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Future of Nuclear Power in India

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Nuclear power in India has significant potential for growth and for providing an increasingly large percentage of India’s energy needs. However, due to a combination of various factors including security concerns, safety issues (especially in conjunction with the potential for natural disasters such as cyclones and earthquakes), and domestic governmental and legal environments, India will probably not achieve its full nuclear energy potential over the course of the next two decades although there will be some growth in nuclear energy.

India has significant nuclear know-how due to its nuclear weapons program. Nuclear power in India has a potentially strong future due to the enormous energy needs of India as well as its neighboring countries, some of which it can export power to. In 2012, only 3.6% of India’s energy needs were provided by nuclear power, meaning there is potential for enormous growth, especially since a significant portion of its populations is not yet electrified.[1]While India has significant deposits of coal and there is hydropower potential in its Himalayan states, as well as in Nepal and Bhutan, geographical and demographic factors mean that for large parts of the region, nuclear energy has the potential to provide much of the energy needs of the population.[2]

India is likely to experience a growth in nuclear power over the next couple of decades, as a result of increasing energy demand as India continues to develop and industrialize. At the present, India has 20 nuclear power plants in operation, 7 under construction, 18 planned, 39 proposed, and 5 research reactors.[3] As such, it is currently one of the emerging centers of nuclear energy in the world, with plants currently in operation than China (17).[4] India also has the potential to be fairly self-sufficient in producing its own nuclear energy, without the need to import material or equipment because of its uranium and thorium reserves, the latter of which are vast.[5]

One major factor that could fuel India’s nuclear power growth is its integration into the global nuclear system. India has long been outside the global nuclear order as a result of not signing the Non-Proliferation Treaty (NPT). “It could not become a nuclear-weapon state under the treaty, which limited admission to the nuclear club to the five states that tested before 1967. By testing after that date and by continuing to pursue nuclear weapons rather than accede to the NPT, India has long been a nuclear outlier. As such, it has been kept outside of the Nuclear Suppliers Group (NSG) and until recently barred from international nuclear commerce.”[6] India’s integration into the international nuclear system began with the US-India nuclear pact of 2006, under which India separated its military and civilian nuclear programs, opening up the way for foreign investment in India’s civilian nuclear sector.[7] In 2008, the NSG issued a waiver to India, which enabled India to be supplied by member countries of the NSG.[8] Since then, India has signed nuclear cooperation agreements with the United States, Russia, France, the United Kingdom, South Korea, Canada, Argentina, Kazakhstan, Mongolia, and Namibia.[9] Indian companies since then have also said that they would invest over US $50 billion in expanding their manufacturing sector, incorporating new technologies and materials.[10]

These highlight the fact that India now has multiple steady sources of both nuclear material such as uranium and nuclear technology from developed countries. Even countries that had been previously averse to normalizing nuclear relations with India, such as Japan and Australia, have been exploring deals with India.[11] Of particular note is the deepening of relations between Japan and India, which has come about due to the current Prime Minister Shinzo Abe’s policies aimed at strengthening ties with other Asian nations in order to balance China. Japan, which has experience with dealing with safety issues due to a history of earthquakes and tsunamis and the Fukushima incident, can be especially invaluable in helping India address its nuclear security concerns.[12]

India has major security incentives to nuclearize its energy. Among major countries, it is especially dependent on energy imports to a greater extent than China, Russia, or the United States primarily because of its small hydrocarbon reserves.[13] India must import 90% of its oil.[14] In order to offset its dependence on foreign energy, the Indian government has pursued numerous diversification strategies such as bidding for oil concessions throughout the world, especially in Central Asia and Africa.[15] However, in many of these cases, India has been outbid by Chinese companies and is still, in any case, largely dependent on the shipment of hydrocarbons to India, and as such is vulnerable to security issues in the Indian Ocean such as piracy or to the fluctuation of oil and gas prices. In all these scenarios, increasing the percentage of its energy that is derived from domestic nuclear power plants seems wise.

However, nuclear power in India faces many problems that may impact its ability to build further plants and attract foreign investment. Despite the benefits that nuclear energy would bring India, a lack of coordination and strategic foresight in India’s government and among its political parties threaten to retard its nuclear growth. Like many other industries and projects in India, land acquisition is difficult and lack of safety measures a potential hazard. Furthermore, acquiring land and safety issues often lead to protests, even when proper procedures are followed. In a populist democracy such as India filled with opportunist politicians and a slow bureaucracy, protests can often cripple projects, seriously hurting India’s ability to develop infrastructure at a steady pace. For example, India’s largest automobile producer, Tata Motors, was forced to abandon its production of the Nano mini car in the Indian state of West Bengal in 2008 due to protests and attacks by villagers over the acquisition of land for its factory.[16] A series of haphazard and contradictory actions on the part of the government and the judiciary did not provide a predictable legal environment for the operation of the factor. Furthermore, protestors were agitated by the then opposition political party in West Bengal. Situations like this are common throughout India and can impact the construction of nuclear power plants in India.

