arms race between India and Pakistan poses perhaps the most probable prospect for future use of weapons of mass destruction, including nuclear weapons. Both nations have nuclear weapons development programs and could, on short notice, assemble nuclear weapons. Neither India nor Pakistan seems to scrimp on resources for their expensive military program, despite dire economic conditions and widespread poverty among their citizens. India's program, older and probably larger than Pakistan, culminated in 1974 with a nuclear detonation and, we are convinced, has progressed from there.

A nuclear exchange on the subcontinent would be devastating. Millions of innocent civilians in this densely populated region would be vulnerable, particularly as each side strives to develop missiles with which to reach deeper into the other's territory, to put at risk major population centers, including Islamabad and New Delhi. And both countries are also capable of developing chemical weapons. Competition between the two means that one's perception of the other fuels competitive work and thus helps reality catch up with fear.

China is also a major proliferation concern as an alternative supplier when western export controls make technology and weapons more difficult to acquire. China acceded to the Nuclear Non-Proliferation Treaty and agreed to abide by the Missile Technology Control Regime last year. More recently, it signed the Chemical Weapons Convention.

We're closely monitoring its behavior for signs that China is not living up to its commitment. The breadth of Chinese contacts with potential proliferators, particularly in the Mideast, makes detecting and confirming potentially dangerous transactions difficult. Chinese nuclear- related deals, for example, with Algeria and Syria, appear consistent with its Non-Proliferation Treaty Obligations. As Iran's principal nuclear supplier, China has supplied research reactors and other technology, consistent with the NPT, but of concern, nonetheless, given Iran's pursuit of a weapons capability. On the other hand, China's relationship with Pakistan seems less benign. We're also concerned about Beijing's missile and chemical transfers to the Mideast.

We're also concerned with the worldwide proliferation of advanced conventional weapons, weapons that significantly increase conventional war- fighting capability but fall short of the devastating capabilities of mass destruction weapons. The proliferation of these weapons, although perhaps less potent and psychologically alarming than weapons of mass destruction, may have an even more pronounced impact on the military outcome of future region conflicts.

Third World countries such as Iran are improving their military capabilities through the purchase of advanced conventional weapons, and these weapons will present formidable challenges to US military operations in the future if they should need to be conducted in this part of the world. Anti-ship cruise missiles, for example, employing countermeasures and precision guidance could threaten US and allied naval forces. The expanding ranks of Third World nations who are now fielding these weapons include Iran, Syria, and Libya.

Increasingly, advanced surface-to-air missiles with enhanced anti-stealth capability pose a growing threat to low-flying aircraft and to cruise missiles such as those in the US inventory. We witnessed a sharp increase in the demand for such weapons, of course, since Desert Storm, which vividly demonstrated the effectiveness of the systems that we used there. Similarly, many countries are marketing precision-guided munitions, some even more capable than many US systems.

Advanced aircraft are often the delivery system of choice for weapons of mass destruction, and they are now commonplace among proliferating countries. Although missiles are less vulnerable than aircraft to defensive measures and are more difficult to detect, the aircraft available to these countries are fully capable of delivering nuclear weapons and munitions filled with chemical or biological agents.

I've painted a rather bleak picture, Mr. Chairman, but accuracy and candor in this case, I am afraid, require bleakness. Unless we reverse the current trends, the future could come to be even more dangerous than these descriptions of current reality. The spread of nuclear weapons capability is of most concern because of nuclear weapons' horrible destructive capacity that could put millions of innocent civilians at risk and dramatically change regional security landscapes wherever they're introduced. A North Korean nuclear weapon would threaten both our allies and all of Asia and US forces as well. Iraq's indiscriminate use of chemical weapons in its war with Iran underscored the urgency in our efforts to stop the spread of and ultimately to banish this whole class of weapons. And lastly, countries persist in pursuing biological weapons, possibly the most troubling capability of all, despite a strong international consensus to the contrary.

The intelligence community recognizes the urgency of this problem and is moving to respond to the increasing threat. A non-proliferation initiative last year set forth principles to guide non-proliferation efforts. The intelligence community was instructed to accelerate its work in support of US efforts to stem the spread of weapons of mass destruction and to broaden our support to international organizations, to increase the pool of experience and well-trained experts committed to the non-proliferation agenda. Last spring my predecessor Bob Gates established a new interagency Non-Proliferation Center -- the NPC -- to serve as the focal point for intelligence community non-proliferation activity in support of the agencies involved in policy, enforcement, licensing, and operations. The center has a broad non-proliferation mission covering the worldwide development or acquisition of product technology, designs, components, and complete military systems in the areas of mass destruction and advanced conventional weapons. The NPC's full-time staff, drawn not only from the CIA but also from other national agencies, albeit not yet to the extent I envision -- I plan an expansion and a strengthening of this organization, Mr. Chairman. This organization is designed to foster what the current atmosphere of reduced budgets mandates: a more corporate, efficient, and focussed management of community and national resources to attack this most important problem.

Although the NPC is still in its infancy, we're beginning to see some pay-offs from utilizing this type of approach. Based on my successful experiences with the arms control intelligence staff during the CFE negotiations, I've seen the value to decision-makers and to people on the spot such as negotiators and military commanders of one-stop shopping in the intelligence community in today's fast-paced world. This is not only important for analytical support to decision-makers, but it's also important for assuring efficient and effective use of intelligence collection and budget resources.

An important element of our non-proliferation efforts is scrutinizing our collection philosophy. What worked against our old enemies isn't guaranteed to work against these new problems and adversaries. I'm putting special emphasis on two broad areas:

First, there needs to be more of an effort on human intelligence. Well-placed first-hand information can pull together seemingly unrelated technical tidbits to build a convincing and accurate picture. And, Mr. Chairman, this is one reason why I am particularly attentive to sources and methods and caution with respect to details in this field.

Second, we are working to ensure that our collection is usable and accessible to the policy-makers who need it to stop proliferation.

