NSG ‘entry’ charges up India’s n-power programme

After over a decade of negotiations, India’s nuclear power programme is finally gathering momentum.

As the country garners global support to join the prestigious Nuclear Suppliers Group (NSG), top US firms are also moving ahead with their plans to set up nuclear reactors in India along with Nuclear Power Corporation of India Ltd (NPCIL).

At the sidelines of Prime Minister Narendra Modi’s visit to the US, it was announced by the two countries that Westinghouse Electric Company and NPCIL will immediately begin engineering and site design work for six reactors with a view to finalise contractual arrangements by June 2017.

Westinghouse signing the commercial agreement next year will mark the first commercial deal by a US firm since the two countries signed a civil nuclear deal.

“Culminating a decade of partnership on civil nuclear issues, the leaders (President Barrack Obama and Prime Minister Narendra Modi) welcomed the start of preparatory work on site in India for six AP 1000 reactors to be built by Westinghouse,” a joint statement by India and the US stated.

The NSG, a 48-nation closed bloc that engages in nuclear commerce, will be holding a plenary meeting on June 20 in Seoul where India’s application will be considered. The meeting was earlier scheduled for June 9 in Vienna. India has managed to garner official support from some of the dominant players in the NSG club, including the US.

Besides, Switzerland, which had opposed India’s entry earlier, now supports India’s membership bid. Mexico is also likely to fall in line during Modi’s visit there on June 8. This is mainly due to active diplomatic efforts and backchannel talks, senior government officials said.

The reactors are expected to come up in Mithi Virdi, Gujarat, the site allotted to Westinghouse by the UPA government when a memorandum of understanding was first signed in 2009. The reactors are to be built by 2030.

Another US major, GE Hitachi Nuclear Energy also reiterated its interest in investing in India’s nuclear programme.

“GE Hitachi Nuclear Energy continues to have a strong interest in providing our technology to India for the eventual construction of multiple ESBWRs (Economic Simplified Boiling Water Reactor), the world’s safest approved reactor design,” the company said while responding to a query by BusinessLine .

“We believe the path forward requires a sustainable regulatory environment, which would include a nuclear liability law that channels liability to plant operators consistent with global best practices,” it added.

French plans French major EDF Energy announced a preliminary agreement to set up six reactors in Jaitapur, Maharashtra with a 9,600 MW capacity. EDF Energy’s Head of Nuclear Xavier Ursat had told shareholders at the annual general meeting in May that the company will give a complete technical and economic proposal to the Indian government by the end of this year.

Analysts say India’s ratification of the Convention on Supplementary Compensation for Nuclear Damage was as per the provisions of the Civil Liability for Nuclear Damage Act.

“While India had agreed to join the CSC in 2010, it had not ratified till recently. This was one of the key issues as global firms wanted to be sure that the country’s liability law is conforming to global norms and best practices,” an analyst with a Mumbai-based brokerage firm said.

The CSC aims to increase the amount of compensation available in the event of a nuclear incident through public funds made available by contracting parties on the basis of their installed nuclear capacity and the United Nations rate of assessment.

Joining the NSG will be a further boost to India’s nuclear power programme, said the analyst.

“While the NSG was allowed to have nuclear commerce with India since 2008, joining the group will ease any remaining trust issues. Besides cost of the nuclear fuel itself can be optimised,” the analyst said.

The US had also been instrumental in obtaining a waiver from the NSG since India has neither signed the Nuclear Non-Proliferation Treaty (NPT) nor the Comprehensive Test-Ban Treaty (CTBT).  However, sources said, this time the main threat is from China, which can veto it at the last moment. Last month, during his visit to Beijing, President Pranab Mukherjee lobbied hard for China to change its mind.

“We believe we made a lot of progress and that has led us to formally apply to NSG some days ago. We are engaging all NSG members regarding this issue … NSG is a regime, it is a sort of flexible arrangement among states which is quite different from the NPT which is a treaty,” S Jaishankar, Foreign Secretary, had stated earlier. 

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