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Prospects for India-Japan Civil Nuclear Cooperation

Prospects for India-Japan Civil Nuclear Cooperation

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  • 1. Indian Council for Research on ICRIER-Wadhwani Chair in International Economic Relations India – US Policy Studies INDIA-US INSIGHT “Advancing the Strategic Potential of India-US Relations, Accelerating India’s Economic Development” Vol. 2, Issue 7 July 24, 2012Prospects for India-Japan Civil Nuclear Cooperation- by Rajaram Panda India-Japan bilateral of December 2001, when both countries Links of Interest ties have shown signs not only agreed to “work as partners ICRIER - Wadhwani Chair of promise in recent against proliferation” of WMD, but also India – US Insight years. Both countries agreed to cooperate in implementing Vol. 2, Issue 6 have found rigorous export controls on sensitive and “Assessing the Third US-India convergence of dual-use materials and technology.1 Strategic Dialogue”interests in security and strategic by Hemant Krishan Singh & Amandomains. Economic ties are also In the global scenario, the current Raj Khannalooking up. However, cooperation debate centres on two main areas of the June 18, 2012on the nuclear issue, an area of nuclear issue, namely abolition of nuclearhigh potential, remains India-US Insight is produced weapons and growing interest in theunexplored. While India is looking by the Indian Council for peaceful use of nuclear energy.for various sources of energy to Research on International Proponents of the first raise the demand Economic Relations (ICRIER),meet its increasing demand to for complete nuclear disarmament. The an autonomous, policy-sustain economic growth, Japan main votaries of this argument are the oriented, not-for-profitpossesses expertise and “have-nots” like Japan, NAM countries, economic policy think tank.specialised high technology in the Australia, Canada and New Zealand, ICRIERs main focus is tonuclear field. Civil nuclear who have “argued rather from an enhance the knowledgecooperation can add to the idealistic standpoint, emphasizing the content of policy makingrobustness of bilateral ties. Both inhumanity of nuclear weapons”.2 through research targeted atcountries hold different improving Indias interfaceperspectives on nuclear issues There have also been recent moves with the global economy.because of past experiences and towards nuclear disarmament by thepolicies. However, there have “have” nations, led by the US, whose ICRIER does not take specificbeen some signs of change in policy stance is determined by the policy positions; accordingly,recent times. security environment that has emerged in all views, positions, and the post-Cold War era. In particular, conclusions expressed in thisControlling the proliferation of President Barack Obama’s speech in publication should beweapons of mass destruction Prague in April 2009, that aimed to understood to be solely those(WMD) provides a common create a world without nuclear weapons, of the author(s)platform for both India and Japan is significant. The US Nuclear Posture © 2012 by the Indian Councilto speak with one voice. The series Review (NPR) released in April 2010 for Research on Internationalof Joint Statements and “moved Obama’s nuclear disarmament Economic Relations (ICRIER)Declarations issued by the top policy a step further by declaring aleadership of both countries reduction in the number and role ofroutinely stress this point. Japan nuclear weapons in the national securityhas noted India’s impeccable of the US and its allies”.3 ICRIER - Wadhwani Chair intrack record on non-proliferation. India – US Policy StudiesThis became demonstrably clear The second trend, centred on growingas far back as the Joint Statement interest in nuclear energy world-wide, Amb. Hemant Krishan Singh Chair ICRIER Core 6A, 4th Floor, India Habitat Centre P: 91 11 43112400 WWW.ICRIER.ORG/ICRIER_WADHWANI 1 Lodhi Road, New Delhi -110 003 F: 91 11 24620180
  • 2. INDIA-US INSIGHT| Prospects for India-Japan Civil Nuclear Cooperation| Vol.2, Issue7 | July 2012including in developing Perspectives of India and Japan Even while negotiations on thecountries, is driven by concerns civilian nuclear deal with the USabout energy security and On the issue of civil nuclear were underway, there wereglobal warming. While this cooperation between India and reports in 2006 that Washington“nuclear renaissance” may be a Japan, differences do exist. Though was putting pressure on India towelcome prospect, growth in several summit meetings have agree to a future moratorium onnuclear power generation taken place, a breakthrough in this testing of dual-use missilebrings with it risks of safety, area has proved elusive. However, technology that could be usednuclear proliferation and the fact that both strive for the to deliver a nuclear payload andnuclear security. There is an ultimate goal of total elimination of testing another atomic device asinherent risk of nuclear power nuclear weapons remains a quid pro quo for the civilianbeing diverted towards military unquestioned. nuclear deal.6 India rejectedpurposes instead of the originally such a commitment as a back-intended peaceful uses. India-Japan bilateral ties had door entry to the CTBT, which itTherefore, securing this risk retreated into a chill following feels only came into existencedemands that necessary safety India’s 1998 nuclear tests at after those