Author: Kanchan Gupta
Publication: The Pioneer
Date: July 21, 2008
Addressing a large public rally - hordes still
turn out to gawk at her, marvelling at her high-pitched English and stilted
Hindi, pallu firmly in place a la Mrs Indira Gandhi, amma to millions south
of the Vindhyas - in the boondocks of Nellore last week, Congress president
Sonia Gandhi made a solemn promise to the unwashed masses of India. The surge
in India's power production on account of nuclear reactors that will mushroom
after the signing of the India-US civilian nuclear cooperation agreement,
she said, will light up every home in every village. Actually, Ms Gandhi promised
more than that: "Our Government has signed an international agreement
that will enable more nuclear power plants to generate power. I am sure many
of you are asking yourselves why this is so important. It is extremely important
because as our economy grows, the demand for power would rise. We need power
for our farms, hospitals, schools, factories and every home in every village."
I am not too sure whether Ms Gandhi is right
about the 123 Agreement having been signed, but given the Prime Minister's
propensity to keep secrets from the very people whose destiny he presides
over, and whom he tends to mislead ever so often through word and deed, one
can never say for sure what exactly is the status of the nuclear deal. That
apart, Ms Gandhi's speech at Nellore provides a clue to the Congress's main
campaign issue in the next general election, which could be held any time
between early-winter and early-spring next year, depending on whether the
UPA Government survives tomorrow's confidence vote.
The aam admi, the poor, the struggling, the
impoverished masses living on the edge, we can now be sure, will be told that
their lives will take a turn for the better with the signing of the nuclear
deal which will enable Government to supply nuclear power to one and all.
Parched farms will become verdant as pumpsets energised by nuclear power will
suck out water from the bowels of the Earth; classrooms in schools without
teachers, blackboards and drinking water facilities (children can relieve
themselves in the fields, so toilets are unnecessary) will be well lit with
nuclear power bringing alive fused bulbs; production at factories will double
and treble as machines powered by nuclear energy work faster than workers
can cope with and managers can keep track of; and, it shall be Diwali every
night in wretched villages where power is now considered a luxury and dwellers
of hovels still make do with oil lamps provided they can afford kerosene sold
in the black market. India won't be shining; it will be glowing brighter than
a thousand suns.
For a moment, let's believe that I am not
being facetious and that Ms Gandhi's speech was written by someone higher
in the food chain than a 'promotee' information officer of the PIB. Can all
this be achieved by signing the 123 Agreement? Will there be such a surge
in our power generation capacity? The answers to these, and other related
questions, lie in basic facts that have been swamped by needless propaganda
of the 1960s and 1970s variety. While the truth could have served the larger
purpose of justifying the need for India to forge a strategic relationship
with the US, bunkum is being resorted to to justify the Prime Minister's strange
obsession with the nuclear deal and his sly efforts to foist an iniquitous
agreement on the nation. Bogus claims are being made to fool the people into
believing that a bright future awaits them, never mind the subjugation of
India's strategic interests to those of America and the business interests
of American firms.
So, here are some basic facts that should
help realise the stupendous folly into which we are being led by a Prime Minister
desperate to keep his commitment to the Americans before both he and President
George Bush demit office. The share of nuclear power from existing reactors
in the power produced in our country today stands at 2.8 per cent. If new
reactors are set up, and if they go critical without any time overrun, then
this share will increase to at best eight per cent by 2020. This is inconsequential,
given the rate at which demand for power is increasing by the day. Nor will
an increase in the production of nuclear power decrease our demand for, and
consumption of, oil - in India, oil is not used for generating energy. In
other words, the money we will spend on acquiring nuclear power reactors will
not be offset by savings in our oil import bill.
Which brings us to the cost of nuclear power.
At present, power from existing nuclear reactors costs, after huge subsidies,
between Rs 2.70 and Rs 2.80 per kWh. The coal-fired Sasan mega power project
in Madhya Pradesh will be supplying power at Rs 1.196 per unit. The real cost
of power from existing nuclear reactors is around Rs 4 per unit; the cost
of power produced by new reactors will be around Rs 5.50 per unit. Compare
this to the real cost of power produced at thermal plants: Rs 2.50 per unit.
What the UPA Government, therefore, is seeking to achieve is to permanently
raise the cost of power by leaps and bounds, a cost that will have to be paid
by the masses whom Ms Gandhi addressed last week.
The story does not end here. We are being
told that to cushion our energy needs from the volatile oil market, we need
nuclear power. That's hogwash: Our power sector is not dependent on oil. But
that's only one reason. The other reason why this argument does not hold is
that the uranium market, monopolised by a clutch of suppliers and controlled
by an even smaller group of countries, is as, if not more, volatile than the
oil market. The international spot price of uranium has risen at a rate faster
than that of oil. A little known fact - with hindsight deliberately suppressed
by the Government - should help us understand just how volatile is the uranium
market. Between 2005 (when the India-US nuclear deal was first proposed) and
2007 (when the 123 Agreement was finalised), the spot price of uranium has
quadrupled. According to a June 2008 market assessment, a further 58 per cent
increase is expected.
There is more to the story. And this is about
who gains from the nuclear deal. American and French firms dealing with nuclear
reactors and starved of orders - no new reactor has been set up in the US
in the last 35 years; the first new reactor in Europe is being set up in Finland
after 17 years and has already run into a huge cost escalation of more than
$2 billion - are hoping to revive their fortunes by entering the Indian power
sector. They are expecting business worth $100 billion over the next 20 years.
Since they will not be footing the bill, the Government will have to either
raise money from the market or pass on the buck to hapless consumers. With
a fraction of this money, a lot more thermal, hydel and gas-fuelled power
plants could have been set up to supply clean and affordable power to the
people at less than half the cost of nuclear power.
Yet we are being told that nuclear power will
benefit the masses. It is reminiscent of Marie Antoinette's suggestion that
starving French peasants who couldn't afford bread could eat cake. Or, as
a biographer has pointed out, what she really meant was they could eat "crumbs
from a bread pan".