Too often, the value of intelligence is measured by how much it adds to our knowledge of a particular subject, but knowledge alone is no longer sufficient. Policy-makers need more than facts; they need information that they can use -- so-called actionable intelligence. Ultimately, our success won't be measured by how many reports we produce -- indeed, that may be a contra-indicator -- but by how we have directly contributed to United States and multilateral actions to stop proliferation.

Greater cooperation is essential not only within the intelligence community and our own government, but also among allies who, given the right information, can and have contributed to our common goal. The US already is discovering a willingness among nations to take decisive action against proliferators whether it's advanced machine tool fees on the docks or precursor chemicals turned around on the high seas. The cooperation we have begun to see has been gratifying.

Our government's support to international organizations also has an important impact on the intelligence community. We've seen some remarkable changes in the world in just the past few years with the United Nations taking a more active role on the international scene. This should grow in the future due to new international norms such as the chemical weapons convention and to strengthen existing agreements such as the Nuclear Non-Proliferation Treaty, biological weapons convention, and Missile Technology Control regime as these attract more attention and wider membership and see stricter enforcement.

These agreements will require the full support of all member states, not just the United States, to monitor compliance and to ensure enhanced global security. But ours is a major role, and we intend to cooperate aggressively.

The success so far of the many scientists and weapons experts from a number of countries that make up the United Nations Special Commission on Iraq in discovering and destroying much of Iraq's huge program to acquire weapons of mass destruction is of lasting significance. The Special Commission and the International Atomic Energy Agency owe their success to the professionalism and the deep commitment of their staffs, and to the broad assistance, including critical information given to them by member countries. The United States, among many other nations, is committed to providing the United Nations the information and support it needs to complete its mission. Working closely with the State Department, an unprecedented amount of information has been shared with the United Nations, changing the previous rules of the game, and assisting them in completing -- at least in making substantial progress in this historic mission.

Clearly, strengthening the IAEA must go hand in hand with renewing and reinforcing the Non-Proliferation Treaty. We've already witnessed a new willingness by the agency to pursue safeguards inspections more aggressively. For the first time, the IAEA requested and received access to undeclared sites in Iran and South Africa. But the recent showdown between the IAEA and North Korea shows the fragility of the agency's mandate. Without strong international sponsorship and support, it cannot succeed. The United States can take a lead role in strengthening and supporting international organizations, but we cannot do it alone. Outspoken and forthcoming assistance from others, such as the Russians, Europeans and Japanese, is essential in giving the IAEA the credibility and accountability it needs to complete its mission successfully.

Mr. Chairman, I'd like to close this somewhat bleak testimony on a note of optimism, tempered appropriately by caution. During the past two years, three nations, France, South Africa and China, became new signatories of the Non-Proliferation Treaty. Membership in other multilateral institutions, such as the Australia Group and the Missile Technology Control Regime, is expanding. Argentina is cooperating in dismantling its Condor missile program. Germany, once a high technology supermarket for a range of troubling exports and countries, has enacted strict export controls, a most gratifying development. We've made some important headway in making the proliferation of weapons of mass destruction a more difficult, expensive, and lengthy proposition. Obtaining these troubling capabilities today is a much more difficult task than it was a few years ago.

Today I've discussed the problem of worldwide proliferation of weapons of mass destruction aiming for a better understanding of the significance of the threat and of the challenges that we face. An important part of the intelligence community's job is to define the problem better, to set priorities for our targets, and to focus our resources to counter proliferation where its consequences are the most acute. I believe we've made significant progress already, shifting resources to address the task better. Through our programmatic approach and our continued cooperation with other agencies involved in policy, enforcement, licensing, and operations, we're setting the stage that will allow us to make further progress in countering proliferation activities worldwide.

Mr. Chairman, that concludes my statement.

SEN. GLENN: Thank you, Mr. Woolsey. An excellent statement. And that's sort of a general rundown of things around the world. We'll try to get into some more detail of it, perhaps, as we go along.

We've all focused, as you indicate in your statement, too, mainly on the nuclear area through the years, and that's because of -- well, that's been our major concern. I've been equally concerned that as we go along, the chemical weapons or biological weapons can be the poor man's nukes or the poor nation's nukes of the future. And they are so much easier to fabricate than putting together the huge industrial complexes needed for nuclear weapons.

Judge Webster, one of your predecessors, sat right where you're sitting just a few years ago, and in talking about how difficult it is to track some of these things, said that a very credible weapons factory, chemical or biological, could perhaps be put together in a room the size of this hearing room, which surprised a lot of people and got some attention at that time. And so I'm particularly interested in some of those areas as trying to forestall some of the development of chemical nuclear weapons.

In this morning's paper I'm sure you saw that China may have -- this thing in the Washington Post -- China may have revived germ warfare weapons program, US officials say. What can you tell us about that, because I'm particularly concerned about germ weapons programs where, while germ weapons do not work in a flash like a nuclear explosion, they nevertheless over a period of time can be just as devastating and kill just as many hundreds of thousands of people.

And what can you tell us about the report in the paper? I won't read -- I'm sure you've read that this morning here --

MR. WOOLSEY: Yes.

SEN. GLENN: -- and the pertinent parts here about some of the information we had before may have been deleted, it's now been reported -- reliable officials, all of whom prefer to remain anonymous, for their own purposes, obviously. But what can you tell us about that? Is China really going on a germ weapons program now, or a biological weapons program?

MR. WOOLSEY: Mr. Chairman, I think all I can say in public session on this is the following. For some years, the intelligence community has highlighted the possibility that this capability may exist in China, and I have thought about this this morning and discussed it with some of my experts. Further than that I cannot in public session, I think, make any statement.

SEN. GLENN: Okay. I understand.

In discussing China's compliance with the NPT and the other commitments they've made, in your testimony you state -- I believe I quote this correctly -- "On the other hand, China's relationship with Pakistan seems less benign." That sort of hops out off the page here when you read that, "seems less benign." Can we interpret that to mean that the intelligence community believes that China's relationship with Pakistan's nuclear program -- does it, for instance, violate their NPT obligations? And what extent is it less benign?