who possessedmechanisms, non-proliferation Pokhran. Japan suspended all nuclear weapons hadsafeguards and nuclear security economic aid to then on-going developed the requisite know-measures are put in place. In projects under its ODA. The move how.fact, the principle of the three was seen in India as Japan’s over-“S’s” was agreed upon by the reaction and lack of understanding In view of the waiver granted byG-8 countries and was included of India’s compulsions. The 1998 the 45-nation NSG to India in 2008in the Leaders’ Declaration of nuclear tests had also invited to conduct trade in nuclearthe G-8 Hokkaido-Toyako sanctions from the UN and other materials and technology, IndiaSummit in 2008. Here, the role of countries like the US. Political obviously expects Japan to re-the IAEA becomes essential. relations, however, steadily examine its position in the improved from 2001 onwards. specific context of bilateral civilThis paper attempts to address nuclear commerce.the issue of the ongoing debate As the only country in history toin Japan, its dilemma on forging have been a victim of nuclear The ice was finally broken duringcivil nuclear cooperation with attack, Japan is ultra-sensitive to all former Japanese Prime MinisterIndia, and how this cooperation things ‘nuclear’ and public opinion Yukio Hatoyama’s visit to India inwould help in bringing relations is vehemently opposed to nuclear December 2009. In a joint pressbetween the two countries proliferation and weapons in any interaction with Indian Primecloser. The possible impact of form.4 Unsurprisingly, Japan has Minister Dr. Manmohan Singh, hethe Fukushima incident on remained inflexible on issues such as publicly referred to exchangesJapan’s nuclear future is also the Nuclear Non-Proliferation Treaty with his Indian counterpart onexamined. The paper concludes (NPT) and Comprehensive Test Ban CTBT and Fissile Material Cut-Offthat though the Fukushima Treaty (CTBT). According to the Treaty (FMCT) and expressedincident has resulted in a Japanese perception, a public appreciation for the reassurancestemporary setback to the acknowledgement in India’s favour conveyed to him by Dr. Singh,negotiations on civil nuclear on these issues would send a wrong indicating that both countries willcooperation between the two signal to the world about Japan’s be able to act on thesecountries, neither country can future nuclear intentions. understandings to ensure ado away with nuclear energy as “positive conclusion”. Thus, evenan option for their energy This underscores the fact that without a breakthrough, thesecurity. On the contrary, India’s refusal to accede to the NPT seeds of progress on civil nuclearFukushima provides a lesson to and CTBT remains an irritant in cooperation were sown.countries to move towards bilateral ties.stringent safety mechanisms to India’s quest for Nuclear Energymake nuclear energy a reliable On its part, India, from the veryand clean source of energy for beginning, has taken a consistent India has a well developed andthe future. position that the NPT is largely indigenous nuclear power discriminatory in nature and that program currently consisting of 20 the CTBT is a “flawed” pact.5 civilian nuclear reactors. It expects to develop a 20 GWe ICRIER Core 6A, 4th Floor, India Habitat Centre P: 91 11 43112400 WWW.ICRIER.ORG/ICRIER_WADHWANI 2 Lodhi Road, New Delhi -110 003 F: 91 11 24620180
  • 3. INDIA-US INSIGHT| Prospects for India-Japan Civil Nuclear Cooperation| Vol.2, Issue7 | July 2012nuclear capacity on line by 2020 bilateral civilian nuclear cooperation reconsider its position. Japan’sand 275 GWe by 2052, with the pact on June 28, 2010. Under this experience in Kazakhstan couldaim to supply 25 per cent of pact, Japan would export its nuclear also be an appropriate guide.15electricity from nuclear power by power generation technology and This will propel engagement bythen.7 related equipment to India while Japanese corporations in Indian banning India from using them for economic activities, giving aCurrently, India’s share of nuclear military purposes or transferring them tremendous boost to dormantenergy in its overall energy to another country.10 economic ties between the twoproduction is less than 3% but it countries.has plans to increase this in the The Japan Forum on Internationalcoming decades.8 It has also Relations (JFIR) has strongly urged When India obtained the NSGmastered some of the related Japan to forge civil nuclear links with waiver, it had agreed to let thetechnologies such as uranium India.11 Supporting as it does India’s International Atomic Energyexploration, mining, fuel economic growth momentum, Agency inspect 14 of its 20fabrication, heavy water Japan is cognizant of the fact that reactors. To enter into theproduction, reactor design and India’s greatest challenge to nuclear deal with the US, Indiaconstruction and operation, maintain growth is to secure agreed to separate its civil andbesides reprocessing and waste sufficient energy supplies, especially military nuclear facilities and tomanagement. In addition to the for the generation of electricity. place its civilian facilities underfast breeder test reactor (40 Japan’s technology and expertise in IAEA safeguards.MWth) at Kalpakkam, it plans to generating and ensuring the safetybuild a 500 MWe reactor (PFBR), of nuclear power is among the best The US and France have strongwhich is likely to be operational in the world and therefore the JFIR