A model for this sort of behavior is already being provided by the ongoing protests over the last two years over a nuclear power plant in Kudankulam, Tamil Nadu. The Kudankulam plant has come under major criticism and protests by locals due to its proximity to the sea, as they fear a repeat of the Fukushima disaster and are upset by the failure of the government to compensate them for land near the reactor.[17] India’s already vibrant environmental activists have been instrumental in keeping up strong protests and discussing safety issues in the public domain.[18] However, as with many other populist movements in India, the government failed to act in a predictable and consistent way, with the chief minister of Tamil Nadu, Jayalalitha first backing the protestors and then the nuclear power plant whenever each option seemed more favorable for attaining votes.[19]

Some of the safety concerns of activists over India’s nuclear energy are valid given the state of India’s nuclear technology. This may also be an obstacle that needs to be surmounted for India’s nuclear energy to reach its full potential. Because of the origin of India’s nuclear program- as a military program- the main focus was on the eventual creation of nuclear weapons and not security in the event of an earthquake or tsunami hitting a nuclear plant. Due to its exclusion from the international nuclear community, India’s safety technology is not as advanced as other natural-disaster prone countries, such as Japan.[20] Countries with much greater nuclear expertise than India have still had nuclear disasters, such as the United States, Soviet Union, and Japan, and given the clumsiness of other Indian rescue and evacuation operations in recent history such as during floods this summer in Uttarakhand, there is a genuine possibility that a nuclear disaster in India would be mismanaged. This knowledge might give protesters, both in the present and future more fuel for their actions as well as be a factor in the government’s somewhat slow approach to dealing with protests and fast-tracking new plants as it might be waiting for appropriate contracts from companies from the developed world with good safety records, such as France.

The Kudankulam plant also reflects another weakness of India’s legal protections for nuclear power, namely that of its nuclear liability law. Due to this law, India has recently failed to go through with a deal with Russia to set up two new power plants at Kudankulam.[21] This law “gives Indian nuclear plant operators the right to seek compensation from suppliers for a period of five years, and not for the entire lifetime of a nuclear reactor.”[22] However, this and other concerns have led to many global companies raising serious concerns over the liability laws, which they claim are too strict and not in compliance with international norms.[23] Due to internal policies in India, it is highly unlikely that the law will be amended anytime soon. As a result, it has played a role in preventing many American companies from doing business in India’s nuclear industry.[24] This is highly ironic given the enormous effort made on the part of the United States to bypass international norms and push for India’s acceptance into the nuclear club. Furthermore, Prime Minister Singh risked his political career in 2005 to push through the nuclear agreement with the United States in India’s parliament. Despite all this, India’s political situation makes it almost impossible for Prime Minister Manmohan Singh to push through changes that would make foreign companies more comfortable investing in India’s nuclear sector. As a result, India has as yet failed to reap the full benefit of its nuclear cooperation with the United States and other countries.

Although India has enormous potential for becoming a major nuclear energy power, it is unlikely this potential will be met in the next two decades. India’s political and legal systems are largely gridlocked and have been so for the past few years. Even if this gridlock is overcome at the national level after the next elections in 2014, it is unlikely that India’s culture of political opportunism and populist agitation will simply recede in the next decade or so. As such, any further projects will probably proceed slowly through the bureaucracy and political system, current projects will be delayed, and planned projects pushed back, as most infrastructure and laws are in India due to an abundance of vested interests and governments too fragile or unwilling to risk their necks in order to push through changes.

India’s governments have a history, especially in recent times as coalition governments have become more common, in failing to pursue policies deemed beneficial, such as implementing new FDI schemes, the lack of which has driven away investment by Walmart and other large companies that could modernize India’s infrastructure. Even though India’s government has declared the expansion of the Kudankulam power plant to be “necessary for the welfare and economic growth of India,” it has failed to take steps to facilitate this, despite it being its prerogative to do so.[25] Furthermore, many writers assert that India’s leaders are not actually planning to utilize their nuclear power potential due to its effort and controversy and see its civilian nuclear program primarily as a tool to improve relations with the United States; and there are cheaper and more effective ways of providing more energy for India, such as importing gas from Iran.[26] Such a solution would appeal to political classes in a democracy where short term planning is preferred and more feasible than more strategic, long term planning which is difficult in a political system that is somewhat chaotic.

The results of such policies is that India will most likely continue to play it safe and avoid controversy and derive the majority of its energy from coal,  oil, and gas, though the share of nuclear energy will gradually expand. However, despite the efforts made on the part of India and by other countries, India will probably not experience a giant boom in nuclear power plant construction and foreign companies won’t be doing exceptionally brisk business in India as was expected in the late 2000s. A leading nuclear authority, Arjun Makhijani has asserted that in the near term, India’s nuclear sector will contribute at most 10-12% of its energy needs.[27] However, it is vital enough both as a source of national pride and energy that it is unlikely that nuclear power in India will go the way of Germany and be phased out.

