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American firms eye major bite from Indian nuclear pie

By Aziz Haniffa in Washington DC
November 25, 2008 12:51 IST
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With billions of dollars in military technology agreements likely to be made with the United States-India nuclear deal going through, there's an excited buzz among American companies.

Even as the United States and India were discussing the practicalities of implementing the civilian nuclear deal consummated over a month ago, a US-India Business Council civil nuclear trade mission with the imprimatur of the US Department of Commerce to leave for India December 4, was already oversubscribed with several more companies clamoring to get on the delegation so they too could try to get a bite out of the Indian nuclear pie.

Denying there was a lull following the completion of the deal and the euphoria had dissipated, USIBC president Ron Somers told, "We continue to be extraordinarily enthused."

"This mission is our largest-ever executive mission to India," he said. "It's now oversubscribed -- there is no more room on the mission."

Somers said, "As many as 52 top-level blue-chip American companies have subscribed to attend the mission," which will go to New Delhi, Mumbai, and Hyderabad, including the fuel-handling facility in Hyderabad.

"And, so, again, the fact is that in this economic climate, given the role that energy security is playing worldwide, it's more important than ever that countries like the United States and India collaborate even more deeply."

"This is our most popular ever executive mission and one of the reasons we want to attend the mission is to put the final dots on the i's and cross the t's so that we can move forward in true partnership going forward into the 21st century," Somers said.

Lending credence to his contention that American companies continued to request for a place in the delegation, although the mission was already oversubscribed, even as this correspondent was talking to Somers, he was receiving calls from senior officials of firms imploring him to make an exception to expand the mission to allow their companies to join.

"This is another call expressing interest," he said. "So there is no lull in the enthusiasm."

Meanwhile, in New Delhi, American and Indian officials were trying to hammer out the next steps to implement the deal even as they acknowledged the challenges of overcoming the shortages of equipment supplies and nuclear engineers.

A Voice of America report datelined New Delhi said the head of the US Nuclear Regulatory Commission, Dale Klein had pledged to work assiduously to overcome some of these hurdles.

Klein was quoted as saying that "the US and the Indian industry need to solve both of these aspects --the equipment and the people."

"The US can certainly help India in terms of sharing technologies that have worked well in the academic arena," Klein said, and added: "We can look at sharing joint curricula and we can also learn from how India does its educational program. So, it's a two-way street.

Commerce Secretary Carlos Gutierrez continued to press for India to move expeditiously to enact nuclear liability protection so that the private sector in both countries can engage in making the best of the deal in terms of the sale of nuclear technology, reactors, fuel and other spin-off equipment and services.

Gutierrez said that American companies cannot wait to jump in and contribute to India's developing nuclear power sector, but were hampered by the lack of liability protection.

He urged the government of India to "draft and ratify domestic law consistent with the Convention of Supplementary Compensation for Nuclear Damage."

Somers acknowledged that this is indeed an imperative that needs to be enacted quickly. He said, "It is in the interests of Indian companies that the liability question be attended. While it's true that the American companies require this, the Indian private sector also requires it because if there were ever to be an accident that would result in liability, it would be the end of the Indian private sector companies participating in the industry as well."

"So, more than ever, it's the Indian private sector that should be promoting the need for this Convention on Supplementary Compensation – that's the limitation on liability issue."

"And, we'd also hope that the Indian private sector will be the champion of modifying the Indian Atomic Energy Act to enable the Indian private sector to participate -- I mean, the great companies like Reliance, and Tata and Essar and Bharat Forge, and I could go on and on," Somers added.

He said that "there are so many great companies that would want to be able to participate," and had been already in discussions with American firms "but right now the Indian Atomic Energy Act only allows the public sector companies and that too only the Navratna public sector companies to participate in the Indian nuclear program."

"So, the champions need to be the Indian private sector on both counts," Somers reiterated, "for their engagement and involvement in the nuclear build-out within India and to protect themselves in the event of a liability by limiting liability, subscribing to the Convention of Supplementary Compensation."

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Aziz Haniffa in Washington DC