interest in encouraging Japan toby late 2012. India is also urged Japan to cooperate with enter into a civil nucleardeveloping technology to utilize India. In particular, the JFIR identified agreement with India in order toits abundant resources of thorium specific reasons why Japan should facilitate their own nuclearas a nuclear fuel in the third cooperate with India, including (1) commerce through thestage of its three-phase nuclear the political significance of such construction of nuclear powerprogramme.9 cooperation; (2) the need for India plants in India. to deal with its lack of energyJapan’s compulsions resources; (3) the growing threat of On June 18, 2010 the Japanese global warming; (4) the advantages Cabinet adopted a new 10-yearEven as energy-starved India is of promoting cooperation in science growth strategy, which includedkeen to woo Japan’s highly and technology; and (5) the promoting export of nuclearcapable nuclear power industry, contribution by Japanese power generation facilities.16 KanTokyo has held back. In view of corporations involved in nuclear Naoto’s plan to “rebuild thethe entering into force of the power.12 The JFIR recommendations country” through his New GrowthIndia-US nuclear agreement in said: “…we call on the Japanese Strategy aimed “to promote tiesDecember 2008 and further government to cooperate with India with emerging economies in Asianuclear agreements signed by on this issue, while at the same time and encourages exportingIndia with countries like France, showing initiative in the global infrastructure – including nuclearRussia, Canada, Kazakhstan and campaign for nuclear technology – to the region bySouth Korea, Japan finds itself disarmament.”13 cooperating with governmentsnow in a relatively awkward and the private sector”.17position. Japan, as on date, is one of the few nations to possess technologically On October 22, 2010 aThough still non-committal, advanced nuclear power reactors. consortium of thirteen JapaneseJapan understands the strategic Toshiba alone possesses over 30 per companies18 joined hands toimportance of India and the cent of global civilian nuclear establish International Nuclearsignificance of meeting its reactor building capability.14 If Energy Development of Japanenergy demands. There is a Japan relaxes its policy and agrees Co. Ltd. (JINED), headquarteredgreater appreciation in Japan to cooperate with India, the Indian in Tokyo, to support nuclearthat nuclear power would also nuclear market will unfold growth power plant projects in emerginghelp India fight global warming. potential to the tune of $100 to $150 countries.19 The mission of JINED isBoth the countries held the first billion within a decade. This provides to present proposals to countriesround of talks aimed at sealing a a huge incentive for Japan to that are going to build their first ICRIER Core 6A, 4th Floor, India Habitat Centre P: 91 11 43112400 WWW.ICRIER.ORG/ICRIER_WADHWANI 3 Lodhi Road, New Delhi -110 003 F: 91 11 24620180
  • 4. INDIA-US INSIGHT| Prospects for India-Japan Civil Nuclear Cooperation| Vol.2, Issue7 | July 2012 nuclear power stations. JINED President Ichiro Takekuro (from Tokyo Nobumasa Akiyama of Hitotsubashi Electric Power Co.) announced his aspiration to “prepare best University has observed: “This (civil proposals that are comprehensive packages of the know-how nuclear) deal is important in a accumulated over the last 50 years (by Japan) in areas such as symbolic way. But there are some advanced technology and fuel procurement”.20 Currently in other areas in which the two collaboration with the Ministry of Economy, Trade and Industry (METI), countries could strengthen their JINED is aiming to win nuclear power plant project orders in Ninh ‘strategic partnership’, as there Thuan province, Vietnam.21 JINED has determined a behavior code could be a potential to complicate centered around the following three pillars: (a) to see that a safety the bilateral relationship in the course culture that accords top priority to the three S’s (safety, security and of negotiating a nuclear safeguards) takes solid root in the company; (b) to engage in cooperation agreement.”26 He proposal activities adapted to the needs in the concerned country; further says: “without Japanese and (c) to earn and keep the trust of stakeholders and society as a involvement, American and French whole.22 nuclear businesses could be denied opportunities in the Indian nuclear Subsequent to the NSG waiver in September 2008, the US, Russia and market. Also, India could face a France quickly concluded commercial nuclear agreements with India. delay in its nuclear energy program. Though the political leadership in Japan realized the futility of In this respect, India may push this remaining aloof, obtaining the approval of the domestic constituency agenda in its relationship/partnership on policy reversal for India remained difficult. French and American with Japan.”27 reactor vendors have complex tie-ups with leading Japanese nuclear engineering companies for the supply of major components. The There is a growing realization in French company Areva and US-based corporations Toshiba- Japan that indefinitely postponing a Westinghouse and General Electric-Hitachi were initially not allowed to decision will displease both the US engage in nuclear commerce with India unless Japan had formalized and France apart from hindering an agreement for nuclear cooperation with India. business