The US has decided to lift curbs that have prevented civil nuclear cooperation with India. Banasree Purkayastha explains that the decision comes at an opportune time as India looks to pitch itself as a credible maker of small nuclear reactors & boost domestic nuclear power production
What the US said on civil nuclear cooperation with India
Last Monday, US national security advisor Jake Sullivan said Washington is finalising steps to remove long-standing regulations that have prevented civil nuclear cooperation between India’s leading nuclear entities and US companies. The announcement, a fortnight before US President-elect Donald Trump takes over, is significant as the Indo-US civilian nuclear deal signed in 2008 has not been operationalised yet. “This will be an opportunity to turn the page on some of the frictions of the past and create opportunities for Indian entities that have been on restricted lists in the United States to come off those lists and enter into deep collaboration with the United States, with our private sector, with our scientists and technologists, to move civil nuclear cooperation forward together,” said Sullivan, making the announcement on his visit to India.
The announcement coincided with broader efforts to enhance India-US collaboration in critical and emerging technologies.
Significance of the announcement
The announcement to remove regulatory hurdles in civil nuclear cooperation signifies more than just a policy change unlocking new avenues for collaboration in nuclear energy, space, and advanced technologies. The biggest impact, of course, is the taking off of Indian government entities from the US entity list. Per an Indian Express report, these could include: Bhabha Atomic Research Centre, Indira Gandhi Atomic Research Centre and Indian Rare Earths — all government-run institutions.
The announcement also comes at a time when India is looking to pitch itself as a credible manufacturer of nuclear reactors, especially small nuclear reactors (SMR). Collaboration between India and the US would benefit both nations, given that India is faced with technical constraints while high cost
of labour and the protectionist mood in the US is an impediment to cost-effective production.
What is the US Entity List?
US Entity List is a list of foreign individuals, businesses, and organisations that are subject to export restrictions and licensing requirements for certain goods and technologies. The list — compiled by the Bureau of Industry and Security (BIS) of the US Department of Commerce — is ostensibly used to prevent unauthorised trade in items that could be diverted to terrorism, weapons of mass destruction (WMD) programmes, or other activities that are perceived by the US as going its foreign policy or national security interests. The US had placed restrictions on more than 200 Indian entities after India tested nuclear weapons in 1998, but many have been taken off the list over the years as bilateral ties evolved. The list currently includes at least four entities of India’s Department of Atomic Energy, and some Indian nuclear reactors and nuclear power plants.
Legal hurdles in cooperation
Washington and New Delhi have been discussing supply of US nuclear reactors to energy-hungry India since the mid-2000s and the 2008 deal allowed the US to sell civilian nuclear technology to India. However, legal hurdles continue to stand in the way. A longstanding obstacle is India’s Civil Liability for Nuclear Damage Act, 2010 which holds suppliers liable for damages in case of a nuclear accident, deterring foreign vendors like GE-Hitachi, Westinghouse, and Orano from investing in India’s nuclear sector. On the US side, Part 810 of Title 10, Code of Federal Regulations, under the US Atomic Energy Act of 1954, restricts US nuclear vendors from manufacturing equipment or performing nuclear design work in India. This limitation hinders India’s aspiration to participate in the manufacturing value chain and co-produce nuclear components for joint projects.
Current status of India’s nuclear power industry
India’s nuclear power sector is governed by the Atomic Energy Act, 1962, under which only government-owned entities such as Nuclear Power Corporation of India Ltd (NPCIL) can generate and supply nuclear energy. Much of the nuclear power capacity has been built with help from Russia. There has been no private sector involvement so far. But that is now looking to change with the country aiming to increase its nuclear power capacity from the current 8,180 MW to 22,480 MW by 2031-32 and eventually 100 GW by 2047. For the first time, Budget 2024 included plans to partner with the private sector to build small reactors and research and develop SMRs. Earlier this month, NPCIL invited requests for proposals from private players to set up small reactors, making it the first formal move by the government to decentralise the country’s nuclear power sector.