MR. WOOLSEY: Well, let me put it this way, Mr. Chairman. Beijing has consistently regarded a nuclear-armed Pakistan as a crucial regional ally and as a vital counterweight to India's growing military capabilities. And building on a close and extensive defense cooperation effort, Beijing prior to joining the Non-Proliferation Treaty in 1992 probably provided some nuclear weapons-related assistance to Islamabad that may have included training, may have included equipment.

Based on China's longstanding nuclear links with Islamabad, it's unclear whether Beijing has broken off contract with elements associated with Pakistan's weapons programs, and as I'm sure you're aware, there are a variety of press reports indicating that China delivered some sort of M-11 ballistic missile-related equipment to Pakistan late last year. We are closely watching that particular situation for any further developments, but with respect to any details beyond what I've just said on that subject, I'm afraid I would have to go into it on a classified basis.

SEN. GLENN: Okay. We have followed the developments in Pakistan, their relationship with China for many years on this committee and through other committees also. I got a report just this morning here -- it was a report out of Pakistan, Islamabad, on February 11th. It's a Reuters report that says that Pakistan and US commandoes are going to hold joint exercises. Are you aware of those and do you know what those will encompass? I just got this this morning.

MR. WOOLSEY: There's nothing I can say about that, Mr. Chairman.

SEN. GLENN: One of the things that got to me a little bit in this, in their release, the Pakistani version of this as brought up by their minister of state for foreign affairs talks about the exercises and what they would encompass and then spells out, "He also reportedly confirmed that there was no Jew in the group. Do you know anything about that one at all?

MR. WOOLSEY: Absolutely nothing.

SEN. GLENN: Well, this is a report -- we'll be glad to give it [to you] -- I got just before we came to the hearing this morning.

I didn't know whether we are going into something like that or not. This is not from our US sources. I'd just say this is out of Reuters on a report out of Pakistan.

MR. WOOLSEY: I know nothing about this, Mr. Chairman.

SEN. GLENN: Doubly disturbing if that's the attitude they're taking on some things like this. And I certainly would -- I hope we can confirm that if there are to be exercises over there that we're not discriminating against people by nationality or by ethnic background on who can be part of the American force going over there.

MR. WOOLSEY: We'll make certain that the proper portion of the US government -- and I have a feeling it's not the intelligence community, Mr. Chairman -- gets back to you with an answer.

SEN. GLENN: (With a laugh) No, I understand that. I understand that.

My time is up on this first round. We're on the six-minute rule and the early bird rule here in the order which people came to the hearings

Senator Cochran?

SEN. COCHRAN: Thank you, Mr. Chairman.

Let me welcome you to the committee and thank you very much for making time available for us to review the situation as you see it.

I noticed in your testimony that you pointed out the most serious area of concern seems to be North Korea at this point. In connection with that, what are we concerned about -- the development of nuclear weapons capability and the hiding of that from the International Atomic Energy Agency, new missile technology that can deliver other weapons of mass destruction to South Korea or other targets?

And what, if anything, do you see the prospects as being for our being able to get a better handle on what the facts are, and then to influence things for the better, to try to help convince North Korea, with our other allies -- some in the region, some elsewhere -- that they should be a more responsible member of the world community in this connection?

MR. WOOLSEY: One always wants to try, Senator Cochran. The North Koreans are in discussions with various governments on a bilateral and multilateral basis on these subjects, and with the IAEA. And it wouldn't be appropriate for me to make a policy comment about it. I would just say from an intelligence perspective, and observing their programs and efforts to date, it is the combination of their lack of cooperation with the IAEA, the existence of the advanced Yongbyon complex, the nature of their missile developments, including the new 1,000-kilometer missile, and their willingness to export technology and systems to even -- to essentially any state that would have the funds to pay, puts North Korea almost in a class by itself in the proliferation world. There are other nations that do individual things and take individual steps in some of those areas that trouble us greatly. The thing that is salient about North Korea is that it seems to be taking action in all of those areas that trouble us greatly.

SEN. COCHRAN: In view of that, as we look at our commitments of military forces around the world and look for ways to cut back on military troop deployments and our own expenditures in the military area, do you think it indicates that we ought to be very careful before we agree to withdraw numbers, large numbers of American forces from Korea? Would that be inviting North Korea or maybe encouraging them to proceed in the way that they've been going? Or should we even consider adding some troops or doing additional things in that region to sort of convince them that this is not the right approach, that they run a risk of possible retaliation of some kind or other risks; that they might want to consider their conduct more carefully?

MR. WOOLSEY: Well, Senator, I really think on that type of a question I should refer you to Colin Powell and to Les Aspin, as soon as he gets out of the hospital. I don't think it's appropriate for me to comment on US force deployments and the implications thereof.

SEN. COCHRAN: Do you think we are providing the kind of support or assistance to our international organizations that help monitor proliferation so that we can do as good a job as the facts require to try to help ensure compliance with NPT agreements and encourage other nations to become responsible members of the nuclear [non]-proliferation regime? Specifically thinking about the IAEA, is that a useful organization, do they do good work? What's your opinion about the extent to which we ought to continue to support or increase our support for their efforts?

MR. WOOLSEY: I believe the IAEA, in the aftermath of the -- and essentially the embarrassment of the Iraq revelations, has taken some very positive steps to strengthen its procedures. The most important one is that it's now pressing its right to have access to undeclared sites if information exists to suggest that such sites are tied to nuclear activities. And this access ought to increase the agency's -- and its policy about access ought to increase the IAEA's ability to uncover hidden facilities.

I think that the IAEA recognizes the importance of verifying the truth and completeness of several of these countries' declarations about past nuclear activities. And I think it is, like all of us, growing and learning in this very important, complex and difficult business.

We have been an important part of helping the IAEA in this regard -- that is, the United States has been. And I think I might ask Mr. Oehler as the head of the Non-Proliferation Center if he has any further comments to make that might expand on what I've said a bit.

