US, UK want a piece of Indian market

US, UK want a piece of Indian market
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First Published: Thu, Jan 08 2009. 11 59 PM IST

Hot spot: A file photo of the Bhabha Atomic Research Centre campus in Mumbai. The Indian civilian nuclear energy market, currently pegged at 4,120MW, is estimated to grow to 20,000MW by 2020 and to be
Hot spot: A file photo of the Bhabha Atomic Research Centre campus in Mumbai. The Indian civilian nuclear energy market, currently pegged at 4,120MW, is estimated to grow to 20,000MW by 2020 and to be
Updated: Thu, Jan 08 2009. 11 59 PM IST
New Delhi: Close on the heels of a December agreement between India and Russia to build four Russian nuclear reactors at the Kudankulam power plant in Tamil Nadu, the US and the UK are sending large commercial missions to India to tap the potentially lucrative atomic energy market.
The US commercial nuclear mission, supported by the US departments of commerce and energy, consists of heavyweight companies such as GE-Hitachi Nuclear Energy Inc., Thorium Power Ltd and Westinghouse Electric Corp., and hopes to push its case in meetings with external affairs minister Pranab Mukherjee in Delhi and Atomic Energy Commission chief Anil Kakodkar in Mumbai next week.
Hot spot: A file photo of the Bhabha Atomic Research Centre campus in Mumbai. The Indian civilian nuclear energy market, currently pegged at 4,120MW, is estimated to grow to 20,000MW by 2020 and to between 50,000MW and 63,000MW by 2030
Currently pegged at 4,120MW, the Indian civilian nuclear energy market is estimated to grow to 20,000MW by 2020 and to between 50,000MW and 63,000MW by 2030.
The market, potentially worth tens of billions of dollars, opened up after the Nuclear Suppliers’ Group approved a waiver of restrictions on India in September, followed the next month by a landmark Indo-US nuclear deal.
“The Americans have been instrumental in pushing the nuclear deal with India through the Nuclear Suppliers Group and now that restrictions have been lifted hope to get a good part of the business,” said V. Raghuraman, principal adviser on energy, environment and natural resources for the Confederation of Indian Industry, that is partnering with the US-India Business Council (USIBC) on the commercial nuclear mission to India.
The size of the Indian nuclear market differs widely. While the Nuclear Power Corp. of India Ltd (NPCIL) says it will be worth around $50 billion (Rs2.43 trillion) by 2020, Raghuraman says that could go up to $100 billion.
USIBC estimates are at $150 billion.
A US diplomat who declined to be named said that based on industry estimates, the overall potential size of the market was as much as $300 billion.
Raghuraman pointed out that since the Indian nuclear industry was still in its infancy, with shortages in both nuclear fuel as well as high technologies, all foreign missions were welcome. “There is no point making comparisons between the Russians and the Americans because right now we are at a stage where we need them all,” he said.
An Indian diplomat who declined to be named said the US mission had been expected in early December, but postponed its visit because of the Mumbai attacks.
“The Americans must have noticed that Russian President Dmitry Medvedev kept his date with Delhi on 4 December, when an agreement for four additional nuclear reactors was signed, and perhaps realized they had to make tracks sooner than later to register their presence in India,” this diplomat said.
The strategic aspects of the Indo-US nuclear deal, especially the US’ determined push in the teeth of Chinese opposition to elevating India to the global high table, dominated the headlines for most of the three years the deal was being negotiated.
Officials in the ministry of external affairs and the Prime Minister’s Office said that when the pressure was at its peak, companies in the US with influence in the Bush administration were persuaded to push India’s case in Washington.
The Indian diplomat pointed out that it was “too early to return the favour to the Americans” but admitted that the “lobbying had begun in right earnest”.
The diplomat pointed to the presence in the USIBC nuclear mission of Akin Gump Strauss Hauer Feld Llp., an influential law firm in the US which was employed by India as a lobbyist in 2003 and sacked in 2004 for failing to prevent the US from selling F-16 fighter aircraft to Pakistan.
The firm probably hoped to use its contacts with several Indian law firms to “possibly get an early bird headstart on the Indian action”, he said.
The US is also keenly aware that it has hardly built any nuclear reactors at home since the mid-1970s (unlike France and the UK).
According to USIBC, the US remains the largest generator of nuclear power in the world, with 27% of the world’s installed capacity and nearly double the number of nuclear reactors in France.
Predictably, Delhi is pleased with the international attention.
The British delegation, which also consists of nuclear technology manufacturers as well as suppliers of nuclear fuel and components such as Rolls-Royce Plc., Weir Power Group Plc. and AMEC Plc., arrives in Delhi on 19 January; it will have talks with minister of state for power Jairam Ramesh as well as officials from NPCIL.
Raghuraman conceded that while the Atomic Energy Act required all foreign players to only partner with the government, several Indian companies were hoping that joint ventures with these players would also help them win global contracts.
“It’s not only about reactors and components and nuclear fuel, there is a much wider operational area in the manufacturing of instruments and electronics as well as peripheral services. If India can emerge as a major nuclear manufacturing hub in the years to come, it would give a big boost to the nuclear engineering industry. The question is also how are we going to position ourselves in the global market,” he said.
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First Published: Thu, Jan 08 2009. 11 59 PM IST