prospects in India being Since then, licence agreements between the Japanese companies pushed by METI. At the same time, Toshiba and Hitachi and their US subsidiaries, Westinghouse and GE some analysts of the nuclear issue respectively, have been liberalized or flexibly interpreted. This has take the view that granting India an enabled Westinghouse Electric Company to sign a memorandum of exemption from NSG guidelines was understanding for an “early works agreement” (EWA) with Nuclear a mistake and some of the harm Power Corporation of India Ltd (NPCIL) on June 13, 2012 aimed at done to the non-proliferation regime supporting the future construction of AP1000s at the Mithivirdi site in could be reversed if Japan holds firm Gujarat. The agreement represents significant progress toward the on extracting a no-testing pledge by realization of the India-US Civil Nuclear Agreement signed in 2008. The India. EWA will include preliminary licensing and site development work. Westinghouse hopes to complete negotiations on the EWA by autumn This basically implies that even if 2012. According to Gary Urquhart, vice president and managing current Prime Minister Yoshihiko Noda director of Westinghouse India, this “agreement is an important step is favourably inclined, he will have to which will allow Westinghouse and NPCIL to continue the work await an opportune moment to necessary for keeping the Mithivirdi project moving forward”.23 move civil nuclear cooperation with India forward. Also, GE-Hitachi Nuclear Energy (GEH) announced on June 13, 2012 that it expects to sign an EWA with NPCIL in the near future, to bring its Impact of the Fukushima disaster Economic Simplified Boiling Water Reactors (ESBWR) to India. Site preparation for the ESBWR units is under way near Kovvada in the Given the widespread anti-nuclear state of Andhra Pradesh.24 For more than 50 years, GE-Hitachi has sentiment following the meltdown at been designing and building the most advanced boiling water the Fukushima Daiichi power plant, reactors on the planet. The planned agreement with NPCIL will PM Kan announced Japan’s plan to facilitate efforts to bring the world’s best reactors to India. gradually phase out the operation of With the above agreements, GE-Hitachi and Toshiba-Westinghouse all nuclear reactors and thereby are no longer constrained to sell nuclear plants and technology to eliminate dependence on nuclear India with or without the Japanese Diet giving its formal approval. 25 energy completely. This was done in Japan’s role in India-US and Indo-French nuclear cooperation is at a rather hasty manner without giving stake. due consideration to alternativesPage 2 ICRIER Core 6A, 4th Floor, India Habitat Centre P: 91 11 43112400 WWW.ICRIER.ORG/ICRIER_WADHWANI 4 Lodhi Road, New Delhi -110 003 F: 91 11 24620180
  • 5. INDIA-US INSIGHT| Prospects for India-Japan Civil Nuclear Cooperation| Vol.2, Issue7 | July 2012and without taking the Cabinet into the report, the panel exposed the regulator—that would monitorconfidence. All of Japan’s 52 nexus between the regulators and and inspect power-companynuclear power plants had been regulated in Japans nuclear operations, including riskshut down by May 2012, leaving it industry, concluding that this management, governancewithout nuclear power for the first powerful industry group had and safety standards. Thetime in 40 years. The Noda pressured its overseers to loosen report also recommendsgovernment has recently moved to regulations or postpone greater consolidating and rewritingrestart two reactors at the Oi stringency. The panel also found existing nuclear laws andnuclear power plant under intense that the Fukushima No. 1 nuclear regulations to bolster safetypressure from businesses plant disaster was “man-made” and and set criteria for aspectsconcerned about summer power not natural, fundamentally the result such as decommissioningcuts, even though METI Minister of a corrupt regulatory system that nuclear reactors. If theYukio Edano candidly admitted allowed Tepco to put off critical government does so,that the government failed to build safety measures.31 Panel Chairman restarting other reactorsa public consensus before ordering Kiyoshi Kurokawa observed: “Its which remain shut couldthe two nuclear reactors back fundamental causes are to be become smoother as publiconline on June 16, 2012. found in the ingrained conventions confidence rises.34 But in the of Japanese culture: our reflexive short term, there is a fear thatThe Oi plant in Fukui prefecture was obedience; our reluctance to the panel findings could fuelthe first to pass stress tests question authority; our devotion to complaints that Japan isintroduced in 2011 to address ‘sticking with the program’; our restarting nuclear reactorspublic concerns about safety.28 groupism; and our insularity.”32 before key reforms are inThe impact of the Oi restart will not place.35 The Mainichi The panel called for a complete Shimbun, in an editorialbe felt immediately, however. Both revamp of Japans nuclear industry exhorting the government toreactors must go through a series of and regulatory structure, issuing a take the panel reportsafety checks before they can be series of recommendations, the seriously, has observed: “…brought to full capacity. This creation of a permanent the government must notprocess is expected to last about six parliamentary committee to monitor allow power suppliers toweeks. The end of Japan’s self- a new