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| July talks will enable S Korea enter India's nuclear energy market |
| Jyoti Malhotra / New Delhi Jun 22, 2010, 00:31 IST |
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India and South Korea will begin negotiations in July towards an inter-governmental agreement on the peaceful uses of nuclear energy, enabling Seoul to join the league of big and middle powers entering the lucrative civil nuclear energy market in India, estimated to be as large as $100 billion over the next 20 years.
Last week’s visit by External Affairs Minister S M Krishna to Seoul was marked by Korea’s keenness not only to push ahead with the civilian nuclear deal, request the Indian government to complete land acquisition for the South Korean steel major Posco in Orissa, expand the trade umbrella (under the free trade agreement which came into effect in January 2010) to $30 billion by 2014 and embark upon joint space projects, including the fabrication of satellites as well as their launch on Indian vehicles.
The expansion of the strategic partnership envisaged in January during South Korean President Lee Myung-bak’s visit as chief guest for the Republic Day celebrations certainly makes Seoul a key pillar in India’s “look east” policy. The India-Korea nuclear deal also has consequences for Korea’s most important neighbours, Japan and China.
First of all, Krishna’s keenness to travel to Seoul displays New Delhi’s intent to move beyond its immediate South Asian preoccupations, especially Pakistan, and emphasise its interest in establishing a presence in South-East Asia.
South Korea clearly returns the interest. Korean officials on condition of anonymity, noted that three presidents visited India in 1996, 2004 and now in 2010, while the last Indian prime minister, P V Narasimha Rao, went to Seoul as long ago as 1993.
Korea now becomes the first regional power to enter the Indian civilian nuclear energy market, beyond the US, France and Russia. Canada will be the second when Prime Minister Manmohan Singh travels to Ottawa later this week, when a similar inter-governmental agreement will be signed on civilian nuclear energy matters.
Having supported India’s effort at obtaining a clean exemption at the Nuclear Suppliers Group (NSG) in 2008, the Korean leadership has since pointed out to Delhi that it has mastered the full nuclear cycle and that the government-owned civilian nuclear agency, KEPCO, beat France’s Areva (which has been contracted to build civilian nuclear reactors in Jaitapur, Maharashtra) to win a whopping $20-billion contract in the UAE earlier this year.
KEPCO officials had visited New Delhi on the eve of President Lee’s January visit, indicating the agency’s strong interest in India.
The India-Korea nuclear deal becomes even more significant in the context of Japan’s inability to take forward nuclear talks with New Delhi. The weak political establishment in Tokyo has been so tied up domestically that it has not been able to concentrate its mind on permitting Japanese companies (Hitachi, Toshiba and Mitsubishi) to allow their minority US partners (General Electric and Westinghouse Electric Co) to enter the Indian market.
Indian officials feel Japan’s tardiness could be Korea’s gain.
Meanwhile, China, whose proposed initiative to “grandfather” two Pakistani nuclear reactors and slip the stringent conditions imposed by the NSG, will also be closely watching the incipient India-Korea deal.
Clearly both countries are keen on sealing their newfound partnership. Krishna told his South Korean counterparts that Posco should be persuaded to start work on the already acquired 4,000-odd acres of land, especially since the 500-odd acres under dispute with Orissa tribals could take much more time to resolve. He pointed out that Orissa Chief Minister Naveen Patnaik was of much the same mind on this matter.
Buoyed by the 70 per cent increase in bilateral trade since the signing of their free trade agreement in January, Krishna tried to push the frontiers of agreement by proposing joint initiatives on the exploration of hydrocarbons in third countries.
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