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The Hindu
23-07-2025
- Business
- The Hindu
Redeeming India's nuclear power promise
The Union Budget for 2025-26 marked a significant shift in India's nuclear energy plan by announcing an ambitious target of 100 GW of power generating capacity by 2047, up from the present 8.18 GW. This positions nuclear power as a major pillar in India's energy mix, given the two goals of emerging as a developed country (Viksit Bharat) by 2047, and achieving 'net zero emissions' by 2070. Simultaneously, the Nuclear Energy Mission announced a special allocation of ₹20,000 crore to develop 'at least five indigenously designed and operational Small Modular Reactors (SMR) by 2033.' Such ambitious plans will need the involvement of private players, both domestic and foreign, into a hitherto government sector, which will require significant changes to the legislative, financial and regulatory framework. The government has indicated that some changes in the Atomic Energy Act, 1962 and the Civil Liability for Nuclear Damage Act (CLNDA), 2010 are in the offing. However, such reforms also need a change in mind set. India's nuclear journey India had an early start, setting up Asia's first nuclear research reactor, Apsara, in 1956, and beginning work on Asia's first nuclear power reactors at Tarapore in 1963. As early as 1954, Dr. Homi Bhabha, the architect of India's nuclear programme, presented a target of generating 8 GW of nuclear power by 1980. However, the journey has been long and difficult. Following India's war with China in 1962; its entry into the nuclear club in 1964; the decision to stay out of the nuclear Non-Proliferation Treaty (NPT) in 1968; and the Peaceful Nuclear Explosion (PNE) test in 1974, India was excluded from the emerging nuclear order. International cooperation ceased and export controls slowed down the nuclear power programme. This led to the nuclear power target being pushed to 10 GW by 2000. Moreover, India took time to successfully indigenise the design of the 220 MW Pressurised Heavy Water Reactor (PHWR), employed in Rajasthan. Its advantage was that it used natural uranium as fuel unlike the design of the Tarapur Light Water Reactor (LWR), which used Low Enriched Uranium (LEU) that India obtained from the U.S., and later, from France. Subsequently, the same 220 MW PHWR units were established at Narora, Kaiga, Kakrapar etc., and the design was upgraded to 540 MW (set up at Tarapur in 2005-06) and to 700 MW with two units becoming operational at Kakrapar in 2024. After the nuclear tests in 1998, followed by intense negotiations with the U.S. and other strategic partners, India finally gained acceptance as a responsible nuclear power. It also got a special waiver from the Nuclear Suppliers Group (NSG). India was thus ready to resume exchanges with other nuclear powers to import both nuclear fuel and more advanced reactors to expand its nuclear energy programme. However, the CLNDA created new difficulties that have prevented such anticipated external participation. In fact, Russia is the only country that is partnering with us at Kudankulum with six VVER-1000 power reactors because the government-to-government agreement, signed in 1988, predated the CLNDA. Towards green development To become a developed country by 2047, India's annual per capita income needs to grow from the current $2,800 to $22,000, and correspondingly, the GDP needs to grow from the current $4 trillion to over $35 trillion. There is a well-established correlation between economic growth and energy consumption. In 2022, India's per capita electricity consumption stood at 1,208 kWh, compared to 4,600 kWh for China, and over 12,500 kWh for the U.S. India's electricity generation capacity, currently at 480 GW (divided almost equally between fossil fuels and renewables), will have to grow five-fold, accounting for growth in population and urbanisation. However, solar, wind, and small hydro projects provide only intermittent power. That is why out of 2030 terrawatt-hours (TWh) — the total electricity generated in 2024 — renewable energy, with half the generation capacity, accounted for only 240 TWh. Coal fired thermal plants accounted for 75% of energy generation. The climate change commitments announced by Prime Minister Narendra Modi in 2021 at Glasgow COP26 of 'net zero emissions by 2070, raising non-fossil energy generation capacity to 500 GW by 2030 while meeting 50% of the energy demand through renewables, and achieving a carbon intensity reduction of 45% over 2005 levels by 2030' means that India will not be able to rely on fossil fuels for its growth. Renewable energy is (including solar, hydro, wind, and biomass) is estimated to provide 20% of the demand and up to 25% with investments in battery and pumped storage. Therefore, the obvious candidate to fuel India's energy growth is nuclear power. There is a renewed interest globally in nuclear power. This reflected in the Dubai 2023 COP28 'Declaration to Triple Nuclear Energy', acknowledging nuclear power as a critical input in reducing reliance on fossil fuels, enhancing energy security, and a move towards a low carbon