Story Of The Week

India Australia Civil Nuclear Deal

India’s Prime Minister Narendra Modi and Australia’s Prime Minister Tony Abbott concluded a long-pending civil nuclear deal on 5Th September in New Delhi that will give energy-deficient India access to fuel supply to boost its nuclear energy program and beat chronic power outages,

Narendra Modi said “We signed a nuclear cooperation agreement because Australia trusts India to do the right thing in this area, as it has been doing in other areas,” the visiting Abbott was quoted as telling reporters in New Delhi after signing the safeguards deal”.

The dialogue to sign the agreement began nearly two years ago and will also encompass supply of conventional fuel like coal and natural gas. India’s thermal power plants are running dangerously low on coal supply and the country gets over half its energy supply from coal-fired plants. Australia will now be a long-term reliable supplier of uranium to India, and will provide for the supply of uranium, production of radio isotopes, nuclear safety and other areas of cooperation. Coming on the heels of similar agreements France and Russia, the deal with Australia helps an energy-starved India get further global acceptability for its nuclear program despite not being a signatory to the nuclear non-proliferation treaty (a treaty that does not allow countries to pursue their nuclear weapons program with India refusing to sign saying it is arbitrary). Australia, which has a third of the world’s uranium reserves, does not export to any other non-NPT signatory country.

India which first tested an atomic weapon in 1974 was subject to economic sanctions after testing nuclear weapons in 1998 but those have slowly eased in the face of its growing economic clout. In 2008, the U.S. lifted a ban and allowed its companies to sell nuclear equipment to India. India currently has 20 small nuclear reactors within six plants and operates only a few of those. Some analysts, therefore, interpreted the deal with Australia as more about diplomacy and less about uranium supply. But India’s government has a stated goal to raise its nuclear energy capacity to 63,000 MW within 2032 by adding $85 billion worth of reactors. Nuclear power is critical to India’s economic growth plan as it works to reduce paralyzing power shortages.

Mr Abbott said he would “welcome” Indian companies in the energy and infrastructure sectors. In particular, he mentioned the Gujarat-based Adani Group and the Andhra-based GVK Group for their large investments in the recent past, defending them against allegations by environmental organisations like Greenpeace.

Environmental groups are very hard to please and have very high environmental standards in Australia. Mr Abbott was confident that there can be no reasonable objection to the current proposal. Adani Group is speaking of $16 billion for this mine, and India’s investments of under $20 billion will almost double the total amount.

Prime Minister Narendra Modi will visit Australia in November this year to attend the G-20 summit, when he is expected to face international pressure over India’s decision not to sign the WTO trade facilitation agreement.

Mr. Abbott said he was keen to negotiate a Free Trade Agreement (FTA) as soon as possible.

It is unlikely that Australia’s unilateral cancellation of uranium export to Russia came up for discussion when Abbott held talks with his Indian colleagues.

But if India and Russia are to have a meaningful strategic partnership, it should encompass the whole globe. Both friends should take up with third countries those issues affect them badly. But then such things normally do not take place in international diplomacy unless the two sides concerned make a conscious policy decision.

Perhaps it is time for the two traditional friends India and Russia to think out of the box and take up each other’s interests with third nations. It will be only then that the two friends will have a true strategic partnership on the global plane.



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