The Financial Express (Delhi Edition)
India N-powered with Oz uranium agreement
Boost for plans to raise nuclear power output 12-fold in 30 years
AUSTRALIA, which has 40% of the world’s known uranium resources, on Friday signed a deal with New Delhi that removed all hurdles for export of the radioactive element in ore form by the island nation to India for peaceful power generation.
The agreement signed during the first day of Prime Minister Tony Abbott’s visit to the capital will come in handy for energy-starved India, anxious to calibrate the use of fossil fuels without compromising on energy needs of an economy expected to grow at a brisk pace for several years in a row.
India plans to augment its nuclear power capacity from less than 5,000 MW or 2% of the country’s total power capacity to upwards of 60,000 MW in less than three decades.
Currently, India imports uranium from Kazakhstan and Russia only, even though it has nuclear cooperation agree- ments with a host of countries, including the US and France. The country’s power genera- tion is heavily skewed in favour of coal-fired plants (68% of the total capacity of 2.5 gigawatts are coal-fired), constraining its ability to boost energy output while trimming the carbon-intensity of its economy as pledged in global climate fora.
Friday’s safeguard deal would boost Australia’s confidence in India’s exclusive use of uranium imported from that country for peaceful purposes. The deal was struck despite the 2008 India-US nuclear agreement having barely borne fruit as US nuclear reactor operators and component suppliers turned chary of the mishap liabilities imposed by India later.
New Delhi is exempted from a global sanctions regime that bans countries from importing fuel or civilian nuclear technology unless they expressly tread the non-proliferation path. Despite its refusal to sign the Nuclear Non-proliferation Treaty — which means the country retains the autonomous space to pursue nuclear options for military purposes — Canberra thought it fit to sign the safeguard deal.
With more buyers in place, Australia can mine more uranium and profit from that (it currently accounts for only a tenth of the global uranium output despite plentiful reserves). Anglo-Australian miners such as BHP Billiton and Rio Tinto Group would particularly benefit.
Apart from the US, India already has civil nuclear cooperation agreements with Russia, France, the UK, South Korea, Canada, Argentina, Kazakhstan, Mongolia and Namibia. In December 2010, India and France signed a treaty to set up nuclear reactors by the French company Areva, but the project has since faced delays because of uncertainty over sourcing components from Japan due to India not being a signatory to the NPT. During Prime Minister Narendra Modi's recent visit to Japan, the two countries reportedly “improved” the “understanding” between them on the civil nuclear issue and Modi and his Japanese counterpart Shinzo Abe instructed officials to work for the inking of a pact at an early date to strengthen the strategic cooperation in the area.
According to the visiting leader, India was more worthy of such a trade deal — which prohibits use of Australian uranium in weapons or to power nuclear submarines — than Russia. “If we are prepared to sell uranium to Russia, and we've been prepared to do that in the past, we ought to be prepared to provide uranium to India under suitable safeguards,” Abbott told Australian Broadcasting Corporation ahead of his departure to India.
Abbott said after signing the uranium deal here: “..I want it to be a trusted partnership and plainly, selling uranium to India, which can take place under this agreement, is a great sign of trust that exists between India and Australia.” Asked if Australia supports India's membership of Nuclear
Suppliers Group, Abbott said the fact that both countries have signed the nuclear cooperation deal “means we think that India is a first class international citizen and is entitled to membership of all the various clubs that goes with that”.
New Delhi and Canberra had begun negotiations on uranium sales in 2012 after the latter lifted a long-time ban on exporting the valuable ore to India to meet its ambitious nuclear energy programme. Both India and Pakistan are nuclear-armed, and along with Israel and North Korea are the only countries not signed up to the NPT to prevent the spread of nuclear weapons.
India has 20 functioning nuclear power units at present (including the plant in Kudankulam, Tamil Nadu, where trial runs are on and commercial production will commence by November this year), but only 10 can use imported uranium. The country gets 40% of its civil nuclear fuel requirement from domestic sources and has ambitious plan to up the share of nuclear power in total generation to 25% by 2050. Adding new reactors for this purpose would require at least a couple of trillion dollars.
Australia has no nuclear power plants but is one of the world's top exporters of uranium. Its uranium output stood at 7,529 tonnes in 2011-12 and was valued at $782 million Australian dollars. Australia is also keen to foray into mining of coal, diamonds and gold in India. Giants like BHP Billiton and Rio Tinto are awaiting the opening up of India's coal sector for private operators. Stating that Australia could help India secure energy security, Abbott said, “Not just uranium, but obviously in coal and perhaps in gas as well.”