Press Release

The Congress leadership and the UPA government are propagating that the Indo-US nuclear deal is absolutely essential for India’s energy security. A massive disinformation campaign has been mounted that nuclear energy is a solution not only to the shortage of electricity in the country but also an answer to the oil price rise. This is nothing but a cover to promote the strategic ties with the US. As it is difficult to promote India-US strategic ties directly, therefore the recourse to false claims that nuclear energy will at one stroke reduce not only our oil consumption but also remove our power shortages.

Let us take the issue of oil first. More than 50% of India’s oil consumption is in the transport sector – cars, buses and trucks and the rest in petrochemicals and fertilisers. Only a negligible amount is used in the power plants. Nuclear energy has very little to do with oil – it cannot be used as a substitute for oil; unless the Government experts have found a new way to burn uranium directly in cars and buses! On the other hand, Natural Gas from Iran would insulate India substantively from the oil price shocks. The Government has been dragging its feet over the Iran Gas Pipeline project at the behest of the US and in consideration of the Hyde Act.

On the power shortages, the facts are as follows.

· India’s growing shortage of electricity has little to do with a lack of nuclear energy but a lot to do with starving the power sector of public investments over the last two decades. In the last three Five-year plans, capacity additions has been of around 20,000 MW per Plan, less than what we had added in the 7th Plan.

· Even if the Deal is signed today, it will take about 8 years before any electricity is produced from imported reactors under the Deal

· The cost of installing nuclear power plants using imported reactors is three times that of coal-fired plants of the same size

· The cost of electricity from such plants will be more than Rs. 5.00, twice that from coal-fired plants

· The quickest and cheapest way to remove the current electricity shortages is to build coal-fired plants which take half the time required by nuclear plants

· Nuclear plants require imported uranium, which is controlled by a small international cartel. The price of uranium has gone up by five times in the last few years because of this cartel.

· Nuclear energy has an important place in India’s energy option and this route needs to be kept open for the future. However, this should be based on our indigenous technology and our indigenous resources to ensure energy security.

· Even with the most optimistic nuclear scenario that the Government has projected, Nuclear energy will at best meet only 8% of our electricity demand and about 4% of our total primary energy demand. While the nuclear option should be kept open for the future, it has little importance for meeting our immediate energy needs.

The Government has also been highlighting a temporary shortage of uranium fuel and painting it as a permanent one. The Government, either deliberately or a failure of planning, did not invest in expanding the existing uranium mines or opening new mines. Worse, they also closed one of the existing mines. The Atomic Energy Commission has made clear that we have enough uranium for 10,000 MW of installed capacity against the current capacity of only about 4,000 MW. It appears that the spectre of uranium shortage has been created only to push a Deal that is not in India’s national interest.

The India-US Nuclear Deal is not about India’s energy security. Energy security lies in using indigenous energy resources such as coal and ensuring our future energy supplies from Iran and other countries in West and Central Asia. Obviously, augmenting indigenous coal production, investing in oil exploration, securing gas supplies through Iran Gas Pipeline are much more important for India’s energy security than buying imported reactors and importing uranium for such nuclear plants. Energy security does not lie in helping a moribund US nuclear industry to sell us billions of dollars of reactors, which nobody is buying in the US.

Mythical energy claims are being made in order to promote a bad nuclear deal. Energy is just a cover. The real intent is India-US strategic ties.