future. In June, the International Atomic Energy Agency (IAEA) and the World Bank agreed to work together to support nuclear energy in developing countries, marking a significant policy shift. World Bank President Ajay Banga pointed out, 'nuclear (energy) delivers base load power, which is essential to building modern economies.' Creating an enabling environment The government is looking at three routes. One is to standardise the 220 MW PHWR design and apply it to Bharat Small Modular Reactors, which would significantly reduce costs and commissioning time. This could replace captive thermal power plants that today account for over 100 GW, and which will be replaced over the next two decades. The second track is to scale up the Nuclear Power Corporation of India Limited (NPCIL) plans for the 700 MW PHWR by facilitating land acquisition, streamlining licensing, and strengthening indigenous supply chains. The third track is to accelerate negotiations with partners in France and U.S. that have been moving at a glacial pace for the last 15 years. Under the Atomic Energy Act, nuclear power is a sector reserved by the government. The NPCIL is a government owned company that builds, owns, and operates the PHWRs, the first two Tarapur LWRs, and the Russian designed VVERs. Nuclear power financing is qualitatively different because of the higher upfront capital costs, lower operating costs, a lifecycle of 50-60 years, and costs associated with decommissioning as well as managing radioactive waste. The indigenised PHWR model has a capital cost of $2 million/MW while the equivalent cost for a coal fired thermal unit is just under a million. Given NPCIL's annual budget of $1.2 billion, the government has realised that to achieve the target of 100 GW, private sector companies will have to be brought into the sector, necessitating a comprehensive set of amendments to the Atomic Energy Act. Questions of majority/minority ownership; whether the nuclear operator will be exclusively NPCIL; who has responsibility and control over the nuclear island part of the plant; and concerns over assured fuel supply and waste management responsibility will need to be discussed with potential stakeholders that include major players like Tatas, Adani, Ambani, Vedanta etc. All these will require amendments to the 1962 Act. A set of comprehensive amendments will also be needed for the 2010 CLNDA especially with regards to its liability clause which affects not just the 'operator' but also the 'supplier' of nuclear power. A third area is commercial disputes relating to tariffs. Nuclear electricity tariff for NPCIL is notified under the Atomic Energy Act. Generally, commercial disputes fall under the Electricity Act and are settled by the Central Electricity Regulatory Commission (CERC) but a recent dispute between NPCIL and Gujarat Urja Vikas Nigam has led to conflicting views by the CERC and the Appellate Tribunal. The case is now under consideration before the Supreme Court. With the entry of the private sector into the field, should the tariff setting come into the 'levelised cost of energy' as applicable to thermal, solar, wind and hydro will depend on how the question of ownership and control are determined. While India has had an impeccable nuclear safety record, the certification and safety oversight is the responsibility of the Atomic Energy Regulatory Board (AERB) that is 'autonomous' but not a legal entity and is subordinate to the Department of Atomic Energy. In 2011, a draft Bill was circulated to establish AERB as an independent regulator, but the Bill lapsed. With the entry of the private sector, the need for an independent regulator becomes paramount. In addition, a raft of financial incentives will need to be introduced. While nuclear energy is a low-carbon energy source, it is not classified as 'renewable', like solar or wind. Revising this classification would make nuclear power projects eligible for tax incentives and specially designed 'green financing' instruments. Long term power-purchase-agreements and provision for viability-gap-funding are other incentives. The sector also needs to be opened up to foreign direct investments, perhaps up to 49%, to ensure Indian ownership and control. In the past, the process of reform has been tentative. In 2011, the NPCIL set up a Joint Venture (JV) with the National Thermal Power Corporation (NTPC), but it languished till it was revived last year. It will now build and operate four units of 700 MW each, scheduled to come up at Mahi Banswara in Rajasthan. Land acquisition has been underway and once completed, the first unit will take seven years. A JV with the Rural Electrification Corporation (REC) is also being envisaged. Both the REC and NTPC are public sector units and these JVs will be wholly government entities. However, if India has to deliver on the promise of 100 GW by 2047, it needs foreign partners and the private sector. While this has been accepted by the government, it now has to move forward with the reforms comprehensively and decisively. Rakesh Sood is a former diplomat and is currently Distinguished Fellow at the Council For Strategic and Defence Research.