GORDON OEHLER (HEAD, NON-PROLIFERATION CENTER): Well, we believe that the IAEA is a really very valuable tool in the international program to counter proliferation. It is not going to succeed by itself. It, like all other programs, has its strengths and weaknesses. But its primary strength is that at declared facilities, the International Atomic Energy Agency really does monitor those situations very carefully and we believe can detect illegal use of those in weapons programs.

What is a little more difficult is -- for the IAEA is detecting nuclear weapons developments at undeclared facilities, and that's what we're working on in other areas as well as working with the IAEA.

SEN. COCHRAN: Thank you.

Thank you, Mr. Chairman.

SEN. GLENN: Senator Stevens.

SEN. TED STEVENS (R-AR): Thank you, Mr. Chairman, and Mr. Director, it's nice to see you here. I made a particular point to come this morning because I see you in the closed sessions of the Intelligence Committee and in the closed sessions of the Defense Appropriations Committee, and it's not often we get a chance to ask you questions right out here in front of God and everybody, you know? (Laughter.) So Jim, it's nice to see you here. I appreciate your comments that you made about your role in the negotiation of these arms control agreements that we have. And based upon, I think, the experiences that all of us have had with you, I again welcome you as the Director of Central Intelligence.

But having said that now, what are we going to do about getting more public information out about the scope and extent of the threats against the United States? Particularly at this time when -- as we travel around the country, everyone's saying "Why don't you cut more from defense and why don't we reduce and do we really need a[n] intelligence agency?"

I -- I think -- I'm just back from Korea. As I told you the other day. I think the state of -- let's put it this way: the level of fear in Korea is higher than I've seen it in many years. And it comes about because of some of the things you've been mentioning. But can we have a program to have more information about threats available? I want to congratulate you, Mr. Chairman, and your assistant, Randy Rydell, for -- for the translation of this Russian Foreign Intelligence Service Report. That sort of thing, I think, the sharing of intelligence reports would go a long way. But my first question to you is about the information. Are we going to see an ability to -- to present the declassified version rather than to have something that's 90 percent unclassified remain in the closet because it's 10 percent sensitive?

MR. WOOLSEY: We'll do our very best, Senator Stevens. These issues are important to the Congress, and it's important for us to be able to inform you as much as we can in public as well as somewhat more completely, as will always be the case, in executive session, and it's important for the American people to understand these issues. We know that.

Part of the problem is that we need to be very careful on a step by step basis in examining what we say. One of the reasons I speak somewhat slowly in answering questions and have Larry and Gordon here with me is that the sources and methods by which we learn many of these things are extremely sensitive, and particularly where we know something based on a single source, it is -- can be devastating to our ability to know about it in the future if we talk about it in an unclassified manner.

Now, having said that, there are increasingly, if one stays attuned to them, I think, ways in which we can emphasize for you things that have appeared publicly or that are known from more than one source, and we worked hard on this statement of mine today and in talking through among ourselves some of the answers to possible questions to come forward as much as we possibly can in public with specifics. I think that you'll see a strong effort in the intelligence community as a whole, not just within the CIA, to do what you're asking. But there is always this governor on the system, so to speak, of watching out for protecting sources and methods that I know you understand very well, but I thought I should say something about it publicly.

SEN. STEVENS: I do understand that, and I appreciate your comment. I don't think any of us want to put at risk the access we have to this information or our people who are out there gathering it for us. But I do think that we ought to have more public knowledge of the extent -- nature of the threats that are there. There is, I think, a perceived American opinion today that there are no substantial threats against this country. And I don't think that's true.

MR. WOOLSEY: I certainly --

SEN. STEVENS: And I, for instance, put Korea --

MR. WOOLSEY: I certainly agree with you --

SEN. STEVENS: Can we talk very much about the new weapons that the Koreans are -- the North Koreans are manufacturing and how many of them are being saled -- sold?

MR. WOOLSEY: We can with respect to the North Koreans assistance to several other countries. We can look at how much more we can say than I did in the statement. Let me ask Mr. Oehler if he has any --

SEN. STEVENS: Doctor, it's nice to see you.

MR. OEHLER: Yes. They are currently selling two versions of ballistic missiles: what was mentioned, the normal modified Scud, which has a 500-kilometer range, which they've sold to several nations in the Middle East; and then they've had a number of discussions and contract talks with the 1,000-kilometer range missile. Some indications may be of continuing missile development work.

They also are leaders in the production of long-range artillery and have been discussing the sales of those advanced conventional weapons with other countries, as well.

SEN. STEVENS: I think it's the existence of that artillery and the massing of it that has created the fear I mentioned in Korea.

What about some of the things, Mr. Director -- I see the light's on. I note that the Indian government has -- India government has purchased at least one, maybe two aircraft carriers, and that presents a concept of force projection that India has not had in the past. Can we relate that in any way to the concepts of proliferation that's going on in that region?

MR. WOOLSEY: We have not to this point, Senator Stevens, related India's naval expansion to any of its weapons of mass destruction capability. That naval expansion is certainly evidence of India's desire to play a major role, as is understandable, in the Indian Ocean and in that part of the world militarily, but -- I'll let Mr. Oehler correct me if I'm wrong -- to this point we see no link in terms of weapon systems or capabilities between those enhanced Indian maritime capabilities and any of their weapons of mass destruction programs. Is that correct?

SEN. STEVENS: Well, if they use aircraft carriers and force projection, they have a floating landing strip miles from their shore and they don't have to have the same ICBM capability, do they?

MR. WOOLSEY: This would depend upon whether or not they were prepared, for example, if they assembled a nuclear weapon, whether they had maritime systems that were designed and equipped to deliver them. And --

SEN. STEVENS: Well, we don't relate those transportation systems to the nuclear threat, is what I --

MR. WOOLSEY: Not at this point. SEN. STEVENS: Thank you very much, Mr. Chairman.

SEN. GLENN: Thank you, Senator Stevens.

