S. L. RABEY

Job Seeker

Institute of Oriental Studies of the Russian Academy of Sciences

Key words: India, nuclear diplomacy, nuclear energy, thorium, Kudankulam, N. Modi, H. Baba, nuclear damage, Russian projects

In the first half of 2016, perhaps even in the coming weeks, an extremely important event will take place in the Indian nuclear power industry: The operating second power unit of the Kudankulam NPP, which is being built with Russia's participation, will be put into operation, which will eventually become the largest in the country after all four units are commissioned. The capacity of the second unit, as well as the first, which started generating electricity in the summer of 2013, is 1 thousand MW. Although there are 21 nuclear reactors operating in the country, more than a third of the total capacity of Indian nuclear power plants will be accounted for by two Kudankulam units.

By the way, the issue of increasing the number of power units of this power plant to eight and, therefore, the total capacity - up to 8000 MW, which is significantly more than the current total capacity of all Indian nuclear power plants - 5780 MW. It follows that nuclear power has become one of the leading sectors of the economy, and it is among the priority sectors in the country.

It cannot be otherwise, because India's own hydrocarbon fuel resources are insufficient to meet the needs of a rapidly growing economy. For key consumers - industrial enterprises and large cities - the only sustainable source of energy is the atom. The new government of the country, headed by N. Modi, relies on the priority development of the nuclear industry, while trying to intensify international cooperation and attract foreign companies to build nuclear power plants. Russia's position in the competition for Indian atom has a number of advantages, but Rosatom is unlikely to maintain its monopoly position due to the inevitable increase in competition in this rapidly growing market.

NUCLEAR POWER DEVELOPMENT PROGRAM

The foundations of India's nuclear program were laid back in the mid-20th century by the outstanding Indian nuclear physicist Homi J. Baba. He was aware that the country would have to face a sharp increase in energy consumption, and predicted that nuclear power would play a leading role in ^the long term1. After decades, this idea is considered by modern experts as one of the ways out of the energy crisis, which especially worsened in 2012-2013.*

Described by X.Baba's development program follows the logic of prioritizing the use of internal resources. The scientist proceeded from the fact that India has very scarce reserves of natural uranium: according to various estimates, the country has from 80 to 112 thousand tons of this resource, which is only about 1% of the world's reserves. ² This amount of uranium is sufficient to fully support the military nuclear program.

* The peak deficit, i.e. the under-delivered amount of electricity during peak load hours, reached a record 11.4% in January 2013. However, later on, thanks to the government's efforts to expand generation, the peak deficit rate began to decrease: in January 2014, it was only 4%. See: Central Electricity Authority, Ministry of Power, Government of India - cea.nic.in (author's note).

Chart. Structure of primary energy consumption in India.

Compiled from: BP Statistical Review of World Energy 2015.

the program. However, from the point of view of peaceful nuclear development, India's reserves are small: they are enough to create a network of nuclear power plants with a total capacity of 10-13 thousand MW. Construction of heavy-water reactors powered by natural uranium is the first stage of the X program. Women.

On the other hand, India has rich deposits of thorium, which is also suitable for use as a nuclear power plant fuel. Its resources in India exceed the reserves of natural uranium by an order of magnitude and amount to an estimated 850 thousand tons ³. The development of thorium promises huge prospects for the nuclear power industry. Indian scientists estimate that thorium energy could provide work for 500 thousand people. MW of generation capacity over the centuries ⁴.

In 2009, Indian Prime Minister M. Singh stated that the successful implementation of the program developed by H. Baba " ... would contribute to a sharp reduction in India's dependence on hydrocarbons and would be an important contribution to the fight against global climate change." According to experts, for reasons of energy security and sustainable development, it is necessary to move to large-scale development of thorium as soon as possible.⁵ This can only be done by combining the two alternatives.

