Friday, 5 February 2010

Britain and India agree nuclear power deal

Rhys Blakely, Mumbai

Britain and India today agreed the text of a deal that will allow British companies to enter the fray against Russia and France in the scramble to supply nuclear power equipment worth an estimated $150 billion.
The breakthrough, which emerged from talks held in London, comes after international sanctions that had prevented India from buying civilian nuclear technology for 30 years were lifted in 2008.
Lord Mandelson, the Business Secretary, said: "This is a very, very significant advance, and I look forward to that text being signed off at a ministerial level before long."
The countries declined to give further details, but officials said it would provide "major trade opportunities" for British businesses.

India is expected to increase the power it generates from nuclear sources 100-fold in the next 40 years and American Government offials estimate that deals worth at least $150 billion will be generated.
A British Government spokesman added: "Fifty years after building the world's first commercially operated power station, the UK is still one of the market leaders in this sector. It’s an industry that earns the UK £700 million in overseas business every year and employs over 80,000 people across the nuclear supply chain."
During a visit to the Kremlin in December, the Indian Prime Minister Manmohan Singh signed a new pact under which Russia will build as many as 12 new reactors in India.
The deal, which Russian officials said was worth "several dozens of billions of dollars", is structured in such a way that India will continue to receive nuclear fuel from Russia and keep imported equipment, even if it tests nuclear weapons.
India’s equivalent pact with the United States Government is far more stringent, calling for the return of all nuclear co-operation and return of all associated US-supplied equipment and fuel if the arrangement were to be terminated.
India was originally banned from accessing civilian nuclear technology when it tested an atomic bomb in 1974.
India has also approached Areva, the French manufacturer, over the possible supply of latest generation reactors. Areva already has a deal in place to supply India's regional rival China with the same advanced hardware.
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 full capacity.
Meanwhile, India is on course to become the world’s third largest energy consumer within three decades, according to McKinsey, the consultants, after the US and China. With demand for electricity in India expected to increase five-fold in the same period, its share of world energy consumption will nearly double.