India is the sixth largest energy consumer in the world, accounting for 3.4% of global energy consumption. The total demand for electricity in India is expected to cross 950,000 MW by 2030.
About 75% of electricity consumed in India is generated by thermal power plants, 21% by hydroelectric plants and 4% by nuclear power plants. As of 2010, India has 20 nuclear reactors in operation in six nuclear power plants, generating 4,780 MW while five other plants are under construction and are expected to generate an additional 2,720 MW.
Following a waiver from the Nuclear Suppliers Group (NSG) in September 2008 which allowed it to commence international nuclear trade, India has signed nuclear deals with several countries including France, United States, Britain, Canada, Namibia, Mongolia, Argentina, Kazakhstan and Russia. Australia was the only country that had not agreed to sell its uranium to India, though India’s urgent requirement for additional sources of ‘clean’ energy should resonate with the Australian mindset of reducing carbon emissions to save the planet.
Australia holds around 40% of the world’s estimated low-cost uranium reserves. Significant deposits exist in the north of the Northern Territory, northern and central Western Australia, northwestern Queensland and in central South Australia. With Australia’s Prime Minister Julia Gillard indicating her willingness to sell uranium to India, an important obstacle in the way of India-Australia relations has been removed. Delegates at the 46th national conference of the Labour Party in Sydney endorsed Gillard’s plan to export uranium to India, with 206 of them voting in favour and 185 against. Gillard, moving a motion to change the party’s policy on the issue, said that clearing the move would boost trade and enhance Australia’s ties with India.
The landmark policy change came after a fiery debate, with Gillard pointing out that it was not rational that Australia sells uranium to China but not to India. She contended that Australia could sell uranium to India without breaching its obligations under the nuclear Non-Proliferation Treaty as any agreement in this regard would include strict safeguards to minimise proliferation risks. In an interview to an Australian paper, Gillard said that selling uranium to India would be good for the Australian economy, it will be a way of taking a step forward in our relationship with India and that the US-India Civil Nuclear Agreement had effectively lifted the de-facto international ban on cooperation with India in this area. The Obama administration has also been pursuing a strategy of closer partnership with India and considers Australia a part of it. The US seems to have influenced Gillard’s U-turn on uranium exports to India, as the Obama administration viewed the long-standing ban was a roadblock to greater engagement between Washington and New Delhi.
The US has reconfigured its military commands so that the US Pacific Command embraces responsibility not only for the Pacific but also for India and the Indian Ocean. This is in line with sustained argument from Australian officials and ministers urging the Americans to consider the Pacific and Indian oceans as a single unified theatre of operations. In response, the Americans have urged deeper engagement with India for Australia which required the end of the ban on uranium exports. To those sections within her party as well as the Australian Greens who continue to question India’s nuclear energy programme, Gillard drew attention to India’s exemplary record as a nuclear power.
The Australian ban on sales was seen in Delhi as a sign of Canberra’s distrust of Indian intentions. The shift in position will go some way in changing that perception and as key players in the emerging Asia-Pacific security architecture, the two countries can focus on economic and maritime security cooperation.
The shot in the arm to India-Australia relations could result in a flowering of a closer strategic cooperation. In the past, it has engaged in joint naval exercises with Australia. In 2007, there was some animated discussion over the formation of a ‘Quadrilateral of Democracies’ including India, Australia, Japan and the US. This will help India build stronger economic and defence ties with these countries for economic growth and to safeguard the sovereignty and integrity of the country.
The writer is a former senior professor of ICFAI Business School, Chandigarh
The views expressed by the author are personal