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US, India progress with nuclear deal
Publication Date : 15-06-2012
The United States and India concluded high-level talks with an agreement on nuclear power cooperation which both sides hoped would help quell chatter about their bilateral relationship not living up to expectations.
US Secretary of State Hillary Clinton announced on Wednesday that US-based nuclear power plant manufacturer Westinghouse Electric Company and the state-owned Nuclear Power Company of India had inked a preliminary agreement that could speed up construction of the first US nuclear power plants in India.
It comes after months of impasse over India's contentious nuclear liability legislation and gives the historic US-India civil nuclear cooperation agreement of 2008 its first commercial breakthrough.
Mrs Clinton hailed it as a 'significant step towards the fulfilment' of the 2008 deal, under which the US gave India access to civilian nuclear technology for the first time in three decades after India built nuclear weapons.
But she underscored the preliminary nature of the agreement, noting there was 'still a lot of work to be done', primarily sorting out differences over India's tough nuclear liability law which holds nuclear power plant suppliers liable if accidents happen.
She was speaking at a joint press conference with visiting Indian Foreign Minister S.M. Krishna at the start of the third US-India annual strategic dialogue.
Krishna said the deal should put at rest some of the interpretations and some of the confusion that was prevailing in the immediate aftermath of the 2008 nuclear accord.
There had been high hopes then that warming ties would translate into substantial opportunities for trade and investment, open up new markets and create jobs for US companies.
But US firms have voiced concerns over India's unfriendly investment environment and the recent state of domestic politics that had slowed the pace of economic reform.
The liability clause, for example, has kept US nuclear power companies from committing to work in India as they want more cover from liabilities in the event of a nuclear accident.
India is looking to cut reliance on oil and coal and rely more on cleaner nuclear energy to power its fast-growing economy and provide electricity to its 1.2 billion people.
Almost two in five Indians lack regular access to electricity.
India has 20 nuclear power reactors in operation and aims to have nuclear power supply a quarter of its energy needs by 2050, a tenfold increase from today's levels.
Refuting the perception that slowing dynamism in ties was making it difficult for both sides to reap tangible benefits quickly, Mrs Clinton and Krishna emphasised their countries' shared interests, ranging from security and defence, to health and education.
"The strategic fundamentals of our relationship are pushing our two countries' interests into closer convergence," she said.
She said ties had entered "a new and more mature phase' and 'there is less need today for the dramatic breakthroughs that marked earlier phases, but more need for steady, focused cooperation".
But she urged both sides to do more to "convert common interests into common actions".
During the talks, both sides also reviewed progress on a bilateral investment treaty that could form the foundation for a free-trade agreement, India's contributions to aid Afghanistan's economic development and New Delhi's efforts to increase integration with Asia-Pacific countries.