Westinghouse, the US-based nuclear giant majority owned by Japan's Toshiba Corporation, has filed for bankruptcy even as it was engaged in negotiations to build six nuclear reactors for India. How badly does it affect India's plan to produce nuclear power for civilian use?
Following the 2008 Indo-US civil nuclear deal that allowed India access to nuclear technology and fuel without giving up its weapons programme, Westinghouse was to build six reactors in India. Westinghouse and the Nuclear Power Corporation of India (NPCIL) were to conclude contractual agreements in June 2017.
India wants to triple its nuclear capacity by 2024.
India is looking at nuclear power to meets its base load power requirement—the minimum demand on a grid at any given point in time. It was also meant to be used to meet power requirements for large projects like steel plants. With focus on manufacturing through initiatives like 'Make in India', demand for power is set to grow as well. Catering to an increased base load power through conventional (and polluting) sources like thermal or gas or clean and renewable sources like wind and solar will be difficult. India wants to triple its nuclear capacity by 2024 to wean Asia's third-largest economy off polluting sources.
In a recent statement, Westinghouse said the bankruptcy will not affect its plans in India.
Several analysts told HuffPost India that the company's bankruptcy filing won't affect India's plans. "There are other companies that India can engage," said Pramit Pal Chaudhuri, fellow at the Aspen Centre.
Had Westinghouse been executing the project, India would have got a bridge loan from Japan. But if India were look at other suppliers, it will also have to look at arranging a similar loan, says Chaudhuri. At the most there could be some delays, he said.
Westinghouse said the bankruptcy will not affect its plans in India.
Chaudhuri also said that Indian companies like Larsen & Toubro have acquired substantial technical know-how on building big nuclear reactors. Westinghouse has signed a memorandum of understanding with Larsen & Toubro to supply nuclear plant elements and execute civil works.
Ronen Sen, former Indian Ambassador to US and a key negotiator of the Indo-US Civil nuclear deal, too feels that "chest beating" around Westinghouse is uncalled for. He also clarified that those debunking the Indo-US Civil nuclear deal are confusing issues. "The deal was not only Geo-strategic but opened many doors."
Earlier, the US Embassy said in a statement: "We understand that Westinghouse continues to stand behind the delivery model that it presented in its Technical Commercial Offer to India, which included an Indian construction partner, and looks forward to progress on an agreement in 2017."
Westinghouse filing for bankruptcy is a "cause of concern".
"I don't think this (Westinghouse filing for bankruptcy) will be a major problem for us" said Group Captain Ajay Lele of the Institute of Defence Studies and Analysis, a government-backed, New Delhi-based think tank.
Some experts, however, do advise caution. Dr Roshan Khanejo of the United Service Institute--another government-backed think-tank, said Westinghouse filing for bankruptcy is a "cause of concern". It is not clear whether this will "impact the company's commitment regarding the deadlines of supplying reactors and, also the cost of the reactors". India needs to be careful when negotiating with Westinghouse, she said.
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