US joins rush to supply nuclear equipment to India

Largest ever US trade mission travels to Delhi and Mumbai as nuclear supply embargo on the country is lifted
Rhys Blakely in Mumbai

The United States will enter the fray against France and Russia this week in the scramble to supply nuclear power equipment worth an estimated $150 billion to India.
The US is sending what is thought to be its largest ever trade mission to Delhi and Mumbai, including representatives of 30 companies that deal with civilian nuclear projects, to pitch for contracts related to India's atomic energy industry. The move comes after India's status as a nuclear pariah, with which other nations were not allowed to trade nuclear fuel and equipment, was controversially ended last year.
The state-owned Nuclear Power Corporation of India (NPCI) is understood to have begun preliminary discussions with General Electric and Westinghouse, the US companies, over the supply of atomic hardware. Others, including Bechtel Nuclear, The Shaw Group and Babcock & Wilcox, will be in India to meet senior government officials.
In the background will be India's deepening defence ties with the US.

This week India signed a USD2.1 billion deal to buy eight long-range maritime reconnaissance aircraft from Boeing, one of the companies that had lobbied hardest in Washington for India to be allowed to become part of the international nuclear club. The deal with Boeing marked India's largest ever acquisition of military equipment from the US, its former Cold War enemy.
Boeing is also vying with five other companies – including Dassault of France and Russia's Mikoyan Design Bureau to supply 126 fighter jets in a $10 billion deal to modernise India's ageing air force.
Players from the same three countries are battling to profit from India's entry into the nuclear power market. The NPCI recently held talks with AtomStroyExport, Russia's nuclear power equipment and service export monopoly, over the provision of reactors. The Indian body has also approached Areva, the French manufacturer, over the possible supply of third-generation 1,600 MW European Pressurised Reactors. Areva already has a deal in place to supply India's regional rival China to supply the same hardware.
The rush to do business with India follows the overturn of a three-decade ban on supplying the country with atomic fuel and equipment in September. The process was spearheaded by the US and handed President Bush with what may prove his most significant foreign policy victory while in office.
The ban was imposed by the Nuclear Suppliers Group, a group of 45 nations that legally supply nuclear fuel and technology, which was created after India shocked the world by testing its first atomic device in 1974. The NSG had prevented Delhi from importing the nuclear material it says it needs to help to meet rocketing domestic energy demand until last September.
Analysts said that America's willingness to supply India with nuclear hardware underscored Washington's ambition to champion India as an Asian counterweight to China. India argued that access to nuclear power was essential to fuel its economic rise.
Much of India is regularly blighted by power cuts and with nuclear fuel in short supply, the country's existing nuclear power plants are estimated to be running at only about half of their capacity of about 4,000 megawatts. Deals with foreign firms are expected to double nuclear power's share in India's electricity supply to up to 7 per cent within 20 years as at least 18 new reactors are built. The US-India Business Council estimates that nuclear trade with India could be worth up to USD 150 billion over the next 30 years.
Critics condemned Mr Bush's unprecedented willingness to supply India with civilian nuclear technology despite the country's refusal to sign the Nuclear Non Proliferation Treaty or the Comprehensive Test Ban Treaty. India tested nuclear weapons as recently as 1998 and has refused to rule out doing so again.