As one of the fastest growing economies of the world, India is ramping up its nuclear energy sector to meet its burgeoning energy demands. In the quest for nuclear energy, the country has signed civilian nuclear power cooperation pacts with a number of countries, including the US, France, Russia, Canada, Mongolia, Kazakhstan, Argentina, Namibia, and South Korea, which became the ninth country with which India signed such an agreement.

These two countries inked the agreement last year in July when India’s President Pratibha Patil visited South Korea. It paves the way for South Korea-based companies to enter India’s nuclear construction market. “South Korea has a lot of technology in energy infrastructure which they can help India with,” Rajiv Biswas of IHS Global Insight said to the press. “It also recognises India as a key future market. This is a very big opportunity for Korea to expand into the emerging economies. All in all, it is a very positive deal for both the nations.” Both the countries had for the first time discussed about a possible civil nuclear cooperation agreement during Indian foreign minister SM Krishna’s visit to South Korea in June 2010. Earlier this year in March, Indian Prime Minister Manmohan Singh asked South Korean businessmen to help India expand its burgeoning nuclear power sector and invest in environment friendly technology, while South Korean President Lee Myung-bak requested that India set aside specific allotment for South Korean nuclear reactors.

Unlike India, where only 3 percent of its energy needs are met by the nuclear energy sector, South Korea’s 21 active nuclear reactors fulfil 30 percent of the country’s electricity needs. The country is planning to increase this to 40 percent by 2040. For South Korea, nuclear energy is a strategic priority. “Our long-term power supply plan is to increase the portion of nuclear power from the current 30 percent to 40 percent by 2040 and the plan has not changed,” the Korea Herald newspaper quoted an unnamed official from the Knowledge Economy Ministry. In addition to 21 active nuclear reactors, the country has seven reactors under construction, and it plans to build 11 new reactors by 2030. It plans to increase the capacity by 56 percent to 27.3 GWe by 2020, and then to 43 GWe by 2030.

South Korea is Asia’s fourth-biggest economy and is currently the sixth largest nuclear energy exporter. The country’s nuclear energy program dates back to the 1950s. In the early 1960s, the country began the operation of its first nuclear reactor and in 1978, the operation of its first power reactor. The country is now aiming to become a major exporter of nuclear energy technology. In January, 2010, South Korea’s Ministry of Knowledge Economy Minister said that there is the aim to achieve exports of 80 nuclear power reactors worth US$400 billion by 2030, in the course of becoming the world’s third largest supplier of such technology, with a 20 percent share of the world market, behind the USA and France or Russia. “Nuclear power-related business will be the most profitable market after automobiles, semiconductors and shipbuilding,” the Ministry of Knowledge Economy said in a statement.

In comparison to South Korea’s nuclear power industry, India’s nuclear energy sector is still in its initial stages and is dependent on foreign investors to take it to the next level. The country’s civilian nuclear program has suffered because of international sanctions after its nuclear tests in 1974 and in 1998. And since India has not signed the Nuclear Non-Proliferation treaty, which aims to prevent the spread of nuclear weapons and technology and promote peaceful uses of nuclear energy, it wasn’t allowed to sign deals for nuclear reactors and materials for civilian nuclear programs. In 2004, India and the U.S singed the civilian nuclear program agreement, which heralded a new era for the country’s nuclear energy sector.

Despite not being part of the Non-Proliferation treaty, the country succeeded in getting a much needed waiver from the Nuclear Suppliers’ Group (NSG) in 2008 – due to India’s commitment to non-proliferation – which opened the doors for international civilian nuclear energy cooperation with other countries.

India is aiming to fulfil 25 percent of its electricity needs from nuclear power by 2050. According to reports, the country expects to have 20,000 MWe of nuclear capacity on line by 2020 and 63,000 MWe by 2032. Additionally, the country plans to set up around 30 reactors.