PROGRESS IS EVIDENT, BUT NOT VERY SIGNIFICANT

As illustrated in the diagram, coal dominates the structure of consumption of primary commercial energy resources in India: its share is 57%. It is followed by: oil-28%, natural gas -7% and hydropower-4.6%. Renewable energy sources (RES) account for just over 2% of total energy consumption, with nuclear power completing the list at just 1.2% ^.6

Today, as mentioned above, there are 21 nuclear reactors operating in the country; their combined capacity is 5,780 MW. All reactors are installed at the sites of seven nuclear power plants. India's largest nuclear power plant, Tarapur, has an installed capacity of 1,400 MW and is located in the state of Maharashtra. In addition, there are nuclear power plants in the states of Rajasthan ("Rajasthan" 1180 MW), Karnataka ("Kaya-ga" - 880 MW), Gujarat ("Kakrapar" - 440 MW), Uttar Pradesh ("Narora"-440 MW), Tamilnadu ("Madras" - 440 MW) ⁷.

The seventh site is the Kudankulam nuclear power plant, which in 2014 launched the first Russian-made VVER-1000 reactor, the most powerful in India. 5 more reactors are under construction and are being prepared for launch: units 7 and 8 of the Rajasthan NPP with a capacity of 700 MW each, two more similar units at the Kakrapar NPP, as well as Unit 2 of the Russian design at the Kudankulam NPP.

Thus, the scale of nuclear power generation in India is small, but the government has repeatedly announced impressive plans for the development of the industry. Thus, the National Plan for Electric Power in 2012 sets a goal to raise the installed capacity of nuclear power generation from 4,500 MW (at that time) up to 20,000 MW by 20208 After visiting the ^H. Baba Nuclear Research Center in 2014, the country's Prime Minister announced the need to triple the capacity of nuclear power plants over the next ¹⁰ years9. Western experts also tend, in general, to highly assess the possibilities of increasing nuclear generation in India. A recent study presented by McKinsey&Company predicts that by 2030, the average annual growth rate of nuclear generation will be 8.4%, outstripping RES (8%) and all other sources.¹⁰

However, not all plans and forecasts were destined to come true. X himself. Baba assumed that by 1980 the installed capacity of the nuclear power plant would reach 8000 MW. Over time, the forecasts became more and more ambitious. So, To-

Chart. Installed capacity of nuclear power plants in India, MW.

Compiled by: http://www.npcil.nic.in/

The Atomic Energy Mission of India predicted in 1962 a level of 20-25 thousand tons. MW by 1987, and in 1969-the level of 43,500 MW by the end of the century. These forecasts, however, were made even before the first power reactor was built in the country. In reality, the increase in nuclear power generation capacity was not so rapid: 420 MW during the 1960s and 1970s, 640 MW in the 1980s, 880 MW in the 1990s, and 2,180 MW in the 2000s. Finally, during 2010-2015, 4 NPP units with a total capacity of 1,660 MW, including Kudankulam (1,000 MW), reached the critical level. The graph shows the growth dynamics of the total capacity of nuclear power plants in India. It shows that the development of nuclear power generation is accelerating.

Indian scientists are moving towards the creation of thorium reactors and a closed nuclear fuel cycle, not without success and, one might even say, with breakthrough success. A 30 kW research reactor has been operating at Kalpakkam NPP since the mid-1990s. The KAMINI reactor (Kalpakkam mini) uses uranium-233 derived from thorium ¹¹ as fuel. KAMINI is the only operating reactor of this type in the world. Based on the experience gained, a 300 MW thorium power reactor is being developed. It is reported that the design has already been completed and its construction should begin in 2016, but it is not yet known where ¹² are.

NUCLEAR TESTING AND NUCLEAR POWER ENGINEERING

For a long time after the 1974 nuclear tests, which bore the colorful name "Smiling Buddha", the channels of international cooperation in the nuclear industry were significantly limited for India. Technological cooperation was almost completely suspended, but foreign supplies of raw materials still continued: France and China replaced the United States and Canada as suppliers.

