Why in News?

The India-US civil nuclear deal, signed two decades ago, has taken a significant step forward with regulatory approval from the US Department of Energy (DoE).

The approval allows US-based Holtec International to transfer Small Modular Reactor (SMR - a capacity of 30MWe to 300 MWe per unit) technology to Indian private firms.

What’s in Today’s Article?

• Key Developments in the India-US Civil Nuclear Deal
• Conditions and Safeguards of the Recent Deal
• Strategic and Diplomatic Significance
• Geopolitical and Economic Factors
• Future Prospects
• India’s Strategic Vision for SMRs
• Conclusion

Key Developments in the India-US Civil Nuclear Deal:

• US DoE authorisation:
  • Regulation involved: "10CFR810" (Part 810 of Title 10, US Atomic Energy Act, 1954).
  • Authorised recipients:
    • Holtec Asia (Holtec's Indian subsidiary).
    • Tata Consulting Engineers Ltd (TCE).
    • Larsen & Toubro Ltd (L&T).
• Excluded entities (pending Non-proliferation assurances):
  • Nuclear Power Corporation of India Limited (NPCIL).
  • National Thermal Power Corporation (NTPC).
  • Atomic Energy Regulatory Board (AERB).

Conditions and Safeguards of the Recent Deal:

• Duration: 10 years (subject to 5-year reviews).
• Restrictions:
  • No retransfer of technology to other Indian entities or foreign countries without US consent.
  • Use only for peaceful nuclear activities under International Atomic Energy Agency (IAEA) safeguards.
  • No access to enrichment technology or Sensitive Nuclear Technology.
  • Prohibition on military or naval propulsion use.
• Reporting requirements: Holtec to file quarterly reports to DoE.

Strategic and Diplomatic Significance:

• Revival of the 123 Civil Nuclear Agreement:
  • The agreement, signed in 2007, aimed at full civil nuclear cooperation, including enrichment and reprocessing.
  • Despite diplomatic progress, operational hurdles delayed implementation.
• India’s nuclear sector implications:
  • Technological advancements:
    • India’s civil nuclear programme has primarily relied on Pressurised Heavy Water Reactors (PHWRs).
    • Holtec’s SMRs use Pressurised Water Reactor (PWR) technology, which dominates global nuclear energy.
    • Opportunity to modernize India’s nuclear energy capabilities.
  • Private sector involvement:
    • Holtec’s collaboration with Indian firms could boost domestic manufacturing of SMR components.
    • The potential to position India in the global SMR supply chain.

Geopolitical and Economic Factors:

• US-India collaboration vs. China’s SMR expansion:
  • China is aggressively expanding in the SMR domain, leveraging it for diplomatic influence in the Global South.
  • India-US collaboration could provide a counterbalance to China’s dominance in nuclear technology.
• Impact on US-India trade relations: Despite protectionist policies under previous US administrations, this deal signifies a commitment to technology transfer and economic cooperation.
• Challenges in implementation:
  • India’s Civil Liability for Nuclear Damage Act (2010) has deterred foreign investment due to liability concerns.
  • Amendments to the Atomic Energy Act (1962) needed to allow private sector participation in nuclear power generation.

Future Prospects:

• Next steps for Holtec in India - Possible collaborations:
  • TCE for engineering expertise.
  • L&T for manufacturing nuclear components.
• Potential entry of NPCIL and NTPC: Government may provide necessary assurances to include state-owned enterprises in future agreements.
• Holtec’s expansion plans: Holtec Asia’s facility in Dahej, Gujarat, could see workforce expansion if manufacturing is approved.

India’s Strategic Vision for SMRs:

• Clean energy transition: SMRs are seen as a viable option for reducing carbon emissions and meeting energy demands. Key part of India's renewable energy strategy.
• Global nuclear competitiveness: India’s engagement in SMR development could enhance its standing in the international nuclear energy market.

Conclusion:

The US regulatory approval for Holtec marks a milestone in operationalizing the India-US civil nuclear deal. This development aligns with India’s goals for energy security, technological advancement, and geopolitical positioning.

However, regulatory and legal challenges need resolution to fully leverage the deal’s potential.