India-USA nuclear deal
Key points
- On November 17, 2006 the US Senate passed the bill to implement civilian nuclear energy cooperation with India. During July 2005, India and the USA had reached an agreement on the separation of civil and military nuclear plants and technology transfer for civil nuclear plants.
- The Indo-US nuke deal brings a reliable source of nuclear technology that can be exploited to set up nuclear power plants in India. This in turn could possibly go a long way in quenching India's current and projected thirst for power. Needless to say that the companies like BHEL, Larsen & Toubro, KSB Pumps and Honeywell Automation that provide products and services for nuclear power plants would be the primary beneficiaries in this scenario.
- India's power generation today is approximately 15% below the actual consumption. As per the energy and resources institute (TERI) the projected economic growth of 7-8% over the next 20 years will quadruple India's energy needs.
- Coal, the main source of India's energy needs today, is peaking its exploitation and the gas supply from Iran via a pipeline is unlikely to materialise due to the US opposition.
- Hence if India's power generation has to keep pace with the burgeoning economy, nuclear power has to provide a significant component of it, as opposed to its current contribution of 3%. A very plausible scenario to look at is the building of nuclear power plants with the help of the USA.