In your testimony you stated that after discussing the CIS, Iraq, Iran, North Korea, I've only touched on the most egregious regimes that present the greatest proliferation threat to US interests and to the security of our allies. Then you state, "Others are also worthy of concern," and then you discussed Libya, India, Pakistan, China. These things quite often are all in response to what somebody else did. Some nation has a bomb or a mass destruction capability, another nation wants it because of their concerns. We've seen Pakistan develop what they called at one time the Islamic bomb, and they claimed they needed that because Israel has the bomb, and so on. You didn't mention Israel, and yet in the Russian Foreign Intelligence Service report that we are releasing here this morning, they say that during the period 1970-78, that Israel had probably 20 nuclear weapons by this time, from 100 to 200. Is that a reasonably accurate estimate, from your view at CIA?

MR. WOOLSEY: Let me see what we can say on an unclassified basis on this, Mr. Chairman.

SEN. GLENN: Okay.

(Mr. Woolsey confers off-mike.)

MR. WOOLSEY: Mr. Chairman, if it's all right, I would prefer to provide any information on this subject in --

SEN. GLENN: I'm sorry?

MR. WOOLSEY: I'd prefer to provide any information on this subject to you on a classified basis.

SEN. GLENN: Okay. All right.

Let me run through very briefly some of the things in this Russian report. And I know that this is not something that you've had a chance to really go through yet in detail, but perhaps some of it you can comment on anyway just nation by nation in how our view compares with theirs, if we could make statements in that regard. They say that they think there are 100 countries that possess the industrial base for chemical weapons production. Is that something that you would -- I thought maybe it would be even more than that.

MR. OEHLER: Well, recall that chemical warfare has been around since World War I, and so the chemical infrastructure needed to produce toxic chemicals is not very sophisticated. So almost any country that has any chemical infrastructure at all can produce them if they chose to. Most, of course, don't.

SEN. GLENN: Okay. Just in general, Argentina. They say there's no information that they possess nuclear weapons. Brazil, basically the same. We're aware of times past when those countries maybe were competitive. They now are sort of cooperating with each other to not develop weapons, as I understand it. Is that a fair assessment?

MR. OEHLER: That's a fair assessment, and that's been some good news.

SEN. GLENN: Okay. Israel we just -- they have a lengthy paragraph here on Israel, what the Russian view of Israel is. We already covered that. India may be classified among the countries which unofficially possess nuclear weapons. I think we have assumed that since 1974 and the PNE that occurred then. They signed an agreement on some things. It has not subscribed to NPT. But they say that -- no, let's go on to the next one.

Iraq. They appear to possess all types of WMD, weapons of mass destruction. And they subscribe to the NPT. They're a member of IAEA -- well, we know the situation in Iraq, too.

Iran. That's sort of a question mark yet to us as to how far things have gone in Iran. They say they don't possess nuclear weapons, but they have military applied research. Ratified the NPT, but -- and so on. Do we give them a chemical and biological weapons capability also?

MR. OEHLER: Iran? Yes, very definitely chemical. They used them, in fact, in the war with Iraq --

SEN. GLENN: How about biological?

MR. OEHLER: -- after Iraq used them first.

SEN. GLENN: Yes, well that's right.

MR. OEHLER: And we believe, based upon their extensive pharmaceutical infrastructure, that they have the capability for a BW program as well.

SEN. GLENN: For BW? I was concerned about that. We know they used CW before. But BW, you give them a capability for that? How long would they be -- what would be your estimate on how close they are to being operational with biological weapons?

MR. OEHLER: They could be operational now.

SEN. GLENN: They could be? Today?

MR. OEHLER: Could be with biological, yes.

MR. WOOLSEY: And if I might add a word about their nuclear capability, Mr. Chairman. Part of our concern is based on some of the public statements out of Tehran. Iranian leaders have repeatedly said that Iran does not accept the continuation of what they term Israel's regional nuclear monopoly. During a press interview, I believe earlier this year, President Rafsanjani hinted at a strategy for circumventing the IAEA. And a more detailed answer about that we would be able to provide on a classified basis.

But let me just say one other thing. We do believe that Iran is pursuing a nuclear weapons capability. Its nuclear program is at an early stage, but it's attempting to acquire nuclear technologies that are inconsistent with and unnecessary for peaceful nuclear uses. For example, Bob Gates stated publicly a short time ago that Iran has sought reactors that are maximized for the production of plutonium, not for the maximization of electric power.

SEN. GLENN: Okay. I was little surprised this morning, I guess it was a little new to me. I had thought that in the international sales of weapons of mass destruction that the PRC, that China was out there one-stop shopping, you could buy about anything you wanted to buy. You're indicating this morning, I think, that you consider North Korea more of a one-stop shopping sales center for this type thing than any place else, is that correct?

MR. WOOLSEY: Well, I don't want to neglect China, Mr. Chairman. There are certainly some problems. I think that it's important to look at the full range of their activities, particularly in the Mideast.

Let me see if Mr. Oehler has anything to add to what I had in my statement.

MR. OEHLER: I think the difference is that North Korea has shown no compunction to selling anything that they have, even if it's well beyond what we believe are the international norms as expressed by NPT and the Missile Technology Control Regime.

With regard to China, while they may have done and, for all we know, may continue to be doing some things we would rather they didn't, they certainly have modified their behavior and not sold the types of missiles that they did to Saudi Arabia, and other nuclear technologies that are directly -- come under the NPT. So very clearly, they have modified their behavior because of these international organizations. That's the difference.

MR. WOOLSEY: And let me see if Mr. Gershwin has anything to add to that.

SEN. GLENN: Fine. Mr. Gershwin?

MR. GERSHWIN: I was going to mention that I think it's important to realize that China did supply the CSS-2 missile to Saudi Arabia, which today China would not be able to do if it were to adhere to the Missile Technology Control Regime guidelines. Also, just to reiterate, that China is, in fact, in our view, the biggest supplier of nuclear technologies to Iran. These are safeguarded but, nevertheless, they have been a more important component of Iran's nuclear development program than any other country.

SEN. GLENN: And I think we also assume that they have been the biggest cooperator with Pakistan, too, through the years, isn't that correct?