Recall that in 1974, the world's energy crisis broke out, and oil prices rose many times. The development of nuclear power in these conditions was assessed by the country's leadership as a priority area, and its practical implementation was entrusted to Indian physicists and engineers.

The first reactor built by Indian specialists was Unit 2 at the Rajasthan nuclear power plant. However, in fact, this was only the end of the construction of the unit, which was started according to the Canadian project, but was curtailed after the atomic tests of 1974. The reactor reached criticality in 1981.

Nevertheless, the experience of building "Rajasthan-2" was invaluable, because on the basis of Canadian developments, Indian specialists created their own design of an improved heavy-water reactor. During the 1980s and 1990s, six identical reactors with a capacity of 220 MW each were built in India. In addition, the necessary infrastructure was created: plants for the production of heavy water, for the enrichment and processing of uranium.

The next turning point in the history of the Indian nuclear program was the 1998 nuclear tests. The reaction of the world community was sharply negative; however, despite the extensive public and political resonance, there were no collective economic sanctions against India. Unilateral economic sanctions were imposed only by the United States, but they lasted only a few months, since by the end of the 1990s, the United States was able to impose new sanctions on Russia. India has become a major foreign trade partner of Soedi-

the United States, and the introduction of a full-scale embargo greatly infringed the interests of American business. Another 14 Western countries have curtailed humanitarian aid programs for India. However, the rapidly growing Indian economy was not affected much. ¹³ The biggest problem was the restrictions imposed by the Nuclear Suppliers Group (NSG)* Denying India access to the international nuclear fuel market and scientific and technical cooperation.

Thanks to the colossal efforts of the governments of M. Singh and J. Bush Jr., the ring of isolation around India was broken. After lengthy discussions in 2008, the US Congress and the Indian Parliament ratified the Agreement on the Peaceful Uses of Nuclear Energy, the so - called 123 Agreement. It obligated India to divide its nuclear industry into military and civilian industries, put the latter under the control of the IAEA, and extend a unilateral moratorium on nuclear testing. In return, the United States pledged to ensure full cooperation with India on civil nuclear energy issues. In September 2008, the NSG member states, not without diplomatic pressure from Washington, unanimously adopted the "Declaration on Peaceful Nuclear Cooperation with India", which, as an exception, lifted the previously existing restrictions on cooperation with Delhi in the nuclear sphere.

INDIA'S "EXCLUSIVE STATUS"

Many researchers believe that the United States agreed to the nuclear deal because of China's growing influence in the region. However, the motivation of India itself was based mainly on long-term resource and economic considerations. The importance of NSG access for India cannot be overstated, given that the lack of electricity remains the main constraint on the country's economic growth. The agreement with Washington, which gave India access to international cooperation and imports, is perhaps the most successful diplomatic breakthrough of the Singh cabinet. After all, India was de facto recognized as a nuclear state, although an exception was made for it from all international rules.

Of course, the lifting of NSG sanctions against India poses a certain threat to the global non-proliferation regime. India's exclusive status largely weakens its leverage over other nuclear-armed countries, such as Pakistan and Israel, which are not signatories to the Treaty on the Non-Proliferation of Nuclear Weapons (NPT), as well as Iran and other "threshold" countries. NSG participants were forced to be more and more inventive in justifying cooperation with India.¹⁴ As for India itself, the threats posed by energy security and climate change are likely to be much higher than the likelihood of uncontrolled nuclear proliferation.

Focusing on attracting foreign companies to large-scale nuclear power plant construction, the Indian government was optimistic in the late 2000s about allocating space for nuclear parks for American and French builders. But at that moment, the unexpected happened - the disaster at the Fukushima-1 nuclear power plant, which forced the whole world to rethink the prospects for a peaceful atom. A wave of mass demonstrations against the construction of new nuclear power plants took place in India, which may have forced the government to change its point of view15.

