The Telegraph
Tuesday , March 11 , 2014
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Energy talks minus PM’s ‘best moment’

Ernest Moniz

New Delhi, March 10: India and the US will tomorrow skip negotiations on civil nuclear cooperation at their final energy talks under the Manmohan Singh government because of persisting differences over realising the 2008 nuclear deal the Prime Minister has described as his “best moment” in office.

US energy secretary Ernest Moniz landed here today for the Indo-US energy dialogue, a key pillar of the bilateral relationship between New Delhi and Washington, which he will hold with Planning Commission deputy chairperson Montek Singh Ahluwalia on Tuesday.

But Moniz and Ahluwalia will carefully steer clear of seemingly cast-iron differences between the two nations on India’s nuclear liability law that continue to hobble plans for US companies to set up reactors in India, top officials told The Telegraph.

“There is simply nothing new to say on the nuclear liability question right now, and that’s why that will not be one of the areas of conversation tomorrow,” an official said. “We don’t have an agreement on the liability issue — it’s as simple as that.”

Moniz is the first member of the Barack Obama cabinet to visit India after the bilateral spat over the arrest of Indian diplomat Devyani Khobragade in New York last December.

His visit signals a return to cooperative talks between allies Obama has repeatedly described as “natural partners” for the 21st century.

But officials concede that the cautious decision to put off talks on nuclear cooperation till a new government is in place in New Delhi is reflective of a stalemate that refuses to thaw.

At its heart is India’s nuclear liability law. The law is too strict and unreasonable, according to American companies like Westinghouse and GE that have promised nuclear reactors to India, but in election season, the Indian government is unwilling to even contemplate any amendments.

Civil nuclear cooperation between India and the US is one of six major components of the energy dialogue that the nations started in the aftermath of their 2008 deal. But it is the only one of the six components that was not discussed by negotiators in six days of talks here that preceded the final meeting tomorrow between Moniz and Ahluwalia.

Moniz and Ahluwalia will discuss cooperation on traditional energy sources like coal, oil and gas, emerging sources like shale gas, renewable energy sources, energy efficiency and sustainable growth.

But it is the stand-off over nuclear cooperation that has stalled the heady progress in India-US ties over the past two years.

The 2008 deal facilitated an exemption from the Nuclear Suppliers Group for India that allowed several other nations like France and Russia to ink nuclear pacts with India. Others like Canada, Australia and Japan are negotiating agreements with India.

At a rare media interaction at the start of this year, Singh publicly stated what his aides had long shared in private.

Asked about the ultimate high point of his 10 years in office, Singh said: “The best moment for me would be the India-US nuclear deal.”

But for sections in the US state department, the deal remains stillborn, because no American firm has yet found it feasible to invest in India.

Westinghouse and the Nuclear Power Corporation of India Limited inked an early works agreement last year, but the pact is largely symbolic — the American firm is unwilling to invest substantially till its concerns on India’s liability law are addressed.

US Congressmen and American industry have over the past two years repeatedly lobbied with India to tweak the liability law.