Commerce is the way ahead, particularly, nuclear commerce. Progress is partly trade and commerce. Trade and commerce requires connectivity, by road, rail, air and sea. Trade and commerce is a byproduct of demand and supply, and there is plenty of demand for clean energy. Traders in the guise of individuals, corporations, and governments indulge in commerce to expand their economies. That is one of the ways if not the only way, in which, progress happens.
The future, probably, belongs to nuclear energy- and thereby, commerce. Because, nuclear energy is clean and plentiful. And we do need plenty of energy. The naysayers of nuclear commerce can crib about the possible proliferation of nuclear weapons and dirty bombs etc, but that is just a side effect of nuclear energy and commerce-collateral damage. The penetration of technology is the parameter of progress-especially, material. Either we invite technology, including nuclear, or perish in the race for survival. It is clear that the underdeveloped parts of the world are those with lesser penetration of technology.
Nuclear commerce is the buying and selling of the components of nuclear energy, such as, reactor technology and raw materials. India has always been at the forefront of commerce. Infact, whenever, it has denied commerce, it has found itself at a disadvantage.
India has large deposits of Thorium and some Uranium. Commerce in nuclear technology is a fact of life in India, and India is carrying it forward with due diligence.
The deal is nearly done.US$100 billion worth of nuclear power infrastructure deals are rampaging across India Inc after India became the only country to be allowed to trade in nuclear material without signing the nuclear Non-Proliferation Treaty (NPT).
The Nuclear Suppliers’ Group (NSG) allowed India to engage in nuclear commerce without signing either the NPT or the Comprehensive Test Ban Treaty, heralding the way for the US Congress to ratify a lucrative civilian nuclear deal with New Delhi.
Nuclear power plant infrastructure companies such as the US, Russia, France and Britain are expected to fight for India’s nuclear business. Investments worth more than $20 billion could now be made in infrastructure related to nuclear power plants, as India moves towards its goal of generating 40,000 megawatts of nuclear power by 2020.
That increase, from the present 3,500 megawatts, will raise the nuclear share of energy production in the growing economy to between 5% and 7% of the country’s total energy output from the present 3%.
The size of India’s nuclear business potential gives indication of the kind of American pressure that went into getting approval from not so willing countries such as Ireland and New Zealand in the 45-nation NSG. The waiver agreement follows lobbying by groups such as the Washington-based US-India Business Council going all out to secure congress ratification to “clear the way for US companies to participate in India’s nuclear renaissance”.
The Confederation of Indian Industry also indicated the expectations of Indian and US companies, with a statement released on September 8 titled “Important role for industry to play in clean energy sector”. The statement began with David Bohigian, then US assistant secretary of commerce, saying nearly $17 trillion would be invested in clean energy technologies by 2025, and that “India and the United States can be active partners in this drive towards sustainable and green industry”
Over 400 Indian and foreign firms are expected to gain from the NSG waiver, according to leading industry bodies such as the Federation of Indian Chambers of Commerce and Industry. The 2020 goal for the country’s nuclear power generation industry requires a minimum investment of $45 billion, estimates the Associated Chambers of Commerce and Industry of India.
Most of the new nuclear power plant deals are in the ‘will happen’ category, Larsen & Toubro has already struck a $750 million joint-venture deal with the government-owned Nuclear Power Corporation of India Ltd (NPCIL) to manufacture forgings for nuclear power plants.
Engineering major, government-owned Bharat Heavy Electronics Ltd, and L&T are together expected to gather contracts worth $10 billion of the estimated $100 billion worth of deals over the next 20 years.
Mumbai-based NPCIL, which spearheads India’s nuclear power program, says it has 17 nuclear reactors in operation and five reactors under construction.
The $1.2 billion GVK group, another leading infrastructure-developing Indian company is planning to buy reactors and equipment from American companies such as General Electric and Westinghouse Electric.
Other companies that potentially stand to benefit include consumer durables giant Videocon, which has recently forayed into the power sector. It is one of at least 40 companies, which include Tata Power and Jindal, in contest for contracts to build nuclear reactors and ancillary infrastructure.
The 40 companies have formed a lobby group to pressurise the government to allow private companies to get involved in the sector. “These 40 companies have already started negotiations with the government and their foreign counterparts.”
India’s three biggest industry bodies – the Associated Chambers of Commerce and Industry of India, the Federation of Indian Chambers of Commerce and Industry, and the Confederation of Indian Industry – are pushing the government to make appropriate amendments to the law to let the companies get a share of the cake.
India’s nuclear power plants are estimated to be running at about only 50% of capacity. The country has been starved of nuclear fuel for the past 34 years after being banished into the nuclear winter.
Growth in the nuclear industry will benefit more than just companies building the plants and their suppliers. The US-India Business Council points out that India suffers severe shortages of energy, leading to power cuts and low power use. At the same time, it imports more than 75% of polluting hydrocarbons it uses.
“India’s energy utilization is fractional compared to most countries,” a US India Business Council statement noted, with India “consuming only 600 kilowatt hours of electricity per person per year as compared to 14,000 kilowatt hours per person consumed in Europe and the West.” With even the capital New Delhi suffering from daily power cuts, ordinary citizens and unrelated businesses will be grateful for any improvement.
In effect, the nuclear commerce that is anticipated in India will hit and impact all aspects of Indian life and India is not likely to let this opportunity pass it by.