MR. GERSHWIN: Yes. That's correct. SEN. GLENN: That's been our understanding, and we've had all sorts of reports about people back and forth and that it was actually a Chinese design weapon that the Paks are using, probably. Can we -- have we ever confirmed that, or is that still -- I've seen press reports to that effect. Can we confirm that or is that something outside our scope today?

MR. GERSHWIN (?): We'd rather not talk about that in open session.

SEN. GLENN: Okay. All right.

There are other things that get into this, obviously, but back when we were trying to decide whether we were going to vote for Most Favored Nation status for China or not, everybody talked about the civil rights and the people in Tiananmen Square. And my comments on it at that time that indicated my major concerns were that here we were, just about the time the French stopped selling around the world, beginning to get control of our own sales around the world, the Germans were beginning to put laws into effect finally that stopped their transfer of material and equipment, the Swiss, we had a number -- we thought after 20 years of working on this maybe we finally were beginning to get a little bit of -- we were beginning to make some headway.

And then it was my impression that who stepped in? The People's Republic of China. And they would sell to almost anybody, and they were the new suppliers, pretty much. And now you're adding North Korea to this, I -- I gather here today. So -- and I voted against most favored nation status on that basis.

I'm as concerned about civil rights as anybody else, but I was mainly concerned that the Chinese were stepping here just -- we were about to get some control internationally over some of these weapons of mass destruction that -- the People's Republic of China apparently was willing to sell anything to almost anybody was my impression at the time. And I don't know whether you want to comment on that or not, or -- my time is up anyway, so go ahead.

MR. WOOLSEY: Let me just say a word particularly about China and Iran on nuclear matters.

Its nuclear sales to Iran do appear to be consistent with its NPT obligations, but because of Iran's very dubious commitment to the NPT, China's sales are certainly of concern. It's -- China's negotiating to sell two nuclear power reactors to Iran now, and it has sold an electromagnetic isotope separation unit to Iran. This was one of the uranium enrichment technologies that Iraq pursued when Iraq was working on its own nuclear weapons capabilities.

SEN. GLENN: Now, is the rationale that they need that for nuclear power plants -- the isotope separation? The world's awash in uranium enrichment for whatever purposes, but --

MR. WOOLSEY: Mr. Oehler, you might want to --

MR. OEHLER: Yes, it is. It is awash, correct.

SEN. GLENN: But they -- and so they still want an isotope separation unit there that they would use themselves, and I suppose they're saying that that's for use for their civilian power, is that correct?

MR. OEHLER: Well, I think in this you're speaking of calutron?

MR. : Yeah.

MR. OEHLER: What they -- China sold Iran a calutron. You remember that, of course --

SEN. GLENN: Yeah.

MR. OEHLER: -- from the Iraqi program days. Calutrons have peaceful uses. They also, as Iraq showed, have the ability to make fissile materials.

SEN. GLENN: Yeah.

MR. OEHLER: But what was sold was one calutron, and as you saw in Iraq, you really need to have dozens to a hundred or so operating full time before you have a significant weapons threat.

SEN. GLENN: My time is up.

Senator Cochran.

. . .

SEN. GLENN: What is the -- we've seen numerous press accounts alleging efforts by Third World nations -- Libya and Iran being most frequently cited -- to recruit former Soviet military experts. Last year Bob Gates testified before this committee that the so-called "brain drain" problem is, in his words, what, and I quote, "concerns us the most about the CIS republics as a proliferation threat." What is your assessment of it today?

MR. WOOLSEY: Most scientific immigration, Mr. Chairman, out of CIS states to this point has been experts in basic scientific disciplines -- theoretical physics, math, computer sciences, and the like -- and they have been looking for jobs in industry and education and primarily in the West. These types of people are not normally the ones who have had direct experience or expertise with weapons of mass destruction. Moscow TV this past December was probably referring to these types of people when it said that over 9 percent of Russia's scientists had left the country.

But as far as weapons-related scientists are concerned, China is often cited as a country that's aggressively attempting to recruit CIS scientists to help with a wide variety of their programs, and other countries that have been reported to be trying to take advantage of the prospective brain drain out of the CIS are Iraq and North Korea, India and Pakistan. But many of the reports so far appear to be unfounded rumors or allegations that are intended to discredit the recruiting country.

Some reports that CIS nuclear experts are abroad probably refer to on-going cooperation that's sanctioned by the IAEA -- I mean, by the Atomic Energy Agency in -- with civil nuclear projects and probably don't involve nuclear weapons-related activities. But having said this, even though our conclusion would be that we can't substantiate that top weapons scientists have emigrated to proliferating countries from CIS states, the political and economic situation in several of the CIS states, particularly Russia and Ukraine, make this a continuing concern and something we need to be on top of and worried about.

SEN. GLENN: Okay. We, of course, are trying to promote free enterprise in the new CIS republics, yet there are real proliferation-related risks associated with the commercialization of the former Soviet military-industrial complex. For instance, we've had efforts by the Chetek organization to market nuclear explosions to provide a service, and by Glavkosmos to export space launch vehicles. Are we beginning to see an open door of dangerous military-related exports from these CIS republics, exports that may be encouraged by the very free market forces we're now promoting?

MR. WOOLSEY: Well, the answer to that question is somewhat mixed, Mr. Chairman. Some of the CIS countries are -- I think are going -- I'd say the CIS countries generally are going to refrain from authorizing the export of things like weapon-grade nuclear materials and nuclear, chemical, bacteriological weapons to countries of proliferation concern. But those that have facilities in -- and personnel and weapons generally appear to be disturbed about proliferation of weapons of mass destruction. These countries might view sales of certain goods or services such as space launch vehicles and civilian power -- nuclear power components as posing little proliferation threat while being vital sources of hard currency. And it's this dual use aspect, particularly of space launch vehicles and civilian nuclear power capabilities, I think, that presents a real problem.

Russian and Ukrainian officials believe that missile and space technology is one of the few areas where they can compete successfully with the West and can earn hard currency. And both Russian and Ukrainian space and missile industries have largely lost their insulation from local economic dislocation. And the officials who run these facilities and these parts of these two countries' economies see foreign sales as the best way to stave off bankruptcy and factory closings and massive unemployment. So that's the reason why I think Moscow and Kiev both dispute our readings of the Missile Technology Control Regime and insist that on some contentious issues they don't violate the MTCR guidelines. And those contentious issues are particularly Russian sale of cryogenic engines, for example, to India, or Ukrainian proposals to use ICBMs for space launch.