nuclear regulator to be resume operations at theirimposed nuclear hiatus could pave created later in 2012, and a idled nuclear plants withoutthe way for restarts at other plants rewriting of rules to "meet global closely studying the reportsand the likely candidates include standards of safety, public health valuable conclusions.”36Ikata in southwest Japan and and welfare.33Tomari in the far north. The Mainichi Japan’s Indian dilemmaShimbun has harshly criticised Noda Though the government is notand observed in an editorial that required to take into account or It is not surprising that theJapan’s energy future must be implement the panels findings and Japanese government as welldecided by its people.29 recommendations, its weight as public seem confused on cannot be overlooked as it will be what stance to adoptIn the meanwhile, a ten-member considered more objective than the towards India. While there isDiet-appointed panel, comprised enquiry being undertaken by the no sharp division either in thelargely of scientists, lawyers and government itself. Demands are LDP or the DPJ that wouldacademics, investigating the going to mount on the Noda threaten a split in either partyaccident in Fukushima released its government to take the conclusions on the issue of civil nuclearfindings in a 640-page report on of the parliamentary-mandated cooperation with India, theJuly 5, 2012 condemning the panel into account when Japan average public iscountry’s atomic-energy industry reviews nuclear-safety standards uninterested in this as aand regulators alike. The report said and revamps its regulator later this foreign policy issue. Yet, therethat the regulators and Tepco year. is no denying the fact that"failed to correctly develop themost basic safety requirements,30 It is possible that the government the Hiroshima experience,leaving the Fukushima Daiichi plant might seriously consider the panel’s and now the Fukushimavulnerable to the earthquake and suggestion to set up an agency accident, lurk constantly intsunami that hit on March 11, 2011. appointed by the Diet — separate the Japanese consciousnessUsing harsh language throughout from the government’s nuclear and thus shape Japanese ICRIER Core 6A, 4th Floor, India Habitat Centre P: 91 11 43112400 WWW.ICRIER.ORG/ICRIER_WADHWANI 5 Lodhi Road, New Delhi -110 003 F: 91 11 24620180
  • 6. INDIA-US INSIGHT| Prospects for India-Japan Civil Nuclear Cooperation| Vol.2, Issue7 | July 2012thinking. This tendency is unlikely to undermine India’s interests in a minister Masayuki Naoshimabe erased anytime soon. major way as India has several explained the “Vision” of the options at its disposal. Sourabh government.44 He said thatThe DPJ finds itself in the midst of Gupta of Samuels International Japan needs to formulatedefining a course that would not Associates in Washington D.C. holds and implement a strategyabandon Japan’s stated policy on the view that “India could still that allows it to be a winner innuclear disarmament, while at the access Russian and South Korean the global scenario bysame time facilitating nuclear technologies, though the range of traversing the boundarycommerce with India. Even though options and quality of such between the governmentthe forging of a ‘strategic and technologies might retard India’s and enterprises, betweenglobal partnership’ has already own progress in developing industry ministries, as well as thereceived the strong endorsement of technology standards that could national and localthe foreign policy community in make its civil nuclear sector globally governments.Japan, the country is struggling to competitive someday in the futurefind a middle path on the vexed … if ever.”39 While India looks for Nuclear commerce betweennuclear issue that would enable it some positive signal from Japan, India and Japan will beto meet both ends. Tokyo seems to be avoiding sending consistent with Japan’s vision the wrong signal.40 for a future industrial structureIf Japan continues to prolong its in which nuclear power plantsdeliberation on this issue, India will India–Japan relations do not carry are an integral part of a largersurely not hesitate to enter into civil any historical baggage and the package.nuclear cooperation agreements ‘strategic” character of thewith other countries in order to relationship will receive a huge In the context of India-Japansatisfy its energy needs. During his impetus if Japan sheds some relations, it is important tovisit to South Korea in June 2010, element of inflexibility on the nuclear note that the presidents ofExternal Affairs Minister S.M. Krishna issue despite its extremely sensitive Hitachi, Toshiba and Mitsubishirecognized “Korean capabilities in nature. The ability to make mutually Heavy Industriescivil nuclear energy” and beneficial compromises is the key to accompanied Naoshimaexchanged drafts for inking an a strategic partnership. Going by this when he visited India in AprilInter-Governmental Agreement on spirit of accommodation, a 2010. The leaders of thesePeaceful Uses of Nuclear Energy.37 demonstration of flexibility towards companies form the core-South Korea is the world’s fifth its strategic partner (India) on the lobbying group which islargest atomic energy producer issue of nuclear commerce would encouraging the governmentwhich accounts for 40 per cent of be “a powerful statement of of Japan to work out a civilSouth Korea’s power generation.38 Japan’s investment in the bilateral nuclear