The Indian nuclear program was not stopped, but there was a pause in its implementation. The situation was complicated by the law adopted in 2010. The National Law on Civil Liability for Nuclear Damage, which in the event of a nuclear incident provides for the liability of builders and fuel suppliers throughout the entire life of the nuclear power plant. The law is a serious barrier, especially for nuclear builders from the United States. As private companies, American corporations cannot place the burden of responsibility for a potential nuclear power plant incident on their own shoulders. For France and Russia, the Indian law of 2010 poses less of a threat, since the state provides its guarantees. Different liability insurance options are offered - this leads to an increase in the cost of projects, but makes them compatible with the law.

SUCCESS OF NUCLEAR DIPLOMACY

When the new government came to power in India in 2014, the discussion of nuclear issues in the country noticeably intensified. It is widely believed that the government of M. Singh artificially restrained (partly through insufficient funding) research and development (R & D) in the nuclear industry,

* The Nuclear Suppliers Group (NSG) is an international organization that currently includes 48 States. The goal of the association is to limit the risk of nuclear proliferation by establishing export controls on key materials, equipment and technologies. ed.).

preferring international cooperation in this area ¹⁶. The new Bharatiya Janata Party (BJP) government sees self-reliance as a priority, and it is expected that this principle will be extended to the nuclear power industry as much as possible. The circumstances are such that it was under the BJP government that India came under international sanctions for nuclear tests, and in the new period in power, the party is going to finally eliminate the consequences of the "decisive step" of 1998, turning the country into an active participant in the global nuclear market.

Narendra Modi continued M. Singh's course of active foreign policy diplomacy, having made 16 foreign trips in the first year of his tenure as Prime Minister. It should be noted that out of all the countries that he visited, 7 are members of the NSG, all the rest are the closest geographical neighbors. This circumstance clearly indicates that nuclear cooperation occupies a significant place among the areas of diplomacy of the new Prime Minister. It is characteristic that most of the high-level meetings ended with the achievement of specific agreements. Modi's visits to France, as well as talks with the US and Russian presidents held in India were significant from this point of view.

During Vladimir Putin's visit to Delhi in December 2014, Rosatom and the Department of Atomic Energy of the Government of India signed a "Strategic Vision for strengthening cooperation in the field of atomic energy", which provides for the construction of at least 12 (!) new reactors over the next ²⁰ years17. In addition, the document provides for cooperation in research, joint development of innovative nuclear power plants, technical cooperation and technology transfer.

In April 2015, Prime Minister Narendra Modi negotiated with the French side a formal agreement on the construction of six reactors by AREVA. A cooperation agreement was signed between AREVA and the Indian consortium L&T, which involves the production of certain components for nuclear power plants in India: both for the national market and for export to third countries. ¹⁸

The talks between President Barack Obama and Prime Minister Narendra Modi, which took place in India in January 2015, were of great importance. Earlier, the United States insisted on controlling the handling of nuclear fuel supplied to India, but the Indian side did not agree to such conditions. However, according to Indian media, during recent negotiations, the American president agreed to cancel the condition on total control over the use of fuel.¹⁹

"THE JAPANESE FACTOR"

Construction of foreign nuclear power plants in India is also hindered by the fact that French and American companies depend on Japanese steelworkers from Japan Steel Works (JSW), whose metal is used in the construction of reactor buildings. Three of the four modern reactors that France and the United States are going to sell to India require the participation of Japan. American companies also have Japanese capital in their civil nuclear plants and cannot operate without the conclusion of the Japan-India Civil Nuclear Energy Cooperation Agreement.²⁰ Negotiations between India and Japan on an agreement on cooperation in the field of peaceful nuclear energy began in June 2010, but were suspended for two years after the tragedy at the Fukushima-1 nuclear power plant.

According to K. Koyama, Chief Economist and Managing Director of the Institute of Energy Economics of Japan, the essence of the agreement should be as follows. By exporting materials, raw materials, equipment and technologies for nuclear power, Japan, as an active supporter of the NPT, must be confident in the reliability of its partner.²¹ Therefore, the agreement should provide for the prevention of the use of all types of these exports for military purposes, as well as their transfer to third parties.