Hindustan Times
12-07-2025
- Business
- Hindustan Times
Ending the licence raj in India-US relations
As we approach the 20th anniversary of the US-India civilian nuclear agreement, it is worth reflecting on both the progress made and continuing challenges to India's navigation of US export controls. A major rationale for the 2005 nuclear agreement was to enable India to access strategic technologies from the US and its allies. Further reducing or harmonising export controls remains crucial both for strategic cooperation and for US and Indian businesses working in a variety of sensitive sectors — defence, aerospace, semiconductors, quantum, space, and chemical and biotechnologies — that generally require an export licence from a relevant government agency. At face value, tremendous progress has been made in India's ability to access leading-edge technologies. Since the 1970s, India was at the receiving end of discriminatory US export controls on account of its nuclear weapon programme and close defence relationship with the Soviet Union. Despite a bilateral high technology arrangement being initiated in the 1980s, India's nuclear weapon programme and 1998 tests resulted in US sanctions. The US took various measures against India that included suspending defence sales, denying the Indian government credit and loans, and denying visas for Indian scientists. By the late 1990s, about a quarter of US exports to India by value required a licence. Following the removal of most sanctions by 2000, when then US president Bill Clinton visited India, the George W Bush administration began a gradual process to further dilute barriers, increase strategic trade, and remove Indian entities from restrictive lists, through an initiative known as Next Steps in Strategic Partnership (NSSP). This was not altruistic on the part of the US, because it required reciprocal steps on the Indian side, integrated India into international export control regimes, and facilitated access to the Indian market. The 2005 civilian nuclear agreement turbocharged this process, resulting in 2008 in US legislation that exempted India's nuclear programme (called the Hyde Act) and a waiver for India by the Nuclear Suppliers Group (NSG), a cartel of nuclear exporting countries. Subsequent developments built upon these efforts. In 2010, labs belonging to India's Defence Research and Development Organisation (DRDO) and Indian Space Research Organisation (Isro) were removed from US entity lists. India was granted the special legislative category of Major Defence Partner. Under the first Donald Trump administration, the Bureau of Industry and Security (BIS) at the US Department of Commerce placed India in the top category for licence exceptions called Strategic Trade Authorisation-1, enabling certain sensitive nuclear-related commerce without a license. A US-India Strategic Trade Dialogue, led in India by the foreign secretary, created working groups to manage licence exceptions, particularly for defence articles. Late in the Joe Biden administration, the US moved to remove the Bhabha Atomic Research Centre, Indira Gandhi Atomic Research Centre, and Indian Rare Earths Limited from the entity list. Despite these major developments, India's government and businesses continue to find US export controls baffling and cumbersome. The International Traffic in Arms Regulations (ITAR) regime that governs defence-related exports is managed by the US department of State's directorate of defense trade controls (DDTC). Meanwhile, Export Administration Regulations (EAR) are managed by the BIS at the Department of Commerce. The various US export control regimes and processes remain disaggregated and tortuous. For its part, India has updated its own export control regulations, initially shaped customs and trade laws after the 1960s. In 2005, India passed a WMD Act to better harmonise policies with global standards. After 2010, India updated end-user certification requirements on certain items under a Special Chemicals, Organisms, Materials, Equipment, and Technologies (SCOMET) category, which is regularly reassessed by the ministry of commerce and industry. India is also a member of major multilateral groups for harmonising export controls, including the Chemical and Biological Weapons Conventions, the Missile Technology Control Regime (MTCR), the Wassenaar Arrangement on conventional arms and dual-use technologies, and the Australia Group on biological and chemical items. The good news is that there has in fact been an increase in successful Indian licensing applications from the US. But several challenges remain. For example, cooperation on space launch technologies and unmanned aerial combat systems (drones) has been delayed or frustrated. There are several reasons for this. One, export controls are always changing, due to the rapid evolution of emerging technologies and global supply chains, and the need to constantly reevaluate what constitutes security-sensitive commerce. In attempting to update its own regulations, the US sometimes imposes unilateral changes before notifying others. This requires constant contact and negotiation. Two, neither country has a single-window approval, licensing, and enforcement process for export controls. The US departments of commerce, State, and defence all oversee different processes, while some approvals require Congressional authorisation or notification. The National Security Council can offer a single response and has sometimes convened representatives from relevant US agencies – along with their Indian counterparts – to overcome specific obstacles and identify bottlenecks to implementation. Transferring some items from ITAR to EAR would also be welcomed by partners such as India, although radical changes would involve Congress. Despite