I think Russia and Ukraine both are likely to step up their efforts to persuade the West to alter or reinterpret those parts of the MTCR. President Yeltsin recently signed a decree governing the export of Russian missile technology. We haven't yet received full copies or had an opportunity to study this new decree in detail. But I'm -- I think we all need to be concerned that Russian and Ukrainian enterprises are going to continue to push on these issues. And it's also the case that Russia is pursuing sales of nuclear power stations. It has, so far, insisted however -- and I want to emphasize this -- that such stations are to be subject to full-scope IAEA safeguards.

SEN. GLENN: You mentioned in your statement, I believe, a new cooperative effort between Russia and China.

MR. WOOLSEY: Yes.

SEN. GLENN: I believe you mentioned that just in passing. If China is going to be a major new customer for a variety of high tech and weapon- related exports, it concerns me, obviously, because China then has been prone to sell these things around the world pretty much willy-nilly to anybody that wanted to buy. And if this included biological, chemical and things like that, it would create a whole new threat, it seems to me. What is the new China-PRC relationship? I mean the Russian-PRC relationship?

MR. WOOLSEY: Well, it's precisely the further proliferation out of China that is, I think, of front and center as our concern.

The Russian government -- President Yeltsin signed a memorandum of understanding with the Chinese in December. It establishes a broad framework for Russian military technology assistance to China. I think at one point it stated that the two countries were prepared for cooperation in all fields, including the most sophisticated weapons and armaments. And Russia has been actively promoting military exports to China to obtain hard currency and to help its defense industries. And its cooperation with China also reflects, I think, its continued interest in promoting rapprochement with China, since the days of the old Sino-Soviet split.

Its arms exports to China have included modern aircraft and surface- to-air missiles. And they've been holding exchanges about nuclear power. Of course they're both nuclear weapon states, and nuclear power cooperation doesn't violate non-proliferation guidelines. But this is something I think we all want to keep an eye on very closely because the possibility that some of this technology might be further exported by China is something that would be very much of concern to, I think, all of us.

SEN. GLENN: My time is up on this round.

Senator Dorgan?

SEN. DORGAN: Thank you very much. I regret that I missed your opening statement. I've been in a conference committee meeting -- (inaudible) --

(Audio break.)

MR. : (In progress) -- their behavior have not sold technologies of direct NPT concern, and all of the nuclear technologies that they have sold have been put under safeguards.

With regard to imports, we see them looking for some instrumentation occasionally --

SEN. DORGAN: May I -- just a question on that point.

MR. : Sure.

SEN. DORGAN: In other words, you're saying that since they became a party to the treaty, in your judgment, there's been compliance?

MR. : There has been compliance with the NPT, that's correct, the Non-Proliferation Treaty, Nuclear Non-Proliferation Treaty. Now, that doesn't mean that our concerns about Chinese sales of nuclear technologies go away --

SEN. DORGAN: I understand.

MR. : Because, for example, they are still providing nuclear relevant technology, nuclear technologies to Iran, and because Iran is a country of concern with a nuclear weapons program, we worry about that technology being diverted into the weapons program as well. But they have, to the best of our knowledge, lived up to their obligations under the NPT so far.

SEN. DORGAN: And those obligations do not include requirements that would prohibit the current conveyance of nuclear technology to Iran, is that correct?

MR. : They can sell equipment and technology to Iran, but it must be put under safeguards. And let me add one footnote --

SEN. DORGAN: What do safeguards mean when you're talking about conveying nuclear technology to a country like Iran? Of what value are safeguards?

MR. OEHLER (?): Well, it is a help. SEN. DORGAN: Could you describe the help?

MR. OEHLER (?): The reactors, for example, that would be sold -- could be sold to Iran would be inspected by the International Atomic Energy Agency and monitored all the time by those agencies to see if -- to prevent those reactors from being used for illegal purposes like the production of plutonium.

SEN. DORGAN: And you have the IAEA challenge inspections. I believe one has been -- one has occurred in Iran, has it not?

MR. OEHLER (?): It was a walk-through inspection.

SEN. DORGAN: A walk-through, okay.

MR. OEHLER (?): The IAEA would not term it a challenge inspection. But the Iranians allowed the IAEA in to visit a number of facilities.

SEN. DORGAN: And if these shipments to Iran that you describe are of concern to us, what are we currently doing to manifest that concern, or what can be done to manifest that concern?

MR. OEHLER: Well, I believe if you ask the State Department, they've been discussing this quite a bit with the Chinese, but you'll have to get the details from them.

SEN. DORGAN: Could you describe then what China is buying and from whom, in a little broader context?

MR. OEHLER: Well, China has a fairly well developed nuclear weapons program of their own, as you know. They are looking to modernize that, and we're looking to see what kind of instrumentation. There are some indications that there are nuclear-related discussions going on with the Russians in line with what we were just talking about a minute ago, although not directly weapons-relevant technologies.

SEN. DORGAN: Mr. Woolsey, in your statement you say that more than a dozen countries have operational ballistic missiles. The experience from the Gulf War suggests that having operational ballistic missiles is a lot different than having functional, accurate missiles that place at risk designated targets.

But nonetheless -- I'm interested in this from the standpoint of the current discussion in this country about building an anti-ballistic missile system. My understanding is the proposal to move ahead with an ABM system is predicated on the assumption that there will be terrorist states that possess the capability of delivering, with a ballistic missile of some type, a nuclear weapon and, therefore, we must find ways to shield or protect against that.

Isn't it far more likely that the state of the ballistic missiles that most of these countries have is not the type of ballistic missile that's going to pose much of a threat in the near term? Isn't it far more likely a threat from a potential terrorist country in the delivery or placement of a nuclear weapon might be in the hold of a rusty tanker at a dock someplace rather than on the head of a sophisticated intercontinental ballistic missile coming over the pole?

