Nearly eight years after signing a historic civilian nuclear agreement, India and the US are engaged in price negotiations to close a deal between Nuclear Power Corporation of India Limited (NPCIL) and Toshiba-Westinghouse (T-W) for six reactors. The deal, the first of its kind involving an American firm, could be signed during Prime Minister Narendra Modi’s visit to Washington for the fourth Nuclear Security Summit on March 31-April 1.
Although the Modi administration has made no comments on the negotiations, sources close to the Indian government have confirmed that T-W recently made a formal “techno-commercial” offer to NPCIL and “uranium fuel offer” to the Department of Atomic Energy (DAE). The US firm has also agreed to run the Mithi-Virdi 6,000MW nuclear power plant near Bhavnagar in western Indian province of Gujarat on the basis of an agreement signed by the two companies in September 2013.
A senior Indian official said: “Both offers are under examination. The total capital cost, as well as per unit power cost, is under consideration. A US Exim Bank team is expected in India shortly for the financing package. The deal will be signed once these issues are sorted out.”
The official also said that a similar civilian accord signed by India and Japan helped T-W make a final decision in this regard. India and Japan signed the deal during Japanese Prime Minister Shinzo Abe’s visit to New Delhi in December 2015.
Although commercial negotiations are going on, it is still not clear whether NPCIL and T-W will be able to close the deal before Prime Minister Modi’s arrival in Washington. Officials of the two firms hinted that the price parleys with ballpark price figures of USD 4.1 billion (or INR 27,000 crore) for two Westinghouse AP 1000 reactors.
Earlier, India’s Central Electricity Authority (CEA) had asked the NPCIL to fix the nuclear power price at INR 6.50 per unit. As the NPCIL cannot ignore the CEA’s instruction, the Indian officials are trying hard to negotiate for a bulk order of six AP 1000 light water enriched uranium nuclear reactors. If the two sides resolve the price issue, the two companies will sign a general framework agreement as part of the annexure of the techno-commercial accord. Both New Delhi and Washington are eager to conclude the deal in 2016, as it is the last year of Barrack Obama administration.