Publication: Monitor Volume: 4 Issue: 120

Respectively claiming a diplomatic victory and celebrating the closing of a potentially lucrative business deal, New Delhi and Moscow initialed an agreement that calls for Russia to construct a nuclear power plant in southern India. The agreement comes despite worldwide condemnation of India’s recent conduct of underground nuclear tests. As one of the world’s five established nuclear states, Russia joined in that condemnation, but clearly was not going to let the recent developments in South Asia get in the way of a good deal. The agreement, signed in New Delhi on June 21 by Russian Atomic Energy Minister Yevgeny Adamov and the chairman of India’s Atomic Energy Commission, R. Chidambaram, is estimated to be worth close to US$3 billion. It calls for Russia to build two 1,000 megawatt light water nuclear reactors at Kudankulam in the southern Indian Tamil Nadu state. The current timetable reportedly envisions about two years of construction planning and another six of actual construction work on the plant. (Reuter, UPI, June 22)(See also the Monitor, May 13-14)

Moscow justified the June 21 deal on the grounds that it was an addendum to a 1988 agreement–reached by then Soviet leader Mikhail Gorbachev with then Indian Prime Minister Rajiv Gandhi–and thus was exempt from subsequent international prohibitions on the sale of nuclear technology to India. That logic suggests Moscow may not be planning to sign additional agreements with India for the construction of nuclear power plants. The deal nevertheless undermines international unity in the face of both India’s nuclear tests last month and efforts to isolate New Delhi because of those tests. That fact that was not lost on Indian leaders. “There is an important signal involved here,” an Indian defense expert was quoted as saying. “Irrespective of the wording of the P5 [the five established nuclear powers], it is quite likely more and more powers will realize it is better to do business as usual with India.” (Reuter, June 22)

The agreement is not a surprise. Although Moscow joined in condemnations of the recent nuclear testing, Russian leaders made clear that they did not support calls for sanctions against the two countries. Top Russian energy officials made equally and publicly clear their desire for continuation of the Moscow-New Delhi negotiations for the plant construction deal. The agreement, moreover, comes as Moscow has indicated its intention to also follow through on a series of arms deals with India. New Delhi is one of Moscow’s most important allies in Asia. It is also a major customer for Russia’s hard-pressed defense industrial sector. A delegation of Indian defense officials was in Moscow last week to discuss possible purchases of air defense missiles and naval vessels. (Xinhua, June 22)