MR. WOOLSEY: It's a question about, as is often the case, Senator Dorgan, in what is the near term. The first thing we need to worry about is these nations, particularly I think North Korea and in the Mideast, that have Scud-range, single-stage ballistic missiles, and that those might be mated up, let's say, with chemical weapons or otherwise to put at risk friends and allies of the United States in the region in some sort of hostilities -- Turkey, Israel, Saudi Arabia -- in another sort of Gulf War type situation.

The next thing -- and this is not too far behind -- is that countries in that part of the world, or let's say North Korea, might hold two-stage ballistic missiles with the range capable of putting at risk American forces and American allies in places like Europe, thereby undercutting our ability to form coalitions and to do, again, anything such as that we did in the Gulf War. And that is not too many years away. There are two-stage ballistic missiles in the Mideast. Happily, I think the only ones are in Saudi Arabia. But that is not too far away, unfortunately, especially given the vigor of North Korea's efforts on its 1,000-kilometer missile and so forth.

The testimony that Director Gates gave last year, and I alluded to it here earlier, indicated that he didn't expect any nations beyond Russia or China to develop and produce ICBMs during this decade. And I declined a few minutes ago, shortly before you came in, to say whether, you know, now we could give a precise date, whether that's eight or 10 or 15 years. But that's develop and produce. If, through violations of the Missile Technology Control Regime and the Non-Proliferation Treaty, countries other than Russia and China are able to acquire components and technology from other countries, that could make such things a concern sooner.

I think the thrust of your question is, aren't short-range threats of concern sooner to us than intercontinental threats, other than from Russia and China? And I think that's correct, it's just that the short-range threat, before too many years, may be getting a bit longer.

SEN. DORGAN: I really appreciate the Chairman holding these hearings, and I regret I couldn't participate in the entire portion of it because I think non-proliferation issues have taken a back seat for some years, and the fact is it ought to be brought center stage and given enormous emphasis -- enormous emphasis -- in order to avoid the kind of future that you and other suggest could happen if we're not very, very careful here and don't exert enormous energy to try to stop the spread of weapons and delivery vehicles and so on.

Let me make one other point, Mr. Chairman, if I can. We're talking about nuclear weapons and weapons of mass destruction, and it's interesting to watch, and also tragic to watch, that around the world increasingly a weapon of mass destruction is starvation. It has literally killed millions more people than have nuclear weapons and is increasingly used by terrorists, by others, and as a military strategy, a deliberate military strategy. And I suspect that that also calls on some creative approaches in the intelligence area to understand how and who and what responses might be called upon by us and others. Would you comment on that?

MR. WOOLSEY: It does exactly, Senator Dorgan. I said in my confirmation hearings that -- sort of as if we had slain a large dragon but now found ourselves in a jungle full of a bewildering variety of very poisonous snakes. And one of the more poisonous snakes is things like using starvation as a weapon. It's something that we have some capability to understand -- who's doing it and how. But it's certainly a different type of intelligence requirement than counting ICBM silos.

SEN. DORGAN: Mr. Chairman, if you'd indulge me for one more quick question, you may have --

SEN. GLENN: If it's quick, because our witness has to go another commitment here, and they're due over there at 12:30 down the street. So we'll --

SEN. DORGAN: Let -- let me simply submit it in writing, in light of that.

SEN. GLENN: No, go ahead, if he can -- go ahead, if it's short.

SEN. DORGAN: Okay.

Would you just in two sentences or so tell me again the status of the uncertainty about the actual destruction of nuclear weapons in Russia and the Ukraine?

MR. WOOLSEY: The status of corralling them is that we believe the tactical nuclear weapons are back in Russia -- can't be 100 percent certain, but we believe them to be. The strategic weapons still exist in Kazakhstan, Belarus, and Ukraine -- SS-24s and SS-19s in Ukraine and Bear-H and Blackjack bombers, SS-18s in Kazakhstan, SS-25s in Belarus. The Russians appear to be capable of destroying approximately 2,000 nuclear warheads and disassembling them a year. They believe they could go up to 4,000 to 5,000 if they had a storage -- better storage capability for the fissile material and the components. We're in discussions with them -- not we in the intelligence community so much, but the -- we assist the policy makers in their discussions with the Russians about how they might be able to increase that disassembly and destruction and exactly what type of storage, given their existing facilities, is necessary. And some of the assistance that is providing -- is being provided is going forward under Nunn-Lugar.

SEN. DORGAN: Thank you for your patience.

SEN. GLENN: Thank you very much, and I appreciate your being here this morning. And let me say your analogy of dragons and snakes here, I think that that's a good place to take off and say it's one reason why I have not gone along with those who wanted to drastically cut your budget out there. I think that when you have 15 little CISs now to monitor among -- and all the other things going on around the world, I have not agreed that this was a time to seriously cut your budget. If we did away with the CIA, I think we'd have to invent a new one of some kind. And why do that? Because I -- you know, and --

My dad fought in World War I in France, and that was to be the war to end all wars. And we know what's happened since then, how many times we've been up and down this track. And it seems to me that we need, if anything, more intelligence, not less. And you -- it's much more difficult to keep track of all those little snakes running around the jungle than it is the one big dragon that you could focus your attention on.

MR. WOOLSEY: Some of them are fairly lethal, and Mr. Chairman, may I say for the entire intelligence community, not just the CIA, that we very much appreciate your non-agreement in with those who say -- (laughter).

SEN. GLENN: (Laughs.) I -- I was on the losing end of that vote, so -- 14 to 1, as I recall. But that was in a different committee we're referring to. I won't go into detail now.

I know you do have a high-level commitment down the street here -- at 12:30 I was told -- and you just about have time to make it. Thank you very much for being here this morning.

MR. WOOLSEY: Thank you very much for having us, Mr. Chairman.

SEN. GLENN: I may submit additional questions, as may other members of the committee.

MR. WOOLSEY: We'd be glad to answer them.

SEN. GLENN: Thank you.