Potholes on the road to nuclear power

There was a hiccup in the India-France nuclear deal. The framework agreement between Areva, the French nuclear plant supplier, and the Nuclear Power Corporation of India Ltd (NPCIL) was signed at the end of delegation-level talks at Hyderabad House between prime minister Manmohan Singh and French president Nicolas Sarkozy on Monday.

The commercial deal, which is when the real transaction gets going, remains to be sealed. Both sides said the finer points are still to be worked out.

From the Indian point of view, the “details” relate to pricing; from the French side, it’s about the supplier liability clauses in the Indian law. These are not unbridgeable concerns. But it does mean that the haggling will be protracted, and this is not a bad thing. 

Despite orchestrated local protests, the Jaitapur nuclear complex in Maharashtra is bound to come up sooner or later. But it is sensible to recognise that it will be some time coming. There is a long gestation period before the first megawatt of nuclear power is produced from the French-supplied plant. Whatever the critics and sceptics may say about Singh’s strong backing fornuclear power, it is clearly the way to go.

It is also necessary to note the complexity of getting nuclear power deals from paper to the ground. The container in the French reactor, known as the European Pressurised Reactor, or EPR, was designed by the Finns, and is being supplied by the Japanese Steel Works (JWS). India will have to work out a civil nuclear deal with the Japanese before the project can move forward.

The South Koreans are keen to bag the reactor supply contract, but they get their components from US companies, General Electric and Westinghouse. Unless American concerns over liability issues are dealt with, this deal cannot go ahead either.

The Russians, our oldest allies, have also expressed reservations about the nuclear legislation and this could delay the reactors that Moscow promised for the Kudankulam nuclear power plant.

This does not imply that India will have to amend its nuclear liability legislation which had raised a political storm when it was passed in Parliament during the monsoon session. What lies ahead is tough parleying for the Indian negotiators.

We need to be less starry-eyed about the potential of nuclear power projects, but pursue them with tenacity. Even if the goal of generating about 40,000 mw by 2020 through nuclear power is reached, it will remain a small, but crucial, part of the country’s energy basket.