Jake Sullivan’s last minute nuclear visit to India

National Security Advisor of India Ajit Doval met with U.S. National Security Advisor Jake Sullivan in New Delhi on 6 January, 2025. It was the last major international meeting that the current administration had with another major world power as NSA Sullivan was accompanied by a large delegation of senior U.S. government officials. It is clear that such meetings do not come unplanned, but what attracted attention was the number of problems they tried to solve in the last days of their term. The November 5th presidential election results were clearly not what they had expected, which raised the question of what they could have expected to complete, so that it is not a risk considering the upcoming administration change.

A wide range of topics from the fields of artificial intelligence, quantum computing, semiconductors, telecommunications, defense and space were discussed and at the end NSA Sullivan announced that the US would expedite the efforts to finalize the delisting of the Indian nuclear entities from the sanctions list. The sanctions were imposed by the Clinton administration as a result of the Pokhram-II tests in 1998 and 10 years later in 2008 late PM Manmohan Singh signed the Section 123 Agreement, which established an agreement for cooperation as a prerequisite for nuclear deals between the US and India. Even though most of the 200+ sanctioned Indian entities were off the list in the years to follow as bilateral ties evolved, major entities of the Department of Atomic Energy like Bhabha Atomic Research Centre, Indira Gandhi Centre for Atomic Research and Indian Rare Earths remained.

As is generally the case, the most important announcements are kept for the end and mentioned briefly. Why is it so important?

For India – because it would allow greater choices for the strategic planning of the Department of Atomic Energy regarding the future energy needs of India.

For the US – because they can get a piece of that future pie in the form of supply of nuclear reactor technology and their construction, as well as the supply of nuclear fuel and services for the consecutive disposal of the nuclear waste. Additionally, cooperation with the US can lead to India using reactor designs utilizing enriched uranium, rather than thorium, which can be another line of influence considering India has only 2% of the world’s uranium but 25% of the world’s thorium, which means that India would have to look for enough supplies of uranium based fuel, which is a solution likely to be proposed by the US.

It is important to mention that the sentence that US will be taking the final steps to delist Indian entities was mentioned once. Additionally, both US and Indian diplomats did not disclose further details. The step is important as it gives opportunities to both sides, but it also requires further work. The step from the US side would require the necessary moves from the administration but that would not be enough for India to reap the benefits of more free trade.

As of now, Indian laws need to come in line with internationally accepted noms so that international cooperation would be possible. As of now, Indian liability rules require the costs of any accident to be channeled to the maker of the nuclear power plant, rather than the operator, which is the international standard. Foreign investments would not be possible in such environment, especially considering events, such as the one at Fukushima, where the plant was operational in 1971, but the disaster struck in 2011, i.e. 40 years later. Such time periods would mean multiple presidential administration changes in the US, which would translate to practical inability to plan possible policy changes, even those pertaining to core strategic orientation.

Currently, only 4 of the 24 functioning reactors were not produced by entirely Indian companies – 2 at the Rajasthan Atomic Power Station were made with Canadian technology (CANDU (Canada Deuterium Uranium) pressurised heavy water reactor) and 2 at the Tarapur Atomic Power Station were made using boiling water reactors supplied by General Electric and Bechtel. However, they were both made operational before the Pokhram tests – in 1973 and 1969 respectively - and it is safe to assume that the US would demand that any future adverse effects in these cannot result in recourse back to GE and Bechtel, while future involvement would require similar liability waver. It was not immediately clear what changes would be made to the regulation and U.S. and Indian officials did not share any further details.

How important is nuclear energy?

The short answer is that it is likely more important even than initially projected. The role of the nuclear power plants in any national grid is that they provide the core supply and have gradually shifted the need to scale coal power plants. A much greater scale can be achieved at significantly lower environmental cost and operational costs. The greatest disadvantage, however, is that their production is not easily regulated – a possible stop requires months of procedures to have controlled extraction of the rods in the reactors, whereas all others, including the newly popular green energy sources, can have almost instant stops or initiations. Because of that, as well as the much higher electricity production cost of plants employing photovoltaics or wind turbines, they are used as regulators of the national grids – in peak demand (such as very hot period and large parts of the population requires air conditioning or very cold periods resulting in high heating demand) they produce more, while in decreased demand times they can be turned down or even off.

How big is the future market?

In 2010 the Nuclear Power Corporation of India, a wholly government owned company, announced plans to install up to 64MW by 2032. A year later, however, the Fukushima disaster struck and heavy protests lead to delays in plans and construction. As of November 2024 India had 8 nuclear power plants with a total of 24 nuclear reactors with installed capacity of 8,180MW. Another 10,868MW from new reactors and even new plants altogether are planned and it is all based on current perception by the administration, i.e. expectations for future use and availability of local technology.

The problem is that nuclear power plants are some of the heaviest capital investment projects any government will undertake. Unlike most other businesses or factories, they require extremely careful geological survey of the area and a combination of large water resources needed for the cooling. Because of this, nuclear power plants are always built on areas, which are least likely to be affected by seismological activity and are situated next to a large river or ocean. Once there is a public approval, the typical time required to plan and build one plant is ca. 10-12 years.

Requiring public approvals in a democracy can also require longer time, especially if it is tied to political turmoil and there is a heavy influence from other countries benefiting from such turmoil. This can easily become the case of India considering its growing international importance. On the other hand, however, comes the need for the produced electricity. It is inevitable that the country will be pressed to find more ways to generate it.