This is unfortunate, as India has both the potential and need to derive a greater percentage of its energy from nuclear power. From India’s point of view, it is absolutely necessary that it cleans up and rationalizes its confusing and indecisive political system in order to provide a more stable environment for investors. Furthermore, politicians ought to be more responsible and consistent in their public positions on various issues including nuclear power and infrastructure. For example, both of India’s main parties, the BJP and Congress tend to oppose the same policies they supported when in power, making it hard for them to agree to pass important legislation in a coalition driven parliament.  It will take enormous political courage on the part of India’s politicians to push through reforms and to not change tack after every protest. From the point of view of other countries and foreign corporations interested in doing business with India, it is important that they continue lobbying or advising the Indian government to provide more confidence for investors as well as a more stable and predictable environment. Not only will this assuage concerns but it will help India acquire the technology and efficiency needed to address domestic concerns about safety.

 

[1] “Nuclear Share Figures, 2002-2012.” World Nuclear Association. Web. 21 Oct. 2013. http://www.world-nuclear.org/info/Facts-and-Figures/Nuclear-generation-by-country/#.UmcM_FCThzV

[2]“IEC 2013: Securing tomorrow’s energy today: Policy and Regulations: Long Term Energy Security.” Deloitte. http://www.deloitte.com/assets/Dcom-India/Local%20Assets/Documents/IEC%202013/Long_Term_Energy_Security.pdf 4.

[3] “Asia’s Nuclear Energy Growth.” World Nuclear Association. Web. 21 Oct. 2013. http://world-nuclear.org/info/Country-Profiles/Others/Asia-s-Nuclear-Energy-Growth/#.UmcOVFCThzU

[4] Ibid.

[5] Deloitte, 5.

[6] Painter, Daniel. “The Nuclear Suppliers Group at the Crossroads.” The Diplomat. 10 June 2013. Web. 21 Oct. 2013. http://thediplomat.com/2013/06/10/the-nuclear-suppliers-group-at-the-crossroads/

[7] Ibid.

[8] Ibid.

[9] Ibid.

[10] “Nuclear Power in India.” World Nuclear Association. Web. 21 Oct. 2013. http://www.world-nuclear.org/info/Country-Profiles/Countries-G-N/India/#.UmcYKlCThzV

[11] Fensom, Anthony. “Atomic Allies?: India and Australia Explore Uranium Sales.” The Diplomat. 1 Nov. 2012. Web. 21 Oct. 2013.http://thediplomat.com/pacific-money/2012/11/01/atomic-allies-india-and-australia-explore-uranium-sales/

[12] Mian, Zia, A.H. Nayyar and M.V. Ramana. “South Asia’s misplaced confidence in nuclear technology.” Global Research. 21 April 2011. Web.  21. Oct. 2013. http://www.globalresearch.ca/south-asia-s-misplaced-confidence-in-nuclear-technology/24431

[13] Deloitte, 4.

[14] Kugelman, Michael (editor). “Foreign Addiction: Assessing India’s Energy Security Strategy.” Woodrow Wilson International Center for Scholars. October 2008. http://www.wilsoncenter.org/sites/default/files/FINALASIA_SpecialReport_142_rpt2.pdf, 1.

[15] Kugelman, 3.

[16] “Ruled by Lakshmi.” The Economist. December 11, 2008. http://www.economist.com/node/12749719

[17] Harikrishnan, K.S. “Protest Never Ends at Indian Nuclear Plant.” Asia Times Online. 5 Feb. 2013. Web. 21 Oct. 2013. http://www.atimes.com/atimes/South_Asia/OB05Df01.html

[18] Deloitte, 21.

[19] “The Kudankulam Conundrum.” The Economist. September 15, 2012. http://www.economist.com/node/21562972

[20] Mian, Zia et al. “South Asia’s misplaced confidence in nuclear technology.”

[21] “India, Russia to Sign 5 Agreements; Kudankulam Pact Unlikely.” The Times Of India. 20 Oct. 2013. Web. 21 Oct. 2013. http://articles.timesofindia.indiatimes.com/2013-10-20/india/43220396_1_liability-law-rosatom-kudankulam-nuclear-power-project

[22] Sharma, Rajeev. “India’s Nuclear Logjam.” The Diplomat. 21 Nov. 2011. Web. 21 Oct. 2013. http://thediplomat.com/indian-decade/2011/11/21/indias-nuclear-logjam/

[23] Ibid.

[24]”After US, India’s Nuclear Liability Law Trips Russia Kudankulam Deal.” Firstpost. 21 Oct. 2013. Web. 22 Oct. 2013. http://www.firstpost.com/world/after-us-indias-nuclear-liability-law-trips-kudankulam-deal-with-russia-1183791.html

[25] “Kudankulam: India Nuclear Plant Begins Operating.” BBC News. BBC, 22 Oct. 2013. Web. 23 Oct. 2013. http://www.bbc.co.uk/news/world-asia-india-24619985

[26] Kugelman et al., 4.

[27] Ibid.

 

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Written by Akhipill

October 13, 2013 at 10:31 PM

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