Japan's demands for a future agreement are even more stringent. These are: (a) Enhanced inspection regime at civilian nuclear facilities; (b) termination of the agreement if India conducts nuclear tests; (c) ban on enrichment and reprocessing of Japanese fuel; and (d) enhanced fuel tracking and flagging capabilities.

Japan has leverage over India. First, without a Japan-India agreement, the capabilities of American and French nuclear companies are limited, since they widely use Japanese-made components. Second, Japan has historically been a proponent of the nonproliferation and nuclear disarmament regime. This gives it the moral right to expect concessions from India.

The Institute of Energy Economics of Japan has predicted that India will experience the highest growth rate of electricity demand in Asia between 2010 and 2035.

Japanese experts estimate that the average annual growth rate of electricity consumption will be 6% (for reference: in China, the same indicator is 3.2%) ²². Such rapid growth speaks in favor of the wider use of nuclear technologies in the energy sector.

Japanese business circles are interested in making deals with India, which will attract additional orders for the nuclear industry, and this, in turn, will contribute to the development of many sectors of the Japanese economy. David Brewster, a researcher at the National Institute of Australia, also confirms that Japanese businesses are interested in cooperation with India, whose nuclear market is one of the most promising in the coming decades.²³

Many researchers point to the presence of significant social factors that contribute to the approval of the Japan-India agreement. Purnendra Jain notes that Modi has personal experience of working with Japanese colleagues and understands the importance of cooperation with this country in the economic interests of India. As Minister of Gujarat, Modi visited Japan twice to learn about best practices in economic policy and to attract investment. During his trips, he met many representatives of the Japanese business and political elite, including Shinzo Abe.²⁴

It is also important that the leaders of the two countries, Modi and Abe, have recently established friendly relations.²⁵ Both Prime ministers are from the same generation and share similar political values, particularly soft nationalism and market economy priorities. Their meetings are unusually warm and go far beyond the limits of diplomatic protocol.

WHAT IS THE FUTURE OF THE RUSSIAN ATOM?

The Indian nuclear market is unlikely to go to just one supplier. It would be logical to assume that the main partner in this area will remain Russia, as the only country that has just built two truly modern reactors in India. However, judging by some details of the Modi government's nuclear diplomacy, nuclear companies from the United States, France and Japan may soon come to India, and the market will be divided into parts.

Nuclear projects offered to India by Russia have a number of competitive advantages. First, the specific cost of generating electricity from Russian reactors is at least 2 times lower than the declared tariffs of all other foreign projects. ²⁶ The devaluation of the ruble has an additional positive impact on the cost of work carried out with Russian participation, since " the design of facilities and basic equipment are financed by the Russian side in the national currency. Secondly, our country is ready to show flexibility by offering various options for risk insurance and project lending. Third, Russia is ready to offer, following the example of recent agreements with Egypt, projects for the construction of nuclear power plants combined with seawater desalination plants. This is especially true for the coastal water-deficient states of India.

Finally, and most importantly, the nature of the Russian - Indian privileged economic partnership is unique and based on the highest level of mutual trust. Of all the countries, only Russia is ready to share the most advanced technologies with India. According to the Russian Ambassador to India, A. M. Kadakin, "this position is explained simply: we are friends, and this fact answers all questions." ²⁷

^{Venkataraman G.} 1 Bhabha and his Magnificent Obsessions. Universities Press (India). 1994, p. 157.

^{Tellis A.J.} 2 Atoms for war? U.S. -Indian Civil Nuclear Cooperation and India's Nuclear Arsenal. Washington DC, 2006, p. 17 - 18 - http://carnegieendowment.org/files/atomsforwarfinal4.pdf

³ International Thorium Energy Organisation -http://www.itheo.org/thoriumresources

⁴ India Energy Policy, Laws and Regulations Handbook. Vol. 1 Strategic Information and Basic Laws. Internationall Business Publications, Washington DC. 2015.