India and South Korea both can gain “significantly” from the civilian nuclear cooperation agreement. South Korea aspires to become a major exporter of nuclear technology and materials, while India is seeking partners that can help it develop its nuclear energy sector. In 2009, a South Korean company won a US$40 billion contract to build and operate a 5600 MWe capacity NPP with four APR 1400 units for the UAE. This contract has established the country as a credible supplier of nuclear technology. Last year, the country signed a bilateral agreement with Saudi Arabia for cooperation on the development of nuclear energy. An international panel of nuclear safety experts from the International Atomic Energy Agency (IAEA), after their two-week mission for the Integrated Regulatory Review Service in July of 2011, concluded that South Korea has strong regulations pertaining to the operation of atomic energy facilities safely and in preventing accidents.

Pranamita Baruah, researcher at the Institute for Defence Studies and Analyses (IDSA), a non-partisan, autonomous body dedicated to objective research and policy relevant studies on all aspects of defence and security, wrote in an article that “the nuclear deal will provide the South Korean companies a framework to participate in India’s ongoing nuclear expansion programme.”

Baruah also wrote that over the last few years it has become difficult for a number of western countries to enter the Indian nuclear energy sector, as Japan holds the licenses for critical components of their reactor designs. French nuclear firm Areva and the U.S-based General Electric had signed agreements to sell nuclear reactors to India, but they would have to face liability issues, as both the companies use reactor vessels produced by Japan Steel Works.

Japan agreed to grant a crucial waiver to India in 2008 as part of the 46 nation Nuclear Suppliers Group (NSG), but despite that, it has avoided doing nuclear trade with India, which has constantly refused to join the NPT. Also, the country is having second thoughts about nuclear power following the Fukushima nuclear accident. Japan’s reluctance to give nuclear technology and materials to India is expected to benefit South Korea. In the absence of Japanese cooperation, South Korea can become a major player in the Indian nuclear energy sector. Industry experts believe that South Korean companies will succeed in nuclear power-related business, and emulate the success stories of Hyundai, Samsung, and LG in the Indian market. Also, it’s said that the nuclear liability issues may not trouble South Korean nuclear companies – KHNP and KEPCO – as they are state-backed. Plus, the Korean nuclear energy industry aims to be 100 percent self-sufficient with no residual intellectual property constraints. In August of 2009, the state-run Korea Electric Power Corporation (KEPCO) signed an MoU with the Nuclear Power Corporation of India Ltd (NPCIL) for bilateral cooperation on technical exchange of data and experience.

Enumerating the disadvantages for South Korean companies, Ji-yeon Jung, Ph.D.c., South Asian Studies at Jawaharlal Nehru University, noted in a report that South Korea has limited information and accessibility to Indian government’s policymaking process; and India favors continuing exchanges with countries with which it has already established reciprocal relations such as France, Russia, Canada, and the US. However, he also noted that the fact that India is diversifying its cooperation channels to meet surging energy needs is a positive sign for South Korea.

He said that South Korea should be aware of the growing power of private entities in India. “Reliance Energy, Tata Power, and Larson & Toubro are companies that have been eyeing the nuclear sector following the US-India civil nuclear deal. Therefore, Korea needs to seek exchanges and technology cooperation with these companies.” It’s still early on in terms of India’s ambitious civilian nuclear energy program. The local protests against the setting up of nuclear-power plants, especially after the Fukushima nuclear accident, are growing louder in the country. They have put a big question mark on many civilian nuclear energy projects. South Korean companies will also have to face the same protests which can prolong the necessary waiting periods, and they also have to cross over India’s stringent nuclear policy hurdles. Indeed, it will take some time for the nuclear energy cooperation between India and South Korea to show results. However, India is desperate to bridge the widening-gap between energy demand – which is exponentially growing – and supply. And, South Korea is seen as a long-term reliable partner that will help India succeed in achieving some of its nuclear energy goals to bridge that gap.

Moreover, as a senior Indian official said to The Hindu newspaper, having the South Koreans in the fray means India’s other nuclear partners have to keep the price of their reactors competitive