deal with India.The Korea Electric Power Company strategic relationship”.41 This is a During this visit, it transpiredhas secured a $40 billion nuclear challenge before the incumbent that both sides agreed to putdeal to build and operate four centre-left DPJ. aside past differences on thenuclear reactors (1000 MWe each) nuclear issue, and workin UAE and has announced similar If one follows the DPJ’s trade policy towards a civil nuclear treatydeals with Turkey as well. The India- carefully, there is a slow but careful with the establishment of aSouth Korea civil nuclear pact was shift towards promoting exports and Joint Working Group (JWG)inked during Indian President investments in emerging markets. on civil-nuclear cooperation.Pratibha Patil’s state visit to that India fits into this Japanese The decision to establish acountry in July 2011. Japan cannot framework perfectly. In June 2010, JWG was taken in a meetingafford to watch silently as such METI unveiled the government’s new between Deputy Chairman ofdevelopments take place in its “Industrial Structure Vision” the Planning Commission,neighbourhood. strategy.42 Modestly recognizing the Montek Singh Alhuwalia and “deadlocked position” of Japanese Naoshima during the fourthThough the importance of forging a industries that have struggled to ministerial-level meeting ofstrong economic and political keep pace with the world’s major the India-Japan Energyrelationship between India and players and market changes, the Dialogue.45Japan remains undisputed, Japan’s “Vision” identified “Four Shifts” in the“policy of denial” of a nuclear government and the private The JWG can prove useful foragreement because of its own sectors.43 In a message to the both sides. While India willdomestic constraints will not Japanese people in June 2010, METI stand by its commitment to ICRIER Core 6A, 4th Floor, India Habitat Centre P: 91 11 43112400 WWW.ICRIER.ORG/ICRIER_WADHWANI 6 Lodhi Road, New Delhi -110 003 F: 91 11 24620180
  • 7. INDIA-US INSIGHT| Prospects for India-Japan Civil Nuclear Cooperation| Vol.2, Issue7 | July 2012core global non-proliferation policy makers in Delhi have the nation’s reactors.47 Primeprinciples, the DPJ will be in a potential to destabilize the system. Minister Noda is going to facebetter position to explain its stand The Indian government thus faces a increasing public pressure. Histo the Japanese electorate. India is major challenge in satisfying choices are limited.unlikely to change its position on disgruntled constituents withoutthe CTBT which was reiterated by disrupting the development of its ConclusionSingh to Hatoyama in December nuclear sector.2009. In order to make a civil In the post-Fukushima scenario,nuclear agreement possible, Japan Post-Fukushima pressures Japan is faced with criticalmay reinterpret its stance in order choices in its energy policy:to assuage the sentiments of the The crippling of the Fukushima whether to continue with itsJapanese public by laying stress on Daiichi nuclear power plant raised partial dependence onstrong export controls and non- fundamental questions worldwide nuclear energy by significantlydiversion clauses, to which India is about the future of the global upgrading regulatoryunlikely to object. nuclear energy industry and led to mechanisms or to increase calls for higher international reliance on renewables due toFor the DPJ, the threshold for standards on nuclear safety.46 This mounting anti-nuclearpossible nuclear commerce with development casts a shadow on sentiment in the country. InIndia is high. For progressing the possible future nuclear cooperation either case, the role of nucleartransaction, India needs to make a between India and Japan. energy as a key source ofstrong commitment to Japan, power is likely to besimilar to what it made at the NSG Prior to Fukushima, Japan’s nuclear circumscribed, despite thein 2008, for which a modality can power industry was on the cusp of a huge economic cost.be found. Even thereafter, it will new period of growth and the DPJrequire a great deal of political skill government’s roadmap had called The importance of futureon the part of the DPJ and Noda in for increasing the share of nuclear cooperation between Indiaparticular to win over the Japanese energy to 50% by 2030. Japan was and Japan in the civil nuclearelectorate. forging uranium supply deals from field lies in the fact that a Kazakhstan to Namibia. It had also recession-hit Japan can illIndia’s challenges moved closer to launching its afford to derail the economic controversial nuclear fuel recycling benefits from nuclearIndia will face a huge absorption system and restarting the Monju fast commerce with a strategiccapacity problem once civil breeder reactor. partner.nuclear commerce unfolds a vastnew arena of business in the The Fukushima incident only Moreover, METI will find it hardcountry. Mere agreements for strengthened the anti-nuclear lobby to convince major companiessetting up new nuclear reactors are and the Japanese government was like Toshiba, Hitachi and MHI tonot enough; execution of projects forced to revisit its nuclear energy simply abandon the nuclearentails a host of issues. Addressing development programs. industry as a source of thethese issues will be important as the nation’s energy needs. Noda’sagreements themselves. Issues such While Japan cannot afford to simply decision to restart twoas land acquisition, rehabilitation abandon nuclear power as a