^{Sinha R.K.} 5 Some Preliminary Studies on the Options for Utilisation of Thorium Resources in India. Annual Conference of the Indian Nuclear Society, INSAC-2006, Mumbai. 2006.

⁶ BP Statistical Review of World Energy 2015 -http://www.bp.com/

⁷ Nuclear Power Corporation of India Limited, Department of Atomic Energy, Government of India -http://www.npcil.nic.in/

⁸ National Electricity Plan. Central Electricity Authority, Ministry of Power, Government of India. 2012.

⁹ N-energy programme should focus on benefits to society: PM at BARC // The Indian Express, 22.07.2014.

¹⁰ India: Towards Energy Independence 2030. McKinsey&Company, January 2014, p. 7.

^{Usha S., Ramanarayanan R.R., Mohanakrishnan P., Kapoor R.P.} 11 India's Reactors: Past, Present, Future // Nuclear engineering and design. Vol. 236, 2006. N 7 - 8, p. 872 - 880.

^{Ghunawat V.} 12 Design of world's first Thorium based nuclear reactor is ready // India Today, 14.02.2014.

^{Morrow D., Carriere M.} 13 The Economic Impacts of the 1998 Sanctions on India and Pakistan // The Nonproliferation Review, Fall 1999 http://cns.miis.edu/npr/pdfs/morrow64.pdf

^{Mushtaq Y.} 14 A Blatant Violation of NPT // Eurasia Review, 26.09.2014.

^{Lakshmi R., Denyer S.} 15 Protests disrupt India's nuclear energy plan // The Washington Post, 15.10.2012.

^{Nalapat M.} 16 Manmohan sabotaged India's Nuclear capability // The Sunday Guardian, 06.10.2014.

¹⁷ Strategic vision for strengthening cooperation in the peaceful uses of nuclear energy between the Russian Federation and the Republic of India http://www.rosatom.ru/

¹⁸ India, France move closer to nuclear deal as Modi-Hollande chemistry plays up // The Times of India, 11.04.2015 - http://timesofindia.indiatimes.com/india/India-France-move-closer-to-nuclear-deal-as-Modi- Hollande-chemistry-plays-up/articleshow/46883974.cms

¹⁹ Joint Statement during the visit of US President Barack Obama to India // The Hindu, 25.01.2015.

^{Dikshit S.} 20 Liability law no longer an obstacle to Russian reactor deal // The Hindu, 09.06.2011.

^{Koyama K.} 21 Japan resuming talks with India on Nuclear Cooperation Pact // Special Bulletin. The Institute of Energy Economics, Japan (IEEJ), June 2013 https://eneken.ieej.or.jp/data/4901.pdf

^{Matsuo Y.} 22 World Energy Outlook 2012 // IEEJ Asia -http://eneken.ieej.or.jp/data/4684.pdf

^{Brewster D.} 23 Japan may not be such an easy pushover on nuclear deal with India // East Asia Forum, 26.09.2014 -http://www.eastasiaforum.org/2014/09/26/japan-may-not-be-such-an-easy-pushover-on-nucl ear-deal-with-india/

^{Jain P.} 24 India draws Japan closer as Modi embraces Abe // East Asia Forum, 08.09.2014 - http://www.east-asiaforum.org/2014/09/08/india-draws-japan-closer-as-modi-embraces-abe/

^{Chellaney B.} 25 Asia's best friends shape an axis // The Japan Times, 02.09.2014 - http://www.japantimes.co.jp/opinion/2014/09/02/commentary/japan-commentary/asias-best-fr iends-shape-an-axis/

^{Bhaumik A.} 26 Russia is India's Only Nuclear Power Partner // Deccan Herald, 19.02.2015.

²⁷ Ibidem.

Permanent link to this publication: