Russia, India Reiterate Nuclear, Hydrocarbon Plans (Update1)

Russia, India Reiterate Nuclear, Hydrocarbon Plans (Update1)

By Bibhudatta Pradhan and Archana Chaudhary

Feb. 12 (Bloomberg) -- Russia and India today reiterated plans to jointly set up hydrocarbon projects and build nuclear power generation units in the South Asian nation in an effort to improve economic and political ties.

``I expressed my hope that the ongoing discussions between our oil and gas companies would result in finalization of joint projects in India, Russia and third countries,'' Prime Minister Manmohan Singh told reporters in New Delhi today. He spoke at a joint briefing held with Russian Prime Minister Viktor Zubkov.

The two countries will try to achieve the target of doubling trade to $10 billion by 2010, Zubkov said. Russia and India are negotiating accords discussed when Russian President Vladimir Putin visited India in January 2007.

India needs civilian nuclear technology from the U.S., Russia, France and other nations to meet its target of adding 40,000 megawatts of nuclear power by 2020 as demand increases in the world's second-fastest growing major economy.

The two sides had signed agreements on four power plants during President Vladimir Putin's visit to India in January last year. The agreements call for the ``construction of four energy blocks at the atomic plant at Kudankulam'' besides nuclear power plants at new sites in India.

``We have finalized negotiations in regard to reaching an agreement on cooperation in the construction of additional nuclear power plants in India,'' Singh said.

Oil Imports

The South Asian nation is trying to acquire oil and gas assets abroad and encourage investments in indigenous fields to cut dependence on imports which supply more than 70 percent of its oil needs. India's state-owned Oil & Natural Gas Corp. owns a 20 percent stake in Russia's Sakhalin-1 gas fields.

``We agreed that there was vast potential for mutually beneficial cooperation in the area of hydrocarbons,'' Singh said. Russia and India will also consider a ``comprehensive economic cooperation agreement'' to help meet trade targets, he said.

The two countries continued discussions on a civilian nuclear accord, Singh said today. The final agreement on the sale is awaiting a successful conclusion to India's talks with the International Atomic Energy Agency, following which the country has to negotiate with the 45-nation Nuclear Suppliers' Group on getting fuel for peaceful energy needs.

India is negotiating a safeguards agreement with the IAEA as part of measures required before the implementation of a nuclear energy accord with the U.S.

Russian companies want a slice of the $40 billion that India plans to spend over 15 years to buy reactors from suppliers such as France's Areva SA, Electricite de France and U.S.-based General Electric Co. and Westinghouse Electric Co.

Russia is helping India set up two light water reactors of 1,000 megawatts each at Nuclear Power Corp.'s Kudankulam unit. The deal is part of a technology agreement with Russia before international sanctions against India were announced in 1998. The four new reactors will be in addition to these two units.

To contact the reporters on this story: Bibhudatta Pradhan in New Delhi at bpradhan@bloomberg.net ; Archana Chaudhary in Mumbai at achaudhary2@bloomberg.net .