reactors, with possibly more toand resettlement, environmental source of energy, the Noda follow in the coming monthspermits and water usage, government will remain under when better regulatoryelectricity pricing and liability are intense pressure to assuage public standards are in place, is aall extremely contentious. There is concerns regarding safety cautious step in the rightthe inherent risk of getting regulations designed to prevent direction.entangled in legal gridlock. another Fukushima-type accident. In July 2012, Tokyo has witnessed The signing of a MOU betweenWhile Japan will face ideological Japan’s largest anti-nuclear rally Westinghouse and NPCIL onhurdles, India may find it difficult to since the Fukushima disaster. Over June 13, 2012 with anotherselect sites for new plants due to 100,000 protestors, reportedly the between GE-Hitachi and NPCILenvironmental issues. With biggest such gathering in Japan’s to follow, provide somediscontentment already brewing in history, urged the government to impetus for an India-Japan civilrural areas, further miscues by completely halt restarting of the nuclear cooperation ICRIER Core 6A, 4th Floor, India Habitat Centre P: 91 11 43112400 WWW.ICRIER.ORG/ICRIER_WADHWANI 7 Lodhi Road, New Delhi -110 003 F: 91 11 24620180
  • 8. INDIA-US INSIGHT| Prospects for India-Japan Civil Nuclear Cooperation| Vol.2, Issue7 | July 2012agreement in the coming months. Even though a been developing a nuclear fuel cycle to exploit its reservesfast-tracked deal is not on the cards, it has not of thorium. Now, foreign technology and fuel are expected to boost Indias nuclear power plansentirely been written off. From India’s side, Japan considerably. All plants will have high indigenousneeds to be given the space to proceed at a engineering content. India has a vision of becoming apace it is comfortable with as the government in world leader in nuclear technology due to its expertise inJapan has to take the domestic constituency on fast reactors and thorium fuel cycle. http://www.world-board before framing its nuclear policy towards nuclear.org/info/inf53.htmlIndia. That has precisely been India’s approach 9. Gupta and Sastry, n.,7.on this sensitive but important bilateral 10. http://search.japantimes.co.jp/print/nn20100701f4.htmlendeavour since negotiations on civil nuclearcooperation began. India can wait a while 11. “India’s Leap Forward and Japan”, The 29th Policylonger, but not indefinitely. Recommendations, The Policy Council, The Japan Forum on International Relations, Tokyo, September 2007, pp. 18- 19. Dr. Rajaram Panda, a leading expert on East Asian 12. Ibid, p.4 affairs, was formerly Senior Fellow at the Institute for 13. Ibid, p.4 Defence Studies and Analyses, New Delhi. He can be reached at rajaram_panda@yahoo.co.in 14. Indeed, there are two US companies- General Electric and Westinghouse – are taken over by Hitachi and Toshiba References respectively. Also, the French company, Areva, has close technical cooperation agreement with Mitsubishi and is 1. Ministry of Foreign Affairs, Government of Japan, dependent for certain advanced materials and machine “Japan-India Joint Declaration”, Tokyo, 10 December tools. Japanese companies produce technologically the 2001, http://www.mofa.go.jp/region/asia- most advanced civilian nuclear reactors. pacific/india/joint0112.html 15. Kazakhstan’s Kazatomprom acquired 10 per cent of 2. Tetsuya Endo, “Two sides of the same coin: Nuclear Westinghouse Electric Corporation from Toshiba for $540 Disarmament and the Peaceful Use of Nuclear Energy”, million in October 2007. As a result, Westinghouse gained AJISS-Commentary, No. 92, 26 May 2010. access to Kazakh uranium and potentially more fuel 3. Ibid. fabrication capacity and in return, Kazatomprom gained access to the world nuclear fuel market. For Japan- 4. “Hiroshima, Nagasaki demand halt to Japan-India nuke Kazakhstan nuclear cooperation, see Togzhan Kassenova, pact talks”, The Mainichi Daily, 3 July 2010, “Kazakhstan’s nuclear ambitions”, Bulletin of the Atomic http://mdn.mainichi.jp/madnews/national/news/201007 Scientists, 28 April 2008, 03p2g00m0dm064000c.html; “Tokyo NGO criticize http://www.thebulletin.org/print/web- Japan-India nuclear pact for spreading proliferation”, edition/features/kazakhstans-nuclear-ambitions The Japan Times, 1 July 2010, http://search.japantimes.co.jp/print/nn20100701f4.html 16. http://mdn.mainichi.jp/mdnnews/business/news/20100628 p2g00m0bu042000c.html 5. “Japan wants India to sign CTBT, PM puts onus on US, China”, The Indian Express, 29 December 2009, 17. Masako Toki, “Japan’s dilemma: nuclear trade vs nuclear http://www.indianexpress.com/news/japan-wants-india- disarmament”, Bulletin of the Atomic Scientists, 3 to-sign-ctbt-pm-puts-onus-on-us-china/561027/0 November 2010, http://www.thebulletin.org/print/web- edition/features/japan%E280%99s-dilemma-nucl... 6. Siddharth Srivastava, “India has China in its range”, Asia Times, 14 April 2007, 18. The 13 Japanese companies consist of nine electric http://www.atimes.com/atimes/printN.html utilities, three manufacturers, and the Innovation Network Corporation of Japan. These thirteen companies are: 7. Arvind Gupta and Ch. Viyyanna Sastry, “Time for India to Hokkaido Electric Power Co., Tohoku Electric Power Co., Export Nuclear Power Reactors and Peaceful Nuclear Inc., The Tokyo Electric Power Co., Inc., Chubu Electric Technologies”, 20 January 2011, Power Co., Inc., Hokuriku Electric Power Company, The