its desire to increase arms exports, the Trump administration may not have the ability or willingness to address this issue. Meanwhile, India prefers more time-consuming individual licences in its export controls over general authorisations. This complicates supply chain integration, which often involves the import and re-export of sensitive items. Three, although some challenges confronting the US export control regime are systemic — frustrating even close allies such as Australia, UK, Japan, and South Korea — certain elements of the US bureaucracy continue to raise specific concerns about India, including its relations with Russia and Iran and its nuclear and ballistic missile programmes. Some more outdated concerns conflict with political-level recognition by successive US administrations of India's strategic circumstances. This complicates India's attempts to get general authorisation for certain cutting-edge technologies (e.g. quantum technologies). Four, corporate entities in both the US and India could still benefit from learning how to navigate the complicated US export control process. Industry consultations, particularly with small and medium enterprises (SMEs) in India, would enable corporate entities to take advantage of new opportunities afforded by the dilution of export-control restrictions. Five, a longer-running issue has been end-use verification by the US, which India believes is sometimes too intrusive. Since the US retains concerns in many countries about diversion by corporate entities, even without governments' knowledge, the answer lies in better domestic enforcement. A lack of agreement over enforcement could result in extraterritorial measures by the US, to the detriment of Indian businesses. Finding mutually satisfactory mechanisms to ensure the enforcement of end-use provisions is necessary. This year offers a few opportunities for meaningful change. India could tie export controls to trade negotiations, despite a traditional US aversion to linking trade with national security. Additionally, there are possibilities for greater civilian nuclear commerce, subject to changes to Indian legislation and policy. These present opportunities to increase civilian nuclear energy to meet India's growing demand and ensure stability in India-US strategic commercial relations. But due to the complexity of export controls, both governments would also do well to establish a regular inter-agency touch point to inform each other of new export control restrictions, ensure speedier licences, and enable better communication and enforcement. Dhruva Jaishankar is executive director, ORF America. The views expressed are personal.
India Today
02-07-2025
- Politics
- India Today
The Dalai Lama is India's trump card, so why hide it?
For 66 years, India has harboured China's greatest ideological threat—the Dalai Lama. Yet despite hosting the exiled Tibetan spiritual leader since 1959, New Delhi has consistently refrained from wielding this powerful diplomatic weapon against Beijing's aggression. When Jawaharlal Nehru granted asylum to the Dalai Lama following China's brutal suppression of the Lhasa uprising, it wasn't merely humanitarian—it was a geopolitical gamble that established India as keeper of Tibet's moral conscience. However, Nehru maintained a rigid separation between hosting the man and supporting his political cause, a policy that has largely persisted across successive This cautious approach has cost India dearly. In 2003, Atal Bihari Vajpayee formally recognised Tibet as part of China, hoping to secure reciprocal recognition of Sikkim and ease border tensions. Instead, China doubled down on supporting Pakistan, blocked India's Nuclear Suppliers Group membership, and continued claiming Arunachal Pradesh. India surrendered leverage whilst China conceded Narendra Modi, there have been tactical shifts—the Dalai Lama's 2017 visit to disputed Arunachal Pradesh sent clear signals to Beijing. Yet after the 2017 Doklam standoff, India quickly retreated, with officials instructed to avoid the Dalai Lama's 60th exile anniversary events. Only following the deadly 2020 Galwan clash did Modi publicly wish the Dalai Lama happy birthday—a symbolic departure from years of paranoia about Tibet reveals India's untapped potential. China fears that any recognition of Tibetan autonomy could inspire unrest across Xinjiang, Inner Mongolia, and Hong Kong. This anxiety represents India's greatest leverage, yet New Delhi has rarely capitalised on it stakes are escalating dramatically. Approaching 90, the Dalai Lama's succession will trigger a geopolitical crisis. Beijing insists on appointing the next Dalai Lama through its puppet institutions, whilst the Tibetan leader has declared his reincarnation will occur outside Chinese control. This threatens to create rival Dalai Lamas—one Chinese-backed, another supported by the exile faces a defining choice: recognise a successor chosen by Tibetan exiles and directly challenge Beijing's legitimacy in Tibet, or remain silent and abandon Tibetans to Chinese control. After decades of cautious diplomacy, India's Tibet card is about to turn nuclear. The question remains whether New Delhi will finally play its hand or continue as Tibet's polite innkeeper rather than its guardian.- EndsMust Watch
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Business Standard
25-06-2025
- Politics
- Business Standard
Smiling buddha to Operation Shakti