According to the Executive Summary report from November 2024 by the Central Electricity Authority of the Ministry of Power by the Government of India, currently nuclear makes up for 1.79% of the installed capacity with 8,180MW out of 456,757MW with coal making 47.65%, renewables at 45% (hydro, wind, solar distributed at roughly 2:2:3 proportion) and 5.3% for gas. The production figures show that nuclear was responsible for 3.59% of the electricity produced in November 2024. Realistically, a major supply change can come primarily from nuclear.  

The demand will grow exponentially. There are several reasons for that. One is the growth of the middle class in India which will continue as a trend in the following decades. Currently, according to the International Energy Agency, India’s residential consumption amounts to 21.7% of the total country’s consumption. Countries like the US, UK, France consume ca. 37-39% of the total. It is safe to assume that the more people can afford better lifestyles, which would include air conditioning and so on, India’s residential consumption will increase. Even if one makes the argument that purchasing power is far greater in those countries, we should not forget that those countries are a fraction of the population of India. Middle class in India is now estimated at 31% and projected to grow to 38% by 2031. Even if the population does not grow, that is still 100 million people, which in itself is close to 150% of the entire population of the UK or France. That additional demand will have to be met by additional production.

The second one is the exponential growth in artificial intelligence. Behind that are massive supercomputer sets with just as big cooling systems. The development of data centers, the increased research and development of quantum computing and the further leaps in AI will face us as a society with an increased need for electricity to such extend that it has not been predicted before, at least by bureaucrats. The capabilities within the vaguely defined “IT world” described above increase in a geometric progression over time. Indication for where the world will be going is the deal that Google made with Kairos Power in October 2024 to purchase electricity from nuclear reactors to fuel its AI data centers with the first one being operational in 2030 and more coming online in 2035.

The shift in the strategic focus in the US towards nuclear energy is clear. The biggest sign was that on 29 May 2024 the Biden-Harris administration announced new steps to bolster the nuclear industry, which included a wide array of measures aimed at bolstering domestic production. They were divided in 4 major groups, which were roughly looking into a) revitalizing the existing nuclear energy production, b) R&D for new technologies in the field, c) streamlining of the licensing processes needed for the deployment of new reactors and extending life/capacity of existing ones, and d) helping the supply chain and the workforce associated to it.

It is clear, that this holistic approach was not a spur-of-the-moment political decision – it was rather the result of the push of the energy lobby and a consequence of the decisions by the Department of Energy (DOE) over the last couple of years. A major initiative by the DOE was the Advanced Reactor Demonstration Program, where the 6 shortlisted companies - TerraPower, X-energy, Kairos Power, Westinghouse, BWX Technologies, and Southern Company – would receive government funding to advance their development of latest generation reactors. Additionally, they initiated Project Pele – a program intended to design, build and demonstrate a mobile microreactor.

Aside from domestic production, the US has been pushing for their companies to get projects abroad. Among the 6 companies mentioned, Westinghouse has been very active internationally. They have pushed for larger presence in Eastern Europe as they have planned for 9 reactors in Ukraine, 3 in Poland and 1 in Bulgaria, all of them of the AP-1000 reactor, which is a Gen 3+ pressurized water reactor using enriched uranium and estimated to be in orders safer than comparable reactors. Aside from the highly decreased cost stemming from constructing it, additional advantage is that the used fuel can be stored indefinitely in water on the plant site, which eliminates, from a political point of view, the need to negotiate transportation and storage services. The reactors in Ukraine will obviously be subject to the development of the conflict in the country, Poland signed on 23 September 2023 for 3 reactors for its Lubiatowo-Kopalino plant in Pomerania and Bulgaria has been taking steps to go continue on track with the 2 reactors for its Kozloduy NPP, but advances have been slow due to political instability, which has stalled the country's government system for a couple of years already. On top of that, the Czech Republic has also expressed interest in 4 reactors.

With regards to India, Westinghouse had plans for 6 AP1000 reactors and negotiations were in place during the first Trump administration, but the abovementioned liability issues facing foreign producers stalled the process. During the visit of PM Modi to the US and the discussions with President Biden on 8 September 2023, however, the dialogue was renewed and agreement was reached for intensified consultations between US DOE and India’s Department of Atomic Energy (DAE) to support the work towards the construction of the 6 reactors in Kovvada in Andhra Pradesh.

It is clear that Jake Sullivan’s visit was to make sure that, among the other topics, work is done with regards to this project, which is comparable to all the business that Westinghouse will get from the entire EU. Positive development will not only mean a significant increase of business for the US, but also increased lines of cooperation, in other words- influence. The growing energy needs of India would mean growing possibilities for the US. Considering the change of power and its unpredictability, the Biden administration would have to push for further steps.

The project, however, is positive for India as well. The work with the India will give the know-how, which can be developed further, possibly independently. India will be able to diversify its reliance on local thorium resources and if the technology is improved in the following years, the country can look further for uranium supplies aside from its domestic mining, which does not necessarily have to be supplied by the US. One thing is clear- the growing economy and the changing landscape involving drastic rise in energy consumption stemming from the development of artificial intelligence and quantum computing will require to make choices for more efficient electricity production, to which nuclear is currently the best bet.

All views are personal.