http://www.idsa.in/idsacomments/TimeforIndiatoExportN Kansai Electric Power Co., Inc., The Chugoku Electric uclearPowerReactorsandPeacefulNuclearTechnologies_ 120111 Co., Inc., Shikoku Electric Power Co., Inc., Kyushu Electric Power Co., Inc., Toshiba Corporation, Hitachi, 8. India has a flourishing and largely indigenous nuclear Ltd., Mitsubishi Heavy Industries, Ltd, and Innovation power program and expects to have 14,600 MWe Network Corporation of Japan. nuclear capacity on line by 2020 and 27,500 MWe by 2024. It aims to supply 25% of electricity from nuclear 19. See Peter J Brown, “Japan Weighs role in India’s nuclear power by 2050. Because India is outside the Nuclear boom”, http://www.atimes.com/atimes/printN.html Non-Proliferation Treaty due to its weapons program, it 20. “Launch of International Nuclear Energy Development of was for 34 years largely excluded from trade in nuclear Japan”, Nuclear Power Industry News, 26 October 2010, plant or materials, which has hampered its development http://nuclearstreet.com/nuclear_power_industry_news/b/ of civil nuclear energy until 2009. Due to these trade nuclear_powerr_news/archive/201... bans and lack of indigenous uranium, India has uniquely ICRIER Core 6A, 4th Floor, India Habitat Centre P: 91 11 43112400 WWW.ICRIER.ORG/ICRIER_WADHWANI 8 Lodhi Road, New Delhi -110 003 F: 91 11 24620180
  • 9. INDIA-US INSIGHT| Prospects for India-Japan Civil Nuclear Cooperation| Vol.2, Issue7 | July 2012 21. http://www.mhi.co.jp/en/news/story/101015en.html 22. Nuclear Power Industry News, n. 20.ICRIER - Wadhwani Chair in 23. “US firm Westinghouse signs MoU for building nuclear plants in India”, Business Today, June 14, 2012,India – US Policy Studies http://businesstoday.intoday.in/story/us-firm-westinghouse-signs-mou-on-india-nuke- plant/1/185448.htmlIndian Council for Researchon International Economic 24. “US venders move towards India deals – Nuclear Engineering”, http://www.dianuke.org/us-Relations vendors-move-towards-india-deals-nuclear-engineering/Core 6A, 4th Floor 25. In the US, Hitachi is partnered with General Electric and Toshiba with Westinghouse.India Habitat Centre 26. Quoted in Brown, n. 19.Lodhi Road 27. Ibid.New Delhi-110 003 28. According to a poll by the Mainichi Shimbun newspaper, 71 per cent of people cautioned against a rush to restart Oi reactors, while 25 per cent supported Noda’s stance.Phone: 29. “Japan’s energy future must be decided by its people”, The Mainichi Weekly, editorial, 4 July 2012, http://mainichi.jp/english/english/perspectives/news/20120704p2a00m0na012000c.html91 11 43112400 X 402 /435 30. Mitsuru Obe and Phred Dvorak, “Japan panel blames nuclear crisis on regulator, industry tie”, Wall Street Journal, 5 July 2012,Fax: http://online.wsj.com/article/SB10001424052702304141204577508054139099724.html91 11 24620180 31. Kazuaki Nagata, “Regulatory system corrupt; safety steps were rejected”, The Japan Times, 6 July 2012, http://www.japantimes.co.jp/print/nn20120706al.html 32. Quoted in IbidWebsite: 33. Obe and Dvorak, n. 30.WWW.ICRIER.ORG/ICRIER_WADHWANI 34. Ibid 35. Justin McCurry, “Japanese panel: Fukushima a ‘man-made’ disaster”, Christian Science Monitor, 5E-Mail: July 2012, http://www.csmonitor.com/World/Asia-Pacific/2012/0705/Japanese-panel-Fukushima-a- man-made-disaster-videouschair@icrier.res.in 36. “Govt, legislators must take Diet panels nuclear crisis report seriously”, Mainichi Shimbun, 6 July 2012, http://mainichi.jp/english/english/perspectives/news/20120706p2a00m0na002000c.htmlINDIA-US INSIGHT 37. P.S. Suryanayana, “New Delhi, Seoul to begin talks on civil nuclear cooperation”, The Hindu, 19 Vol.2, Issue 7 June 2010. July 2012 38. Jasbir Rakhra, “India-South Korea Relations: The Nuclear Enterprise”, http://www.ipcs.org/article/india/india-south-korea-relation-the-nuclear-enterprise-3084.h... 39. Quoted in Brown, n. 19. 40. Brown, n. 19. 41. Sourabh Gupta quotes in Peter J Brown, “Japan weighs role in India’s nuclear boom”, Asia Times, 19 June 2010, http://www.atimes.com/atimes/Japan/LF19Dh02.html 42. See, “The Industrial Structure Vision 2010”, Ministry of Economy, Trade and Industry, June 2010, http://www.meti.go.jp/english/policy/economy/industrial.html 43. The “Four Shifts” are: shift in industrial structure (building a new industrial structure that connects potential strengths to business), support for business model shifts by enterprises (win by technology and by business); free from dichotomy between globalization and domestic employment (job creation by aggressive globalization “and” building world-class business infrastructures, and shift in government role (survive in global market to acquire added value). 44. For the text of the message, see http://www.meti.go.jp/english/policy/economy/industrial.html 45. http://breakingnews.gaeatimes.com/2010/04/30/india-japan-to-establiosh-a-working-group... 46. For a detailed analysis of Japan’s current nuclear dilemma, see Rajaram Panda, “Japan’s Nuclear Energy Dilemma in the post-Fukushima Period”, IFANS Review (Seoul), vol.19, no.2, December 2011, p. 101-138. 47. Hiroko Tabuchi, “Tokyo rally is biggest yet to oppose nuclear plan”, The New York Times, 16 July 2012, http://www.nytimes.com/2012/07/17/world/asia/thousands-gather-in-tokyo-to-protest-nucl... ICRIER Core 6A, 4th Floor, India Habitat Centre P: 91 11 43112400 WWW.ICRIER.ORG/ICRIER_WADHWANI 9 Lodhi Road, New Delhi -110 003 F: 91 11 24620180

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