On the morning of May 18, 1974, at 8:05 sharp, some 110 kilometres from Jaisalmer in Rajasthan's Thar desert, the push of a button announced India's entry into the closed club of nuclear nations. The reverberations of that test, conducted underground in arid Pokhran, and called Pokhran-I (codename Smiling Buddha), were felt around the world. With this detonation, India had become the only country outside the five permanent members of the United Nations Security Council – the P5, namely the United States, the United Kingdom, Russia, France, and China – to have conducted a confirmed nuclear weapons test. China had tested its first just 10 years ago, in 1964, two years after the Indo-China war. India termed it a 'peaceful nuclear explosion', but it was in effect a decisive and unequivocal declaration that it had nuclear capability. The country's nuclear journey gained pace in the late 1950s under Prime Minister Jawaharlal Nehru through Project Phoenix. It was mainly to promote civilian nuclear energy, but with physicists like Homi Bhabha, the 'father of the Indian nuclear programme', laying the groundwork for weapons development. The Atomic Energy Act of 1962 gave further control to the central government over atomic energy resources. After Nehru died in 1964, the efforts shifted mostly towards peaceful goals under Prime Minister Lal Bahadur Shastri and Gandhian scientist Vikram Sarabhai. However, with Shastri's successor, Indira Gandhi, the momentum towards weaponisation resumed. A small, secret team of scientists and engineers worked through the 1960s and early 1970s to build the necessary infrastructure and technical capabilities. The 1971 Indo-Pak war, during which the US sent warships to the Bay of Bengal, further galvanised India's resolve, culminating in Gandhi authorising the development of a nuclear test device in 1972. India had already opposed joining the nuclear Non-Proliferation Treaty (NPT), which it saw as discriminatory. In later years, while it participated in negotiations for the Comprehensive Test Ban Treaty (CTBT), it did not ratify it for the same reasons. Pokhran-I invited strong, sharp reactions from the world. India faced immediate sanctions. Major nuclear suppliers shut their doors to it. Less than a year later, led by the US, the Nuclear Suppliers Group (NSG) was formed to restrict and regulate the supply of nuclear material and know-how to countries that hadn't ratified the NPT. The US further tightened export controls by passing the Nuclear Non-Proliferation Act, 1978. An editorial in The New York Times read: 'Such great talent of resources has been squandered on the vanity of power, while 600 million Indians slip deeper into poverty. The sixth member of the nuclear club may be passing the beggar bowl before the year is out.' India continued with its programme through the '80s and '90s, aware that neighbouring Pakistan was also acquiring nuclear capability. Meanwhile, the original five nuclear weapons states kept a close eye on India, which had by now opened its economy to the world. Twenty-four years after Smiling Buddha, the hot, barren Pokhran would once again witness a country's determination to exercise its sovereign right to security, despite the intense scrutiny and the threat of sanctions. It was again in the month of May, when average temperatures in Pokhran hover above 40 degrees Celsius, that India conducted its second test – a series of five nuclear tests, actually; three on May 11 and two on May 13, 1998. Pokhran-II, codenamed Operation Shakti, with the devices named Shakti-I through Shakti-V, carried out under Prime Minister Atal Bihari Vajpayee, also invited intense criticism from the global community. Besides the Western world, countries in the Asia-Pacific region, such as Australia, Japan, New Zealand, the Republic of Korea and Malaysia also reacted adversely. While India stood its ground, it made known its 'no-first-use' policy. India's record since has established it as a nuclear-responsible country. In 2008, it signed a civil nuclear agreement with the US, and the same year, it received a waiver from the NSG. It has since signed civil nuclear cooperation agreements with Japan, Australia, South Korea, France and Vietnam, among other countries.
Time of India
21-05-2025
- Business
- Time of India
Democrats and Republicans introduce bill on Indo-US nuclear cooperation
Four US Senators (Two Republicans and two Democrats) have introduced a bill to create a whole-of-government strategy for nuclear cooperation and nuclear export with India as an "ally or partner nation" to further the bilateral civilian nuclear deal . "The Secretary of State, in consultation with the heads of other relevant federal departments and agencies, shall establish and maintain within the US-India Strategic Security Dialogue a joint consultative mechanism with the Government of the Republic of India that convenes on a recurring basis," as per the bill. Republicans Jim Risch and Mike Lee are sponsoring the bill along with Democrats Martin Heinrich and Chris Coons. The purpose should be "to assess the implementation of the Agreement for Cooperation between the Government of the United States of America and the Government of India concerning peaceful uses of nuclear energy, signed at Washington on October 10, 2008; to discuss opportunities for the Republic of India to align domestic nuclear liability rules with international norms... to develop a strategy for the United States and the Republic of India to pursue bilateral and multilateral diplomatic engagements related to analysing and implementing those opportunities." Foreign nuclear power firms had evinced interest in setting up atomic power plants in India after it secured a waiver from the Nuclear Suppliers Group to engage in global nuclear trade. The NSG waiver came after the landmark India-US civil nuclear deal of 2008. However, the Civil Liability for Nuclear Damage Act of 2010 proved to be an impediment for private sector participation. Foreign players termed certain provisions of the law unacceptable and contradicted the international Convention for Supplementary Compensation for Nuclear Damage (CSC).
