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Sunday, Jan. 29, 2012

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Business trip: Trade and Industry Minister Yukio Edano at a Nissan plant in Chennai on Jan. 10. Since 2000, Japanese firms have invested over $5 billion in Tamil Nadu. KYODO

SUNDAY TIMEOUT

Fukushima casts a shadow over India's industrial boom


The ongoing nuclear disaster in Fukushima has quashed once ambitious plans for the construction of new reactors in Japan. The government does, however, remain committed to promoting exports of nuclear reactors and technology as it sees huge potential in overseas markets.

Nuclear energy will fuel the roaring economies of China and India, although in the latter, popular protests are slowing expansion. In Tamil Nadu, civic groups such as the National Alliance of People's Movements and the People's Movement Against Nuclear Energy have opposed commissioning the Koodankulam Nuclear Power Plant (KNPP) that was built with Russian assistance.

Plans to start up the first of two reactors there, each with 1,000 MW capacity, at the end of 2011 have been postponed until March 2012. Meanwhile, local groups conduct daily protests in the hope of closing down the facility permanently — though the government is likely to proceed with the project.

This opposition predates the Fukushima meltdowns, but Japan's nuclear crisis has reinforced public opposition in India to the country's ambitious nuclear-energy expansion plans. These concerns are especially strong in fishing villages in Tamil Nadu close to the KNPP, where fishermen fear they might lose their livelihoods as those in Fukushima did.

Prime Minister Manmohan Singh ordered safety reviews of India's nuclear reactors after March 11, calling local concerns about safety "understandable," but he also points to India's safety record and the advanced safety features of the KNPP.

Interestingly, Tamil Nadu's Chief Minister J. Jayalalithaa requested that the central government halt the proposed project in response to intense local opposition and a hunger strike by anti-nuclear activists. That request followed the example of the West Bengal state government's post-Fukushima decision to scrap its planned Haripur nuclear-power project.

Singh has warned that the postponement of the KNPP plant's startup raises questions about Tamil Nadu's ambitious industrialization plans.

Chennai, the state's capital formerly known as Madras, is called the "Detroit of India," being a major production base for automobile makers, including Nissan. There are plans to attract more Japanese investment spearheaded by the creation of an integrated township with residential, commercial and industrial elements — and a golf course — on a 600-hectare site 50 km south of Chennai near the Mahabalipuram, UNESCO World Hertitage Site. The project is a joint venture involving Japanese and Singaporean investors and developers.

Not far south of the planned development is a nuclear power and research complex in Kalpakkam, including a prototype fast-breeder reactor, that reportedly did not suffer any damage from the 2004 tsunami. In contrast to the KNPP protests, those living around the major tourist hub of Mahabalipuram are tight-lipped about the neighboring plant and anti-nuclear activism is not evident.

Since 2000, Japanese companies have invested more than $5 billion in Tamil Nadu, and that figure is set to surge as Japan has signed an agreement to participate in building a Chennai-Bangalore industrial corridor involving the construction of highways, a high-speed rail network and industrial estates.

At present, of nearly 800 Japanese firms operating in India, some 250 are in Tamil Nadu, including big names such as Hitachi Mitsubishi, Komatsu, Toshiba and Marubeni.

Economy, Trade and Industry Minister Yukio Edano visited Chennai earlier this month, not long after Prime Minister Noda's visit to New Delhi at the end of 2011 during which he reopened talks on a civilian nuclear cooperation pact that would allow Japan to export its nuclear technology and expertise.

Japan has previously balked at such cooperation because India has carried out nuclear weapons tests and is not a signatory to the Nuclear Non-Proliferation Treaty. However, since the administration of U.S. President George W. Bush concluded a controversial deal with India on sharing nuclear technology and fuel in 2008, Tokyo has been pressured by Washington to make an exception to its policy. That came after the United States, as part of the deal, had prodded the Nuclear Suppliers Group, which includes Japan, to lift restrictions that had barred such sharing with India. At the time, Japan was miffed, but market opportunities now trump principle.

During Noda's brief visit, the People's Movement Against Nuclear Energy made a public appeal for Japan to refrain from proceeding with nuclear cooperation with India.

The letter states, "As the only country in the world to have suffered radiation from nuclear bombs and nuclear power plants, Japan must take a lead in saving humanity from the nuclear menace and not try to make money out of the deadly nuclear business.

"While you yourself are struggling to contain the damages of the Fukushima disaster, you have no moral legitimacy to sell this dangerous technology to other countries. Hence we request you not to revive the civil nuclear cooperation negotiations with India."

In response, and following the first trilateral dialogue between India, Japan and the U.S., held in Washington on Dec. 19, 2011, Japan is expected to make concessions on nuclear cooperation.


SUNDAY TIMEOUT



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